It was a big news day in general, but it was already going to be big in Ottawa with the highly-anticipated (or feared) Federal Budget presented to Parliament on Tuesday afternoon. There were a lot of major announcements, a lot of money going both in and out the doors (mostly out), so what does it all mean? Here are the highlights.
It’s Shorter! The first budget from Finance Minister Bill Morneau and the Trudeau government is 269 pages long, or about half the size of the Conservatives last budget.
Red Ink! The Liberals are forecasting a $29.4 billion deficit for this fiscal year, $29 billion for 2017 and 2018, and $22.8 billion for 2019, which will be the date of the next Federal Election. Yes, the Liberals are saying that the budget will not be balanced when they stand for re-election. The debt will grow by $113 billion by 2020-21, but the debt-to-GDP ratio is expected to stay mostly flat at around 32 per cent.
(No) Growth. The budget projects growth at 0.4 per cent annually, which is lower than economists had it. Sorry about that.
Infrastructure Spending! This is the big one, the one that the Liberals promised in the campaign. This fiscal year, $4 billion will be spent on infrastructure with an expected boost GDP by 0.5 per cent , with another $7 billion to be spent next fiscal year with a one per cent boost to GDP. Amongst the line items: $3.4 billion for public transit, $1.4 billion for affordable housing, $2.2 billion for water and waste management systems in First Nations communities, $400 million for early learning and child care, $518 million for climate change mitigation technologies, and almost $4 billion in other miscellaneous spending just called “infrastructure.” That will all come in at $120 bullion to be spent on infrastructure for the next decade.
A Good Day for Indigenous Peoples. Canada’s First Nations people will see a bump in funding, $8.4 billion over five years, with $2.6 of that to improve primary and secondary education on reserves, and $2 billion for water and wastewater infrastructure over five years to end boil-water advisories. Another $40 million over two years has also been earmarked for the Inquiry into Missing and Murdered Indigenous Women and Girls.
Good Day for Veterans Too. The government will be reopening nine service offices that were closed by the Harper government (more on undoing Stephen Harper’s handiwork later). In addition, $5.6 billion over six years will go to increase disability awards for injured veterans and to enhance other financial benefits. The government will also hire more case workers to improve front-line services for veterans, and “greatly improve” income support to disabled veterans.
Go Green! The budget will provide $1 billion over the next four years for all things environmental. Electric vehicles and alternative fuel vehicles will get support with $62.5 million over two years for charging and refueling stations, as well there will be tax incentives for electric car charging stations. Another $20 million over eight years will go to support research into clean and sustainable technology, while $2.9 billion over five years will go to fighting climate change and air pollution.
Help for Students. The Canada Student Grant will increase by 50 per cent, to $3,000 a year from $2,000 for students from low-income families and to $1,200 from $800 for students from middle-income families. More than 350,000 students should be helped by the change.
Help for Seniors. The Guaranteed Income Supplement will be boosted up to $947 annually, which will affect nearly one million seniors in Canada. The eligibility for Old Age Security has been brought back to down to 65 from 67, another change implemented by the Harper government.
Help for the Unemployed. The Federal government will recognize the economic pressures in 12 areas “identified as having particularly acute unemployment challenges” in Alberta, Saskatchewan and Newfoundland, and enhance benefits in those regions. The threshold that claimants have to reach to get benefits will be lowered from 910 hours, there will be $73 million more spent on call centres and customer service, and the premium paid per $100 of an employee’s income will go from $1.88 to $1.61 starting in 2017, which is four cents cheaper than Trudeau promised on the campaign trail.
Yeah Culture! Major arts organizations are getting $1.9 billion over five years. The CBC in particular will get $675 million to “modernize and revitalize CBC/Radio-Canada in the digital era,” but money will also be flowing to the Canada Council for the Arts ($550 million ), Telefilm Canada ($22 million) and the National Film Board of Canada ($13.5 million). Another $35 million will also be spent to help promote Canadian artists and industries abroad.
No More Harper Tax Credits! While the budget will offer teachers a $150 tax credit for supplies, it eliminates the fitness and arts tax credits, worth up to $150 and $75 respectively, and also eliminates income splitting for couples with children, which brings us to…
Kids = Money! The current Canada Child Tax Benefit, National Child Benefit and Universal Child Care Benefit will be rolled up into the Canada Child Benefit, a new monthly tax-free payment system that will start July 1. Parents can receive up to $6,400 a year per child under 6, and $5,400 those aged 6 to 18, but it’s clawed back once the annual household income hits $30,000 and eliminated in its entirety at the $190,000 mark.
Housing Matters. Ottawa pledged $2.3 billion over the next two years for affordable housing in the form of incentives to get developers and municipalities to build more rental units, about 10,000 of them. Statistics Canada will also be funding a $500,000 study to find out if foreign investment is making our housing prices too damn high!
Open Sources Guelph 