Freeland's budget to include grocery rebate for lower income Canadians, here's what else to expect Tuesday
Freeland's budget to include grocery rebate for lower income Canadians, here's what else to expect Tuesday
The 2023 federal budget will include a one-time "grocery rebate" for Canadians with lower incomes who may be struggling with the rising cost of food, CTV News has confirmed.
According to sources, the new measure will be unveiled in Tuesday's federal budget and will help nearly 11 million lower-income Canadians.
The new measure would see eligible couples with two children receive a payment of up to $467, a senior would receive $225, while a single person would receive $234 dollars.
The benefit will be rolled out through the GST rebate system, once a bill implementing it passes in the House of Commons, according to sources. This move is essentially re-upping and re-branding the recent GST rebate boost.
The amounts expected to be offered are exactly what the Liberals offered through last fall's doubling of the GST credit, a boost that was estimated to cost $2.5 billion and got all-party backing. It's not expected that there will be a requirement to spend the rebate on groceries.
According to Statistics Canada's latest inflation report, food prices rose 11.4 per cent year-over-year in January, nearly double the rate of inflation of 5.9 per cent and up from 11 per cent the previous month.
The increased cost of food has been the focus of a parliamentary study that's seen grocery CEOs, including Loblaw chairman and president Galen Weston, grilled over grocery profits.
"I’ve been talking with Canadians from coast, to coast, to coast over the past many months hearing directly concerns around affordability, around the high cost of food, of rent, of so many different things. That’s why a big part of the budget will be focused on measures to help Canadians in targeted ways," Prime Minister Justin Trudeau told reporters on Parliament Hill on Monday.
"Groceries will certainly be part of it but, there’s other things as well that we’re going to continue to do to be there for Canadians…I look forward to a great budget tomorrow."
The NDP had been calling for the Liberals to double the GST tax credit. Reacting to the news, NDP Leader Jagmeet Singh said this measure "looks very much like… what we've been asking for, for a long time."
Both Trudeau and Deputy Prime Minister and Finance Minister Chrystia Freeland have been hinting for weeks that the 2023 budget would include targeted affordability measures to directly help those feeling the pinch of inflation the most.
"This support will be narrowly focused and fiscally responsible. The truth is, we can't fully compensate every single Canadian for all of the effects of inflation or for elevated interest rates," Freeland said last week in a pre-budget speech signalling her priorities. "To do so would only make inflation worse and force rates higher, for longer."
On Monday afternoon, the finance minister took part in a long-standing tradition of picking out a new pair of shoes to wear on budget day.
This year, Freeland opted for a pair of black heels that were on sale at Canadian retailer Simons, from the store's in-house brand. She placed them in a reusable tote bag after purchase.
WHAT ELSE TO EXPECT IN BUDGET 2023?
With the economy expected to continue slowing in the months ahead, potentially leading to a recession, Freeland is facing calls for the massive fiscal document to include a plan to promote economic growth.
Amid Bank of Canada's interest rate hikes, inflation cooled to 5.2 per cent in February. That’s down from 5.9 per cent in January, after 40-year record highs over the summer, reaching 8.1 per cent in June.
"What Canadians want right now is for inflation to come down and for interest rates to fall. And that is one of our primary goals in this year’s budget: not to pour fuel on the fire of inflation," Freeland said in her pre-budget positioning speech.
At the same time, she signalled the 2023 federal budget will still be prioritizing "two significant and necessary investments": the $46.2 billion in new funding included in the $196 billion federal-provincial health-care funding deals, and new measures to boost Canada's clean industrial economy.
It's the latter that government officials have signalled will get some attention in tomorrow's budget, with several news outlets reporting there will be sizable—30 per cent, according to Reuters— new clean technology-focused tax credits to generate growth in the electrical vehicle supply chain and in critical mineral extraction and processing.
"Tomorrow…we're bringing forward a budget that is focused on affordability and supporting Canadians… and creating great jobs for the middle class in a clean and growing economy. Those are the focuses that we've been laser focused on over the past many years," Trudeau said in the House of Commons on Monday, fresh off of U.S. President Joe Biden’s visit, where the green economy was a central piece of discussion.
Canada's clear focus on the clean transition comes in part out of a need for these sectors to remain competitive in the face of the U.S. Inflation Reduction Act, which offers billions of dollars in energy incentives south of the border.
The Canadian Press has also reported that Tuesday's budget will include an increase to the withdrawal limit for a registered education savings plan (RESP) from $5,000 to $8,000; and a plan to go after hidden or unexpected consumer fees known as "junk fees" that inflate the overall cost of a product or service.
Finance Canada officials, who for some time have been parsing the stacks of pre-budget submissions from various industries and sectors, will also have to factor in the Liberals' commitments to the New Democrats, with key planks of the two-party confidence deal due to come to fruition this year.
"We still want to see confirmation of the dental care expansion to include seniors, people living with disabilities and kids 18 and under. We really want this budget to save money for people, and that's something really important for us," Singh said.
With this budget, Conservative Leader Pierre Poilievre has called on the federal government to lower taxes, end "inflationary" spending, match new spending with savings, and improve housing affordability.
"He wants to take away everybody's money, centralize it in his own hands, and promise that it will trickle down through his mighty bureaucracy… And there will maybe be a few little drops that get down to the people who actually earned it in the first place," Poilievre levelled at the prime minister during Monday's question period. "Will he cap government spending and put an end to the inflationary deficits, tomorrow?"
The fall economic statement issued in November 2022 projected the federal deficit at $36.4 billion in 2022-23, down from the $52.8 billion forecast in the April 2022 federal budget. Freeland also forecasted that federal coffers could be back to balance by 2027-28.
The 2023 federal budget is coming just ahead of a two-week break in the House of Commons, allowing Liberal MPs to then descend on their ridings to promote it to their constituents before coming back to the capital to work on getting the budget implementation legislation passed through the minority Parliament.
With files from CTV News' Chief Political Correspondent Vassy Kapelos, and CTVNews.ca's Michael Lee and Spencer Van Dyk
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