Today’s op-ed by Scott Stinson in the National Post reflects the growing frustration among Canadians and a variety of thought leaders and advocacy groups that little is being done by Ottawa or Queen’s Park to examine potential models of fundamental health care reform.

As Stinson aptly notes, health care gained some traction in the last federal election, but only to the extent that current levels of transfer payments to the provinces would be maintained at 6% for the foreseeable future.  A new report this week from the Canadian Medical Association (CMA) is another wake up call for government leaders (whom are well aware of the health care sustainability challenge) to step forward in a bold fashion and convene a variety of stakeholders to determine how best to sustain a system we are accustomed to and make it more efficient.

For Ontario, this higher level of efficiency and value for public dollars invested becomes increasingly important as our population increases by 28% by 2030.  Our senior population is projected to represent one in five of all Ontarians by this time.  With 42 cents of every program dollar already going towards health care, what level of “distress” is the right time to roll up our sleeves and truly address this dilemma?

No doubt, health care reform is a highly sensitive topic and Canadians across the political spectrum are deeply passionate about it.  Nevertheless, there will come a point at which it is no longer simply easier to ignore the matter or delay the point of crisis with additional funding – at the expense of other public spending priorities.  Think transportation gridlock for instance?  Is it so difficult to put aside our ideologies and pause for a constructive conversation about the health care system?  A dialogue that is open to all ideas and one that is built on a spirit of cooperation?  Whether or not there is enough of a public appetite for health care reform to become a top campaign issue in the upcoming provincial election, November’s Ontario Economic Summit will tackle it head-on.  We look forward to facilitating a genuine debate and strategy session among a cross-section of economic leaders who will seek to uncover dynamic solutions to this very complex challenge.

Photo source: Flickr (nihilenz)

Canada can be proud of its talent pool, its rising number of university graduates and science post-graduates. In comparison to other OECD countries, Canada fares rather well in the areas of education, university-funded R&D, competition and peer review. Where we are not delivering is in transferring the knowledge from our talent pool to the marketplace.

The State of the Nation 2010 report, issued by Canada’s Science, Technology and Innovation Council states “research and development performed by business in Canada is low by international standards.” This is reason for serious concern.

It was with great interest that we, at the Ontario Chamber of Commerce (OCC), read Paul Davidson’s article “We need a culture of innovation: Build links between business and academe” (July 5, 2011). The article highlighted the findings of this report and rightly emphasized the need for Canada to foster a culture of innovation by building stronger links between the private sector and academic institutions.

In an age where innovation is essential to remaining globally competitive, Canada and its provinces cannot afford to lag behind.

For the last eight years, the Ontario Economic Summit (OES), an initiative of the OCC, has been bringing economic leaders from business, government, academia, labour and non-profit communities together, to address some of the most pressing concerns affecting Ontario’s economic prosperity.

In recent years, leaders participating at the OES have pointed to the need for a dialogue about how business-academia collaborations might be enhanced to help build a robust innovation climate. In response, the OES and the Council of Ontario Universities partnered to develop the “Connect to Innovate” (CTI) initiative in 2010.

These workshops, facilitated by local chambers of commerce and boards of trade, were held in Sudbury, London, Vaughan and Windsor. They featured senior administrators from each University with one of their research partners from the business community – exactly what Paul Davidson’s article said was needed for this country to remain globally competitive.

Clearly, one of the most significant challenges we face is an inadequate innovation culture, as noted in Paul Davidson’s article. OES “Connect to Innovate” set us moving in the right direction.

The discussions held were open and honest and demonstrated a sincere desire from all to foster closer relationships with a view to a more innovative economic climate. Most importantly, they provided insight which could lead to additional solutions as we move forward with Ontario – and Canada’s – innovation agenda. A full report of our findings can be found at www.occ-oes.com/connect-to-innovate <http://www.occ-oes.com/connect-to-innovate>.

We found that academic institutions and businesses across the province were shifting their mindsets and opening themselves up to new collaborations or building on existing ones in more innovative ways. They recognized the strategic importance of being innovative in the way we work together, to advance our standing on the international stage.

We thank Paul Davidson for showcasing the importance of innovation in our economy – and society. We are pleased to be part of the solution as we host additional workshops in other communities across Ontario throughout 2011 and 2012. This unique program will be extended to include Ontario’s Colleges and we will review our progress at the next Ontario Economic Summit, taking place November 21-23, 2011 in Toronto.

A spirited debate is underway about the relative merits of cutting corporate tax rates to remain internationally competitive for investment dollars and to encourage job creation in Canada.  The current federal election campaign has brought additional attention to the matter, with the Conservative Party vowing to continue with planned reductions in corporate income tax (CIT) rate, which currently sits at 16.5% from a level of 18% in 2010.  A further reduction to 15% is scheduled to take effect in 2012.  The Liberal Party of Canada would like to see a retreat to 18%, arguing that the cuts are not necessary and the revenue is needed to fund for healthcare, childcare, education and other priorities while the NDP have similar concerns and pledge to keep the combined federal/provincial CIT rate below that of the United States. 

A study released last week by the Centre for Policy Alternatives and authored by CAW economist Jim Stanford argues that historical evidence illustrates that business tax cuts are both “economically ineffective and distributionally regressive.” One time OES speaker and renowned economist Jeffrey Sachs is similarly concerned about this global trend, calling on governments to resist the international “race to the bottom”.  Sachs says countries are being “gamed by global companies that are playing off our governments, one against the other.”  Sachs says the United States should champion a multilateral agreement to increase taxes on corporate income.  Laura D’Andrea Tyson, who chaired President Clinton’s Council of Economic Advisors disagrees, insists that higher corporate tax rates undermine growth and competitiveness and that the European Union cannot agree on harmonizing CIT rates for its member states, let alone with the U.S. and other nations.  Jack Mintz, an economist at the University of Calgary says that planned cuts to the federal CIT rate will generate 100,000 jobs and $30 billion in new investment.  As for Ontario, the provincial government started reducing its CIT rate from 14% at the beginning of last year to 12% in July of 2010 and is on course to reduce it further to 10% by July of 2013. 

So with all this difference of opinion on the merits (or lack thereof) of reducing corporate tax rates further, who’s got it right?  It’s important to remember that CIT isn’t the only way that revenue is generated.  For instance, consumption taxes are relied on more heavily as a source of revenue throughout Europe.  Moreover, effective tax rates are sometimes lower than the original CIT because of various loopholes that companies can leverage.  As the Globe and Mail’s Barrie McKenna points out in his insightful piece “Corporate taxes: to cut or not to cut?”, CIT is just one part of the tax package and one factor (albeit an important one) in the investment attraction mix.  Essentially, it’s how important this element is in fostering economic growth that is up for debate.  In short, where is Canada’s “sweet spot” on CIT rates?  Feel free to provide your own comments and opinions below!

On February 28, 2011, the Ontario Chamber of Commerce along with its Québec counterpart, the Fédération des Chambres de commerce du Québec, staged the very first Ontario-Québec Economic Forum.

Hosted by Hon. Sandra Pupatello, Ontario’s Minister of Economic Development and Trade and Clément Gignac, Québec’s Minister of Economic Development, Innovation and Exports, the initiative brought together 150 leaders from both provinces, representing the business, academia and not-for-profit sectors.

During the course of the day, participants tackled some tough issues, including:

1. The Ontario-Québec productivity gap
2. How to encourage businesses to better leverage new technologies
3. How to foster more effective cooperation to enhance innovation
4. Investing in talent through education and profound changes to corporate culture

You can now access streamed videos and photos from the event.

Ministers Pupatello and Gignac Take Questions from CBC's Amanda Lang at the Ontario-Québec Economic Forum on February 28, 2011

A Starting Point for Follow Up Action…

 Post-Forum, the time for action and engagement remains. The Ontario-Québec Trade and Cooperation Agreement Private Sector Advisory Committee (PSAC), co-chaired by Heather Munroe-Blum (Principal and Vice-Chancellor, McGill University) and Mark Lievonen (President, Sanofi Pasteur Limited) is leading the way. Their recent call for action to all Forum participants includes a request to identify specific barriers to interprovincial trade, investment or labour mobility and to put forward some suggestions to remove such barriers.

This information should assist both governments in finding ways to further streamline processes, remove barriers to trade and provide businesses in both provinces with the best chance to sustain themselves, grow, attract further investments and create a true climate of collaboration.

The 2011 Ontario Provincial Budget, announced on Tuesday, held some good news for the business community but not any ground-breaking news.

The Government will stay the course on Corporate Income Tax (CIT) and continue with its plan to reduce CIT to 10% by 2013. This will send a positive message to the business community that the Government will keep its promises to the private sector and maintain a level of certainty within the business environment.

Finance Minister Dwight Duncan also maintained the HST at its current level. The positive implications of this tax are already being felt by businesses and families across Ontario as noted in a recent University of Toronto research paper.

Finally, while there were investments in skills development through post-secondary education and literacy and basic skills, a more broad-based strategy is needed to address the skills shortage facing Ontario. If we are facing a crisis of People Without Jobs and Jobs Without People, the province needs a long-term plan for human capital development that includes workplace skills training and lifelong learning.

A long-term strategy on infrastructure and transportation, as well as an accelerated plan to eliminate the provincial deficit earlier than announced, would also have been welcome. These being such critical factors in boosting the prosperity of the province, we look forward to ongoing discussions on these issues.