The Low-Down on Construction – March 13, 2019

Construction is a big part of Saskatchewan’s economy. And construction projects big and small, from the new Children’s Hospital or the Regina Bypass, to home building and renovations are not only creating a stronger province, but they also support thousands of workers and their families.

There is no doubt that Saskatchewan’s construction sector has seen a slowdown in the past couple of years. There are many reasons for this including the global economic slowdown and the slump in global prices for Canadian resources. However, we cannot ignore that government policies have an impact as well.

In the 2017 Budget, the province introduced PST on construction services as part of its efforts to balance the budget and restore the province’s finances. MERIT Saskatchewan is supportive of a balanced budget – today’s deficits are tomorrow’s taxes – however as we previously wrote, balancing the budget at all costs must be balanced against broader, unforeseen consequences.

There is growing discussion in our province about the impact that the addition of PST has had on the construction sector. We know building permits are down, wages are down, new home sales are sluggish, and construction employers and workers have left the province to work elsewhere. What we do not know is the extent this is the result of the addition of PST to the cost of construction.

That is why MERIT is leading the charge to undertake a study to determine the impact that the addition of PST has had on the construction sector.  We will present these findings to the government for their consideration. The government has shown that they are willing to re-evaluate policies that did not have the desired outcome.

As we carry out this study, we will continue to keep our members informed on the status and findings of our report.