In this edition:
- Governments of Canada and Ontario reach healthcare agreement in principle
- Province adds $80 million to gas tax funding to make up for lower gas sales
- Healthcare, social assistance leads gains in paid employment numbers
- Canada launches new small modular reactor funding program while Ontario eyes new large-scale nuclear plants
- Non-financial sector posted $6.2bn increase in net income before taxes between Q3 and Q4 2022
- Extreme cold weather two years in a row could have ‘really devastating consequences’ for grape growers
Governments of Canada and Ontario reach healthcare agreement in principle
On February 7, 2023, the Government of Canada announced an investment of $198.6 billion over 10 years, including $46.2 billion in new funding, to improve health care services for Canadians. This funding includes an immediate, unconditional $2 billion Canada Health Transfer (CHT) top-up to address immediate pressures on the health care system.
Today, the Government of Canada and the Government of Ontario are taking the next step by announcing an agreement in principle for a shared plan that will invest $73.97 billion in federal funding over 10 years in Ontario, including $8.413 billion for a new bilateral agreement focusing on the four shared health care priorities and $776 million through the immediate, one-time CHT top-up to address urgent needs, especially in pediatric hospitals and emergency rooms, and long wait times for surgeries.
Province adds $80 million to gas tax funding to make up for lower gas sales
The Ontario government is providing more than $379.5 million to help 107 municipalities operate and improve local transit. The funding is being delivered through the gas tax program and can be used to extend service hours, buy transit vehicles, add routes, improve accessibility or upgrade infrastructure.
Funding for the gas tax program is determined by the number of litres of gasoline sold in the province during the previous year. Municipalities that support public transit services in their community receive two cents per litre of provincial gas tax revenue collected.
To make up for reduced gas sales due to ongoing recovery from the COVID-19 pandemic, this year’s gas tax program includes one-time additional funding of $80 million to help ensure municipalities can continue to support their transit systems.
Healthcare, social assistance leads gains in paid employment numbers
The number of employees receiving pay or benefits from their employer—measured as “payroll employees” in the Survey of Employment, Payrolls and Hours—rose by 91,400 (+0.5%) in December, bringing cumulative gains since September to 240,600 (+1.4%). Gains in December were largest in Ontario (36,900; +0.5%), Quebec (+18,900; +0.5%), Alberta (+12,700; +0.6%) and British Columbia (11,500; +0.5%).
Payroll employment in the services-producing sector increased by 72,400 (+0.5%) in December. Gains were recorded in 8 of the 15 sectors, led by healthcare and social assistance (+26,500; +1.2%) and finance and insurance (+13,800; +1.7%), which together accounted for more than half of the increase in the services-producing sector. Employment in wholesale trade (-3,600; -0.4%) and information and cultural industries (-1,600; -0.4%) declined in December, while the remaining five sectors showed little change.
Canada launches new small modular reactor funding program while Ontario eyes new large-scale nuclear plants
Today, at the Canadian Nuclear Association’s annual conference, Julie Dabrusin, Parliamentary Secretary to the Minister of Natural Resources and to the Minister of Environment and Climate Change, on behalf of the Honourable Jonathan Wilkinson, Minister of Natural Resources, launched the Enabling Small Modular Reactors (SMRs) Program. This program will promote the safe, commercial development of SMRs to contribute to our low-carbon economy and help fight climate change.
A report late last year by the Independent Electricity System Operator found that the province could fully eliminate natural gas from the electricity system by 2050, starting with a moratorium in 2027, but it will require about $400 billion in capital spending and more generation including new, large-scale nuclear plants.
The province has not committed to a natural gas moratorium or phase-out, or to building new nuclear facilities other than its small modular reactor plans, but it is now consulting on the prospect.
Non-financial sector posted $6.2bn increase in net income before taxes between Q3 and Q4 2022
Statistics Canada’s Quarterly financial statistics for enterprises report, released today, revealed that in the non-financial sector, net income before taxes (<NIBT) increased $6.2 billion (+6.5%) from the third quarter to $101.8 billion in the fourth quarter. Overall, NIBT was up in 31 of the 39 non-financial industries.
Tight labour markets and resilient consumer demand contributed to upward pressure on the policy rate, increasing 100 basis points in the fourth quarter. Consequently, higher interest costs, along with elevated inflation, continued to concern Canadian enterprises in the quarter.
The petroleum and coal product manufacturing industry led the gains in NIBT, up $3.7 billion in the fourth quarter. Motor vehicle and trailer manufacturing also posted a notable gain in NIBT, increasing by $886 million to $749 million in the fourth quarter, mainly because of higher production in assembly plants.
NIBT for the transportation and transportation support activities industry rose 10.8% (+$442 million) in the fourth quarter, driven by a record-setting increase in carloadings of wheat.
NIBT for the real estate industry, however, decreased by $351 million (-2.9%) to $11.7 billion in the fourth quarter as the real estate market slowed.
Extreme cold weather two years in a row could have ‘really devastating consequences’ for grape growers
While it may feel like the weather could not be any better this February, many grape growers and wineries are worried about reports from Environment Canada about the polar vortex, which threatens to bring cold air to many parts of Ontario, including Niagara.
“Vine acclimation, or cold hardiness to tolerate winter, is always a concern for growers and the unpredictable and unseasonably warm temperatures have not created the ideal environment to ensure adequate dormancy,” says Matthias Oppenlaender, chair of the Grape Growers of Ontario. “There was catastrophic damage in the vineyards last winter, particularly in the Niagara Region, causing stress on the vines and affecting the overall grape production.”
Grape Growers of Ontario CEO Debbie Zimmerman said “the continuous fluctuations in weather are troubling. Extreme weather events of 2022 reduced our crop by 50 per cent, and we are very concerned about the upcoming weather predictions.”
Greg Burti, vice president of Global Markets, Industry Relations and Business Development for Andrew Peller Limited, said at this time last year a weather event damaged the vines’ buds, affecting the crop size.
“It had different effects all over Niagara and affected some growers differently,” said Burti.
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Focus on Business Law
Legal minefield awaits for businesses looking to use artificial intelligence
In recent years, artificial intelligence (AI) has been making waves in various industries, from health care to the arts. The rise of generative AI tools – which use vast sums of existing data, such as audio, code, images, text, simulations and videos to produce original content – is no exception. These tools include ChatGPT, which has been heralded as the “most important general purpose technology since the wheel” by former U.S. treasury secretary Lawrence Summers.
But with this growth come new questions surrounding the use of these technologies, particularly in the area of copyright law.
As Canadian businesses navigate the legal risks of generative AI, they must keep in mind that this is a developing issue and that the laws are not yet sufficiently sophisticated to address the challenges posed by this rapidly evolving technology.
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Through the Daily Updates, the GNCC aims to deliver important business news in a timely manner. We disseminate all news and information we feel will be important to businesses. Inclusion in the Daily Update is not an endorsement by the GNCC.