When Justin Trudeau earned his job the first time around in 2015, he promised “real change” — and part of that was a balanced budget.
The Liberals abandoned that plan during their mandate and now Canadians have a clearer idea of just how far from that promise Trudeau is moving.
His new platform has a similar name and theme — “Forward: A real plan for the middle class” — but the balanced budget promise is long in the rearview mirror.
A re-elected Liberal government is committing to $57 billion in new spending over the next four years, with a deficit of $21 billion in 2023-2024, down from $27.4 billion in 2020-2021.
At a media availability, after the platform was unveiled Sunday, Trudeau was asked multiple times whether he would commit to a timeline for a balanced budget. He didn’t answer. Instead, he slammed the Conservatives for being “obsessed” with balancing the books through cuts.
“We are choosing to invest in people and in their communities and at the same time stay responsible so that our debt-to-GDP ratio continues to decrease every single year,” Trudeau said.
‘We’re making a different choice and that is the choice that is at the heart of what Canadians are facing this election.”
And that’s the hallmark of the Liberal plan when it comes to their promise of being fiscally responsible: committing to a lower debt-to-GDP ratio over time, rather than a balanced budget.
But their shrinking projection is modest: 30.2 per cent by 2023-2024, down from 30.9 per cent in 2020-2021.
The Institute of Fiscal Studies and Democracy at the University of Ottawa gave the platform costing an overall “good” rating, with transparency and responsible fiscal management each receiving “good” assessments too. The report found overall the strategy is “one of modest fiscal expansion.”
(Read the report here: https://ifsd.ca/en/blog/last-page-blog/liberal-2019-platform)
The Liberals only got a “pass” for realistic economic and fiscal assumptions.
On economic challenges, the report notes there are “fundamental economic challenges such as low productivity growth and the declining role of the manufacturing sector” that the platform does not account for.
“The platform does not explicitly define possible fiscal challenges, nor a plan to address them,” reads the report.
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The IFSD is headed by former Parliamentary Budget Officer Kevin Page.
“I think it’s outrageous. I mean, they’re not even trying anymore,” said Aaron Wudrick of Canadian Taxpayers Federation about the overall spending in the platform.
Wudrick said Canadians should be wary of future tax hikes down the road.
“Last time they promised a balanced budget and instead we got big deficits forever. This time they’re promising big deficits forever. So I would be worried that they’re going to end up being very big deficits forever. So this is a document that doesn’t seem to even pay lip service to fiscal responsibility.”
And important to note that among the 48 spending initiatives Trudeau is promising, which add up to $57 billion over four years, a few major ones don’t have price tags.
Pharmacare is lumped into the $6 billion health-care commitment, which is also supposed to cover getting every Canadian a family doctor or nurse practitioner and offering better mental health supports. When it was announced, the Liberals referred to it as a “down payment” to begin negotiating with the provinces — not an actual costed plan.
There is nothing in the costing about the low-cost national flood insurance program Trudeau promised, nor how they’ll pay for relocating people out of flood zones, something the government promised to consider. Instead, the Liberals committed to $150M for better flood mapping, something they say is necessary before they can look at next steps.
Then there’s the Guaranteed Paid Family Leave — a program the Liberal’s own platform calls “ambitious” — promising parents who don’t qualify for EI will receive a guaranteed income. It’s not included in the costing list either.
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Global News asked Trudeau twice how he could commit to lowering the debt-to-GDP ratio when such big promises don’t have price tags.
“We will of course design these programs in a responsible way once we form government, if that’s the choice Canadians make,” Trudeau said, before doubling down on his promise to lower that ratio.
“I can assure you, we will continue to stand by that fiscal anchor that ensures that we’re investing responsibly in your future.”
Reacting to the Liberal platform Sunday, Conservative candidate and finance critic during the Trudeau government Pierre Poilievre reaffirmed his party’s commitment to balancing the budget within five years of being elected. NDP Leader Jagmeet Singh was also asked Sunday when his party planned to balance the books but he did not provide a target.
As of Sunday, only the Liberal and Green parties have released PBO-reviewed costing of most of their platforms. Conservatives and the NDP have released PBO costing of parts of their platforms.
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