The federal Conservatives have managed to pull the country out of deficit for the first time since the 2008 finanical crisis, but Burnaby’s two New Democrat MPs are raising criticism over how they did it.
Finance Minister Joe Oliver presented the 2015 budget on Tuesday, and there is a projected surplus of $1.4 billion - a big improvement over the $55.6-billion deficit in 2009, during the global financial crisis.
However, Kennedy Stewart, the New Democrat MP for Burnaby Douglas, has problems with how the Tories did it, mainly by using $2 billion from a contingency fund and selling off the government’s shares in General Motors.
“They hit their target, but I think what they did was a bit reckless,” he told the NOW. “It’s a very hardcore, right-wing budget. It’s pretty staggering actually. At the core of it, pretty big tax breaks for very wealthy people. … What was also stirring is the term ‘climate change’ wasn’t mentioned once. So it does really look like we’ve got our work cut out for us in the next election, and it really sets up a classic NDP-Conservative battle.”
Fellow New Democrat Peter Julian, MP for Burnaby-New Westminster, echoed Stewart’s comments, stating that there was no mention of the environment, the Kinder Morgan or Enbridge pipelines, or reopening the Kitsilano Coast Guard station.
“When you balance budgets, you have to do it by establishing priorities, and this government is just reckless with spending money,” Julian said. “It’s a fake balancing of the budget. It’s something they are hoping will get them through the election campaign.”
The budget also raises the limit on annual contributions to Tax Free Savings Accounts from $5,500 to $10,000. Julian said that will cost the government billions, and that’s money he would rather see spent on a national child care program or health care. (Based on the Broadbent Institute's estimates, the current TFSA system will cost $15.5 billion annually in 40 to 50 years.)
Oliver, however, lauded the new plan in his speech.
“The causes of global financial challenges are complex – and largely beyond our control. But our responses, the choices we have made, have been direct and unambiguous,” he said in the House of Commons. “For generations, Canadian families have understood the path to prosperity: Don’t compromise tomorrow by spending recklessly today. Don’t pile on debt you can’t afford. And invest sensibly for a secure future. For governments, the principles are the same. We have been prudent. We have been practical. And we have stuck to our plan.”
Select budget highlights: Source, Department of Finance.
- Reducing the small business tax rate to nine per cent by 2019.
- Increasing the tax-free savings account annual contribution limit to $10,000.
- Providing $14 million over two years to Futurpreneur Canada in support of young entrepreneurs.
- $750 million over two years starting in 2017/18, and $1 billion per year thereafter, for a new public transit fund aimed at building new public transit infrastructure to reduce congestion and fight gridlock in large cities.
- Reducing the minimum withdrawal factors for Registered Retirement Income Funds to permit seniors to preserve more of their retirement savings to better support their retirement income needs.
- Extending Employment Insurance Compassionate Care Benefits from six weeks to six months.
Correction: This story orginally said the the Tories balanced the budget for the first time in their nine-year run in Ottawa, but the budget was balanced in 2006 (which was mostly leftover from the Liberals, as the Conservative had just been elected) and in 2007, before the financial crisis hit.
