The recent federal budget doesn’t appear to be getting rave reviews from Canadians.
This past week the Globe and Mail published results of a poll asking 1,000 people whether they had a positive or negative view of the March 22 federal budget. According to the Globe, 52% had negative or somewhat negative opinions. Only five per cent said they had a positive view, 33 % said their opinion was somewhat positive.
With only one out of twenty firmly positive, participants were clearly unimpressed with the budget, and its lack of a plan for eliminating the deficit seems to be a sore point. On the balanced budget question, four in five said it was important to have a plan for eliminating the deficit. Less than one in ten said having such a plan was unimportant.
Normally I would be inclined to regard the findings as just more evidence of the unfortunate triumph of right wing anti-tax, anti-government ideology. However, in this case the opposition parties and the people polled by Nanos research for the Globe may be on to something.
The two main opposition parties approach the matter differently – for the Conservatives it’s mostly about the evils of public debt, period. During the brief budget debate in the House of Commons the Conservatives harped on about the debt burden being passed to our children and grandchildren. (Amazing how Conservatives can fret about that burden while ignoring the legacy of a fossil-fuel degraded environment being handed to the next generation).The NDP’s take was more salient, boiling down to “deficits for what?” Good question.
No there there
During the 2015 campaign the Liberals probably swung more than a few votes by promising – in contrast to the Conservatives and NDP – modest deficits for a few years followed by a balanced budget in time for the next election. That promise has disappeared with no explanation from the Liberals and we’re now witnessing deficits north of $25 billion for this year and last, and no balanced budgets in sight.
The (upper) middle class tax cut and the increases in child benefits are responsible for some of the deficits. But aside from those two measures from last year and a lot of announcements about things that may happen in the future, there is very little to show for the deficit spending. The 2017 budget does nothing to change that.
The Liberals may try to tout the new deals with provincial governments on home care and mental health, but they will be unable to hide the fact that the “new” spending was made possible by sharply curtailing other transfers to the provinces. Major transfers for health, social programs and equalization, up an average of 4.4% a year during the deficit-obsessed Harper years, are up just 2.7% in free-spending year two of the Trudeau regime. There’s irony for you.
But at least the provinces are getting their transfers, diminished though they are. Many initiatives highlighted in the budget are not being funded at all this year. Others are getting a small down payment over the next couple of years, with most of the spending earmarked for after the 2019 election.
In the latter category, housing is the best (or worst) example. The Liberals talk about spending big bucks -$11 billion – on housing over the next ten years. But there’s a catch. Only about seven per cent of that will be spent between now and the next election. The other 93% will roll out only if you re-elect the Liberals – twice – in 2019 and 2023.
MP Nathan Cullen’s description – “a backloaded, bafflegab, better-luck-next-time budget” seems particularly apt when you look at the second category – initiatives mentioned in the budget for which no spending is allocated this year. There are dozens of examples, some of which invite the question, “Why wait?”
Why no money in this year’s budget to “tackle homelessness? Why wait for two years to put some serious dollars into that problem? How about “Improving Indigenous Communities.” The Liberals say they’ll eventually spend $2 billion on that, but this year? Nothing – and only $54million budgeted for next year. And then there is “Housing for Indigenous Peoples not On-Reserve”. The feds will spend $25 million per annum on that, but nothing this year. Same with the “Enabling Accessibility Fund.” That’s slated to get a modest $8 million a year, but not until some time after next April.
Waiting for Child Care
Perhaps the most transparent deception is the budget’s trumpeting of $7 billion for early learning and child care. Recall that universal $15-a-day child care and creation of 370,000 new spaces over four years was a central $4 billion plank in the NDP’s 2015 campaign platform. The Liberals responded to that with a commitment to spend $20 billion over the next decade on “social infrastructure,” including creation of a “National Early Learning and Child Care Framework to ensure that affordable, high-quality, fully inclusive child care is available to all families who need it.”
That was great campaign rhetoric – accompanied with a big dollar number – to counter the NDP’s day care plank. But the reality revealed in budget documents show in detail the extent to which the Liberal plank was driven not by a plan to significantly improve day care, but by the political need to checkmate the NDP.
There was no money in the 2016 budget for child care and none in the 2017 budget either. The promised “Framework” has not yet materialized as the feds reportedly try to convince the provinces to agree to a plan that would target Ottawa’s support to low-income parents. If the provinces and feds do reach agreement, the promised $7 billion will start to flow in next year’s budget but will total only about $1.1 billion by 2020.
It’s obvious the Liberal day care plan doesn’t hold a candle to the NDP proposal it was meant to neutralize. Instead of the $4 billion committed over a four-year mandate proposed by the NDP, the Liberals may spend about $1.1 billion. Instead of creating 370,000 spaces at $15 a day, the Liberals may create about 25,000 subsidized ones before their mandate expires. And their plan does nothing to bring down costs which can be as high as $80 a day in Toronto and $40-$50 a day in places like Halifax.
And here’s more irony for you. The Liberal child care plan of 2017 doesn’t even measure up to the one that Ken Dryden negotiated with the provinces on behalf of the Paul Martin government back in 2005. That plan, subsequently torpedoed for ideological reasons by the Harper government, was worth $5 billion over five years. The Dryden plan works out to about $30 a head for each province – or nearly $30 million for Nova Scotia. The Trudeau plan works out to about $15 per capita before it increases a bit in 2022. But when inflation taken into account, the Trudeau plan is worth less than half what the feds put on the table for child care a dozen years ago.
It’s highly likely that none of those Canadians polled about last month’s budget had the time or inclination to read its fine print. But they caught the drift, and details in the budget certainly bear out their ho-hum reaction.
 Liberals may argue that the improved Child Benefit will help with child care costs, which is true as far as it goes. But in most provinces, those improved benefits would be eaten up by day care costs in a matter of weeks.