Thank you very much, Mr. Chair and members of the committee, for the invitation to present our pre-budget submission to you this morning.
As the largest accredited chamber of commerce in Ontario, the Greater Kitchener Waterloo Chamber of Commerce serves over 1,900 members, representing all sectors of the local business community. Our membership includes small, medium-sized, and large employers that provide 70,000 jobs in one of Canada’s most progressive and economically diverse regions.
The recommendations we are proposing today reflect the priorities of our membership and are focused on job creation, economic growth, and investment in infrastructure.
Our chamber's mission is to serve the local business sector and to be their advocate on the advancement of our region. We believe the prosperity of our community originates from the productivity of our membership.
Firstly, our chamber commends Minister Flaherty for the proposals outlined in the October 30, 2007, economic statement. The reduction in the general corporate income tax rate to the level recommended by the Canadian Chamber of Commerce will significantly strengthen our ability to attract business and compete effectively. Similarly, the reduction of the lowest marginal personal income tax rate to 15% will initiate work effort, savings, and investment, all critical factors that escalate our national productivity, competitiveness, and prosperity.
Approximately 25% of our local workforce in the Waterloo region is employed in the manufacturing sector, providing Canada's second most manufacturing-intensive economy after Windsor, Ontario. A report issued by Canada's Technology Triangle notes that the value added by manufacturing in the Waterloo region totalled $7.2 billion in 2003. Value added, in this context, is a measure of how much value workers generate using land and capital equipment employed in production, essentially including wages and the return from capital on equipment utilized. This is the measure on which global investment decisions are made.
Despite the relative strength and importance of the Waterloo region manufacturing sector, issues such as competition from abroad and an unstable Canadian dollar are providing significant challenges. In response, our chamber has established our manufacturing action group network, or MAGNet, to advance sector concerns.
This group has developed a series of recommendations that, if implemented, will assist in maintaining jobs and investment in the Waterloo region. Our primary recommendation today to further assist our manufacturers in addition to the corporate tax reductions outlined in the October economic statement is the extension in the 2008 budget of the accelerated capital cost allowance beyond the current two-year timeframe.
As noted by Canadian Manufacturers and Exporters, extending this provision will address the short-term cashflow issues that are challenging manufacturers and exporters across Canada. The extension will allow investment in technologies that are critical for boosting productivity, innovating product lines, and remaining competitive under very challenging global conditions.
The Waterloo region business sector and our partners in economic and social development have been active advocates for investment in the necessary infrastructure to accommodate our growing population and economy. In our brief, we have cited some recent studies that have noted the deteriorating conditions of roads, bridges, and other structures and the urgent requirement for repairs and replacements.
At this time, we support the position advanced by the Federation of Canadian Municipalities that a national plan be developed for eliminating the municipal infrastructure deficit and to prepare the groundwork for protective management of our infrastructure in the future.
The first step in this strategy must be a comprehensive national study to measure the scope and geographic characteristics of the current infrastructure deficit. From a local perspective, we recommend that the federal government provide one-third of the funding costs for the planned rapid transit system in the Waterloo region. In June of this year, the Ontario government committed to funding two-thirds of the project cost, at the same time indicating that the province and our local regional government would collaborate to secure additional funding from the federal government. We are very supportive of receiving the funding so that this project can advance.
Finally, CBC/Radio-Canada has proposed the expansion of local Radio One service, including fully staffed morning and afternoon shows, to the Waterloo region and 11 other communities across Canada. Our chamber supports this plan, as it will provide significant local content related to regional political issues, business development, and cultural initiatives. A report on the expansion will be tabled with the Standing Committee on Canadian Heritage and eventually move forward for full consideration by the House of Commons. We seek the support of all members for this important initiative.
Thank you, and I would be pleased to answer any further questions from the committee.