Ottawa is setting aside $33 billion over seven years for roads, bridges, water systems, public transit and international entry points, the largest single investment in public infrastructure since the Second World War.

Finance Minister Jim Flaherty introduced the “Building Canada” plan in the House of Commons today as part of the 2008-09 federal budget.

As part of its infrastructure spending, Ottawa will:

> Set aside up to $500 million in support of capital investments to improve public transit.

> Provide $10 million over two years for repairs and environmental cleanups, which will permit the transfer of more small craft harbours across Canada to interested parties from the federal government.

> Make the Gas Tax Fund a permanent measure, which will allow municipalities the ability to plan and finance long-term infrastructure repairs and improvements.

> Set up a new Crown corporation, PPP Canada Inc., to develop public-private sector partnerships in infrastructure development.

Flaherty said in his speech to the House of Commons that Canada needs access to modern infrastructure to support its communities and keep the national economy competitive.

Creating PPP Canada, the first public-private partnership office of its kind at the federal level, will help maximize infrastructure investment, he says.

“By increasing our use of P3s and taking into account contributions by other levels of government, we should be able to leverage a $100-million investment in infrastructure,” Flaherty says.

Last year, the federal government extended to 2014 the federal Gas Tax Fund, which provides direct funding to municipalities for essential infrastructure. Now, the budget proposes, municipalities will have access to this fund, which will reach $2 billion a year in 2009-10, forever.

In addition to the $1.3 billion Ottawa has already provided to support public transit capital investments and last year’s tax credit for public transit passes, the $500 million for transit in this year’s budget will go to several specific projects, including:

> The Evergreen Light Rapid Transit System in Vancouver;

> Re-establishment of the rail link between Peterborough and Toronto Union Station on the existing right of way;

> New equipment and upgrades to dedicated rapid transit routes for Aéroports de Montréal.