140533
140876

Canada  

Big-spending deficit budget

The final budget of the Trudeau government's mandate will scatter billions in fresh spending — on everything from pharmacare to retraining workers to first-time home buyers — as the Liberals commit to an electoral fight that pits their deficit-spending vision versus the Conservatives' balanced-books approach.

Finance Minister Bill Morneau's budget Tuesday resembled Liberal economic plans that preceded it: the government will exhaust a big windfall, run near-term deficits of about $20 billion and offer no timeline to return to balance.

A stronger economy last year delivered an unexpected revenue bump that will flood an extra $27.8 billion into the federal treasury over the next six years, compared to government predictions in its November economic update.

With seven months to go before the election, Morneau's plan will spread the cash around. Most of it will be aimed at Canadians' pocketbooks.

Funding for some of Tuesday's commitments will only start kicking in after October's election, giving voters the chance to weigh in on the budget's contents at the ballot box.

The Liberals' spending path places them in stark contrast with the Opposition Conservatives, who have called on the government to rein in spending.

"The opposition would like to see us make cuts very rapidly — their idea is balance the budget at any cost," Morneau told a news conference Tuesday after being asked about his deficits.

"Well, if we had taken that approach in 2015 we would not be where we are today with a better outcome for middle-class Canadians. We'd be in a more difficult spot."

The measures in Morneau's fiscal blueprint cover a lot of territory, with a clear focus on individuals — particularly younger adults — as opposed to businesses.

Even with these investments, Ottawa's fiscal track promises to be a key issue on the campaign trail.

The annual deficit projections in Tuesday's budget — which reach as high as $19.8 billion — are less than one percentage point of Canada's gross domestic product, a modest level when compared internationally.

Still, the Liberals will be forced to explain themselves repeatedly until election day.

They came to power in 2015 on a platform that vowed to post annual deficits of no more than $10 billion and to return to balance by 2019.



More Canada News

Canada
140532
Parliament Hill
Parliament Hill Webcam
57111
Recent Trending
Soft 103.9
138488
Castanet Proud Member of RTNDA Canada
137772



139661