Election 2008
The Canadian Construction Association (CCA) is the national voice of the non-residential construction industry in Canada. It represents a membership of more than 20,000 enterprises across the country, with members working in every facet of the business, including design, management of finished projects, road building, and general and trade contracting.
Construction has been and remains a significant driver of Canada’s economy. While few Canadians give much thought to the sector, it is one of Canada’s largest employers and accounts for 6 percent of Canada’s Gross Domestic Product (GDP) – a sizable proportion for any single industry. Today, the sector employs more than 1 million Canadian men and women and contributes over $165 billion to the economy.
CHALLENGES TO FUTURE SUCCESSSkills Shortages Like many other industries in Canada, the construction sector is facing unprecedented labour and skills shortages due primarily to an aging workforce and Canada’s outstanding economic growth. In response, the industry has aggressively promoted careers within the sector to youth and traditionally under-represented groups such as women and Aboriginals. However, even with these aggressive recruitment efforts, it continues to face a significant labour shortage. According to the most recent Labour Market Information report produced by the Construction Sector Council, the construction industry in Canada will need to recruit more than 250,000 new people to the industry over the next 7 years, an increase of nearly 22 percent over the current workforce, just to keep pace with retirement rates and rising demand.
To achieve this goal, the CCA believes Canada must increase the number of domestic trained workers and reform the immigration selection system to facilitate the entry of workers with experience in the sector.
Labour Market Training
CCA has always believed that growing the domestic labour pool is the preferred method of addressing the sector’s skills shortage and that Canada’s community college system is a key part of that effort. To achieve this goal, Canada must ensure that our community colleges are well funded, modern and accessible to those seeking careers in construction.
Improving Community Colleges
The federal government has long supported investments in post-secondary institutions. In fact, federal investments in the 1960s led to the expansion of the college system throughout Canada. Today, Canadian colleges are dramatically underfunded, over-subscribed and poorly equipped to train the skilled workforce required by our modern economy. To overcome this challenge, the CCA calls upon the federal government to demonstrate the same leadership and financial commitment it showed in addressing a similar problem with Canadian universities earlier in the decade.
Recommendations:
- The CCA recommends that the federal government begin recapitalizing community colleges by working in partnership with provincial governments to better apportion educational funding.
- The CCA also recommends that the federal government create a college infrastructure fund to allow community colleges to upgrade equipment, hire new professors and expand where necessary to reduce enrolment waiting lists.
Immigration
Canadian immigration policies do not adequately address the needs of employers dependant upon skilled labour. The heart of the problem is an enduring immigration selection system that awards points based on levels of educational attainment. Applicants with university degrees receive substantially more points than their less educated counterparts, regardless of other factors such as skills or domestic demand for professional construction labour. Furthermore, maximum points are awarded for proficiency in both official languages, which is largely unattained by most skilled trades people. Arranged employment only counts for 10 points on the scoring system, even though the premise of the selection system is to fill labour gaps in Canada and ensure the rapid integration of new immigrants into the economy.
While CCA is pleased with the recent introduction of the Canadian Experience Class category, far more needs to be done to reform the immigration system and ensure Canada is able to compete with other countries for the best and brightest skilled immigrants.
Recommendations:
- The point system should be reformed to put greater emphasis on experience and arranged employment in the selection process.
- CCA also recommends that construction workers be included in a Seasonal Worker Program.
Infrastructure Development Canada faces a substantial public infrastructure deficit. A recent study by the University of Waterloo found that the current infrastructure deficit is estimated at more than $200 billion and growing quickly as Canada’s current infrastructure, most of which was built in the 1960s, rapidly approaches the end of its useful service life. Moreover, the study found that declines in public infrastructure investment in Canada contributed greatly to the growing productivity gap between our economy and that of the United States. In order for Canada to continue to grow and maintain a globally competitive economy, governments at all levels must commit to sustained infrastructure funding.
CCA’s applauds the federal government for its $33 billion investment in Budget 2007. Clearly, this was an important first step and has become a catalyst for further investments by provincial and municipal governments. However, to adequately address current and anticipated future needs, a far more significant investment will be required.
CCA is concerned that without a significant new and sustained financial commitment, the state of Canada’s infrastructure may degrade to a point beyond the capacity of governments to renew feasibly, further eroding Canada’s global competiveness and reducing the productivity of Canadian manufacturing.
Recommendations:
- Ensure long-term, sustained funding for core municipal infrastructure.
- Any new commitments should build on funding already announced and committed as part of the existing federal-provincial framework agreements.
- Introduce a new and separate water and sewer infrastructure fund to expedite the availability of clean and safe drinking water and wastewater treatment facilities across Canada.Government Obstacles
Defence Procurement
Canada has a number of world-leading businesses engaged in the supply of private sector site support services to major facilities and deployed operations conducted by the Canadian government. These firms offer superior operations, maintenance and site support services in the mining, transportation, construction and military industrial sectors.
Current defence procurement policy generally ties the acquisition of equipment to the maintenance and support services required for the equipment throughout its service life. These maintenance and support service contracts often go to the foreign-based equipment supplier, relegating Canadian firms with the requisite experience to lesser roles as sub-contractors.
Recommendation:
- CCA recommends the federal government enhance its relationship with Canadian support services firms by building a true partnership with these firms and seeking new opportunities to increase their roles in government facilities maintenance.
Employment Insurance
Budget 2008 introduced some significant changes to the governance and management of the Employment Insurance Fund, which go a long way in addressing CCA’s concerns relative to the EI rate-setting process and the use of EI Fund surpluses. They, however, deal solely with governance and rate-setting, and not the operation of the EI program itself.
Recommendation:
CCA has called for additional reforms including the elimination of the employer multiple (i.e. a return to 50-50 employer-employee contributions), a mechanism for refunding employer over-contributions, and a yearly basic exemption.
TradeGateways
The Canadian economy is increasingly global in nature and reliant upon the strength of our exporters for domestic prosperity. To remain a strong and competitive global player, Canada must ensure that our domestic policies encourage business investment and promote the growth of exports.
Rightly, the federal government has focused significant resources on improving border crossings and access to the Asia-Pacific region, actions strongly supported by CCA members. The $2.1 billion announced in Budget 2007 for the development of Gateways and Borders was a welcome infusion of funds that is driving the development of the infrastructure Canada will require to ensure the speedy and efficient movement of goods domestically and around the world. While efforts on the west coast are far advanced, development plans for other regional gateways continue to lag.
Recommendation:
CCA members feel the country’s other regional gateways could strongly benefit from better private sector – public sector coordination and strongly encourages the creation of a National Gateways Council to better direct priority setting.
Export Distribution Centre Program
With the introduction of the Export Distribution Centre Program, Canada took a giant step toward the creation of Free Trade Zones. These zones have existed in many countries for decades, and generally, offer businesses operating within these zones the ability to import products tax-free, add value and then re-export them to third markets. The Canadian program offers many of these benefits, providing products are not manufactured or substantially altered within the EDCs.
While CCA applauds this government effort, we believe additional changes should be considered to expand the EDCP and make it more consistent with comparable programs available in other countries, including the United States.
Recommendation:
The CCA recommends that the federal government initiate a multi-stakeholder review of Canada’s Export Distribution Centre Program (EDCP) with Free/Foreign Trade Zones (FTZ) legislation around the world and consider adjustments to the EDCP in order to offer a strong global competitive position with which to attract international trade related investment.
top of the pageTransportation
Hours of Service
The introduction of national Hours of Service regulations was a laudable goal. Its broad application, however, has placed a sizable and unnecessary burden on the Canadian road building and heavy construction sector.
The federal Hours of Service regulations treat long-haul drivers the same as short-haul drivers, which is detrimental to construction operations. Short-haul drivers do not suffer the same effects of fatigue as long-haul drivers, and as such, should be exempt from the Hours of Service regulations.
Several provinces in Canada support this position and have moved to issue exemptions within their jurisdiction. However, without a federal exemption, those companies that operate in border communities are governed by federal legislation, which makes the Hours of Service regulations an unintended barrier to inter-provincial trade.
Recommendation:
- The CCA calls upon the federal government to issue an exemption for short-haul drivers from the Hours of Service regulations (e.g. those who operate within a 160 km radius or less within their working day).
Taxation
Accelerated Capital Cost Allowance for Diesel-Powered Vehicles and Heavy Machinery
Canada’s construction industry has been moving as quickly as possible to adopt cleaner vehicles and heavy equipment. However, given the costs involved with fleet and equipment upgrades, it is often not possible to embrace the newest and cleanest technologies immediately.
Recommendation:
To help improve industry adoption of the newest and cleanest technologies, CCA recommends the government restore the accelerated capital cost allowance from 30 percent to 50 percent.
Employer Provided Vehicles
CCA has long been seeking tax relief for construction employees using company motor vehicles (i.e. non-automobiles) to travel to and from home to construction work sites, particularly where the employee is required to take the vehicle home at night, is prohibited from using it for any non-business purpose, and is required as a condition of employment to report directly to different job sites that are often located much further than the employer’s head office or fixed place of business.
Recommendation:
The law should be reformed to recognize that there is no personal benefit to the employee and therefore no taxable benefit in the foregoing circumstances.