Liberals spend, but don’t tax

This week the Liberal government tabled its first budget in over two years.

In her budget speech, Finance Minister Chrystia Freeland stated that we must build “a more resilient Canada: better, more fair, more prosperous and more innovative.”

This raises the obvious question: Who has been governing Canada for the past five years to have made Canada so un-resilient, so un-fair, so unprosperous and lacking in innovation?

This is generally the pattern of Liberal budgets and this one is no exception. By the numbers, this budget promises a massive level of spending, all told some $143 billion in new spending over the next six years. Where is it all going?

Despite promises not to use omnibus budgets, this Liberal budget comes in at over 700 pages, so it is only possible to highlight some of the proposed spending areas.

Thirty billion dollars has been earmarked for daycare and early learning over the next five years. This will require partnerships with the provinces to fully implement. Ultimately the goal is to provide $10 per day daycare.

Eighteen billion dollars in promised spending over the next five years aims to close the gaps between Indigenous and nonIndigenous people.

Seventeen billion dollars is promised to be spent in future years on the promotion of what the Liberals have termed the “green recovery effort.”

There is also a $12-billion promise to extend COVID business aid programs as well as other income support measures.

Another announcement is $12 billion over five years to increase the Old Age Security benefit that includes a one-time bonus payment of $500 expected later this year.

I should also add this is not a tax-and-spend budget. Many speculated this budget would include a “wealth tax” or other significant tax increases.

From my read of this budget so far, while there have been some minor increases in places, there are no significant tax increases. How does all this spending get paid for? While there is no actual debt-reduction plan, the Liberals indicate that the levels of spending will decrease over time as many support programs will be wound down and that, combined with economic growth, will offset this spending.

What is ignored in this budget?

There is no increase to federal health transfers. This is the most significant priority request from provincial governments with health-care systems under significant pressure right now.

For those hoping for a universal basic income or a national pharmacare program, these items were left out of the budget.

Also given that this budget takes Canada to a debt to GDP ratio of roughly 50%, there is limited fiscal capacity to potentially add these programs.