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Enhancing the Competitiveness and
Attractiveness of Canada and its Cities
The City of Calgary’s Perspective on how Canada can become
a Destination for Talent, Capital and Innovation
Submission to Canada’s Competition Policy Review Panel
Our competitive edge depends on our cities. If Canada’s
cities are to play a leading role in the national prosperity
agenda, they need the fiscal capacity to provide the
services, programs, and infrastructure that will attract
talent and investment.
Conference Board of Canada
Table of contents
1. Introduction
2
2. Competitive and Attractive Cities
4
3. Investing in Cities
3.1. Infrastructure Investments
3.1.1. Revenues that Grow with the Economy
3.1.2. Establishment of a Fully-Funded National Transit Strategy
3.1.3. A Realignment of Roles and Responsibilities
5
3.2 Quality of Life Investments
3.2.1. Investments in Crime and Public Safety
3.2.2. Investments in Affordable Housing
3.2.3. Investments in Arts and Culture
3.2.4. Investments in the Labour Force
4. Conclusion
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Submission to Canada’s Competition Policy Review Panel
1
Introduction
T
Calgary has become an
attractive and desired
location for many individuals
and businesses from around
the world; it has truly
become an engine of
growth in Canada.
he purpose of this document is to present
The City of Calgary’s perspective on what the
Government of Canada can do to help Canada
become more attractive and competitive in
the global economy. Specifically, this document will
address key initiatives such as providing sustainable,
predictable funding for municipal infrastructure, the
establishment of a fully funded National Transit Strategy;
creating partnerships for affordable housing; offering
approaches to deal with labour market pressures;
addressing crime and safety, and funding for community
arts and culture.
The City of Calgary strongly believes that the
Government of Canada should make a significant
investment in helping cities become more attractive
and competitive. Over the past decade, Calgary
has been one of the fastest growing cities in North
America, seeing its population jump from just over
790,000 in 1997 to just over one million in 2007. In
2007 alone,The City of Calgary issued $5.6 billion
worth of building permits (the highest in Canada for a
second year in a row).This rapid growth demonstrates
the fact that Calgary has become an attractive and
desired location for many individuals and businesses
from around the world; it has truly become an engine
of growth in Canada. In fact, a recent study by The
Conference Board of Canada ranked Calgary number
one in terms of overall attractiveness among 27 North
American Census Metropolitan Areas (CMAs). But to
sustain this ranking, Calgary requires the assistance of
other orders of government, particularly the federal
government. As such,The City of Calgary has called
upon the Government of Canada to adopt and enhance
key public policies and programs that would assist it
and other large Canadian cities deal with the existing
and emerging issues they face.
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Submission to Canada’s Competition Policy Review Panel
While responding to growth pressures is one of
the major challenges a city like Calgary is facing, it
also has to remain competitive in attracting both
individuals and investment.That is why The City
of Calgary, in partnership with Calgary Economic
Development, recently released a comprehensive,
ten year economic development strategy.The aim of
this strategy is to provide Calgary with a blueprint
to help it become a key destination for human and
monetary capital.
The reality is that Calgary and other large Canadian
cities no longer compete amongst themselves.The
emergence of the information age has produced an
economic environment that is global in scope.Thus,
Canadian cities require the tools that will allow
them to compete with their global counterparts
to attract individuals and investment. After all,
economically buoyant cities provide the fire that
keeps the Canadian economy burning. Participation
and cooperation by all orders of government are
essential to keep these flames from flickering.
The Competition Policy Review Panel’s
Consultation Paper,“Sharpening Canada’s
Competitive Edge,” asks several important
questions about how best to enhance Canada’s
competitiveness. While many of these questions
focus on foreign investment, investment policies
and competition laws,The City of Calgary believes
that some of these questions have important
implications for cities. For example, questions
such as,“…what mix of policy changes would be
required to make Canada the preferred point of
entry to, and location in, the North American market
for the high-value activities of non-North American
business entities? And, what other priorities and
policy issues should governments address? The
priorities and public policy issues raised in this
document provide, in our opinion, some meaningful
solutions to enhance the competitiveness and
attractiveness of Canada and its big cities.
The reality is that Calgary
and other large Canadian
cities no longer compete
amongst themselves.
The emergence of the
information age has
produced an economic
environment that is
global in scope.
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Submission to Canada’s Competition Policy Review Panel
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Competitive and Attractive Cities
O
ne of the primary goals of the
Competition Policy Review Panel is
“to maximize Canada’s attractiveness
as a destination for talent, capital and
innovation.”The City of Calgary believes that the
Panel’s recommendations in this area will have a
profound effect on how well Canadian cities can
adapt to the new global order.
Several studies have suggested that the first place
to start is by making federal investments in cities.
For example, Enid Slack and Richard Bird have
written that there are three compelling reasons as
to why the federal government needs to invest in
cities. First, over 80% of the Canadian population
lives in cities (or CMAs). Second, cities face serious
challenges if they want to maintain their economic
competitiveness in North America, and the world.
Third, many federal policies have an impact on
cities. Mayors of big cities have become more
vocal because they want to ensure that they have
the necessary resources to meet their budgetary
requirements and provide a quality of life that
makes their cities attractive to people in Canada
and around the globe.
Over the past two years,The Conference Board of
Canada has released numerous studies concluding
that a greater federal investment is required in cities.
As Anne Golden has put it,“Cities and city-regions
worldwide are at the core of national prosperity
agendas, attracting public and private investment
to make them more livable, more competitive
and more sustainable.”This, in our view, requires a
greater investment by the federal government.
In terms of where new investment in Canada’s big
cities should be directed, we recommend starting
with the two key pillars that make cities both
competitive and attractive: (1) infrastructure and
(2) quality of life. Globally competitive cities and
prosperous nations focus on reinforcing each of
these pillars. Now, more than ever, Canada and its
cities must do the same.
According to Tom Courchene, the emergence of the
knowledge based economy has led to the economic,
political and democratic ascendance of Canada’s
big cities. He goes on to declare that knowledge
and human capital are increasingly important
drivers of well-being and are at the cutting-edge of
competitiveness. Indeed, it is in cities where nations
often find the dense clusters of human capital that
drive economic activity, trade and innovation for
the entire country. But in order for Canada to reach
its potential in the knowledge based economy, our
cities must reach their potential through greater
federal investments.
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Submission to Canada’s Competition Policy Review Panel
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Investing in Cities
3.1 Infrastructure Investments
In November 2007, the Federation of Canadian
Municipalities (FCM) released a study which revealed
that Canadian municipalities are collectively facing a
$123 billion infrastructure deficit.The City of Calgary
estimates that its own infrastructure deficit is currently
at $8.4 billion.The magnitude and velocity by which
Calgary has grown over the past decade has put
considerable pressure on The City’s infrastructure.
However, because Calgary and other Canadian cities
have only the property tax as their primary source of
revenue, they have been unable to keep up with the
demands for infrastructure.
The City of Calgary
estimates that its own
infrastructure deficit is
currently at $8.4 billion.
As a result, Calgary has supported various advocacy
efforts advanced by the FCM’s Big City Mayors’ Caucus
(BCMC) which are directed at the Government of
Canada.The City of Calgary stands behind the three
key recommendations made in the BCMC’s primary
advocacy document, Our Cities Our Future.These
recommendations called upon the Government of
Canada to: (1) provide cities with access to revenues
that grow with the economy; (2) establish a
fully-funded national transit strategy; and (3)
realign roles and responsibilities among all
orders of government.
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Submission to Canada’s Competition Policy Review Panel
3.1.1. Revenues that Grow with the Economy
Canadian cities have one primary source of revenue
to finance their operations: the property tax. Several
studies have shown that Canada lags other countries
in providing cities with access to revenues that grow
with the economy. For example, a study by the OECD
reveals the property tax accounts for 92.7 percent of
total local revenues in Canada, whereas in the United
States it accounts for 72.8 percent. As such,The City
of Calgary, as a member of the BCMC, has asked the
federal government to provide cities with access to
long-term predictable sources of revenue that grow
with the economy. Specifically, the BCMC called upon
the Government of Canada to share the equivalent of
one cent (approximately $5 billion) of the Goods and
Service Tax (GST) with all cities and communities in
Canada in order to help them deal with the increasing
infrastructure deficit.
Several studies have shown
that Canada lags other
countries in providing
cities with access to
revenues that grow
with the economy.
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Submission to Canada’s Competition Policy Review Panel
3.1.2. E
stablishment of a Fully-Funded
National Transit Strategy
As Canada’s big cities continue to attract more and
more people, roads are becoming congested resulting
in poor air quality. Increasing congestion also makes
it difficult for goods and people to move efficiently
throughout a city. Consequently, many Canadians have
turned to public transit as a viable alternative to driving.
However, as demand for public transit increases, so too
does the demand on city budgets. As a result of these
factors, in 2007 the BCMC released a proposal calling
on the federal government to establish a National
Transit Strategy, which would include dedicated
funding of $2 billion per year, more integrated land use
planning, and research on best practices. Although the
Government of Canada has announced it is proceeding
with a National Transit Strategy, it very clearly indicated
that it will not be providing any funding commitments
to support it.
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There is strong evidence which indicates that an
investment in public transit is an investment in the
environment. In Calgary, for example, our light rail
transit system is powered by wind generation.This,
coupled with other forms of public transit, reduces the
net annual production of greenhouse gases by 176,000
tonnes annually in Calgary.
3.1.3. A
Realignment of Roles
and Responsibilities
The 1990’s saw governments at all levels and of
all political stripes cut funding for public services,
including transfer payments to cities.This resulted in
cities having to take on more and more responsibilities,
in areas such as affordable housing and homelessness,
but without the corresponding resources to deal with
these increased expenditures. It is important today
that all orders of government sit down at the table to
identify clear roles, responsibilities and resources in
terms of dealing with key public policy issues.That is
why The City of Calgary believes that a realignment of
roles and responsibilities with corresponding, sufficient
financial resources will assist it in focusing its efforts on
maintaining and enhancing its infrastructure.
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Submission to Canada’s Competition Policy Review Panel
3.2 Quality of Life Investments
While investments in infrastructure are crucial for
enhancing a nation’s economic competitiveness, what
makes a city—and a country—more attractive in the
knowledge based economy are investments in policies
and programs that enhance a city’s quality of life.
Affordable housing, homelessness, crime, and public
safety are front-line issues that negatively impact the
quality of life in cities. However, local governments
lack the fiscal capacity and legislative ability to effect
meaningful change which improves the quality of life
in our communities. Quality of life issues transcend
city boundaries and must be addressed by all three
orders of government.The City of Calgary believes that
investments in the following quality of life issues will
help Calgary and Canada become a key destination for
talent and innovation.
Affordable housing,
homelessness, crime, and
public safety are front-line
issues that negatively impact
the quality of life in cities.
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Submission to Canada’s Competition Policy Review Panel
3.2.1. Investments in Crime and Public Safety
One of the key factors in
making Canada a destination
for talent and innovation is
to have safe communities.
While Calgary’s population growth has attracted many
of the best and the brightest individuals, it has also
attracted those who are less desirable. This has led to
an increase in violent, drug-related and gang-related
criminal activity. One of the key factors in making
Canada a destination for talent and innovation is to
have safe communities. Although Calgary is generally
a safe city, all orders of government need to ensure
that violent criminals are kept off our streets.That is
why The City of Calgary has called upon the federal
government to amend the Criminal Code of Canada
to deal with the problem of the “catch and release” of
criminals.The Government of Canada introduced the
Tackling Violent Crime Act in October 2007, which
effectively deals with the catch and release issue.The
City would like to see this Act quickly pass both Houses
of Parliament. In addition, Calgary has requested that
the Government of Canada honour its 2006 budget
commitment to increase its financial support for
local policing in Canada’s big cities.This commitment
would provide funding for an additional 75 to 100 new
officers for Calgary.
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Submission to Canada’s Competition Policy Review Panel
3.2.2 Investments in Affordable Housing
Housing plays a fundamental role in the well-being of
individuals, families and communities.The availability
of safe and appropriate affordable housing benefits
the entire community. Housing affordability in a city,
including the availability of housing options for all
income groups, is essential for a dynamic economy.
Recent growth trends in international and interprovincial migration have increased demand for both
market and non-market rental housing and home
ownership in Calgary. Presently, Calgary does not
have enough affordable housing to meet the need
of its growing population. Factors such as rapid
population growth, increasing land values, stagnant
construction of new affordable rental units, and a rise
in the number of individuals working in the retail and
service sector, have all contributed to the growing
disparity between the supply of, and demand for,
affordable housing in Calgary.
The FCM and BCMC recently released their National
Action Plan on Housing.The purpose of this plan is
to advocate for a long-term funding framework for
eliminating chronic homelessness and significantly
reducing the housing need problem that confronts
over one million Canadians. The persistent uncertainty
around federal and provincial funding for affordable
housing is compounded further by the upcoming
expiry of all federal social housing funding programs
by March 2009.The plan identifies a mix of program
options and mechanisms to address the growing
problems, including a more flexible approach which
can be customized at the local level. The estimated
gross cost of implementing the local strategies outlined
in the plan is $3.35 billion annually.The plan does not
consider how the costs will be allocated across the
different orders of government, but outlines and assigns
areas of responsibility for which the provincial and
federal government hold the majority share. As such,
The City of Calgary recommends that the Government
of Canada endorse the plan.
The inability for many Calgarians to find affordable
accommodations has led to a significant increase in
Calgary’s homeless population. One of the difficulties
in building affordable housing in Calgary is the lack of
available land. As a result,The City of Calgary has asked
the Government of Canada to amend Canada’s Income
Tax Act to provide a tax benefit to those individuals and
businesses who donate land for the purpose of building
affordable housing.This type of tax benefit could
be modeled on Canada’s Ecological Gifts Program,
whereby the Government of Canada provides a tax
credit to private and corporate landowners who
donate land for ecological purposes.
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Submission to Canada’s Competition Policy Review Panel
3.2.3. Investments in Arts and Culture
Perhaps one of the most significant, yet largely
overlooked factors of what makes cities a destination
for talent and innovation is their mix of arts and culture.
World class cities such as London, Paris, New York
and Barcelona have an eclectic arts and culture scene.
Richard Florida, among others, has commented on the
fact that investments in arts and culture help cities
attract the talent that makes them rise from good to
great. Given their importance to cities, we are calling on
the federal government to provide a greater investment
in arts and culture in Calgary. Whether it is through
galleries, theatres, or recreational facilities, investments
in arts and culture are crucial ingredients for making
Canada a destination for talent and innovation. Canada
would indeed benefit by having national cultural
institutions dispersed in major cities throughout
the country.
Given their importance
to cities, we are calling on
the federal government
to provide a greater
investment in arts and
culture in Calgary.
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Submission to Canada’s Competition Policy Review Panel
3.2.4 Investments in the Labour Force
Calgary, like many other big cities in Canada, is
facing a significant labour shortage. It is projected
that economic expansion in Calgary and Alberta will
be limited by a lack of labour in the coming years.
It is projected that there will be an increased share
of people in the 65 and older cohort by 2031. Baby
boomers, currently aged 41 to 60, will be the major
contributors to this shift. It is also estimated that the
relative share of the younger population, aged 15-34,
will shrink significantly.
Despite these trends, an active labour force with strong
job creation and relatively low unemployment rates
should draw migrants to Calgary. However,The City of
Calgary requires assistance in this area from the federal
government. Such assistance must focus on immigration
related issues, such as enhancing skills certification
and credential recognition programs, skills training
programs, language training programs, and temporary
foreign workers programs.
Moreover, Canada’s Aboriginal population provides
great potential for helping reduce the labour shortages
faced by our cities. Canada must take action to
eliminate employment and cultural barriers faced by
Aboriginal peoples so that they can become a key
source of talent for our labour force.
It is projected that
economic expansion in
Calgary and Alberta will be
limited by a lack of labour
in the coming years.
The City of Calgary also believes that having access to
appropriate child care programs will help, in particular,
stay-at-home parents re-enter the workforce.There is a
significant need in Canada for a national early learning
and child care program that is federally funded.
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Submission to Canada’s Competition Policy Review Panel
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Conclusion
T
he primary objective of this document is
to provide the Competition Policy Review
Panel with ideas and solutions that will
enhance Canada’s competitiveness.
It attempts to draw to the Panel’s attention the
importance that cities play in the prosperity of
our nation. We have provided answers to some
of the questions addressed in the consultation
paper to demonstrate that the review and eventual
recommendations put forward by the Panel will
have an impact on how Canada and its cities will
adapt to the rapid changes brought about by the
new global order.
Of course, the public policy issues facing
Calgary today are issues of national importance.
Infrastructure, public transit, public safety and
affordable housing are perpetual issues that are
typically felt most significantly in big cities. As a
city, Calgary has enjoyed tremendous economic
prosperity for more than a decade. We are evermindful that the future prosperity of our city and
our country will be determined by our ability
to attract business and skilled workers.This will
require a cooperative and collaborative approach
from all orders of government.
We believe that there is a role for the federal
government in our cities.The competitiveness
and health of our cities is in the national interest.
The ideas and solutions advanced in this document
clearly identify how Canada can become a country
that is first in terms of a destination for talent,
capital and innovation. Unfortunately, however,
national governments in Canada have been
reluctant to deal with issues that directly affect
cities, even though over 80% of the Canadian
population now resides in urban areas. Several
studies have shown that cities are the engines
of economic growth in Canada. Economically
buoyant and sustainable cities create the fabric
to build economically prosperous nations. But
these engines need fuel. Investments in our cities,
particularly in infrastructure and quality of life
issues, can only help Canada become a leading
destination in the knowledge based economy.
As an engine of growth in Canada, Calgary sincerely
hopes that the Competition Policy Review Panel
seriously considers the solutions put forward in
this document.
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Submission to Canada’s Competition Policy Review Panel
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