When it comes to spurring job growth, the federal government's multibillion dollar infrastructure stimulus program has fallen short, according to a report from the parliamentary budget officer.
This summer, Kevin Page surveyed municipalities that received Infrastructure Stimulus Fund (ISF) money. Results released Thursday show that 21 per cent of municipalities said they were able to use that money to boost employment. Another 43 per cent reported that the funds had no impact on job creation.
The findings were based on 644 completed questionnaires out of 1,129 sent out. Page said that on balance, they indicate that the economic stimulus has been "moderately positive" in terms of its implementation and its impact on community welfare, among other things.
But its effect on the labour market has been "more muted, less positive, less glowing," Page told CTV's Power Play.
While certain types of projects appeared to create jobs, many others did not, he said. Transportation projects were often successful at spurring job growth, while those pertaining to waste management, for instance, "turned out to be not so good for unemployment."
The Harper government has spent $4 billion on the infrastructure stimulus program. But it hasn't made any effort to publicly track the number of jobs it has created.
Rather, it has opted to use economic modelling from the Department of Finance, which suggests the Economic Action Plan in its entirety will have saved 220,000 jobs by Dec. 31, 2010.
Page's report appears to challenge that conclusion.
Scott Bennett, an associate professor at Carleton University, said that while Page's analysis deals with perceptions of job creation rather than hard employment numbers, its conclusions "are particularly worthy of note here, given some of the goals underlying ISF."
Municipalities also said they don't expect the stimulus funding will help improve employment after the program wraps up. Eight per cent said they believe employment will drop off, while 69 per cent said the end of stimulus funding would have no effect on job numbers.
Finance Minister Jim Flaherty defended the stimulus program on Thursday, and said that Page was "alone" in criticizing its impact on employment.
The federal government also said Thursday that it has pushed back the completion deadline for infrastructure projects that receive stimulus cash, from the end of March 2011 to Oct. 31, 2011.
Flaherty said the extended deadline would not affect the federal budget next year.
"This money for the Economic Action Plan is in the fiscal framework so we can stay on our budget track," he told CTV's Power Play. "It does mean though that we will have more job creation next year as a result of the projects that will be completed during the course of next summer."
He said many of the projects that aren't on track to finish by the end of March had encountered "climate" problems.
"That makes it necessary to give them a bit of slack through the next construction season," he said. "But the purpose of the Economic Action Plan is being accomplished."
Speaking in Mississauga, Ont., Prime Minister Stephen Harper said that to be eligible for the "one-time extension," work must be started on the infrastructure project before March 31, 2011.
Close to 90 per cent of the projects were expected to be finished by the original March 31 deadline, according to a background document from Ottawa.
However, Page found that only 75 percent were on track for completion by that date.
"Our numbers, when we looked at it, probably as much as 25 per cent of the projects, upwards of $300 million in federal money would lapse, which means the provinces and municipalities would have to pick up the tab," he said.
"So I think the prime minister has made the right decision today."
With files from The Canadian Press
