WATCH ABOVE: Employment Minister Jason Kenney talks about recent job losses across the country and whether the government should back away from its promised tax cuts.
OTTAWA — Canadians saw tens of thousands of jobs vanish within days and heard the federal finance minister say he was taking the unconventional step of delaying the budget until the next fiscal year.
But it’s all good — the budget will be balanced before April 2016 and Canadians will get the benefits they were promised without the government dipping into any emergency funds, Employment Minister Jason Kenney said in an interview on The West Block with Tom Clark.
“The budget, as the finance minister has made clear, will be balanced in fiscal year 2015-16,” Kenney said. “There may have to be some adjustments on the spending side in the future.”
WATCH: Finance minister buying time to balance budget, Tom Clark reports.
Though it’s uncertain where those spending adjustments would occur, some observers are looking at whether the prime minister’s promises, made in November, to implement the controversial income-splitting scheme as well as increase the universal child care benefit, were promised too soon.
Kenney, however, is confident the surplus will materialize without going back on promises and regardless of the negative-trending economy.
READ MORE: Federal government still pledging balanced budget despite oil prices
In the event the government requires additional funds none will come from the money Ottawa sets aside each year for “urgent and unforeseen” circumstances, Kenney said. The government has, however, in the past given permission to departments to use the fund for circumstances opposition MPs alleged were neither urgent nor unforeseen.
Signs of the shaky economy are everywhere: Target and Sony are pulling out of Canada, Suncor is cutting back and Canadian governments are grappling with low oil prices that show no signs of rebounding any time soon.
All told, the country last week saw about 20,000 jobs vanish.
“Obviously we’re concerned about all of those people,” Kenney said, noting there are hundreds of thousands of jobs available across the country. “We reach out whenever we hear about an employer that’s laying off people, to offer support.”
Because of the free-falling oils prices, Finance Minister Joe Oliver last week announced he was delaying the budget until at least April. (Most Conservative budgets have been tabled in March.)
“This will give us a little bit more time to see what the trend lines are,” Kenney said. “It would be irresponsible, given the volatility … in oil prices to go ahead, until we really have a sense where they’re headed in 2015.”
Some financial institutions have indicated prices might be even lower in April.
WATCH: Government faces a huge challenge to balance budget, former deputy minister of finance says
“What’s really at risk here is the credibility of the government,” said Scott Clark, a former deputy minister of finance, who said he, TD Bank and CIBC are among those who have been analyzing the commodity causing the economic upheaval.
Those are perfect reasons, according to Kenney, the government should hold off on the budget.
But this wait-and-see approach is not sitting well with Opposition Leader Tom Mulcair.
WATCH: NDP leader Tom Mulcair says he believes there is a crisis of confidence in the government and lays out his economic strategy.
“It’s not very promising when we hear the finance minister saying that it’s going to be at the earliest April before we see a budget,” he said in an interview. “They should be acting now. There’s clearly a crisis of confidence within the government.”
The Conservatives should be planning to get rid of their income-splitting scheme, Mulcair said.
His party fought against the 2011 election promise, saying it only serves to take billions from the middle class and put it into the accounts of the richest 15 per cent in Canada.
Instead, the NDP would introduce its $15-per-day daycare, which is expected to cost $5 billion over eight years.
Where would he find the money?
“I’m very clear about the fact that the $50-billion decrease in corporate taxes brought in by Stephen Harper’s Conservatives makes no sense at all,” Mulcair said. “We’re going to make sure that everyone in Canada pays their fair share, including Canadian corporations.”
While the NDP prepares to campaign on increasing corporate tax rates, analysts inside Finance Canada is trying to figure out how to hang on to the elusive surplus in the face of this shaky economy.
The decision to delay the budget, which Clark said he’s never before seen, indicates there is “a lot of uncertainty” about what assumptions the government broadly and finance department specifically should make in preparing the budget, he said.
And while there is often some “flexibility” with numbers, there is not much of that these days, Clark said.
“I think that most people, when the budget is tabled, will all be looking with great keenness at the numbers,” he said.
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