The Honourable Travis Toews, MLA, Q.C.  

President of Treasury Board and Minister of Finance

Delivered via Government of Alberta submission system

RE: Budget 2022 consultation

Minister Toews:

Thank you for the opportunity to provide a written submission to the Ministry of Finance regarding Budget 2022.

Almost two years into the COVID-19 pandemic, and now with the more transmissible omicron variant threatening our community’s economic and physical health, the Calgary business community – no stranger to hardship – continues to face unprecedented ongoing challenges.

Despite this challenge, 0ur province continues to demonstrate grit, resiliency, and determination, coupled with an entrepreneurial spirit and deep-seated commitment to innovation.

Nonetheless, in times of sustained hardship, we need government support to ensure businesses and their employees emerge stronger. With crisis comes opportunity, and the actions taken now will be critical to building a more resilient, competitive, and inclusive future.

To that end, attached are immediate and long-term recommendations that will enable businesses to survive this latest wave of the pandemic and recover as we position Alberta for tomorrow.

Thank you in advance for your consideration and we look forward to working with you to realize a sustainable and prosperous future for all Albertans.

Immediate priorities

Keep Alberta businesses open and Albertans healthy. 

Today, especially in light of the challenging Omicron variant – and particularly for those in hard-hit sectors such as restaurants, hospitality and tourism – businesses continue to grapple with lost revenue, travel restrictions and difficulties attracting talent and ensuring proper staffing.

However, our economy and public health landscape are in a very different position today than in March 2020, at the onset of the pandemic. With credit to all levels of government, we have access to vaccines, new medications, testing, and personal protective equipment. If we equip businesses and citizens with the tools they need to stay safe, additional restrictions and lockdown measures can be mitigated.

As the context under which we are operating changes, so too must our public policy decisions.

1. ADD TO FEDERAL SUPPORTS FOR BUSINESSES WITH ADDITIONAL PROVINCIAL PAYMENTS 

• Introduce a Temporary Alberta Rent Payment (TARP) and Temporary Alberta Wage Payment (TAWS) by March 2022. Over the last few weeks, we have heard businesses continue to struggle with lost revenue and the ability to pay fixed overhead costs like commercial rent and wages as they struggle to retain adequate staffing. Over 70 per cent of businesses have utilized federal support, but many continue to need additional support. Between 12 and 26 per cent of businesses in Canada are at the risk of permanently closing due to the pandemic including those who were inactive in 2020.  To ensure businesses survive, introduce two temporary additional programs that provide top-ups to those already receiving payments through any of the following federal programs: Tourism and Hospitality Recovery Program, Hardest-Hit Businesses Recovery Program, Canada Recovery Hiring Program, or the Canada Emergency Wage Subsidy. 

2. CONTINUE OR RE-START MEASURES THAT PROVIDE RELIEF TO BUSINESSES  

• Start the next intake of the Small and Medium Enterprise Relaunch Grant.  
  The initial phases of the Small and Medium Enterprise Relaunch Grant have been instrumental for businesses and helped many stay afloat. With quick access to funds and limited restrictions on the use of funds, businesses have been able to access funding to bridge their operations through waves of the pandemic. While many businesses are no longer closed due to government restrictions, we hear often - and loudly - from businesses that they are facing more uncertainty than ever. Relaunching the SMERG also provides support for businesses ineligible for the aforementioned temporary top-ups.  
  
  
• Continue the abatement of the Alberta Tourism Levy until August 31, 2022.
  After seeing declines in everything from hotel occupancy rates to food and beverage purchases over the past two years, Calgary’s hospitality and tourism sector has a unique opportunity to reimagine its future, leveraging our strong history as a destination while rethinking the possibilities that lie ahead for the sector. Reimaging that future will only be possible if businesses can survive this wave of the pandemic and reducing costs given declining revenues can make that a reality. One in three businesses in the hospitality sector is actively considering closing down while tourism spending dropped by 43 per cent. Airline cancellations and ongoing testing requirements due to Omicron variant are now causing further setbacks to an expedient recovery. The Alberta Tourism Levy will be critical in helping businesses sustain operations until they can recover their losses.  

3. USE ALL THE TOOLS WE HAVE TO KEEP OUR COMMUNITY SAFE AND THE ECONOMY OPEN 

• Increase the availability of rapid tests. In the last month, we at the Calgary Chamber have experienced a 250 per cent increase in the number of businesses requesting rapid test kits through our program partnering with the Government of Alberta – many citing the need for testing to avoid labour shortages and resulting business closures. To ensure adequate supply, we urge the province to continue to procure additional rapid test kits from the federal government and other vendors, and ensure reporting requirements for businesses align with the general public, reducing barriers for businesses in testing employees.
  
  
• Use pandemic management tools to mitigate the need for restrictions. Over the past two years, we have all worked tirelessly to identify and implement alternatives to shutting down our economy. Pandemic restrictions have pushed businesses to the brink, with only 30 per cent of businesses back to pre-pandemic revenue and 20 per cent considering filing for bankruptcy. Now, with vaccinations, testing, vaccine certification, isolation requirements and contact tracing, we know how to keep people safe – without restrictions. To make this a reality, we must pass legislation that supports employers in mandating vaccination for staff and provide a timeline for when booster vaccinations will be required to be considered ‘fully vaccinated’ under the Restrictions Exemption Program. 
  
  
• Support businesses as they improve ventilation and use higher quality masks. To keep our economy open and avoid further public health restrictions, we need to recognize how COVID-19 spreads. With the evidence of airborne transmission, Alberta businesses need financial support to mitigate viral spread through improvements both to the Heating, Ventilation, and Air Conditioning (HVAC) systems they are using, including high efficiency particulate air (HEPA) filters, and high quality KN95 or N95 masks for their employees. To that end, introduce the Alberta Mitigation Grant, a $1,500.00 grant eligible to businesses to improve their HVAC systems.  
  
  
• Work with the federal government to lift PCR testing requirements for double-vaccinated travelers to redeploy PCR tests for medical use and to those who need them. In the last week of December 2021, the positivity rate for vaccinated travelers at airports was around 4.93 per cent compared to the national average of 19 per cent at that time. This indicates that there is greater community transmission of COVID-19 than at the border. PCR testing resources need to be directed towards the areas where they are most needed in the community.   

4. Mitigate labour shortages & invest in productivity  

• Implement a program like the Accelerated Tech Pathway for the hospitality and tourism sector to help address staffing shortages for businesses and support immigration. With 75 per cent of Canada’s population growth coming from immigration, this remains critical for our long-term economic prosperity. 
  
  
• Fund more immediate work-integrated learning initiatives so that talent can be trained quickly with the skills businesses need. High unemployment and labour shortages are indicative that the current labour pool does not have the skills our economy needs. Work-integrated learning initiatives allow employees to return to work faster and contribute to our economy while increasing our tax base.   
  
  
• Facilitate the next intake of the Alberta Jobs Now program which has been critical to helping struggling businesses hire staff during the pandemic.  With the uncertainty around the Omicron variant and how it will affect restrictions, Alberta businesses need ongoing support from the government to ensure stability.  

Long-term priorities

Build a resilient, competitive, inclusive Alberta. 

Our long-term recommendations reflect consultations with members, experts, and stakeholders this past year to understand the opportunities and challenges facing Calgary’s business community. Below, we outline how government can support businesses and create a thriving, sustainable future for all Albertans as we recover and progress.

1. INVEST IN OUR COMPETITIVENESS 

Alberta’s competitiveness on the world stage is critical to our prosperity in the economy of tomorrow. This is driven by creating a cost-competitive environment for businesses to prosper, avoiding red tape and duplicative regulation, and providing certainty for business. Our competitiveness is intertwined with our ability to attract investment capital and top talent. With cities that afford a high quality of living at a low cost, and as the epicenter of innovative solutions to climate change, our province need only leverage our strengths to thrive.

1. Make it easier to do business in Alberta

• Continue to regularly engage and consult our business community for feedback on existing inefficiencies, red tape and barriers otherwise to growth and competitiveness. 
  
  
• Implement a ‘layered cost’ economic impact assessment that evaluates the cost burden created by regulations and policies.  
  
  
• Continue the strong work of consulting with industry to find opportunities to reduce red tape and maintain the current swift timelines of removing these unnecessary regulations. 
  
  
• Ensure regulatory alignment with the federal government to avoid the layering of costs due to additional and duplicative regulation. Coordinate with the federal government to shelter industry from political disagreements that cause project delays and uncertainty.  

2. Strengthen Alberta’s position as a leader in providing solutions to address climate change through innovation.

• Continue investing in emissions reduction and decarbonization technology with an increasing focus on developing and deploying these innovations.
    
• Facilitate a business and regulatory environment that will attract global energy investment, particularly from the U.S. as they advance their clean technology and emission reductions priorities.  
  
  
• Expand and continue initiatives such as the Technology Innovation and Emissions Reduction Fund, which will help create jobs while strengthening our clean technology sector. 
  
  
• Promote Alberta’s innovation in addressing climate change on the world stage by sharing our ESG accomplishments domestically and internationally, particularly our contributions to carbon capture, storage and utilization technologies.  

3. Attract, retain, and invest in talent

• Develop the talent pipeline in Alberta through strong investment and collaboration in post-secondary institutions. As we transition to a knowledge-based economy focused on innovation, automation, and cross-sectoral collaboration, lifelong education and training are critical to a productive workforce.  
  
  
• Support micro-credentialing and work-integrated learning initiatives, both of which allow people to continue working and fully participating in the economy, while also ensuring they are prepared for future economic markets.  
  
  
• Create pathways for skilled workers from outside Alberta to relocate and work here through the expansion of work exchange programs and economic immigration programs such as the Alberta Immigrant Nominee Program. 
  
• Work with industry to improve the collection and coordination of market information to produce accurate forecasts of evolving skill and competency needs across sectors.  
  
  
• Invest in community vibrancy to attract skilled professionals. This means communities that are connected, diverse, and afford a high quality of living while keeping cost of living low.  

4. Invest in revitalizing Calgary’s downtown to retain and improve our competitive advantage.

• Direct funding towards updating infrastructure that will create more vibrant communities. Our downtown core has struggled in past years and these investments will attract people to live, work, and play. 
  
  
• Support public good infrastructure such as public transit and transportation networks, green spaces and parks, as well as large-scale event facilities. This creates jobs in the short term and allows more people to access our downtown core in the long term.  
  
  
• Invest in the arts, including through affordable projects such as murals, as well as job-creating industries such as performing arts, film, and gaming.  
  
  
• Invest in conversion and repurpose vacant spaces including housing, flexible workspaces, post-secondary institutions, and public amenities, leveraging federal and provincial funding arrangements 
  
  
• Develop and update connectivity networks to accommodate talent migration and population growth. Urban and rural connectivity is critical to our province’s business competitiveness in the long term.  
  
  
• Create a downtown business grant, like the Small and Medium Enterprise Relaunch Grant, which provides $10,000 in funding to businesses looking to move to downtowns. Calgary’s downtown vacancy rate is 33.2 per cent as of January 2022. Targeted support is necessary to offset the negative economic impacts of emptying downtowns. 

2. FOCUS ON FISCAL SUSTAINABILITY  

As we emerge from the pandemic and begin to address our debt and deficit challenges, we must review our fiscal policy and taxation system to ensure competitiveness, simplicity and fiscal sustainability. A strong fiscal strategy is critical to the long-term sustainability and resiliency of Alberta’s economy. A critical focus on fiscal responsibility should be maintained throughout the budget planning process.

1. Focus on long-term fiscal sustainability through both revenue generation and spending efficiency.

• Critically examine all government spending to ensure fiscal responsibility, with a particular focus on finding efficiencies in recurring expenses. 
  
  
• Develop key fiscal anchors over the long term and ensure strong balance sheets to avoid creating untenable future tax burdens and reduce expenditures where possible. 
  
  
• Continue to review all viable sources of revenue and proactively reimagine our fiscal future. 

3. DIVERSIFY OUR ECONOMY  

A diversified economy is key to promoting innovation across industries, remaining competitive on domestic and global stages and attracting the best talent to our city. Diversification will increase the certainty and stability of provincial and municipal revenue. In equal measure, it offers varied economic opportunities so Albertans can contribute to the workforce in a manner better aligned with their experience, skills and interest

With an entrepreneurial spirit, access to immense natural and human resources, and one of the most educated populations in Canada, Alberta is well-positioned to thrive in areas we have succeeded in traditionally, as well as in new areas that will allow us to successfully diversify and expand revenue sources.

1. Diversify within our traditional sectors of strength.

• Further develop Alberta’s potential as a leader in the hydrogen economy, particularly the use of hydrogen as a fuel source in the economy of the future domestically and internationally.  This includes ongoing support for Carbon Capture and Storage (CCS) projects and Carbon Capture Usage and Storage (CCUS) projects. 
  
  
• Support widespread commercialization and promotion of bioenergy innovation to help make bioenergy - and biofuels - a key export for Alberta and cement our position as a global leader in clean and renewable energy.  
  
  
• Scale our minerals and metals development as key exports. Alberta has all the key elements to thrive in the minerals and metals industry. Our geology is favourable, we have a workforce experienced in extraction and development of natural resources and we have an ideal geographical proximity to the large U.S. market.  
  
  
• Scale sustainable agriculture to meet the growing demand for agricultural and farm exports such as meat, dairy and grains over the next few decades. The world’s population is forecasted to reach 9.7 billion by 2050.  
  
  
• Strengthen supply chains which have seen major disruptions from the COVID-19 pandemic. 
  
  
• Invest in manufacturing hubs such as large-scale manufacturing facilities, multi-purpose business centers, and supply chain hubs with the most up-to-date technology.  
  
  
• Provide e-commerce support for Albertan businesses so they remain competitive as consumer use of e-commerce and digital retail platforms increases.  

2. Diversify beyond our strengths.

• Support the growth of the tech industry. Technology-related job creation is projected to increase exponentially in the coming decades, so a thriving tech sector is a significant economic advantage for Calgary.   
  
  
• Invest and expand the aviation and aerospace sector to increase job creation opportunities for Alberta. Long-term travel demand remains high and investment in this sector will be key to ensuring this demand is met by Canadian companies.  
  
  
• Develop and promote medical innovation to ensure the prompt development of COVID-19 tests kits and vaccines which are critical to reopening our economy and keeping loved ones safe.  
  
  
• Build a vibrant arts and culture scene to capitalize on our domestic talent and attract international talent.  
  
  
• Provide incentives to attract film and television production to Alberta which will help create jobs as billions are spent each year by entertainment productions vying for viewers.  
  
  
• Invest in world-class sports and entertainment infrastructure to develop Calgary as the winter sport hub in Canada.  
  
  
• Continue supporting Alberta’s restaurant and hospitality sector. Calgary’s restaurant and hospitality sector is a direct reflection of the diversity and culture of our city. To remain competitive as a tourist destination and improve the vibrancy of our communities, a thriving restaurant and hospitality sector is necessary. 

4. SUPPORT TRADE AND MARKET ACCESS 

Access to markets, internationally and within our borders, is a necessity for growth for businesses across the country no matter their size. Barriers to market access impact almost all sectors in Alberta, as many rely on our trade-exposed sectors such as natural resources. In Canada, inconsistencies in regulatory frameworks across jurisdictions create barriers to inter-provincial trade. The supply chain constraints and challenges since the onset of the pandemic have only exacerbated the difficulties of getting our goods to international markets. Removing non-geographic policy-relevant trade barriers can lead to an initial increase for Canada’s real GDP by 3.8 per cent, which is equivalent to more than $80 billion.

1. Aggressively dismantle barriers to interprovincial trade and strengthen supply chains.

• Continue to set a high bar for other provincial governments on internal trade issues and actively promote the critical work being undertaken in this area, including expanding the New West Partnership Trade Agreement. 
  
  
• Facilitate the free movement of skilled labour across the country by developing consistent and harmonized recognition for professions with specific certifications across provinces as seen with the Red Seal Program.  
  
  
• Continue to remove interprovincial trade barriers through the Canadian Free Trade Agreement (CFTA) and accelerate the progress of the Regulatory Reconciliation and Cooperation Table (RCT) to ensure trade barriers within Canada are eliminated. Work directly with other provinces to sign trade agreements that remove barriers for business to be able to sell within our own nation.  

2. Facilitate international market access for both traditional and non-traditional industries

• Work with the federal government to increase investments in trade-enabling infrastructure and create a regulatory environment that supports private investment in such infrastructure.  
  
  
• Promote exports and minimize risk by finding opportunities to access new and diverse markets, particularly for small businesses. Focus on exports in emerging industries in particular, thereby supporting diversification. 

5. FACILITATE INCLUSIVE ECONOMIC RECOVERY AND GROWTH  

Businesses continue to face significant challenges related to COVID-19 and many do not have the certainty or stability needed to survive nearly two years into the pandemic. At the same time, evidence shows certain segments of our population have felt the impact of the pandemic more acutely than others, particularly based on gender and race.

With all the challenges that the pandemic has wrought and exacerbated, facilitating a strong economic recovery growth will need a multi-pronged approach with a focus on inclusive and sustainable growth.

1. Expand economic opportunities for marginalized and underrepresented groups to participate in the labor force.

• Continue to improve affordability and quality of childcare in Alberta through the federal-provincial childcare agreement. Further improvements will increase labour force participation by women and provide a stronger start for our kids. This yields considerable economic benefits overtime and creates a larger tax base. 
  
  
• Provide targeted support for Indigenous, minority and women-led businesses to participate in government procurement processes. Currently, WBE Canada estimates that less than 5 per cent of domestic and international suppliers to corporations and governments are women-owned businesses. Governments should procure a minimum of 20% from women-owned businesses by 2025 and 30% by 2030 for all new contracts. Incentives should also be developed to encourage businesses to incorporate social procurement efforts into their organizational strategies 
  
  
• Invest in mental health supports for Alberta communities and workplaces. The need for mental health supports has increased as a result of the pandemic, which has exposed the need for significant long-term, systemic change. Without it, our workforce cannot be fully productive. The economic impact to the national economy due to mental health related issues annually totals $50 million – or $1,400 per capita. 
  
  
• Collaborate with government, private, and non-profit enterprises to invest in improving social infrastructure through increased affordable housing or expanding physical and social accessibility programs. Over the short term, this will yield the job creation we desperately need, and over the long term, will reduce the social and economic challenges associated with individuals made vulnerable by the socioeconomic systems in place such as those experiencing poverty and homelessness.  
  
  
• Enable greater participation, opportunity and equity for all genders, particularly women by using the GBA+ framework to inform decision-making at the government level and in the workforce. 
  

 ABOUT THE CALGARY CHAMBER 

The Calgary Chamber is an independent non-profit, non-partisan business organization. For 131 years the Chamber has worked to be the convenor and catalyst for a vibrant, inclusive and prosperous business community, for the benefit of all Calgarians.