Overview: 2012 Federal budget highlights

OTTAWA – Highlights from the Conservative government’s 2012 budget, released Thursday:

• $5.2 billion in ongoing savings, from the $75.3 billion envelope. The government says these cuts are “modest and measured” actions to help balance the budget.
• Highest cuts percentage-wise will come from Finance ($38.6 million) and the Privy Council Office, the bureaucratic arm of the prime minister’s office ($12.2 million).
• The lowest cuts, percentage wise will come from Veterans Affairs ($36.9 million), Aboriginal Affairs ($165.6 million), and HRSDC ($286.7 million)
• Defence will be cut $1.1 billion; Public Safety will be cit $688 million; Agriculture cut $309 million.

Deficit: 2010-11: $33 billion
2011-12: $25 billion
2012-13: $21.2 billion
2013-14: $10.2 billion
2014-15: $1.3 billion
2015-16: $3.4 billion SURPLUS
2016-17: $7.8 billion SURPLUS 

• Government will gradually increase eligibility for Old Age Security and Guaranteed Income Supplement from age 65 to 67. The changes will not affect anyone 54 or older as of Saturday. Changes will be phased in for those born between 1958 and 1962, depending on their birthday.
• Government is encouraging people to work longer by allowing them to defer OAS payments for up to five years in return for bigger payments down the road.
• Spending reductions are expected to chop about 12,000 government jobs over a three-year period. Overall, the public service will be reduced by 19,200 people, or 4.8 per cent (which means 7,200 gone through attrition).
• Between 1998 and 2011, the federal public service grew by approximately one-third, or 95,000.
• Government plans to adjust the Public Service Pension Plan so employee contributions are shared equally (50/50) with the employer. Similar changes will take place with the Canadian Forces, RCMP and Parliamentarians.
• For anybody joining the public service starting in 2013, the normal age of retirement will increase to 65 from 60. (THEY ARE GRANDFATHERED.) technically, the earliest you can retire now is 55. For MPs and Senators will take effect beginning after the next election.
• The government has no intention of building new prisons (p. 277)
• Eliminating the penny. Consumers can still use their pennies, but the Mint will stop producing and circulating new pennies as of Fall 2012. Once pennies aren’t in circulation anymore, cash transactions will be rounded to the nearest five-cent increment. Debit and credit payments, of course, will not be rounded. Expected to save $11 million/year.
• Providing $5.2 billion over 11 years to renew the Canadian Coast Guard ($472.7 million/year)
• Removing disincentives to work from Employment Insurance regulations, such as investing $74 million over two years to ensure EI claimants benefit from accepting work ($37M/year)
• Research and Development: $165 million over two years for “responsible resource development.” In the next 10 years, more than 500 “major economic projects” representing $500 billion in new investments are planned across Canada. The review process will be streamlined.
• More than $1 billion investments to support science and technology
• $500 million to stimulate growth of innovative start-up companies
• Expanding international trade 
• Providing $150 million over two years for the new Community Infrastructure Improvement Fund. 
• $50 million over two years to the Youth Employment Strategy