The throne speech promises a slew of measures that would financially affect individual Canadians as the Trudeau government outlines its strategy to set the country on a recovery path from the health and economic consequences of the novel coronavirus pandemic.
The Liberal government unveiled plans to extend the Canada Emergency Wage Subsidy through to next summer and a variety of initiatives to help workers and especially women rejoin the workforce, including steps toward a Canada-wide childcare system and funding for skills training.
There are also pledges to create a new federal disability benefit modelled after the Guaranteed Income Supplement (GIS) and more help for first-time homebuyers.
But the government’s pitch to Canadians also includes the possibility of new taxes in the future. The throne speech, read in the Senate by Gov. Gen. Julie Payette, mentions “additional ways to tax extreme wealth inequality, including by concluding work to limit the stock option deduction.”
The Conservatives immediately responded by saying they would not support the plan and the Bloc Quebecois said it proposes too many intrusions into provincial jurisdiction, likely leaving the fate of the minority Liberal government in the hands of Jagmeet Singh and the New Democrats.
The eventual vote on the throne speech is a confidence motion and the Liberals need at least one of the three main opposition parties in the Commons to back their plan.
Wage subsidy extended
The planned extension of the wage subsidy will likely come as a relief to workers currently receiving part of their pay through government funding as well as businesses relying on the aid. Lobby groups representing industries that have been especially hard hit by the pandemic, like the restaurant sector, had asked Ottawa to prolong the support into 2021.
The last claim period for the current wage subsidy, which provides a varying degree of support based on the extent of the revenue loss suffered by eligible businesses, ends on Nov. 21. Existing legislation allows for an additional claim period ending no later than Dec. 31.
The Trudeau government also says it will also expand the Canada Emergency Business Account to help businesses with fixed costs, and improve the Business Credit Availability Program.
It also promises industry-specific help for vulnerable sectors such as travel and tourism, hospitality and cultural industries like the performing arts.
There is no mention, however, of tweaking the Canada Emergency Commercial Rent Assistance (CECRA) program, which has been widely criticized for leaving it up to landlords to request the aid. Many struggling small-business tenants have reported their landlords would not apply.
The speech is also scant on new details about the federal income support programs that will replace the Canada Emergency Response Benefit (CERB) which expires this month.
In August, Ottawa announced broad temporary changes to make Employment Insurance more generous, as well as three new benefits for workers who don’t qualify for EI, as well as those with no workplace sickness benefits and parents caring for children who are unable to attend school or daycare.
The throne speech mentions the EI system will be the mechanism for delivering employment benefits, including to those who weren’t eligible for EI before the pandemic. Both the EI system and the Canada Revenue Agency have been administering the CERB.
Childcare, help for women, skills training
The government describes two of its most ambitious, and possibly costliest, initiatives as part of broad plan to get Canadians back to work.
The first is a “significant, long-term, sustained investment” to create a coast-to-coast affordable childcare system that takes inspiration from the Quebec model.
With childcare under provincial jurisdiction, though, it’s unclear whether and how Trudeau’s vision would provide short-term relief to working parents, and particularly women, who are struggling to juggle the responsibilities of work, homeschool and caring for children at home.
The Trudeau government also pledges to make “the largest investment in Canadian history in training for workers,” with programs that would prepare Canadians for jobs in growing sectors as well as help connect workers and employers.
As well, Ottawa promises to set up an Action Plan for Women in the Economy to reverse the drop in female workforce participation triggered by the pandemic.
“We have long understood that Canada cannot succeed if half of the population is held back,” the speech says.
The Liberals also say they will expand Youth Employment and Skills Strategy to increase paid-work opportunities for young Canadians next year.
A new benefit for Canadians with disabilities
In a nod to longstanding criticism of Canada’s support system for Canadians with disabilities, the throne speech describes plans to rejig key federal disability policies.
The government promises a new federal disability benefit modeled after the GIS, which supplements the income of financially vulnerable seniors. Ottawa also pledges changes to the way it assesses eligibility for other government disability programs and benefits.
Advocates say current rules make it difficult for some Canadians with severe disabilities to access or keep the federal disability tax credit.
Taxes on the wealthy
In a speech that contains few signs of fiscal restraint and no detailed price tags, the Trudeau government also hints at new taxes on the wealthy.
Mentioning long-term plans to strengthen the middle class, the speech pledges to find additional ways to use taxation to reduce “extreme wealth inequality,” including targeting the stock option deduction.
Currently, profits derived from employee stock options — a common form of compensation — are taxed at half the rate of personal income.
Under former finance minister Bill Morneau, Ottawa had introduced, then quietly shelved, plans to limit the preferential tax treatment.
Before the pandemic hit, the government said it would include revised plans for taxing stock options in its 2020 federal budget.
Trudeau is scheduled to address Canadians in a nationally televised speech later Wednesday, a move designed to underscore the ongoing severity of the pandemic, but one his political rivals have argued is a political stunt and lends credence to the idea of the throne speech as the Liberals’ platform for the next election.
— With files from the Canadian Press
Comments