Tory plan to cost $51B over five years
Conservatives release costed platform that predicts deficits on par with Liberal projections
OTTAWA—The Conservatives’ election platform commits the party to $51.28 billion in new spending over the next five years, which would create deficits nearly on par with those forecast by the Liberals’ plan.
The party released its costed platform on Wednesday, just hours before Erin O’Toole was set to take the stage for the first of two leaders’ debates.
The platform allocates only $3.633 billion by 2025-26 to cover the cost of boosting health care transfer payments to the provinces by roughly $60 billion over the coming decade, and does not include the price of retooling the Liberals’ carbon pricing program.
And the platform projects a continued budget deficit over the next five years — $168 billion in 2021-22, decreasing to $57.3 billion in 2022-23 and $24.7 billion in 2025-26. The deficits are roughly equivalent to those forecast by the Liberal party, which released its costed platform last week.
The Conservative party has been under pressure to make public the price of its platform, which was released without a full accounting in the early days of the federal election campaign.
The Conservatives’ central message has been that they can wind down COVID-19 emergency spending, boost spending in key areas like health care transfer payments, and still balance the books over the long-term without resorting to spending cuts.
The figures released Wednesday do not include a complete plan to balance the budget over 10 years, as O’Toole has repeatedly said he could do. But it does project deficits declining considerably by 2025-26.
The Conservatives expect their plan to provide a significant boost to economic growth. At the start of the campaign, the party suggested Canada would need to boost the GDP by three per cent a year to get Ottawa’s finances under control. That’s still the target, but the Conservatives now say it’s not essential to return to balance in the long term.
“Our philosophy is based on saying we shouldn’t accept that long-term growth should be 1.6 per cent a year. We should set a target of three per cent a year,” said a senior Conservative official, briefing reporters on the condition they not be named.
“We don’t think it takes magic to get there. We think it takes a plan. We’ve got a plan, and we’ve shown that.”
And while the plan released Wednesday doesn’t include “cuts,” it does feature “reallocations.”
O’Toole would scrap the Liberals’ marquee promise of a national daycare program, booking $26.734 billion in savings over five years. The Conservatives’ alternative would see money sent directly to parents in the form of tax credits, at a cost of $2.62 billion. Conservative officials could not put a dollar figure on how much that would cost the Quebec government, which is set to receive $6 billion under the Liberals’ plan.
The Conservatives would spend $1.5 billion on “natural climate solutions” like forest management and restoration of wetlands, but reallocate $1.996 billion in planned Liberal spending on the same file. The party’s plan to substitute a personal carbon savings account for the Liberals’ carbon pricing scheme has no dollar figure attached.
Asked how the Conservatives would deliver on their pledge to boost health care transfer payments to the provinces by $60 billion over 10 years, given that their costed platform accounts for only $3.633 billion by 2025-26, a Conservative official explained that the party’s plan to boost health spending by six per cent each year means the majority of the funding increase would be seen in 203031. That would be in a second or third mandate of a prospective Conservative government.
“Really, the biggest impact of this comes in later years,” the official said. “Provinces want predictable, stable long-term funding. We’ve given them that for 10 years.”