Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99per week for the first 24weeks
Just $1.99per week for the first 24weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

A worker waits to assist people outside at a mass COVID-19 vaccination site in Mississauga, Ont., on March 22, 2021.

Nathan Denette/The Canadian Press

Ottawa plans to double to $4.4-billion in next month’s budget a fund cities and towns use to build infrastructure as part of a package of COVID-19 spending dedicated mostly to health care costs and vaccination efforts.

The one-time increase of the gas-tax fund, which was called for last month by the NDP, would mean an extra $2.2-billion this year for municipalities and First Nations communities. The proposed boost was lauded by mayors and groups representing municipalities, many of which have major infrastructure backlogs.

“Doubling the funding to municipalities this year is a clear recognition that cities, including Toronto, will drive Canada’s economic recovery in the wake of COVID-19,” Toronto Mayor John Tory said in a statement released by his office.

Story continues below advertisement

The bulk of the $7.2-billion package announced Thursday is a one-time funding boost to the provinces and territories for health care, $4-billion for what Deputy Prime Minister Chrystia Freeland described as “immediate” needs and $1-billion to aid vaccination efforts.

Ontario budget includes billions of dollars to continue the fight against COVID-19

Quebec’s ‘pandemic budget’ projects $12.3-billion deficit for 2021-22, delays decisions on spending cuts, tax hikes

“COVID-19 has placed extreme pressure on health care systems across the country. The pandemic is still here and many parts of our country are facing the threat of a third wave right now,” she told reporters at a virtual announcement.

“This money, flowing through the Canada Health Transfer, will … ensure that our health care system does not buckle under the continued strain of the pandemic, under the pressures of the third wave and new variants.”

A statement from provincial and territorial leaders applauded the funding but said that more was needed. The premiers reiterated their request that Ottawa increase its share of health care costs from 22 to 35 per cent, which they said would require an additional $28-billion in federal funding.

There were few details Thursday about the new health funding. According to the federal government, the $4-billion was intended to address pressures in the medical system, including backlogs accessing care amid the pandemic. The $1-billion is “to ensure the COVID-19 vaccine roll-out continues to accelerate and keeps pace with growing supply.”

Ms. Freeland said that more details about the spending will be included in the budget, scheduled for April 19.

As with previous years, the gas tax money must be invested in local infrastructure such as transit, garbage and broadband in cities, many of which are facing serious economic fallout from the pandemic. Revenues such as transit fares have been down substantially over the past year even as costs for shelters and public health went up.

Story continues below advertisement

Toronto city council in February passed an operating budget with a $650-million hole in it, hoping that higher levels of government would help close the gap. A number of subsequent announcements by the province have cut the deficit roughly in half.

In its budget Wednesday, Ontario touted $1-billion in recent funding announcements for municipalities to help cover operating costs, homeless shelters and transit system shortfalls.

The province has repeatedly urged Ottawa to step in with more money for local governments – on top of the cash the federal government committed last year as part of the Safe Restart Agreement. Under that deal, Queen’s Park and Ottawa agreed to share the cost of a $4-billion cash infusion for Ontario municipalities.

On Thursday, the Ontario government welcomed the gas-tax announcement and pushed for more federal money.

“We continue to call on the federal government to match our previously announced $500-million in provincial funding for municipal operating budgets, which will be critical as they continue to recover from the ongoing impacts of COVID-19,” Stephanie Bellotto, spokeswoman for Steve Clark, Minister of Municipal Affairs and Housing, said in an e-mail.

What Ottawa dubs the “gas tax fund” is no longer linked directly to money raised through the gas tax, meaning that this year’s doubling will have no effect on how much Canadians pay at the pumps. Reflecting that disconnect, the government plans to rename it the Canada community-building fund.

Story continues below advertisement

The proposed increase was praised by the Federation of Canadian Municipalities.

“[Gas-tax funding] flows directly to our cities, and we turn that very quickly into better lives for residents,” Don Iveson, chair of the FCM’s big city mayors’ caucus, said in a statement.

“That means everything from better transit for lower emissions to better recreation facilities that promote health and social inclusion.”

With a report from Bill Curry in Ottawa

Our Morning Update and Evening Update newsletters are written by Globe editors, giving you a concise summary of the day’s most important headlines. Sign up today.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow the authors of this article:

Follow topics related to this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

UPDATED: Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies