Ontario’s Progressive Conservative government delivered its 2020-2021 budget on Thursday, the second budget of Premier Doug Ford’s administration. The fiscal outlook includes approximately $187 billion in total spending this year with a record deficit of $38.5 billion.
The budget placed a heavy emphasis on the COVID-19 pandemic and economic recovery efforts, with some notable spending for the business and tech sector. Here is a breakdown of what Ontario’s budget 2020 means for the province’s innovation sector.
The budget includes $719.2 million in spending for the ministry of economic development, job creation and trade, which oversees tech and innovation in the province.
Among the province’s initiatives is a new investment attraction agency aimed to be a “one-stop-shop” for new businesses and investors. The agency, which will be called Invest Ontario, will initially focus on three sectors: technology, advanced manufacturing, and life sciences. The new agency has yet to officially launch.
The budget, which was initially set to be released in March but was postponed due to the pandemic, includes $719.2 million in spending for the ministry of economic development, job creation and trade, which oversees tech and innovation in the province.
The allocated funding represents a decline from the $782 million budgeted for the ministry in 2019-2020. Notably, however, it is an increase from the $582 million spent in the 2019-2020 fiscal year, according to the budget.
Ben Bergen, executive director of the Canadian Council of Innovators (CCI), expressed the organization is encouraged to see measures in Budget 2020 it says will help innovative, high-growth companies.
He added, however, “we continue to call on the government to invest into strategic programs to increase access to talent, capital, and customers for Ontario’s biggest job and wealth creators: its homegrown companies.”
In the budget, the province said approximately 94 percent of businesses in Ontario will see a reduction in their property taxes, by standardizing the Business Education Tax and offering a permanent exemption from paying the Employer Health Tax.
The budget also included $3.75 million over two years to support work by the Ontario Centres of Excellence (OCE) and the Toronto Business Development Centre to attract more international startups to Ontario. The organizations are tasked with initially focusing on attracting emerging companies in India to expand their operations to Ontario.
While the provincial budget shows some promising signs in spending for the innovation sector, it is unclear what a second year of budget cuts for the ministry of economic development, job creation and trade means for the tech sector.
Ontario’s 2019 budget was considered by many in the province’s tech community a disappointment due to its unfettered cuts to innovation organizations and programs.
Prominent tech hubs were also affected by budget cuts last year. Communitech, MaRS Discovery District, and the OCE all experienced provincial funding cuts, causing them to lay off employees and re-evaluate programming.
Two months after the release of the 2019 budget, Minister of Finance Vic Fedeli was “demoted” to the role of minister of economic development, job creation and trade, after Fedeli reportedly lost face with Premier Ford over the unpopular cuts in the 2019 budget.
With a heavy emphasis on the COVID-19 pandemic and economic recovery efforts, this year’s budget was focused on three pillars: protect, support, and recover. The budget highlighted its actions in ensuring access to virtual healthcare and digital-first tools, noting how it created temporary fee schedule codes that insured physician phone and video patient visits under the Ontario Health Insurance Plan.
The budget highlighted the government’s actions in ensuring access to virtual healthcare and digital-first tools.
Prior to the release of the budget, Technation, a tech industry association, recommended the government’s budget make virtual healthcare “the norm,” even post-COVID-19, arguing such a move would improve patient access to healthcare, decrease wait-times, and save the system money. Technation also pushed for the government to work closely with industry to identify gaps in Ontario’s workforce.
In the budget, the government also highlighted its previously-announced $680 million investment to expand and improve broadband internet and cellular access. Technation president and CEO Angela Mondou told BetaKit that investment is critical not only for citizens but also for accelerating the digital transformation of small-to-medium-sized businesses.
Additionally, the budget reveals new investments from the province in a series of research initiatives aimed to help stimulate the economy and support COVID-19 recovery efforts.
The government is investing $2 million for the Ontario Health Data Platform, which it says will explore opportunities to integrate datasets and support research projects related to COVID-19. The Canada Foundation for Innovation will receive an investment of $3.5 million to support the operations and maintenance related to Advanced Research Computing in Ontario. The province is also investing up to $2 million in funding to enhance collaboration across Ontario’s research sector.
Under its “recover” pillar, the government is investing $37 million in employment and training services to help more than 15,000 upgrade their skills to fit the needs of Ontario’s economy. That investment will specifically support 86 projects and provide training in high-demand skills like information technology and advanced manufacturing.
Both the CCI and Technation urged the government to up its procurement efforts to aid the province’s pandemic recovery efforts. CCI said not only should the government procure physical products, but also modern digital offerings like digital health services, online education services, and cybersecurity tools to strengthen Ontario’s supply chain resiliency.
According to the budget, the Ontario government is investing $1.5 million towards the Special Implementation Team on Intellectual Property (IP) that was established to support the government’s IP action plan, released over the summer.
Bergen told BetaKit he hoped the government would continue to focus on the generation and commercialization of IP. The government’s IP action plan would see the province work with post-secondary and research organizations to revise the mandates of provincial commercialization entities, such as startup hubs and accelerators.
The province is also proposing to extend reporting deadlines for the Ontario Research and Development Tax Credit to give corporations more time to file a claim. The credit offers a non-refundable tax credit to businesses on eligible scientific research and experimental development expenditures.
The government is also investing $500 million over four years in a new Ontario Onwards Acceleration Fund, including $60 million for 2020-20201, which it says will pilot new technologies that improve how people and businesses experience government services in Ontario.
NEW YORK (AP) — Shares of Tesla soared Wednesday as investors bet that the electric vehicle maker and its CEO Elon Musk will benefit from Donald Trump’s return to the White House.
Tesla stands to make significant gains under a Trump administration with the threat of diminished subsidies for alternative energy and electric vehicles doing the most harm to smaller competitors. Trump’s plans for extensive tariffs on Chinese imports make it less likely that Chinese EVs will be sold in bulk in the U.S. anytime soon.
“Tesla has the scale and scope that is unmatched,” said Wedbush analyst Dan Ives, in a note to investors. “This dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players.”
Tesla shares jumped 14.8% Wednesday while shares of rival electric vehicle makers tumbled. Nio, based in Shanghai, fell 5.3%. Shares of electric truck maker Rivian dropped 8.3% and Lucid Group fell 5.3%.
Tesla dominates sales of electric vehicles in the U.S, with 48.9% in market share through the middle of 2024, according to the U.S. Energy Information Administration.
Subsidies for clean energy are part of the Inflation Reduction Act, signed into law by President Joe Biden in 2022. It included tax credits for manufacturing, along with tax credits for consumers of electric vehicles.
Musk was one of Trump’s biggest donors, spending at least $119 million mobilizing Trump’s supporters to back the Republican nominee. He also pledged to give away $1 million a day to voters signing a petition for his political action committee.
In some ways, it has been a rocky year for Tesla, with sales and profit declining through the first half of the year. Profit did rise 17.3% in the third quarter.
The U.S. opened an investigation into the company’s “Full Self-Driving” system after reports of crashes in low-visibility conditions, including one that killed a pedestrian. The investigation covers roughly 2.4 million Teslas from the 2016 through 2024 model years.
And investors sent company shares tumbling last month after Tesla unveiled its long-awaited robotaxi at a Hollywood studio Thursday night, seeing not much progress at Tesla on autonomous vehicles while other companies have been making notable progress.
TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 103.40 points at 24,542.48.
In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.
The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.
The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.
The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.
This report by The Canadian Press was first published Oct. 16, 2024.
TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.
The S&P/TSX composite index was up 205.86 points at 24,508.12.
In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.
The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.
The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.
The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.
This report by The Canadian Press was first published Oct. 11, 2024.
