IMPORTANT NOTICE
April 4, 2012

Attention: Mayors, Councillors & CAOs

Federal Budget released

The Federal Budget 2012 was released on March 29, 2012, reflecting a $276 billion expenditure plan (an increase of $4.8 billion from the prior year) and a projected deficit of $21.1 billion

Through FCM, municipalities across Canada have been advocating for the federal government to ensure that a new long-term infrastructure plan, and a new generation of federal-municipal funding programs, are in place before the existing Building Canada Plan expires in 2014.
FCM has also been calling on the federal government to remove barriers to investment in the rental housing market to preserve construction jobs and address the shortage of affordable housing.

As outlined in the budget analysis provided by FCM, Budget 2012 commits to have a new long-term infrastructure plan in place before current funding programs end. In particular, the budget includes a $150 million commitment to the new Community Infrastructure Improvement Fund which will again see all orders of government working shoulder-to-shoulder to create jobs and invest in communities in a time of global economic uncertainty.

Other highlights include:

• There are no new business tax reductions for either the general corporate rate (15%) or the small business rate (11%)
• There are also no tax increases announced in the budget
• There will be a modest slowdown in spending, with cuts totaling $5 billion that will be phased in over 3 years
• $105 million invested this fiscal year in VIA Rail (capital and operational projects)
• $2 billion will be invested in innovation, research and training
• The Penny will be phased out beginning in the fall of 2012 for a savings of $11 million
• 19,200 jobs will be eliminated, mostly in Ottawa, including 7,000 jobs that will be eliminated through attrition
• The qualifying age for Old Age Security will increase from 65 to 67 in 2023

Budget 2012 did not include anything new to support the affordable, rental housing.

To read FCM’s full analysis, please click here.

Thank you,

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