The Canadian government will invest C$35 billion ($26.2 billion) over the next 11 years through its Canada Infrastructure Bank to target transportation, child care and green infrastructure projects, according to the 2017 federal budget introduced late Wednesday.
The budget, which was presented to the Canadian Parliament by Finance Minister William Morneau, includes loans, loan guarantees and equity investments for infrastructure projects, some of which would be funded by the bank.
The bank would operate separately from the federal government and would depend on private sector and outside institutional investment. The budget does not specify how much investment would come from non-governmental sources, but according to Scott McEvoy, partner at the law firm of Borden Ladner Gervais who focuses on private equity, hedge funds and alternative investments, private investment would provide C$4 for every C$1 of government money.
“Leveraging the expertise and capital of the private sector, the Canada Infrastructure Bank will provide better results for middle-class Canadians,” according to the budget. “Public dollars will go farther and be used more strategically, maximizing opportunities to create the good, well-paying jobs needed to grow the middle class now, and strengthen Canada's economy over the long term.”
The bank would help fund C$10.1 billion in modernizing Canada’s transportation system, including upgrades to its rail lines and maritime facilities; would help with an expected C$21.9 billion investment in clean electricity grid interconnections, electric vehicle charging stations and wastewater management projects; and would invest C$7 billion in building and upgrading existing child-care facilities for low- and middle-income families, the budget said.