COMMENTARY: Federal budget amid COVID-19 crisis will ‘set the agenda’ for next election

On April 19, federal Minister of Finance Chrystia Freeland will present the Government of Canada’s 2021 budget.

It has been more than two years since then-finance minister Bill Morneau presented the last federal budget, and in between, we had a federal election quickly followed by the COVID-19 pandemic, which has disrupted lives, work and the best-laid political plans.

Traditional and social media are full of budget “experts” laying out their must-haves and their must-nots for the budget, but with a third wave of COVID-19 bearing down on Canadians, along with a confusing and inconsistent vaccine rollout on their minds, it’s safe to say that Canadians are thinking very little about the budget.

That doesn’t mean it’s not important or that it will go unnoticed. In some ways, this budget, like Morneau’s in 2019, will set the agenda for the next election. The 2019 budget came in the middle of the SNC Lavalin scandal, and while it did little at the time to shift the political channel, it did lay the groundwork for the 2019 election later that fall.

Despite the pandemic’s toll on the economy and health of the country, the Liberal government appears to be in a much better position to get re-elected than they were in the spring of 2019, for three reasons.

First, the overall public mood is about the same as in 2019, despite the pandemic. Second, their standing in the polls is much better. Third, the pandemic is far from over in the minds of most people and until it is, they are not thinking about a long-term agenda for themselves, let alone the country.

2:58 Liberals, Conservatives in neck and neck race if federal election were held: Ipsos poll

From a public sentiment perspective, our Ipsos Disruption Barometer, which is a combined measure of citizen and consumer sentiment, sits at -3 per cent in April 2021 vs. 0 per cent in March 2019.  People are not jubilant, but nor are they despondent or overly worried about the future. Given the toll of the pandemic, it’s an environment that favours an incumbent government. Initiating any change requires a strong desire to improve for the better, or a fear that we are currently on a failing path. Neither of these sentiments is currently present in Canada.

From a voting perspective, the Trudeau Liberals look much stronger than they did the last time they released a budget. Our latest national polling shows the Liberals riding high at 40 per cent if a vote were to happen today, leading the Conservatives (30 per cent) by a wide margin. As fate would have it, these are an exact reverse of what we saw in March 2019, when the Conservatives led the Liberals (40 per cent to 30 per cent) in the middle of the SNC Lavalin scandal. Of course, all voting intention polls are a point in time and subject to change, but being up 10 points and protecting a lead is by far the preferred scenario.

The pandemic has dominated public opinion in Canada.  It remains the most pressing issue and has become the prism through which we now see all other issues. The majority of Canadians are telling us that the pandemic is far from over. A slim one in ten Canadians (11 per cent) believe that the COVID-19 outbreak has been contained and will soon be over, but everyone else is focused on the short term and the practicalities of getting through the current week.

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We have had a year of disruption, and if a vote were held today people may well lean to the status quo to calm their nerves. The short-term perspective of Canadians also plays well for an incumbent that is willing to spend on items that are seen to be helping now.

4:24 How the pandemic is impacting the latest business headlines including the upcoming federal budget

What does all this mean for next week’s budget?

It means the government can and likely will do whatever they need to reinforce their base because few others will be listening. There will be climate change initiatives despite the fact that they rank 9^th out of 19 possible initiatives we offered to Canadians to include in the budget, and there will be something on childcare (14^th out of 19). Maybe if Canadians were in a more disruptive mood and looking for change, we would see a budget that was focused on reducing taxes for low and middle-income earners (1^st of 19), and increasing them for the wealthy (2^nd of 19).

However, this course of action might actually wake Canadians up and kick-start a more vigorous discussion about the future and the role of government, something that neither the public nor the government are in any mood for right now.

After the budget, the opposition parties will be faced with a dilemma. Defeat the government on its budget and force an election or play for time by supporting the budget. Based on the polling, playing for time makes the most political sense. While giving up election timing in a minority Parliament is anathema for most opposition leaders, forcing an election when it favours the incumbent and hoping for circumstances to significantly change over a short election campaign is a bigger risk.

6:05 Majority of Canadians want reasonable plan for return to balanced budget: Ipsos

There is no shortage of issues being suppressed today by the weight of COVID-19 that could hurt the Liberals in the future. This will change. The opposition parties need to start a dialogue today that challenges Canadians to consider Canada in 2023 and beyond. The pandemic has revealed great weaknesses in areas where we thought we were making progress: gender equity, diversity and racism. It has also pushed back the timeline and sense of public urgency for making changes to improve the environment, modernize our health system, renew our infrastructure, increase productivity, or bring new immigrants into Canada.

A focus on tomorrow’s issues might not be a winning formula for the Opposition, but if they can convince Canadians that they need to consider these issues sooner rather than later and get the current government engaged in a forward-looking policy debate, we would all be better off when we face the next pandemic.

Mike Colledge is president, Canada Ipsos Public Affairs.