Quebec's Liberal government has announced a $620 million aid package for the province's bruised manufacturing sector.
The measures, to be rolled out over the next five years, will help Quebec companies and businesses adjust to the Canadian dollar's unprecedented gains.
Some $256 million of the money announced Friday in Montreal is new funding. The rest was previously included in Quebec's May 2007 budget.
Premier Jean Charest said the measures will help companies adapt to the rapid rise in the Canadian dollar.
"That the dollar rises so quickly is brutal for the Quebec economy," he said.
The upside has been lower prices for some goods. "I don't want to leave the impression that there are only disadvantages to the rise in the dollar," he said.
The aid includes $178 million in tax measures, including changes to capital tax, which companies will have to pay in a lump sum at the end of the year instead of on a monthly basis, said Finance Minister Monique Jérôme-Forget.
The tax measures also include incentives for businesses to invest in equipment and infrastructure, which they should do, given the dollar's strength, Jérôme-Forget said. "It's the time to do it. It's time to modernize our factories and our manufacturers."
The aid plan also includes $442 million in incentives and tax breaks for employee training programs.
Opposition leaders blasted the plan, with ADQ finance critic Gilles Taillon dismissing it as a "minor response to a major problem."
The plan neglects training and re-employement assistance for laid-off workers, and tax breaks for companies won’t help businesses forced to shut down, he said.
Quebec officials estimate some 24,400 jobs were lost in 2006 because of the fallout caused by the strong loonie. So far this year, as many as 36,700 jobs have been cut in the province.
The province’s "buy local" program won’t make much of a difference either, Taillon said.
Quebec’s manufacturing sector and chambers of commerce welcomed the "concrete and tangible" measures, especially the tax breaks.
The province’s largest unions also applauded the Liberal plan, but urged the federal government to do its part to aid flailing industries.
Federal finance minister Jim Flaherty alluded help was on the way in the next budget, during a Friday speech in front of the Oshawa chamber of commerce, his home riding.
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