OTTAWA -- The federal government will be tabling the 2021 budget on April 19, Deputy Prime Minister and Finance Minister Chrystia Freeland announced Tuesday.
The budget is expected to include a full accounting of the state of the country’s finances amid historic spending levels and dire unemployment figures due to the ongoing COVID-19 pandemic.
“Canada entered this global pandemic in a strong fiscal position, which allows our government to provide unprecedented support to Canadians. We will continue to do whatever it takes to support Canadians and Canadian businesses, and we have a plan for jobs, and robust growth,” Freeland said during question period.
The 2021 federal budget will be the first official budget the government has issued in two years, after the Liberals called off the March 2020 budget as outbreaks began to worsen nationwide in the early days of the global crisis.
In the last budget, which was presented on March 19, 2019, the federal deficit was estimated to be $19.7 billion in the 2020-21 fiscal year. However as of the 2020 fall economic update, that had ballooned to at least $381.6 billion in 2020-21, due to hundreds of billions of dollars in federal pandemic spending.
The fall fiscal figures showed that Canada could sink deeper into the red if outbreaks of COVID-19 worsened and led to extended restrictions, which happened in the months following.
In what will be the first federal budget presented by Freeland following the 2020 resignation of former finance minister Bill Morneau, the government has promised more details on a massive economic stimulus plan to rebound from the pandemic-prompted recession.
Depending on the state of the country’s finances the government has signalled they intend to spend roughly three to four per cent of the GDP— $70 to $100 billion between 2021 and 2024 – over the next few years on initiatives such as child care and a green recovery.
With COVID-19 case counts on the rise once again in Canada, it’s possible the key spending document will include more targeted supports for people, businesses, and the health care sector.
In concluding their pre-budget hearings, MPs said that the long-awaited budget is going to be critical to setting in motion Canada’s post-pandemic recovery efforts, stating it’ll be key that the budget include plans on how the government intends to act on a series of promises such as a national pharmacare program, while not setting the country on an unsustainable spending path.
In a statement responding to the budget date news, Business Council of Canada President and CEO Goldy Hyder called for the budget to lay out an economic growth plan.
“With an end to the COVID-19 pandemic now in sight, Canadians are looking for hope when it comes to jobs and the economy,” Hyder said. “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.”
The coming budget is also being viewed as a key political document, as the Liberal minority government will require opposition backing to see the budget bill pass. Traditionally viewed as a matter of confidence, if the Liberals aren’t able to secure support from another major party, the government could fall, prompting a snap election.
CONSERVATIVES CALL FOR REOPENING PLAN
The budget date was dropped on a day when the federal Conservatives put forward an opposition day motion calling on the federal government to table a plan to “safely, gradually and permanently” lift COVID-19 restrictions, citing the economic and mental health impacts they’ve had.
Seeking to address questions about their push being centered on public health measures that are under provincial and territorial jurisdiction, Conservative Leader Erin O’Toole said that if the government can call for tougher restrictions, the federal government could also lay out the conditions needed for a responsible reopening.
He raised the issue during question period as well, suggesting that under the current government, Canada is destined to fail when it comes to the economic reopening. O’Toole asked when Prime Minister Justin Trudeau would outline what criteria would need to be in place as part of a transition to a new normal.
“Thousands of Canadian small businesses are hanging on by a thread, lockdowns are hurting main streets across the country, and family-owned businesses are in crisis… where is the plan, and when is it coming,” said O’Toole.
“Every step of the way we have been there to support Canadians, and every step of the way we will continue to put both the protection and safety of Canadians and the benefits of our economy at the frontline,” Trudeau said in response.
