Leftist policies are ruining Canada
If the Trudeau government is re-elected, many predict that Canadians will pay more taxes because of a budgetary deficit of about $20 billion.
Infrastructural Projects and Budgetary Deficit
Trudeau promised to balance the budget and erase the deficit by 2019 but the government recently announced plans to increase spending by $22.8 billion. In 2015, Trudeau promised to invest in infrastructure and build metro lines, bridges, and roads in order to stimulate the economy and make it more competitive. Out of $188 billion budgeted for infrastructural improvements, the government spent only $19 billion and approved some 4,700 projects. A report by the Parliamentary Budget Officer reveals that little progress has been achieved because of reporting gaps, delays, and other problems. Moreover, provincial spending on infrastructural projects increased but not as planned before the introduction of the program. The Parliament Budget Officer also noted that GDP increased between 0.13 and 0.16 percent as a result of the government’s infrastructure plan. These figures are significantly lower than the 0.4 percent that Ottawa projected. Conservative politician and critic Matt Jeneroux points to the fact that the infrastructure project brought no real economic benefits, one of the main reasons being that the provinces are not actively engaged in investing in infrastructural improvements. The government owns just 2.1 percent of infrastructure compared to 59.8 percent of infrastructure owned by the municipalities and 38.1 percent by the provinces. The division of responsibilities among the municipalities and provincial and territorial governments is a source of concern. Provincial/ federal funding for infrastructural projects is more readily available because of their diverse income streams. At the same time, close to 60 percent of infrastructure is owned and managed by the local municipalities. They collect a small percentage of tax dollars to build new or maintain existing infrastructure, be it youth centres, senior centres, or sports fields.
What is more, according to a report by Michael Fenn et al., investing in new infrastructure does not necessarily bring positive results if sufficient funds are not available to maintain existing infrastructure. Decisions on infrastructural improvements should be made in view of their strategic value, return on investment, and demand. To this end, data on the current condition of assets can help assess whether an asset should be sustained, replaced, or repaired. Limited data is currently available when it comes to the condition of different asset types, including pumping stations, treatment plants and pipes, community centres, administrative buildings, etc. Statistics Canada collects some investment data but the details necessary for comprehensive and prudent infrastructural planning are lacking. Data should not only be collected for big infrastructural assets but for assets such as shelters, police stations, paramedic stations, health care facilities, fire stations, and cultural facilities. Data must also be collected on the types of facilities and assets and the asset management strategies implemented at all levels of government. Factors that have an impact on decision making include age, performance indicators and physical condition, replacement value, use and demand, and others. All these were not taken into account to the extent required when the infrastructure program was developed.
Government’s Fourth Budget and Increased Spending
The government’s fourth budget targets key electrical groups that voted for the Liberal Party, including workers, indigenous people, and postsecondary students. The budget includes additional $586.5 million for training under the Employment Insurance system and to compensate for lost income when a person enrolls in a training program. The government also increased spending by $4.7 billion to improve social and healthcare services in indigenous communities and to settle land claims during the next 6 years. Plans have also been announced to lower interest rates on government student loans and to eliminate interest payments during the 6-month period after graduation.Learn More
Experts suggest that the federal government must assess spending priorities so that the budget deficit becomes more manageable. Whether it is infrastructural projects to attract foreign investment or measures to improve literacy or healthcare services, the federal and provincial levels of government must agree on priorities and how money should be spent as to have a positive effect on the broader economy.Visit Our Sponsor Details