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Ontario’s future prosperity depends on government and the private sector in the province stepping up and exploiting the ample opportunities before them.
In 2001, then-premier Mike Harris created the Task Force on Competitiveness, Productivity and Economic Progress to measure and monitor Ontario’s performance in those areas compared to other provinces and U.S. states. The government understood about productivity what Nobel Laureate Paul Krugman asserted in 1994: that it “isn’t everything, but in the long run it is almost everything.”
By comparing Ontario to peer jurisdictions, our government hoped that policy-makers, business leaders and individual Ontarians would have the information and the impetus to make the decisions necessary to improve our economy.
Back in 2001, Ontario ranked 14th out of 16 North American peers and sixth out of 13 non-North American peers for an overall ranking of 19th out of 28 global peers.
Today, in 2013, after multiple economic cycles, downturns and periods of growth, four premiers and numerous reports, Ontario still ranks 19th out of 28 global peers.
This means that we aren’t closing the gap on our competitors. It means less money in the public purse and fewer dollars in Ontarians’ pockets. It means we, as a province, aren’t living up to our economic potential.
In its 12th annual report, the Task Force identifies a number of key measures needed in both the private sector and government to get Ontario’s economy on the right track. While the province has laid a solid economic foundation, with a competitive tax structure and key investments in human capital, more must be done in order to compete. Business leaders can no longer be complacent with the province’s current levels of investment and productivity. Key areas such as information and communication technology investment and worker training are calling out for attention. Business investment in productivity-enhancing equipment in manufacturing and services alike is required. Overall, the whole of Ontario’s private sector needs to be the engine for growth not just a few sexy hi-tech sectors.
Government can play a significant role in providing the fuel for that engine. The Task Force recently put out a report advocating for tax reforms that tackle some economic myths currently guiding public policy in Ontario and pushes for changes that would enhance the province’s productivity. The question is not whether Ontario taxation is too low or too high overall. The question is how can Ontario’s tax structure continue to become ever smarter for growth and prosperity? And it can.
For the rest of this article, click here: http://www.thestar.com/opinion/commentary/2013/11/27/for_ontarios_economy_good_is_not_good_enough.html