Prime Minister Justin Trudeau listens to Deputy Prime Minister and Minister of Finance Chrystia Freeland speak virtually during a news conference in Ottawa, Wednesday, March 3, 2021. THE CANADIAN PRESS/Adrian Wyld

Prime Minister Justin Trudeau listens to Deputy Prime Minister and Minister of Finance Chrystia Freeland speak virtually during a news conference in Ottawa, Wednesday, March 3, 2021. THE CANADIAN PRESS/Adrian Wyld

Liberals to unveil federal budget on April 19, Freeland says

It’s expected to outline Liberals’ plan to spend between $70 billion and $100 billion over the coming years

The federal government will release a highly anticipated budget in about four weeks, giving Canadians a detailed accounting of pandemic spending and how the Liberals plan to spend billions more on the road out of COVID-19.

Finance Minister Chrystia Freeland announced Tuesday the federal Liberals will table a budget on April 19.

It will be the first federal budget in more than two years, after the government opted not to introduce one in 2020 as the COVID-19 pandemic took hold in Canada.

It will also be Freeland’s first budget as finance minister; she took on the portfolio last summer following Bill Morneau’s resignation.

Freeland said the government went into the pandemic with strong finances, which allowed it to provide unprecedented support to Canadians.

“We will continue to do whatever it takes to support Canadians and Canadian businesses,” Freeland told the House of Commons Tuesday.

“And we have a plan for jobs and robust growth.”

The budget is expected to provide a full accounting of all government spending through the pandemic, which has sent the deficit for the fiscal year to almost $400 billion.

It is also expected to outline the Liberals’ plan to spend between $70 billion and $100 billion over the coming years in fiscal stimulus to help the economy recover.

Goldy Hyder, president of the Business Council of Canada, said in a statement that the government needs to provide economic hope to Canadians with an end in sight to the pandemic.

“To build confidence, the federal government must present a comprehensive and credible plan that spurs investment, private-sector job creation, and long-term economic growth,” he said.

The government will need to get the support of at least one major opposition party to pass its budget. Failure would mean the government falls and would almost certainly provoke a federal election.

Conservative Leader Erin O’Toole, in a statement, said the government has left far too many Canadians behind during the pandemic.

He contrasted Liberal policies with those his own party would unveil, saying he would focus on “growth in every sector of the economy and in every part of the country.”

The government has previously said this year’s budget will include measures to create a national child-care system, invest in skills training and help green the economy.

Additional measures pitched by departments have faced a simple question: how much economic growth can this buy?

The budget is likely to include spending on traditional areas like infrastructure, including for public-sector projects that could act as a catalyst for private projects, said Deloitte Canada chief economist Craig Alexander.

But he also noted that spending on social programs could also provide an economic boost in the short and long term, pointing specifically to child care.

By Alexander’s estimates, governments receive between $1.50 and $6 for every dollar invested in child care, suggesting it can help break down economic barriers by raising labour-force participation rates for parents, and mothers in particular.

“I don’t think the economy needs the government to just go and spend money on things that would just accelerate economic growth in 2021,” Alexander said in an interview.

“What we need is strategic investments that will provide a boost to the economy over the medium to long term.”

The budget will be the first one since March 2019 after the government opted not to introduce one in 2020, pointing to the uncertainty the pandemic had caused to the domestic and global economic outlook.

Freeland asked the Finance Department in the fall to detail the difference between a budget and a fall economic statement.

A footnote in the responding briefing note, a copy of which The Canadian Press obtained under the Access to Information Act, said “while a budget is typically presented every year, the government is under no obligation to do so.”

Freeland delivered an economic statement in late November, which pegged the deficit at $381.6 billion this year, but closing in on $400 billion if widespread lockdowns caused demand for aid to increase again. The federal debt was likely to top $1.2 trillion.

The Liberals argue the debt is manageable because economic growth should outpace interest rates, meaning more money coming in than the federal treasury will have to pay out over time.

A report Tuesday from the C.D. Howe Institute said the fiscal sustainability the Liberals outline is possible, but far from guaranteed.

If repayments are bigger than economic growth, that could mean spending cuts, tax increases or a combination of the two may be needed to keep deficits from spiralling.

The think-tank’s paper argued for the government to cut business subsidies that don’t address a clear market failure. If tax increases are necessary, the think tank said taxes on business investment should be avoided because they drive capital overseas and could push down wages here.

Jordan Press, The Canadian Press

federal budgetLiberals

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Edna Whiteley in 2016. “Her whole life has been happy and about helping others,” says her nephew Bob Steed. Photo: Submitted
Nelson’s ‘little firecracker’ Edna Whiteley turns 100

Whiteley is known as a welcoming ambassador for new arrivals in the city

B.C. Finance Minister Selina Robinson outlines the province’s three-year budget in Victoria, April 20, 2021. (B.C. government video)
B.C. deficit to grow by $19 billion for COVID-19 recovery spending

Pandemic-year deficit $5 billion lower than forecast

A syringe is loaded with COVID-19 vaccine at a vaccination clinic run by Vancouver Coastal Health, in Richmond, B.C., Saturday, April 10, 2021. THE CANADIAN PRESS/Jonathan Hayward
67 new cases of COVID-19 in Interior Health

Thirty people in the region are hospitalized with the virus, 11 of whom are intensive care

An animal carrier full of bullet holes and containing a dead animal was found near Castlegar. Photo: Colleen Schwartz
Castlegar woman finds dead animal inside carrier riddled with bullet holes

The remains were discovered near Syringa Creek Provincial Park

For web
Advocates hold opioid crisis vigil in Trail and Rossland

A delegation offered a powerful presentation on the opioid crisis to Rossland council last month

A lone traveler enters the Calgary Airport in Calgary, Alta., Monday, Feb. 22, 2021. THE CANADIAN PRESS/Jeff McIntosh
VIDEO: Trudeau defends Canada’s travel restrictions as effective but open to doing more

Trudeau said quarantine hotels for international air travellers will continue until at least May 21

B.C. Finance Minister Selina Robinson leaves the assembly with Premier John Horgan after the budget speech Tuesday, April 20, 2021. THE CANADIAN PRESS/Chad Hipolito
Paid sick leave for ‘hard-hit’ workers left out of provincial budget: BCGEU

‘For recovery to be equitable it requires supports for workers, not just business,’ says union president Laird Cronk

A large crowd protested against COVID-19 measures at Sunset Beach in Vancouver on Tuesday, April 20, 2021. (Snapchat)
VIDEO: Large, police-patrolled crowds gather at Vancouver beach for COVID protests

Vancouver police said they patrolled the area and monitored all gatherings

In this image from video, former Minneapolis police Officer Derek Chauvin, center, is taken into custody as his attorney, Eric Nelson, left, looks on, after the verdicts were read at Chauvin’s trial for the 2020 death of George Floyd, Tuesday, April 20, 2021, at the Hennepin County Courthouse in Minneapolis, Minn. THE CANADIAN PRESS/Court TV via AP, Pool
George Floyd’s death was ‘wake-up call’ about systemic racism: Trudeau

Derek Chauvin was found guilty Tuesday on all three charges against him

Former University of Victoria rowing coach Barney Williams is photographed in the stands during the Greater Victoria Invitational at CARSA Performance Gym at the University of Victoria in Victoria, B.C., on Friday, November 29, 2019. THE CANADIAN PRESS/Chad Hipolito
Rowing Canada sanctions former head coach of B.C. varsity women’s team

Suspension of Barney Williams would be reversed if he complies with certain terms

A man pauses at a coffin after carrying it during a memorial march to remember victims of overdose deaths in Vancouver. THE CANADIAN PRESS/Darryl Dyck
B.C. announces historic half-billion-dollar funding for overdose crisis, mental health

Of it, $152 million will be used to address the opioid crisis and see the creation of 195 new substance use treatment beds

Children’s backpacks and shoes are seen at a CEFA (Core Education and Fine Arts) Early Learning daycare franchise, in Langley, B.C., on Tuesday May 29, 2018. THE CANADIAN PRESS/Darryl Dyck
B.C. budget to expand $10-a-day child care, but misses the mark on ‘truly universal’ system

$111 million will be used to fund 3,750 new $10-a-day spaces though 75 additional ChildCareBC universal prototype sites over the next three years.

Most Read