The Federal government unveiled its 2018 budget late yesterday, detailing what to expect of federal spending and taxes over the next year. Most notably, the Liberal government indicated it will not balance the budget by 2019 as promised in its 2015 election campaign. Canada is now projected to remain in deficit past 2022.
The 2018 budget is projecting an $18.1 billion deficit this year, though $21.5 billion in new spending was announced. And in his budget speech to the House of Commons, Finance Minister Bill Morneau said, “It is a plan that puts people first – that invests in Canadians and in the things that matter most to them.”
Here is a rundown of how some of the tax payer cash will be disbursed.
Woman and equal pay
The government did say this budget would be the most gender-positive budget ever presented. The word “gender” appeared more than 350 times in the budget document, compared to 2016 when it only appeared twice.
The government is planning to introduce a new pay equity law in order to close the wage gap among federal workers and those who work in federally regulated sectors.
There is also $3 million set aside over the next five years to enhance pay transparency measures, ultimately to shed light on public sector employers who are and are not following equitable pay practices.
Over a span of three years, $30 million is earmarked to promote women and girls’ participation in sports. Also, and perhaps in response to the #MeToo movement, $10 million will be spent over five years for an RCMP unit to review 25,000 cases of sexual assault that have been called “unfounded.”
Science and research
Over the next five years, $2.6 billion is planned to go towards scientific innovation. That money, the government says, will not only foster scientific innovation, but also gender equity by encouraging female entrepreneurs and business leaders. There is an additional $3.2 billion dollars over five years funding Canadian science and research, including money to grant councils and Canada Research Chairs, upgrade outdated laboratory facilities and harness the power of so called “big data.”
There is now a “use it or lose it” extended parental leave for two-parent families. This is aimed at new fathers who may choose to take parental leave while their partner is off on maternity leave. This new incentive – the Employment Insurance Parental Sharing Benefit – will cost $1.2 billion. The extended benefit gives the second partner an option to take five weeks off if the other parent is off for 12 months, or eight weeks if the other parent opted for an 18-month leave. This new measure takes effect in June 2019.
Furthermore, $4.7 billion in new spending was committed to indigenous communities, including $1.3 billion in new funding for First Nations Child and Family Services. This builds on previous money promised in the 2016 budget to help child welfare, health care, water and housing in indigenous communities. Over three years, $172.6 million will be spent on clean drinking water for reserves, and $400 million will be spent over 10 years on upgrading and expanding Inuit housing in addition to $500 million on Métis housing.
The Liberal government is also making a pledge for a new pharmacare program. There is no indication on what the new program will cost or what it will cover, but former Ontario Health Minister Eric Hoskins will chair a new council that will hold countrywide consultations on how to proceed. Hoskins resigned from his position as Health Minister on Monday.
Other notable spending
- Over five years, $750 million will be committed to improve cyber security, and $116 million over five years will go towards the RCMP to create a National Cybercrime Co-ordination Unit.
- There will be more focus on the environment, as 1.3 billion will be spent over five years to conserve land, waterways and wildlife and protect species at risk. And $100 million over five years will be used to develop rural broadband innovation, including low-earth-orbit satellites.
- $173 million will be used to address irregular border-crossings and asylum seekers.
- $6 million will be committed to developing a new process to hold federal leadership debates during election years.
- $50 million over five years will go towards one or more independent organizations to support local journalism.
- Over the span of five years, $231 million will be set aside to address the opioid crisis.
No NAFTA talk
One glaring omission in the budget was the mention of new tax cuts for businesses. While the federal government could mimic what is currently happening in the U.S., Finance Minister Morneau said he is waiting to make more evidence-based decisions. NAFTA negotiations are currently going on as the U.S. continues to threaten to end the trade agreement which took effect over 24 years ago.
Also, the budget is not taking an economic downturn into consideration, as it is only based on the economy experiencing positive growth over the next five years. That being said, this quiet budget may be the calm before the storm. It can be expected that with an election looming in 2019, there will be a lot more nuggets in the 2019 budget than the 2018 budget.