In order to stimulate economic activity in the face of the global
economic downturn, the Provincial Government today announced it will
increase infrastructure spending to approximately $800 million in the
2009-10 fiscal year and in excess of $4 billion over the next several
years. The $800 million the Provincial Government will spend on
infrastructure in the 2009-10 fiscal year represents a jump of $285
million – well over 50 per cent – from the 2008-09 fiscal year.
The Honourable Danny Williams, Premier of Newfoundland and Labrador,
along with the Honourable Jerome Kennedy, Minister of Finance, and the
Honourable Trevor Taylor, Minister of Transportation and Works, made the
announcement at a news conference today in St. John’s. Simultaneously,
the Honourable John Hickey, Minister of Labrador Affairs and the
Honourable Patty Pottle, Minister of Aboriginal Affairs, made the
announcement at Labrador City. They were joined by the Honourable Kathy
Dunderdale, Minister of Natural Resources; the Honourable Susan
Sullivan, Minister of Human Resources, Labour and Employment; and, the
Honourable Dianne Whalen, Minister of Municipal Affairs.
"Newfoundland and Labrador is not immune to the current world-wide
recession but thanks to the sound fiscal foundation we have laid in the
past five years, we are probably one of the best-positioned regions in
North America to weather this financial downturn," said Premier
Williams. "Infrastructure investment has been a priority for this
government and that will continue. The aggressive infrastructure
strategy we are announcing today includes multiple new projects and
clearly demonstrates that our government is staying the course with our
strategic infrastructure investments. At the same time, we are taking
the necessary measures to stimulate the economy and create more jobs
throughout the province. This is a level of infrastructure funding never
seen before in the province’s history and helps further ensure our
province is equipped to stand strong and forge ahead as masters of our
The Provincial Government’s Infrastructure Strategy will include
investments in the following sectors:
Transportation infrastructure (including repairs and
maintenance) – $309,230,000
Educational facilities (including repairs and maintenance) –
Healthcare facilities and equipment (including repairs and
maintenance) – $163,000,000
Municipal infrastructure – $103,219,000
Newfoundland and Labrador Housing infrastructure –
Justice infrastructure – $18,643,000
Additional economic stimulus will be provided by Nalcor Energy
through its subsidiary Newfoundland and Labrador Hydro with an
investment of $48 million in various projects, including $3.5 million
for the Ramea Wind-Hydrogen-Diesel project; $3 million for the
construction of an office and warehouse in Happy Valley-Goose Bay;
$300,000 to begin a $10 million dollar construction project of two new
terminal stations in Labrador City; $1.2 million to construct
accommodations at Cat Arm; and $2.9 million to begin refurbishment of
the fuel storage facility at Holyrood.
The provincial investment over the next several years is also
expected to leverage additional funding from other levels of government.
It is anticipated the investment plan will create or sustain
approximately 5,400 person years of employment this year.
"This spending builds on the approximately $1.5 billion we have spent
on our provincial infrastructure over the past five years," added
Premier Williams. "We have confidence and optimism in our economy and
our government will continue to invest strategically and wisely."
The infrastructure strategy will bolster the impact of several major
projects expected to provide economic stimulus, cushioning the province
from the global economic downturn. The Provincial Government recently
reached an improved development agreement with Vale Inco to ensure the
timely start and completion of the nickel processing facility at Long
Harbour. The successful conclusion of negotiations for the development
of the White Rose expansion, as well as the tremendous potential for
Hibernia South, will also provide a tremendous boost to the oil sector.
In addition, the development of the Hebron oilfield, with a five per
cent equity stake for the province and a super royalty regime, will
provide further stimulus for economic growth with estimates of
approximately 3,500 employees at the peak of construction.
Minister Kennedy said the advice government has received from
economists regarding the economic recession has been consistent.
"They recommend spending on infrastructure projects that can begin
immediately and result in job creation, thereby creating economic
activity," said Minister Kennedy. "The priority our government has
placed on infrastructure spending, along with the actions we've taken in
the last number of years to reduce taxes and fees and pay down debt are
additional ways we have worked to stimulate the economy. Tax and fee
reductions in the last two budgets equal a two-year combined total of
$342 million going back into the pockets of Newfoundlanders and
Labradorians, and have brought our tax rates to the lowest in Atlantic
Canada. These actions, combined with significant progress in repaying
debt and lowering borrowing costs, have placed our province in a
position of strength and have enabled us to invest significantly more
infrastructure funds as part of the 2009-10 budget."
Minister Taylor pointed out that this infrastructure strategy has
significant benefits over the short and long term.
"We will see tremendous benefits from our infrastructure strategy
this year but we’re also looking beyond 2009," said Minister Taylor. "It
is not prudent to do everything in one year and the construction
industry would be overwhelmed if we took that approach. We will increase
and accelerate infrastructure projects at a level that sustains and
stimulates the economy over the long term, ensuring maximum benefits for
industry and the economy year over year."
Minister Taylor indicated Budget 2009 will include $130 million for
repairs and maintenance to Provincial Government buildings. This is an
increase of $30 million over fiscal year 2008-09. Approximately $80
million of that amount is going to schools and health care facilities
"This is the type of work that gets hammers in hands immediately and
creates jobs right away," said Minister Taylor. "We want to boost
employment as soon as possible."
As part of the Williams Government’s approximate $800 million
infrastructure investment in 2009-10, $103 million is targeted for
municipal infrastructure. New projects will include all types of
municipal infrastructure such as water and waste water treatment, roads
and recreational facilities.
The infrastructure package will have a positive impact on the entire
province and provides significant funding for all sectors. One such
region that will receive significant benefits is Labrador, where
investments are expected to reach $130 million in fiscal year 2009-10
and in coming years are anticipated to exceed $350 million. This builds
upon the direction set for Labrador over the course of the five-year
Northern Strategic Plan, now entering its third year.
"I want to make it clear that this revised infrastructure strategy
forms one part of our government’s approach to economic stimulus within
the current financial environment in which we find ourselves," said
Minister Kennedy. "Other measures are under consideration as we finalize
our upcoming budget. Despite projected deficits in the next couple of
years, we know that stimulus is required and we continue to have an
optimistic outlook for our provincial economy."
Premier Williams says the province’s future is bright, despite the
lack of support from the Federal Government.
"We will not be deterred by the efforts of the Federal Conservative’s
recent budget to suppress growth and prosperity in Newfoundland and
Labrador, through unilateral cuts to previously signed agreements,"
added Premier Williams. "Ours is not a culture of defeat, but as masters
of our own destiny we are continuing to shape and drive our economic
plan to ensure success for the people of our province in these difficult
economic times. We feel it is particularly right this year to have our
own strategy to put Newfoundlanders and Labradorians to work and to find
employment for workers who have been displaced here and in other
provinces. Approximately 5,400 person years throughout the province
should go a long way in accomplishing just that. We have worked hard
over the past five years to develop a fiscal strategy of prosperity for
our residents and this continued path and other recent initiatives will
pave the way for a better future."
Some examples of the new infrastructure initiatives in Budget 2009