Key Takeaways:
- The government’s inability to keep spending under control before COVID opened the path for the $600 billion+ spent in 2020-21.
- However, the natural rise was far more significant, with spending hitting $338.5 billion in 2019-20, up to $24.3 billion from the initial projection.
The government should openly engage Canadians in discussions regarding the balance between more spending and the need for more outstanding taxes to make more informed decisions.
The Trudeau government’s recent throne speech. Which outlines the government’s primary priorities, did not include the words “deficit” or “debt” once but did highlight more than 30 government programs, including public daycare and a forced energy transition.
This government continues to portray its previous level of spending, mainly funded by borrowing, as being accessible to Canadians, which is untrue.
It’s crucial to acknowledge the massive expenditure and borrowing that occurred before COVID, as this set the tone for Ottawa’s reaction to the pandemic.
Total spending excluding interest charges for fiscal years 2016-17 to 2019-20 was anticipated to be $1.15 trillion in Prime Minister Harper’s last budget in 2015. Another approach to looking at spending is comparing the initial plan (Budget 2016) of the Trudeau Liberals with what happened.
Trudeau’s first budget, released in 2016, proposed an increase in expenditure to $314.2 billion by 2019-20. A nearly 4% increase over what the Conservatives promised more minor than a year prior.
Of course, some additional spending was required during the pandemic. Still, Ottawa demonstrated little discretion or even interest in targeting aid to keep the amount spent and so borrowed to a minimum.
According to the OECD, Canada federal, provincial, and municipal governments had the third-largest deficit percentage of GDP among the 26 industrialized countries, with statistics available in 2020.
Source: Vancouver sun News
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