Government budgets often offer some benefits for voters, but when the budget precedes an election, there’s a lot in common with Christmas — there are plenty of gifts, and you try not to think about having to pay for them later.
So it is with the Liberal government’s federal budget tabled last week that will dole out billions of dollars in new spending on all sorts of goodies for Canadians — many of them aimed at helping middle-class voters save money.
The Liberals were aided by the fact that a stronger economy has produced higher-than expected revenue — a projected extra $27.8 billion over the next six years.
Based on Finance Minister Bill Morneau’s plan, the Liberals will spend $22.8 billion of that additional money.
The budget includes: $1.7 billion over five years, and $586 million a year after that, for a Canada Training Benefit to help workers upgrade their skills and learn new ones while staying in their current jobs; $1.18 billion over five years to tighten border security, including hiring more judges to handle judicial reviews of asylum applications; $3.9 billion for farmers (the majority of them in the vote-rich provinces of Ontario and Quebec) in supply-managed industries affected by new trade agreements with the U.S. and Asian countries; $2.2 billion for municipalities’ and First Nations’ infrastructure projects; $950 million for municipal governments to make their buildings more energy-efficient and to provide subsidy programs to help homeowners do the same; $300 million over three years for rebates of up to $5,000 on electric or hydrogen-fuel-cell vehicles.
The budget also calls for putting money toward lowering the interest rate on Canada Student Loans to the prime rate, and to create a new Canadian Drug Agency to centralize evaluations of new drugs and to buy in bulk nationwide, instead of province-by-province.
The provisions include measures to make housing more affordable, particularly for first-time buyers, by increasing the amount they can borrow from RRSPs and by having the Canada Mortgage and Housing Corp. contribute a small share of equity for down payments.
The budget also provides new rules that will let working seniors keep more of the money they earn before triggering a claw-back in the Guaranteed Income Supplement (GIS).
The Canada Training Benefit will provide a tax credit of up to $250 per year to help with covering up to half the cost of job training, such as fees for a college course or other professional training programs. Such training is increasingly becoming crucial to help workers keep their skills up to date in a fast-changing workplace.
Similarly, helping working seniors keep more of their earnings in their pockets will be useful in a world where more seniors are having to remain on the job in order to make ends meet.
Of course, all these goodies have to be paid for, and the money for that ultimately comes from taxpayers’ pockets.
The Canadian Press points out the new budget will result in a 2019-20 federal deficit projection of $19.8 billion, including a $3-billion “risk adjustment,” an increase of $200 million from last year’s forecast. The Liberals’ plan includes a gradual reduction in the deficit, but that will happen more slowly than the government anticipated last year.
Morneau’s 460-page budget is titled “Investing in the Middle Class,” but it could perhaps be more appropriately called “Investing in Middle-Class Voters.”
Rather than using the unexpected windfall to reduce the debt or balance the budget, the Liberals have opted to spend the money like a carefree Vegas vacationer who just got lucky at the slot machines.
Time will tell if voters welcome the gifts – or if they look ahead to the bills that will start arriving after Christmas.
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