Minister of Finance Bill Morneau takes part in media interviews in the foyer of the House of Commons after delivering the federal budget on Parliament Hill in Ottawa on Tuesday, March 22, 2016.
©THE CANADIAN PRESS/Adrian Wyld
Liberals first budget will see red ink swell to $29.4 billion, with a similar-sized deficit next year
Prime Minister Justin Trudeau says the federal election last October was won when he boldly promised early deficit budgets to spur growth and stimulate the economy. Canadians liked what they heard and voted in a massive Liberal majority. They wanted jobs, investments and hope.
Tuesday, federal Finance Minister Bill Morneau delivered on that key promise. But instead of a $10 billion deficit, the Liberals first budget will see red ink swell to $29.4 billion, with a similar-sized deficit next year.
The numbers are staggering and there is no commitment or date to return to balance. It should be a major concern but that has become a worry for tomorrow because today money is being lavishly spent to fulfill government election promises.
The biggest winners are Canadian families, with billions in tax-free child benefits; aboriginal communities will get $8 billion over the next five years; and municipalities will pick up $11 billion this year in infrastructure funding for transit, water, sewer, ports, harbours, roads, buildings, bridges and buses.
It’s positive news for communities across the country pleading for cash to upgrade aging infrastructure. The spending frenzy will be a major economic stimulus for all provinces.
The tax cut to middle income Canadians is there, green infrastructure spending is there, reversing changes to unemployment insurance are there and climate action is there. Also there is a roll back of the eligibility for old age security from 67 to 65. They are all good news items.
But national defence took a $1.6 billion hit. The department is to get that money restored over the next four to five years but what does it say in the fight against international terrorism which struck against with deadly results earlier Tuesday in Belgium.
There is disappointing attention to youth unemployment and the restoration of mail delivery is uncertain.
There will be is disappointment is many areas because expectations were so high.
More than any other region in the country, Atlantic Canada is heavily dependent on Ottawa for essential funding. Hundreds of millions of dollars in federal transfers, supports and equalization payments enable P.E.I. to access services comparable to other Canadians.
That is why the federal budget presented Tuesday is so critical to this province. The projected federal supports to P.E.I. for fiscal 2016-2017 is $582 million, almost $30 million more than 2015-2016.
Early budget analysis suggests that health care spending remains the same while a new health accord is being negotiated. Funding might increase once that new agreement is concluded.
The government is being accused by critics of ‘under-promising’ for Canadians and then will likely ‘over-deliver’ in time for the next election.
But overall, it’s a positive budget for Canadians.
Mr. Morneau says the budget restores hope to the middle class, will revitalize the economy and will use smart investments to ensure that Canada’s best days still lie ahead. The promise is there that hope and hard work will result in prosperity.
Let’s hope they all combine for strong results and renewed hope for all Canadians.