A balanced federal budget was announced April 21 by the Conservative government, but it is a delicate balance.
Tax cuts promised six months ago—including good news for seniors, small businesses and foreign investors—have left Canada’s budget in the black, but with almost no surplus to speak of.
West Vancouver-Sunshine Coast-Sea to Sky Country MP John Weston said the balanced budget is a big win for Canada.
“The government has presided over an economy which has added 1.2 million net new jobs since July 2009 when the recession hit, making us one of the top performers in the world economically,” Weston said in an interview with the Coast Reporter.
Weston attributes this success to the Conservative government’s tax cuts to businesses, allowing them to hire more people.
“Today we saw...further reduction in the tax rate for small businesses from 11 to nine per cent,” he said. “That’s the largest tax cut in more than 25 years for small business.”
Not everyone agrees with some uncomfortable with the precarious position that the diminished surplus has left Canada in.
In addition to eating through most of the $5-billion surplus for 2015/16 (there is $1.4 billion left over), the government has also done away with the unforeseen events fund, typically about $3 billion.
Randall Bartlett, senior economist at TD Economics told Global TV that the balanced budget is not as stable as the government is making it out to be.
“There’s a lot of things booked in here that are not based on economic fundamentals,” Bartlett said. “I wouldn’t necessarily call it the healthiest balance.”
For local seniors, there’s good news. A petition started on the Sunshine Coast to remove the minimum withdrawal limit to Registered Retirement Investment Funds (RRIF) was successful. Seniors are allowed to leave their money in their RRIF longer.
“That means that as seniors are living longer lives than in 1982, and are receiving lower return on investment under current market conditions, the money in their RRIF may last as long or longer than they do,” Weston said.
Pacific Salmon Foundation has been promised $2 million for its Salish Sea Marine Survival Program to investigate the survival of juvenile salmon in the Strait of Georgia.
Although the Conservative argument is that tax incentives for small business and foreign investors will stimulate jobs in the economy, many, including New Democratic Party leader Thomas Mulcair, think that this may be an attempt to sway the vote in the upcoming election.
“I think that’s probably the contingency they’re worried about,” Mulcair told CBC in Ottawa. “The election.”
Weston sees the opposition’s response as promising for another term with the Conservatives. “The opposition parties are upset because the Conservatives have done a good job.” Weston said.
Funding for Canadian security has increased with almost $300 million for the RCMP, CSIS and border patrol. Other items on the budget won’t take effect for a few years.
