I’m looking forward to forward looking from Canada’s newly elected minority government. It may be important to focus on the minority nature of the government.
In the interest of self-preservation, perhaps the minority Liberal government will continue to liberally embrace policies from the Conservative playbook. We saw some of that in Prime Minister Carney’s appropriation of such key Conservative plans for carbon tax relief and capital gains inclusion.
Unfortunately, I had trouble finding much forward looking in either of the Liberal or Conservative electoral platforms.
I’m not one to rely on what was promised in election platforms. Let’s face it, people will tend to say things during the heat of an electoral battle and then “wiggle” to adapt as the situation merits or unfolds. At least that is what a certain communications industry entrepreneur used to say.
What can we expect in the way of telecom policy over the next few years? It’s worth noting that TD Securities wrote a note last week with a title of “We See No Reason for a New Government to Focus on Telecom Regulation”.
Leveraging proprietary TD credit card data, plus widely available StatsCan information, we show that inflation in telecom costs for consumers is not a problem that should cause any concern for either political party that wins the Federal election on April 28. Canadian consumers already benefit from healthy competition and declining prices for equivalent wireless and internet services.
TD’s analysis of credit card data over the years 2022 through 2024 found that telecom spending has remained a constant 2.4% of total consumer spending in each of those years. TD said “In short, we have a robust competitive environment in the Canadian telecom industry, and we believe this leaves minimal risk that any new government will want to spend much time and effort on adjusting telecom policy to lower prices further.”
How would that analysis factor into a Conservative plan to “Launch an oligopoly review of key federally-regulated sectors to increase competition and lower costs for Canadians.” TD stated “To be clear, complimenting the telecom industry is rarely a popular political strategy; so some pre-election verbiage about standing up to help consumers should always be expected.” So, now that we are past the electioneering, can we expect more rational, informed approach to the telecom sector?
The Liberal platform really didn’t say much about telecom, beyond a plan to spend $1.5B this year and another $1.0B next year to “Invest in digital infrastructure for the economy of tomorrow.”
We will catalyze the construction and development of AI infrastructure including data storage facilities, computing capacity, high speed, safe and reliable communication networks, and digital supply chain solutions to improve efficiency and reduce costs for Canadians. This will include improving rural broadband and reliable cell service that connects communities.
The plan shows no spending beyond these first two years, even though the CRTC and the government share a 2030 target for finishing the job. I suspect this one to cost more and take longer than planned.
The Conservative plan talked about “Supporting remote-area internet connectivity so every Canadian has reliable access to news”, but there is no specific funding indicated for this initiative. Interestingly, the item appears under a heading of support for media freedom. That same heading includes “Introducing a Freedom of Speech Act to repeal Liberal censorship laws and restore Canadian news on Meta and other platforms.” This could result in significant shifts in CRTC headcounts and activities if the Online News Act and Online Streaming Act are repealed. At the same time, the Conservative platform called for its own version of the failed Online Harms Act, with “new laws for AI deepfakes of intimate images, modernized laws against online harassment, and stronger child protection online.” So, it looks like there would be support for some version of a new online harms bill.
What about other telecom or digital economy issues? The Liberal platform has a section on building the economy of the future, which focuses on investments in Artificial Intelligence, including $100M annually for an AI adoption tax credit for small and medium sized businesses.
Last summer, I wrote “Will Artificial Intelligence harm ‘real’ intelligence?” I have no doubt that there are some small and medium sized businesses that can benefit from investing in AI tools for their businesses. I suspect that many are looking forward and doing so without targeted government incentives. If so, we might question whether an AI adoption tax credit will accomplish much. I got nervous reading the platform promising to throw money toward AI, such as for data centres. To me, it came across as being bedazzled by the latest shiny object. I noticed that the Conservative plan called for chopping $2.275B from funding for Artificial Intelligence Initiatives.
I am interested in the Liberal’s promise of digital transformation in government.
Establishing a dedicated Office of Digital Transformation at the centre of government to proactively identify, implement, and scale technology solutions and eliminate duplicative and redundant red tape. This will enhance public service delivery for all Canadians and reduce barriers for businesses to operate in Canada, which will grow our economy. This is about fundamentally transforming how Canadians interact with their government, ensuring timely, accessible, and high-quality services that meet Canadians’ needs.
Enabling the Office of Digital Transformation to centralize innovative procurement and take a whole-of-government approach to service delivery improvement. This could mean using AI to address government service backlogs and improve service delivery times, so that Canadians get better services, faster.
However, the platform did not identify any funding for this new office. Will this department improve the ways we interact with government? Government departments like CRA still ask for faxes. Pharmacies still communicate with doctors by fax. As an aside, someone needs to help me understand why a doctor at a major hospital needs to write a barely legible prescription on a piece of paper that still must be presented to a pharmacy, even though the pharmacy has already received an image of the script using its app.
As I noted last week, the Conservatives proposed a crackdown on senior scams, with plans for fines of up to $5M for telecoms failing to implement the latest fraud detection / prevention technology. While this might have been a well intentioned plan, last week’s post explained why this may not be as effective as desired. Hopefully, constructive dialog among all stakeholders – government, telecoms, bankers, law enforcement, social services, and others – will lead to a better approach.
Not sure you can call me an optimist – I tend to be too grumpy for that title – but, I will continue to be looking forward.
Hopefully, the government will take that TD report to heart. I agree with TD. I see no reason for Canada’s new government to focus on telecom regulation.