Cabinet had no choice but to spend billions on a Volkswagen battery plant in Ontario, Finance Minister Chrystia Freeland said yesterday. Her remarks followed a Budget Office report warning the venture will cost taxpayers almost 20 percent more than estimated.

“We knew Canada had to be at the table,” Freeland told reporters. “We were just not, as a government, going to tolerate a situation in which investment was sucked out of Canada, sucked to south of the border, and I don’t think Canadian workers should tolerate that situation.”

Cabinet on April 20 approved subsidies to Volkswagen to build an electric battery plant in St. Thomas, Ont. Federal aid was estimated at $13.7 billion. The Budget Office yesterday said actual subsidies are closer to $16.3 billion based on “a preliminary cost estimate of the entirety of the Government of Canada’s funding commitments to Volkswagen.”

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