June 4, 2023

La Ronge Northerner

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Federal Budget: Christiana Freeland’s Leave | Federal Budget 2022

The economic picture has changed a lot since Ottawa’s last budget, with a series of measures aimed at stimulating economic growth, helping workers and the unemployed, fighting the epidemic and, of course, setting up a day care network for $ 10 a day.

One year later, the economy is back on track, and Canada has to deal with rising oil prices, a significant increase in the price of groceries, inflation that has not been seen in 30 years, and a widening labor shortage. , A serious housing crisis, not to mention the consequences of the war in Ukraine.

Christiaan Freeland will present the first budget of Justin Trudeau’s Liberal government’s first re-election to the House of Commons at 4 p.m.

Parliamentary Budget Officer (PBO) It said in early March that it would face a $ 47.9 billion deficit in the next fiscal year due to higher tax revenue than expected. The Department of Finance forecasts a deficit of $ 58.4 billion in early April, representing a $ 10.5 billion difference.

The Trudeau government may be tempted to invest in national security. CBC News It is reported that $ 8 billion in new money will go to this place.

It must be said that the war in Ukraine affected the cargo of the Canadian Armed Forces. Canada sent arms, ammunition, equipment and various equipment to Ukrainian troops to fight the Russian invaders. This contradiction has also come to light Potential Russian threat in the Arctic.

In addition, Ottawa must allocate at least 2% of its North Atlantic Treaty Organization (NATO) partners’ pressure. GDP To its military budget. The federal government is currently spending the equivalent 1.4% bran GDP. We will increase our defense spendingMinister Anita Anand said recently.

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Except, The Prime Minister announced on March 28 His government is in final talks with US manufacturer Lockheed Martin to buy 88 F-35s. Ottawa expects to spend $ 20 billion to replace 40-year-old CF-18s.

Influence of New Democrats

Agreement between the Liberal Party of Canada (PLC) and the New Democrats (NDP) allowed the Trudeau government to remain in power until 2025, which could also affect the content of the budget.

NDP leader Jagmeet Singh and Canadian Prime Minister Justin Trudeau

Photo: Canadian Press / Sean Gilpatrick

The New Democrats It called for the launch of a global drug insurance program, the creation of a dental care program for low-income Canadians, the implementation of measures to make housing more affordable, and the improvement of housing payments Canada.

At the same time, the Freeland budget may contain a set of environmental measures aimed at combating climate change. Between 2018 and 2020, Canada provided 14.5 times more support for the fossil fuel industry than the renewable energy sector. It is the only G7 country to have increased emissions since the signing of the Paris Agreement in 2015.

The Intergovernmental Panel on Climate Change underscores the need for significant reductions in the consumption and production of fossil fuels and the elimination of the private sector and the suspension of subsidies to the sector, in order to achieve the goals of the Paris Agreement. In (IPCC) Its latest report was released on April 4.

It would be interesting to see what the federal government has to offer now This goes downhill to the Bay to Nord oil projectIt seeks to eliminate subsidies for the exploitation of fossil fuels, impose an additional 3% tax on the profits of oil companies, and create a tax credit for investing in carbon emissions.

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Keep in mind that the provinces have long called for an increase in health transfers. Will Ottawa listen to their continued request this time? On the other hand, new funds are not expected to fight the corona virus. Will the federal government provide a special envelope to solve the drinking water problem for the tribal people and improve services for children? And infrastructure?

Public finance

His The economic update was presented on December 14th Finally, Minister Christiana Freeland pointed out that the budget balance should be $ 145 billion (2021-2022) to $ 58 billion (2022-2023). It sets the stage for a return to equilibrium within five to six years.

In which, growth GDP Real estate has revised slightly upwards to 4.2% in 2022. Debt forecasts-GDP, They have been reduced to 48% this year. Debt is expected to reach $ 1250 billion by 2022-2023.

Despite the significant increase in the cost of living, the Canadian economy is doing well. It was up 0.2% overall in January, Canada estimates 0.8% gain in February. Final details will be revealed by the end of April.

The job market is good. The unemployment rate fell to 6.5% in January It was 5.5% in February, lower than the 5.7% recorded in February 2020, before the onset of the COVID-19 epidemic in Canada.

Inflation rose to 5.7% in February, Compared to 5.1% in January. For its part, the average salary increased by only 3.1%. Food prices rose 7.4% in February, according to Canadian data; This is the largest annual increase since May 2009. Shelter costs rose 6.6% in February, the largest increase since August 1983.

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In such a scenario, the finance minister may decide to help taxpayers – those whose purchasing power is declining – by reducing their tax burden.