A case for more Canadian content

Ken Boshcoff
Member of Parliament

The recent announcement that a foreign company is in negotiations with the City of Ottawa to build a light rail extension has once again raised awareness on the issue of Canadian content requirements or the lack thereof in tax-funded projects.
Consumers at all levels need to be aware of the impact of their spending on the local, provincial and national economies. For large infrastructure projects that involve millions of dollars, there is a significant negative impact on the Canadian economy when these projects are contracted to foreign corporations. Let’s look at an example: If $100 million is budgeted to build rail cars and the project employs 200 people in Canada, how does that effect our economy?
1. The corporation increases its earnings and pays more taxes to the provincial and federal government.
2. The employees have secure work. They spend their earnings in the local economy to buy goods and services and to pay municipal taxes on their housing. They also pay provincial and federal income taxes.
3. The corporation and its employees gain experience. They learn how to do the job more efficiently and may even develop new technologies that give them a cutting edge on future projects.
Alternatively, if the same contract is granted to a foreign company, what is the result?
1. The foreign company increases its earnings while the Canadian company faces a decrease in earnings. The company may need to lay-off some workers due to the resulting decrease in workload.
2. Canadian employees are laid off. Rather than paying into the economy they are forced to go on Employment Insurance, cut back on their purchasing and perhaps even look for employment in another community.
3. If the Canadian corporation loses a number of contracts, their level of experience and expertise will fall and they become less competitive within the market. Over a number of years, the plant will decline until it is closed and all employees are out of a job, further decreasing the tax revenues at all levels and increasing the demands on government services to assist those individuals.
I am currently working to develop a Private Members Bill that would require the Federal government to implement a Canadian content policy for large tax-funded projects. I am hopeful that such a policy will help Canadian companies grow and prosper and provide well-paying jobs to Canadian citizens.
I encourage all individuals to consider the importance of buying Canadian made goods from local retailers. It is a good rule of thumb that will help keep you and your neighbours employed and the local economy strong.