Parti Québécois targets the fund behind Investissement Québec's SME programs

Of the items in the Parti Québécois platform, the Economic Development Fund sits closest to startup financing. It is the fund that allows Investissement Québec to administer financial assistance programs to many SMEs ^[3], and the party says abolishing it will help pay for lower corporate taxes, more automation and robotics, and less red tape ^[2][3].

Treat that as a swap, or more precisely a transfer between two groups of companies, and ask who is on each side. A corporate tax cut reaches a company through the tax it already pays. Program money can reach one that pays none. Québec Tech CEO Richard Chénier, who wants policy better tailored to the startup sector, said cutting taxes is a good idea, but he told BetaKit, "for startups, sometimes it doesn't have any impact" ^[6].

I see about three ways this plays out. In the first, the fund's money is absorbed into the tax cut, so profitable SMEs gain and pre-profit startups lose a channel. In the second, it reappears as other SME support. That is how Jean-François Harvey, Québec director of the Council of Canadian Innovators, framed it when he called tax cuts and redirected support for SMEs good moves, adding that the "devil is in the details" ^[8]. In the third, the fund matters less than immigration. There the PQ is proposing stricter measures, and BetaKit flags finding and retaining tech talent as a possible problem ^[4].

I think the first outcome is the likelier one for early-stage companies, because the party tied the abolition to paying for its tax and productivity promises ^[3]. Harvey's wording is the counter-case. If the support he calls redirected comes back in full, the abolition is a relabelling and my view is wrong.

The immigration plan runs against what the sector has asked for. CCI has proposed a VC investment tax credit, procurement reform and immigration fast-tracks for skilled workers ^[9]. The third points the opposite way from the PQ's stricter measures ^[12], and none of the three appears among the PQ promises BetaKit lists ^[13]. Harvey said that amid trade war chaos the sector needs "stability and predictability" ^[7].

BetaKit's report does not give the fund's size, how many companies its programs reach, or what the immigration measures contain. For now the sector seems more hopeful than panicked, according to BetaKit ^[11]. With a minority government, a referendum is very likely at least two years away ^[5]. Before the election, business leaders including Sagard CEO Paul Desmarais III had called for the province to be more economically ambitious ^[10].