Fed­eral min­is­ter paints bleak pic­ture of eco­nomic growth prospects

The Guardian (Charlottetown) - - CANADA - THE CANA­DIAN PRESS

The fed­eral fi­nance min­is­ter spoke of pitch-black mo­ments in his morn­ing shower and some dark­en­ing clouds for the Cana­dian econ­omy as he kicked off his na­tional bud­get con­sul­ta­tion tour in Hal­i­fax on Mon­day.

Bill Morneau drew chuck­les from a busi­ness au­di­ence at the Hal­i­fax Cham­ber of Com­merce as he de­scribed a morn­ing power out­age that oc­curred while he was cov­ered in soap lather.

The min­is­ter said it’s just the lat­est in a se­ries of chal­lenges he’s fac­ing as he sets out to pre­pare his first bud­get amidst a de­clin­ing econ­omy.

Within a few min­utes of be­gin­ning his speech, Morneau launched into a se­ries of slides that painted a bleak pic­ture of eco­nomic growth ham­pered by plung­ing com­modi­ties prices.

He re­peated prior state­ments that the Cana­dian econ­omy is suf­fer­ing from slower growth than orig­i­nally pro­jected by the for­mer Con­ser­va­tive govern­ment due partly to oil prices that are less than half those of 2014.

“We knew when we were cam­paign­ing we were fac­ing a slow­growth en­vi­ron­ment,” he said.

“The chal­lenge is greater than we ex­pected.”

The min­is­ter said there’s hope that oil prices will im­prove, but as it stands a de­clin­ing tax base means his depart­ment is ex­pect­ing a $15 bil­lion per year re­duc­tion of GDP be­gin­ning this year, com­pared with what was pro­jected in the last bud­get.

“It’s im­por­tant to have a frank view of where we’re start­ing from,” he said.

Morneau is trav­el­ling across the coun­try this week to seek in­put as he draws up his first fed­eral bud­get.

The fi­nance min­is­ter spoke on the same day as the Bank of Canada’s lat­est busi­ness out­look sur­vey was re­leased in­di­cat­ing com­pa­nies’ in­vest­ment in equip­ment and hir­ing in­ten­tions for the next year are tum­bling to their low­est lev­els since the 2009 re­ces­sion.

The for­mer ex­ec­u­tive chair­man of a hu­man re­sources firm told re­porters the sur­vey in­di­cates his party’s in­fra­struc­ture spend­ing will as­sist in re­tain­ing busi­ness con­fi­dence.

He also re­peated the party will keep its cam­paign prom­ises to bring in middle class tax breaks and spend bil­lions on in­fra­struc­ture.

But dur­ing a news con­fer­ence, Morneau of­fered few de­tails when lo­cal re­porters asked about how Ottawa will stim­u­late the Nova Sco­tia econ­omy and help with the up­keep of ag­ing in­fra­struc­ture.

He said he couldn’t com­ment on whether the num­ber of fed­eral ships be­ing built in Hal­i­fax yards will re­main.

He also said he had lit­tle in­for­ma­tion about the Vic­to­ria Gen­eral, an ag­ing Hal­i­fax hos­pi­tal be­set by rou­tine floods and leaks, and couldn’t say whether help­ing fix the prob­lem falls within the planned in­fra­struc­ture spend­ing.

Randy Delorey, Nova Sco­tia’s Lib­eral min­is­ter of fi­nance, said in an in­ter­view he’s con­tent to wait for more de­tails about how his fed­eral coun­ter­part’s in­fra­struc­ture pro­gram will work — and whether he can ask for help with the de­crepit fa­cil­ity.

Dur­ing a news con­fer­ence, the fed­eral min­is­ter was also asked whether Ottawa will con­tinue ef­forts by the for­mer Con­ser­va­tive govern­ment to cre­ate a na­tional se­cu­ri­ties reg­u­la­tor.

He said his govern­ment will work with provinces who want to cre­ate the reg­u­la­tor, but re­spected that Al­berta and Que­bec weren’t in­ter­ested in pro­ceed­ing with the plan.

“We do favour a col­lab­o­ra­tive na­tional se­cu­ri­ties reg­u­la­tor,” he said. “We rec­og­nize we’ll do this to­gether with those provinces will­ing to be part of this ini­tia­tive. We think it’s im­por­tant for Canada find a way to be ef­fi­cient in all things we do.”

Late in the day, the min­is­ter an­swered a wide-rang­ing se­ries of ques­tions from stu­dents at Dal­housie Univer­sity, the first of se­ries of fo­rums that will be held at univer­si­ties.


Fi­nance Min­is­ter Bill Morneau ad­dresses the Cham­ber of Com­merce in Hal­i­fax on Mon­day. Morneau is vis­it­ing Cana­dian cities as he con­sults with stake­hold­ers be­fore the next fed­eral bud­get.

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