02/19/2008

Liberal leader Stéphane Dion pledged new funding for municipalities to eliminate Canada’s infrastructure deficit.
Background:

Liberal leader Stéphane Dion announced that a Liberal government would move to dedicate any surplus greater than $3 billion to municipal infrastructure in an effort to erase the municipal infrastructure deficit and improve Canada’s ability to remain competitive. 

The funding would be in addition to existing federal government infrastructure funding programs such as the Gas Tax Transfer and the Municipal-Rural Infrastructure Fund (MRIF). In addition, Mr. Dion reiterated his pledge that a Liberal government would make the Gas Tax Transfer permanent.  

Mr. Dion said that a Liberal government would set aside a $3 billion Contingency Fund every year that, if not needed for deficit purposes or unpredictable events, would be applied to the debt. Any additional surplus would be used to invest in such infrastructure needs as: public transit; water systems; roads and bridges; and cultural and recreational facilities. This investment would be made through existing federal gas tax transfer agreements, i.e. the funding would be entitlement based. 

According to the federal Department of Finance figures released on January 10, 2008, the federal government had a surplus of $13.2B in 2005-06, an estimated surplus of $13.7B in 2006-07 and forecast to have a surplus of $11.5B in 2007-08, $10B of which the federal government has said it will use to reduce the federal debt. 

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