What should Canadians look for in the federal budget, which the Trudeau government will table next week?
The economic downturn and extra spending during the pandemic pushed spending to 28.3% of GDP in 2020-21 and 19.2% of GDP in 2021-22. In its fall economic update last November, the government projected program expenses to be about 16.1% of GDP in 2022-23..To translate the 16.1% into dollars, if the government instead spent at the same level seen in 2014-15, spending this fiscal year would have been about $88 billion lower than the latest projection. Alternatively, even returning spending to 14.
However you slice the numbers, Ottawa has embarked on a spending spree to shove many tens of billions of dollars in new permanent spending into yearly finances. An important corollary is that there are plenty of areas where the federal government could reduce spending in this year’s budget. Corporate welfare is always a good place to start. Billions of dollars in spending reductions could be found in seven federal departments devoted to regional “economic development.
Finally, there’s climate spending. The government boasts that it’s spent more than $120 billion on climate change since 2015, despite repeatedly claiming that spending and regulatory programs are costlier ways to reduce emissions than a tax. Indigenous program spending is projected to rise substantially despite already significant increases from 2015 to 2022 and a lack of evidence that spending more produces positive results.
Given how bloated the federal budget has become, anyone who keeps their eye on government finances will find several areas of spending that should be cut. There’s significant excess federal spending — all paid for by Canadians through taxes today, taxes tomorrow, or in the form of inflation — for which the benefits do not justify the costs.Share this article in your social network
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