The Liberal government’s federal budget is swimming in a sea of red that includes spending of more than $100 billion in public debt over the next five years.
The blueprint includes spending on infrastructure, indigenous issues and a revamped Canada Child Benefit.
Despite vowing to run deficits around $10 billion before balancing the books in four years, the deficit sits at $29.4 billion this year. There is also a projection of a $17.7 billion deficit in 2019-20; the year the books were supposed to be balanced.
The Grits did not provide a timeline for when they intend to balance the budget.
The Liberals plan on spending $11.9 billion over the next five years on ‘green infrastructure’. Winnipeg’s Bus Rapid Transit project is directly affected by this. There is also money coming into the city to repair water distribution systems and water sewage plants.
Canada Child Tax Benefit
$10 billion over the next years is dedicated for a new Canada child benefit. It will replace both the Canada child tax benefit and the universal child care benefit. It will provide up to $6,400 a year per child under the age of six and $5,400 a year per child for children between six and 17.
Finance Minister Bill Morneau says 90 per cent of families in Canada will receive more each month under the new program.
Ottawa is also eliminating income splitting for couples with children as well as phasing out the children’s fitness tax credit and the children’s arts tax credit.
Investing in First Nations
The Liberals promise to spend $8.4 billion over the next five years on First Nations education and infrastructure. The latter project is part of an effort to end boil-water advisories on reserves. This is the single biggest pledge of cash to Indigenous communities since the 2005 Kelowna Accord. There is also $40 million for an inquiry into Missing and Murdered Indigenous Women.
Investment in youth
There will also be an increase to Canada Student Grant by 50 per cent, $2,000 to $3,000 per year for students from low-income families and from $800 to $1,200 per year for students from middle-income families.
35,000 additional jobs are to be created for young Canadians in each of the next three years under the Canada Summer Jobs program.
Investments in World-Class Institutions and Research
$95 million will be sent per year for discovery research through Canada’s granting council for universities, colleges and research institutions.
Another $2 billion over three years is set aside for a new Post-Secondary Institutions Strategic Investment Fund to modernize on-campus research, commercialization and training facilities.
Finally, $800 million over four years to support development of innovation and tech sector development.
Small Businesses Unhappy
The campaign promise to cut the small business income tax rate has found itself on the chopping block. Instead the rate will remain at the current 10.5 per cent.
Eliot Sims with the Canadian Federation of Independent Business called it a brutal move.
“Small businesses will pay $300 million more than they expected to,” Sims said. “When we’ve got an economy growing at a very slow pace businesses need all the resources they can to invest in their business and create jobs.”
- $2.5 billion over two years to several changes to employment insurance
- $5.6 billion more in benefits to veterans and their families over five years.
- Planned National Defence purchases (such as CF-18s) are being deferred indefinitely
- $1.9 billion over five years to Canadian arts and culture organizations
- $2 billion over two years for a low carbon economy fund
- $1 billion over four years for clean energy investments
- $142.3 million over five years for new national parks and free access during Canada’s 150th birthday