Deeper deficits, no sign of balanced budgets in economic forecast
But missing from the fall economic update tabled Tuesday in the House of Commons was a road map back to balanced books — or any indication when that could happen.
WATCH: Finance Minister Bill Morneau released the liberal governments fiscal update on Tuesday, and spending is a big part of it. Vassy Kapelos reports.
By the end of the current fiscal year, the country will be almost $31 billion in the red, according to the fall economic update released Tuesday – that’s $1.3 billion beyond the $29.4 billion deficit Finance Minister Bill Morneau forecasted in the March 2016 budget.
The finance department’s figures released actually peg the 2016-17 deficit at $24.7 billion, but that takes into account a $6 billion emergency fund the Liberals announced in their maiden budget.
In fact, Tuesday’s figures indicate the Liberal government intends to use that annual envelope of $6 billion every year, effectively minimizing the projected deficit for each year.
The $1.3 billion difference between the March forecast and today’s may not seem so stark compared to the vast divide between what voters were told during the 2015 campaign and the maiden budget.
Throughout the months-long campaign, Trudeau campaigned on a pledge to run “modest” deficits of $10 billion.
Trudeau was also elected on a promise to balance the books by 2019-20. Now, the government is projecting a $24.2 billion that year ($18.2 billion when taking the emergency funding into account), and balanced budgets aren’t even on the radar.
Tuesday’s document casts ahead five years to 2021-22, at which point the government is still projecting a deficit of at least $11 billion.
Commenting on the report, Conservative interim Leader Rona Ambrose zeroed in on the Liberal deficit projections.
“He promised to balance the budget. That has been completely abandoned,” she told reporters Tuesday.
“We’re not going to see a balanced budget any time in the next decade the way it looks.”
Tuesday’s economic update details $81 billion in infrastructure spending through to 2027-28. This includes $25.3 billion on public transit, $21.9 billion for green infrastructure, $2 billion specifically for rural and northern communities and $10.1 billion for trade and transportation projects intended to help Canadian businesses remain competitive.
The publication also signals the government’s intention to come through on its pledge to create an “infrastructure bank,” a move intended to facilitate private investments in infrastructure.
“The new [bank] will allow us to identify a pipeline of projects on which we can base our long-term investment decisions,” Morneau told the House of Commons Tuesday afternoon.
The Liberals rode into Ottawa on a promise of increased transparency and accountability – a tenet that has recently come under fire with questions surrounding their fundraising tactics.
The fall economic update doesn’t touch on political fundraising, but instead looks to the independence and power of the Parliamentary Budget Officer and Statistics Canada.
Morneau said the government will introduce new legislation releasing the budget watchdog from the direction of the Library of Parliament and establishing it as an independent office – in much the same vein as the ethics, lobbying and privacy commissioners, and the auditor general.
The legislation will also grant the PBO “greater access to relevant information” in departments and at Crown corporations.
Similarly, proposed legislation will cement in law the independence of Statistics Canada and the authority of the chief statistician to decide on methodology, as well as the production and release of reports.
Spending so far:
The fall update included a full page summarizing the funds spent since the Liberals tabled their March 2016 budget.
The Liberal government has announced $672.3 million worth of spending for 2016-17, and is holding another $54.3 million for “non-announced” measures for a total of $726.6 million.
Among the items included in the 2016-17 total is:
$15.3 million to support immigration targets
$152.3 million to extend employment insurance to additional regions
$500,000 to support the Supreme Court appointments process
$17.5 million for security at the June North American leaders’ summit
© 2016 Global News, a division of Corus Entertainment Inc.