Question Period Note: SUPPORT FOR RURAL COMMUNITIES

What is the Government of Canada doing to support and promote rural economic development?

• Economic development in rural Canada leads to prosperity for all Canadians and national initiatives should reflect the unique needs and opportunities of rural Canada.
• Rural Canada accounts for 25 percent of the country’s GDP, offering essential economic contributions that help drive overall economic growth alongside urban areas.
• Budget 2024 outlined investments in rural housing, transportation, health, social services professionals, and Indigenous economic development, and increased the Canada Carbon Rebate rural supplement
from 10 to 20 percent.
• Through these investments, the Government of Canada is improving outcomes for rural Canadians and Canada as a whole.

• Non-metropolitan Canada is home to over a quarter of the country’s population. These Canadians live in over 4,000 diverse rural communities (Statistics Canada, 2021) across Canada including near-urban, northern, remote, coastal, island, and Indigenous communities.
• Rural Canada contributes 25% of Canada’s GDP (Statistics Canada, 2023) and supports interconnected environmental, social, and economic systems with urban areas. Rural areas help fuel Canada’s economic engine though natural resource production, unique cultural opportunities and preservation, and people, skills, and knowledge. Rural areas are home to Canada’s food production, mines for critical minerals, unique tourism opportunities, and have so many other significant human and natural assets that benefit Canada as a whole.
• Rural communities are diverse and have unique aspirations and challenges that need to be appropriately addressed to help ensure they can continue to thrive. Given the unique needs and realities of rural and remote communities, the government launched the Rural Economic Development Strategy: Rural Opportunity, National Prosperity, which was released in June 2019. A progress report followed in August 2021.
• The design and implementation of federal initiatives to support and promote rural economic development should address key rural challenges, including:
o Infrastructure needs, including roads, connectivity, public transit, air access and housing, that impede economic development and prevent communities from seizing opportunities;
 Infrastructure limitations, compounded by remoteness, make access to services in larger centres more difficult, and strain supply chains;
o Labour challenges, including shortages, mismatched skills, youth outmigration and unemployment present workforce attraction and retention challenges for smaller communities;
 Only 57% of the rural population (non-metropolitan) over the age of 15 is employed – compared to 64% for that same demographic group in urban areas (Statistics Canada, 2023);
o Capacity and access challenges, including barriers in accessing programs due to insufficient high-speed Internet, lack of community-level data, and capacity/resource constraints due to limited staff, which impact rural applicant’s ability to navigate and apply to funding programs.
• Current federal initiatives to support rural Canadians include:
o The Universal Broadband Fund (UBF): In Budget 2019, the government set a target for 95% of Canadians to have access to speeds of at least 50/10 Mbps by 2026 and 100% by 2030. With new investments, the target for 2026 has been increased to 98%. The UBF has dedicated $3.2 billion, up from the original $1 billion, towards connecting Canadians living in rural and remote areas to high-speed Internet, and improving mobile connectivity for Indigenous peoples. There are federal-provincial co-funding agreements with Quebec ($934 million), Ontario ($1.3 billion), Newfoundland and Labrador ($136 million), Alberta ($780 million), British Columbia ($830 million), and Prince Edward Island ($20 million) to connect 823,000 households.
o The Housing Accelerator Fund: Budget 2024 proposed an additional $400 million in funding, over four years, to the Canada Housing and Mortgage Corporation to top up the Housing Accelerator Fund, starting in 2024-25. In March 2023, the government launched the $4 billion Housing Accelerator Fund to help cut red tape and fast-track the creation of at least 100,000 new homes. This Fund includes a Small/Rural/North/Indigenous stream.

o The Canada Housing Infrastructure Fund: The proposed $6 billion Canada Housing Infrastructure Fund would include a provision where funding agreements with provinces would require allocating at least 20 per cent of their agreement-based funding for northern, rural, and Indigenous communities.
o The Canada Student Loan Forgiveness Program (CSLFP): The CSLFP encourages health care and social services professionals to move to rural and remote communities by offering student loan forgiveness. Budget 2023 included $45.9 million to expand the reach of the Canada Student Loan Forgiveness program for eligible doctors and nurses who choose to practice in rural and remote communities. Budget 2024 proposed to permanently expand the reach of the Canada Student Loan Forgiveness Program to include dentists, dental hygienists, pharmacists, midwives, teachers, early childhood educators, social workers, personal support workers, physiotherapists and psychologists working in rural and remote communities.
o The Canada Carbon Rebate (CRR) rural supplement: The CCR is a tax-free amount to help eligible individuals and families offset the cost of the federal pollution pricing. It consists of a basic amount and a supplement for residents of small and rural communities. Budget 2024 increased the Canada Carbon rebate rural supplement from 10 to 20 percent.

• The Government of Canada takes a coordinated approach to ensure rural realities are captured in initiative design and implementation across government.
• This includes work with Statistics Canada to enhance the Rural Canada Statistics Portal to improve availability and accessibility of rural data to inform policymakers, researchers, and communities.
• Other government initiatives to support rural Canadians include the $3.225 billion Universal Broadband Fund, the $4 billion Housing Accelerator Fund, the proposed $6 billion Canada Housing Infrastructure Fund, the Canada Student Loan Forgiveness Program, and the Canada Carbon Rebate rural supplement.