Deputy Prime Minister Chrystia Freeland, who was appointed Minister of Finance in August when Bill Morneau resigned, said she is confident the coronavirus will be defeated and that it won’t take years to do so.
But until that happens, she said the government is prepared to keep spending money even as the deficit is projected to hit $343 billion this fiscal year, with no clear plan for how or when the federal government will rein it in.
“It’s a lot of money to be sure but this is a one-off, this is spending that will come to an end when the coronavirus is defeated, and I actually have a lot of confidence that is going to happen and that it is not years away,” she said in an interview with The West Block’s Mercedes Stephenson.
“And when it comes to that spending to fight the virus, my message is, we will do whatever it takes.”
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The Liberal government rolled out hundreds of billions of dollars worth of emergency spending measures earlier this year as the country shut down in a bid to limit the spread of the virus.
The resulting federal deficit for the year is projected to hit $343 billion, with Parliamentary Budget Officer Yves Giroux warning that kind of deficit is not sustainable for more than one or two years.
But despite repeated questions from the opposition, the government has not provided any hint on how it envisions reducing that deficit.
That’s as polling by Ipsos done exclusively for Global News suggests 55 per cent of Canadians feel the deficit has grown too large, and as nearly 80 per cent say they want to see a plan to bring it down.
One major credit ratings agency downgraded Canadian credit rating earlier this year, specifically pointing to the deficit and lack of plans to rein it in.
Three others last week told Bloomberg they urged the government to provide a road map out of the red, but the federal throne speech outlined numerous commitments to continue spending and gave no indication of restraint.
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Freeland said while she also has concerns about spending, she thinks there is an important distinction to be drawn between the spending and deficit incurred on one-time emergency measures, and the deficits governments can incur from other kinds of less urgent programming.
“This is an extraordinary time. We are having to spend extraordinary amounts of money to fight this pandemic and yes, that does mean as finance minister, I am very concerned,” said Freeland.
“I believe there is a tremendous onus on us as the federal government to be very thoughtful, very prudent about these extraordinary measures.”
“Not all spending is created equal and I would put in an entirely separate category the really significant but one-off, time-limited spending we are doing right now to fight the pandemic.”
The federal government has not tabled a budget this year and is not expected to do so this fall.
However, the government is expected to release a fiscal snapshot akin to the one issued this summer.