“The economic history of Quebec is punctuated by major projects, from Manic to James Bay. This time, all the experts agree, the big project that Quebec needs is not made of concrete and steel, but of productivity and innovation. » The quote, which makes good sense, is taken from the “new economic plan” tabled – and essentially adopted – during the general council of the Liberal Party of Quebec (PLQ) at the end of the week.
The document is the fruit of the work of the hyperproductive André Pratte, who became president of the political commission of the PLQ. This is a contribution which must, in my humble opinion, fuel an essential discussion: that of the Quebec economy post-François Legault and post-Pierre Fitzgibbon.
A colossal effort has been made by the CAQ government, often with significant support from Ottawa, to attract large-scale foreign investments. The construction of a battery sector going from the mine to the finished product can become a pillar of the Quebec economy if a constellation of innovative SMEs develops around it which can spread their own wings and generate their own growth. It remains to be seen, but it is likely. The Montréal international organization also delivers each year its sometimes multi-billion dollar harvest of foreign investors attracted by the quality of our workforce, by our resources, as well as by the charms of our climate and our savoir-vivre.
Having grown up with surplus labor and energy, we have not yet emerged from the reflex of blissful applause for each of these announcements. However, our little world has changed. In shortage of labor and electricity, each foreign establishment shifts towards it employees and watts which could – and which can – be better used by our own companies. There is a tipping point at which too much foreign investment is harmful.
Without denying what was done by the CAQ team, and which undoubtedly increased Quebec wealth per capita, the government which will be elected in October 2026 (you know my preference) will be well advised to make a correction for the future major trajectory and to favor local business for this new phase.
For example, it is shameful to note that the increase in electricity prices will be 3.3% for large industry next year, but 5.1% for SMEs. This is a conscious decision to pass on the discounts offered to large, mainly foreign, companies to the local company.
A change of direction is necessary. André Pratte’s document takes up known proposals, but never completely implemented: the review and simplification of the taxation of small businesses, a renewed effort, and led by the Executive Council, to reduce administrative paperwork. (Total transparency: these elements were part of the Priority SME strategy that I launched at the Parti Québécois in 2016.)
Pratte also suggests carrying out a complete diagnosis of the tangle of aid programs and tax credits, some of which are counterproductive or obsolete. The Minister of Finance, Eric Girard, announced exactly this necessary process in the last budget, but unfortunately, he has no control over the federal propensity to invent new programs every year whose efficiency is particularly idle. If there is too much red tape in the system, perhaps there is one government too many. Or a government that takes care of what is none of its business.
For the necessary increase in productivity per hour worked, which constitutes the backbone of wealth creation, Pratte adds a strong argument by citing a very recent study by the Organization for Economic Co-operation and Development, the OECD, concluding that, for the development of innovation, State tax assistance for research and development is more effective when it targets SMEs rather than large companies.
Another interesting avenue: investment rather than subsidies. That in exchange for its aid, the State can “recover its investment through a mechanism of participation in the future benefits of innovation, through a royalty on future marketed products”. Well done.
We find in the document adopted by the PLQ bold elements for those who, in this party, in the past preferred laissez-faire. We read: “The rights of exploitation, transformation and energy allocation will be linked to an obligation for value-added transformation in resource regions. » In addition, it is proposed that a “minimum mandatory threshold for local processing of Quebec’s natural resources be determined”. You’d think you were reading Martine Ouellet. Which is intended, in this case, as a compliment.
I particularly appreciated the section devoted to regional consultation. It announces the creation of regional consultation centers, decision-making bodies responsible for involving all stakeholders in the area and coordinating the economic and social development of each region.
The idea is so good that it resembles the regional development centers created by the government of Lucien Bouchard, transformed into regional conferences of elected officials by the government of Jean Charest (which wanted, at the request of the chambers of commerce, to expel the union and community representatives), then abolished by the government of Philippe Couillard, which proceeded to dismantle all this cumulative experience of consultation, telling in particular to the 3000 local entrepreneurs engaged in mentoring that we did not need them.
It was still paradoxical that the same general council of the PLQ celebrated, without the slightest reservation, the action of Philippe Couillard’s government and simultaneously adopted economic and regional proposals in total contradiction with its action. But I insist, it is never too late to be right.