Ontario Investment Fund : a discussion paper

42 Pages·1992·2.1 MB·English

by  Ontario. Ministry of Treasury and Economics

Ontario Investment Fund
A Discussion Paper

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The Ontario Investment Fund
A Discussion Paper
ONTARIO MINISTRY OF
treasury
AND ECONOMICS
APR 14 1992.
LIBRARY
Ministry of Treasury and Economics
April 1992
If
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Ministry of Treasury and Economics
Communications Branch, Room 519
Toronto, Ontario M7A 1Y7
[phone]
Copies are available free from:
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Ce rapport est aussi disponible en franqais.
Printed by the Queen's Printer for Ontario.
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Table of Contents
Preface . i
Advisory Committee Members. ii
Executive Summary . iii
Chapter I: Background and Rationale. 1
1. From Wealth Extraction to Wealth Creation. 1
2. Making Wealth-Creating Investments in Our Economy .. 3
3. Lessons From Our Global Competitors . 6
4. Ontarians Can Invest In Their Own Economy. 7
Chapter II: The Ontario Investment Fund: A Proposal. 11
1. Objectives and Mandate. 11
2. A New Financial Intermediary at Arm's Length from Government. 12
3. A Focused Investment Strategy . 13
Chapter III: Issues For Consultation. 14
1. Objectives and Mandate. 14
2. Organization and Governance. 14
3. Investment Policies . 16
4. Operating Style and Management . 17
Chapter IV: Next Steps: The Consultation Process. 18
Glossary . 19
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Preface
There is a shift underway in our economy. Not long ago, our economy was dominated by
the resource and manufacturing sectors. But today, for a variety of reasons, the Ontario
economy is becoming more diverse. A growing number of people are working in the service
sector. Increasingly, jobs are being created in industries where a worker's knowledge is an
important component of production. Technology, bio-engineering and other kinds of firms in
leading-edge industries are experiencing rapid rates of growth.
These changes are altering the way we work and what we work at. The changes are forcing
us to rethink the ways we support our businesses and industry - how we encourage business
to locate here; how we create and attract the kinds of jobs that will enhance our standard of
living; how we ensure innovative firms will have the capital they need to grow, modernize
and create jobs in an increasingly global and competitive environment.
The Ontario Investment Fund is part of the Province's effort to ensure our economy is
equipped to meet the challenges of a new marketplace. Specifically, the Fund will help
provide much needed investment capital to those businesses that will become increasingly
important to us in the days ahead - businesses in the high technology fields, or in the more
innovative and knowledge-based types of production.
The Fund would provide capital for longer-term investments that, over time, would yield
competitive returns to those who contributed the investment capital.
Participation in the Fund will be voluntary. And the key elements of its composition - what
kinds of investments it will make, how these investments are made and so forth - are all up
for discussion. That is the purpose of this paper.
The Fund will represent an opportunity for a new partnership among labour, the private
sector, pension funds, the financial industry and government. The co-operative model we
have developed for consultations is important, because the only way to succeed is with the
direct participation of those most knowledgeable and interested in the Fund's development.
This discussion paper is just a starting point. I encourage you to participate in designing the
Fund by submitting your thoughts, opinions and concerns about the proposal. You'll find
our address at the end of this paper.
I look
Floyd
Treasurer of Ontario
April, 1992
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Treasurer's Preconsultation Advisory Committee
I would like to thank the following people for serving on my pre-consultation Advisory
Committee for the Ontario Investment Fund project. The Committee was given the joint task
of reviewing the discussion paper of the Ontario Investment Fund and assisting in the design
of the consultation process. The Committee's work, energy, and commitment enormously
enhanced our effort and their experience and knowledge was invaluable. I sincerely hope
the participants will continue to provide advice as we move forward.
April 1992
Advisory Committee Members
Robert Am William Knight
President Vice President, Government Affairs
INCONTEXT Corporation Credit Union Central of Canada
Darcy Beggs Heather Gavin
Senior Research Associate Co-ordinator
Canadian Union of Public Employees Membership Benefit Department
Ontario Public Service Employees Union
William R. C. Blundell •
Former Chairman Mary T. Linton
General Electric Canada Inc. Asset Management Consultant
William M. Mercer Co.
Felix Chee
Treasurer Mary Macdonald
Ontario Hydro Mary Macdonald & Associates
Gordon Cheesbrough Ron Poste
President President
ScotiaMcLeod Inc. Ontario Teachers Federation
Peter de Auer Deanna Rosenswig
Chair, Government Committee Senior Vice President
Pension Investment Bank of Montreal
Association of Canada
Director, Pension Fund Gordon Sharwood
Ontario Hydro President
Sharwood & Co.
Sym Gill
Director Robert L. Sillcox
Pension Benefits Division Senior Vice President
C.A.W., Canada Investment Division, OMERS
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