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Outcomes of Québec-Ontario Joint Meeting of Cabinet Ministers

Backgrounder

Outcomes of Québec-Ontario Joint Meeting of Cabinet Ministers

Office of the Premier

At a joint meeting today in Toronto, the Ontario and Québec cabinets achieved progress in key areas to strengthen the provinces' partnership to build up Central Canada's economy, create jobs and improve people's everyday lives.

Innovation

Québec and Ontario have agreed to jointly support investment in ultra-high speed communications infrastructure to help develop the 5G network -- the next generation of digital communication technology. The meeting laid the groundwork for future collaboration on digital infrastructure.

The provinces plan to create an open innovation ecosystem to accelerate the growth of information and communications technology (ICT) and sectors that use these technologies. Québec and Ontario will work together with consortia of leading technology organizations on projects to help realize the shared vision, including:

  • ENCQOR (Evolution of Networked Services through a Corridor in Québec and Ontario for Research and Innovation): Global ICT companies including Ciena, Ericsson, Thales, IBM and CGI would allow small-to-medium enterprises (SMEs) access to pre-commercial technologies to establish a global leadership position in 5G
  • CENGN (Centre of Excellence in Next Generation Networks): a not-for-profit organization focused on the commercialization of next generation communications solutions. It is a consortium of industry, academic and research leaders, including Cisco, EWA, EXFO, Fujitsu, Juniper, Nokia, Rogers, Telus, Viavi, WindRiver and Zayo. Its mission is to bridge the gap between research and commercialization, including by providing testbed infrastructure for SMEs, government and academia. Participating companies include CENX, Corsa, InBay Technologies and AP1.

Together, these actions will enable Central Canada to build the backbone of digital infrastructure in order to accelerate the development and adoption of transformative technologies. 

Electricity Trade

Ontario and Québec have finalized an agreement for trading electricity, capacity and energy storage. Starting in December 2016 until the end of 2023, the agreement will create opportunities for both provinces to more effectively use each other's energy resources, reduce electricity sector greenhouse gas (GHG) emissions, and deliver value for electricity ratepayers.

Under the agreement, IESO will import a total of 14 terawatt hours (TWh) of clean hydro power from Hydro-Québec over a seven-year period, from 2017 to 2023. Ontario will reduce electricity system costs for consumers by about $70 million from previous forecasts by importing up to 2 terawatt hours annually of clean hydro power from Québec at targeted times when natural gas would otherwise be used. This is enough electricity to power the city of Kitchener for a year and will reduce electricity sector GHG emissions by approximately 1 million tonnes per year.

The provinces agreed to cycle surplus energy from Ontario to Québec such that it can be returned to displace future production from GHG emitting resources. Ontario will cycle and store energy in Québec's reservoirs, sending energy to Québec in off-peak, lower-priced periods and withdraw that energy back in during on-peak, higher-priced periods to offset gas use. Ontario will reserve 500 MW of capacity for Hydro-Québec to meet Québec's winter peak demand.

The agreement results from an MOU signed at the 2015 joint meeting of cabinet ministers in Québec City and confirms the close cooperation that exists between Québec and Ontario with regard to energy and the fight against climate change. Imported energy from Québec is clean hydro power, and its use will be targeted to specific hours in which natural gas would otherwise have been used in Ontario. This will result in electricity sector GHG emissions in Ontario being reduced by approximately 1 megatonne per year from 2017-2023. On the other hand, this allows Québec to benefit from its hydroelectricity surplus by selling it to Ontario.

Trade and Cooperation

Regulatory cooperation is key to ensuring Ontario and Québec create an environment where businesses can thrive. The provinces have signed an agreement to implement the recommendations of the Regulatory Cooperation Enhancements Working Group, including:

  • Enable businesses to operate more easily in both provinces by harmonizing regulatory policy principles and activities, and increasing businesses' awareness of the regulatory environment in each province
  • Develop more meaningful connections with business by working together to identify regulatory barriers to trade
  • Establish a Québec-Ontario working group to consider opportunities to align Oversize/Overweight Permit programs for commercial vehicles.

Environmental Cooperation and Climate Change

Following up on a commitment made at the 2015 meeting, the provinces signed a new Agreement Concerning Environmental Cooperation. Bringing all environmental cooperation work under a single umbrella, the new agreement maintains our existing commitment to work together on climate change and manage air and water issues, while expanding formal cooperation into new areas including spills notifications and response, laboratory cooperation, and environmental compliance and enforcement.

Québec and Ontario are building on a strong foundation at the forefront of Canada's fight against climate change. The two provinces support a pan-Canadian framework that recognizes existing carbon pricing mechanisms, like cap and trade. Ontario and Québec intend to link our cap and trade markets starting in 2018. The provinces will pursue joint promotion of carbon markets, including linking to other jurisdictions. Linked carbon markets are proven to be the most efficient way of reducing GHG emissions while protecting economic growth.

Electric Vehicle Infrastructure

To ensure people and goods can continue to travel seamlessly between Ontario and Québec as the provinces transition to a low-carbon economy, the provinces will coordinate efforts to support the adoption of passenger electric vehicles (EVs) and fuel-efficient commercial vehicles. 

Together, in establishing an EV charging corridor, the provinces will aim to establish an adequate network of charging stations, including fast-charging stations, necessary for long trips. Ontario has five public fast-charging stations in operation, with more than 200 additional to be in operation by March 31, 2017. Québec already has 102 in operation and will continue to increase the number available in its network.

Ontario and Québec will also seek to ensure that EV charging stations are easily recognizable and easy to use, including communicating different payment methods to travellers and exploring options to enhance convenience. The provinces will also work together to continue to raise awareness of the benefits of EVs while also promoting the charging station corridor between the two provinces.

The meeting also laid the groundwork for cooperation on adoption of low-carbon fuels for commercial vehicles and working closely with the Canadian Urban Transit Research & Innovation Consortium to foster the development of cutting-edge technologies, services and solutions for Canadian transportation through industry and academic collaborations.

Infrastructure

Ontario and Québec are jointly advocating for a principled approach for the design of the Government of Canada's remaining infrastructure funding commitments, known as Phase 2.

Ontario and Québec agree that new transformational infrastructure investments are critical to supporting the economic prosperity of each province. That's why both provinces are calling upon the federal government to ensure the design of Phase 2 reflects provincial priorities. 

There is broad agreement between the two provinces on six key principles for the design of Phase 2 funding, including:

  • Develop flexible programs to fund provinces and territories' priority projects
  • Support an equitable funding distribution that ensures federal funding is allocated in a way that reflects provincial populations
  • Respect existing provincial and municipal relationships
  • Recognize jurisdictions that have done good long-term infrastructure planning
  • Reduce administrative burdens -- streamline administration and reporting so that scarce public funds can be more efficiently directed to capital projects
  • Move away from project-based agreements to comprehensive agreements or a formula-based approach.

Ontario and Québec committed to continue to work together in urging the federal government to adopt the above principles in designing Phase 2 federal funding.

Health Care Funding

Québec and Ontario reiterated their commitment, along with other provinces and territories, to strengthen health care for Canadians in the face of emerging challenges.

Health care is the single largest component of every provincial and territorial budget, representing upwards of 40 per cent of their respective annual expenditures. Provinces currently fund nearly 80 per cent of government expenditures on health care. The federal Canada Health Transfer provides long-term, stable and predictable funding. It is an essential mechanism for ensuring the sustainability of our health systems and fundamental to improved health outcomes for Canadians.

To continue to serve our populations' health needs, Ontario and Québec agree that the federal government needs to be a full funding partner, and reverse its decision to cut the Canada Health Transfer. This decision would result in the loss of $60 billion over ten years, putting at risk the sustainability of the existing systems as the federal level of funding would not cover the growth of present expenses.

As the Conference Board of Canada and Parliamentary Budget Officer have noted, health care costs will continue to rise significantly, at an excess of three per cent annually, to maintain and meet the growing needs of the system, due to factors such as inflation, an aging population and population growth. As both provinces continue to transform health care services to better serve people, federal investments and partnership are needed to support this transformation and long-term sustainability of the systems.

Forestry

Moving forward on a recommendation from the 2015 joint meeting of cabinet ministers, Québec and Ontario have signed an MOU on opportunities for consistent and common approaches to foster their shared forest sectors. This will improve conditions for companies operating in both provinces by:

  • Increasing public awareness of the provinces' forest management systems and how they support the three pillars of ecological, economic and social sustainability
  • Collaborating to support forest sector innovation and market development to meet the demands of the 21st century, both at home and abroad
  • Sharing best practices, tools, and technical expertise to support each province's climate change goals, including offset protocols and promoting the use of wood products in construction to mitigate emissions-intensive construction materials
  • Addressing shared interests and challenges associated with third-party forest certification, species at risk and vulnerable species, cross-border movement of wood, industry benchmarking and R&D
  • Joining forces, when appropriate, to advocate and support shared interests in the negotiation of a new Softwood Lumber Agreement between Canada and the United States. 

Seeking solutions for the workers, families and communities that depend on the lumber industry, Ontario and Québec continue to support the work of the Canadian government to reach a new softwood lumber agreement with the United States that takes into account, where appropriate, provincial specificities due to the exclusive jurisdiction of provinces over natural resources and the various forest management systems in Canada. Canada and the U.S. share one of the most extensive bilateral relationships in the world, which benefits both nations' economies. Now more than ever, productive negotiations are required. As the federal government works to secure a new softwood lumber deal, Ontario and Québec will continue to work collaboratively to gain secure, fair access for Canadian producers to the U.S. softwood lumber market.

Northern Development

Recognizing the unique needs and challenges of the northern regions of both Ontario and Québec, the provinces have signed a Memorandum of Cooperation addressing four key areas:

  • Indigenous relations: Ontario and Québec will share information aimed at building capacity and developing economic opportunities of local and Indigenous communities in the North
  • Innovation: Ontario and Québec will cooperate on innovation to accelerate the use of new technologies aimed at reducing greenhouse gas emissions in mining/energy sectors
  • Economic development: Ontario and Québec will focus on key sectors promoting northern economic growth, including energy, mining and forestry. The provinces will share information on the commercial and economic opportunities related to the development of a green economy, particularly in the mining and energy efficiency sectors. The provinces will also partner on skills training and workforce development
  • Infrastructure: Key priorities in information sharing would include identifying planning needs for northern infrastructure including telecommunications, energy supply and efficiency as well as transportation infrastructure.  

The Francophonie

Recognizing the key role Francophones continue to play in building up the country, in September Ontario and Québec signed a five-year funding renewal to support cultural exchanges under the Cooperation and Exchange Agreement first established in 1969. Investments will gradually increase from $100,000 per province in 2017-18 to $200,000 or more per province in 2021-22, including funding to benefit the French language and culture in the fields of education, immigration, early childhood, youth, health, and tourism.

Beginning in winter 2017, Ontario and Québec will pilot cultural exchanges for students in both provinces, supported by a $60,000 investment by the provinces.

Demonstrating its commitment to the Canadian Francophonie, Ontario has applied for observer status in the International Organisation of La Francophonie, with the application supported by Québec along with the governments of Canada and New Brunswick. A response is expected at the Madagascar Summit in November 2016.

Culture

To foster cultural activities and related economic opportunities, Ontario and Québec signed a new Cooperation Agreement regarding culture. Expanding on a 2006 agreement, it increases provincial cooperation and makes it easier for Québec and Ontario artists and cultural organizations to operate in both provinces. With this new agreement, Ontario and Québec will increase sharing of information and expertise about cultural policies, while also promoting cultural works and products through events and partnerships between cultural institutions.

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