Minister of Finance Chrystia Freeland delivers the 2020 fiscal update in the House of Commons on Parliament Hill in Ottawa on Monday, Nov. 30, 2020. THE CANADIAN PRESS/Sean Kilpatrick

Minister of Finance Chrystia Freeland delivers the 2020 fiscal update in the House of Commons on Parliament Hill in Ottawa on Monday, Nov. 30, 2020. THE CANADIAN PRESS/Sean Kilpatrick

Feds to table 2021 budget on April 19: Freeland

It will be the first federal budget in more than two years

The federal government will release a highly anticipated budget in about four weeks, giving Canadians a detailed accounting of pandemic spending and how the Liberals plan to spend billions more on the road out of COVID-19.

Finance Minister Chrystia Freeland announced Tuesday the federal Liberals will table a budget on April 19.

It will be the first federal budget in more than two years, after the government opted not to introduce one in 2020 as the COVID-19 pandemic took hold in Canada.

It will also be Freeland’s first budget as finance minister; she took on the portfolio last summer following Bill Morneau’s resignation.

Freeland said the government went into the pandemic with strong finances, which allowed it to provide unprecedented support to Canadians.

“We will continue to do whatever it takes to support Canadians and Canadian businesses,” Freeland told the House of Commons Tuesday.

“And we have a plan for jobs and robust growth.”

The budget is expected to provide a full accounting of all government spending through the pandemic, which has sent the deficit for the fiscal year to almost $400 billion.

It is also expected to outline the Liberals’ plan to spend between $70 billion and $100 billion over the coming years in fiscal stimulus to help the economy recover.

Goldy Hyder, president of the Business Council of Canada, said in a statement that the government needs to provide economic hope to Canadians with an end in sight to the pandemic.

“To build confidence, the federal government must present a comprehensive and credible plan that spurs investment, private-sector job creation, and long-term economic growth,” he said.

The government will need to get the support of at least one major opposition party to pass its budget. Failure would mean the government falls and would almost certainly provoke a federal election.

Conservative Leader Erin O’Toole, in a statement, said the government has left far too many Canadians behind during the pandemic.

He contrasted Liberal policies with those his own party would unveil, saying he would focus on “growth in every sector of the economy and in every part of the country.”

The government has previously said this year’s budget will include measures to create a national child-care system, invest in skills training and help green the economy.

Additional measures pitched by departments have faced a simple question: how much economic growth can this buy?

The budget is likely to include spending on traditional areas like infrastructure, including for public-sector projects that could act as a catalyst for private projects, said Deloitte Canada chief economist Craig Alexander.

But he also noted that spending on social programs could also provide an economic boost in the short and long term, pointing specifically to child care.

By Alexander’s estimates, governments receive between $1.50 and $6 for every dollar invested in child care, suggesting it can help break down economic barriers by raising labour-force participation rates for parents, and mothers in particular.

“I don’t think the economy needs the government to just go and spend money on things that would just accelerate economic growth in 2021,” Alexander said in an interview.

“What we need is strategic investments that will provide a boost to the economy over the medium to long term.”

The budget will be the first one since March 2019 after the government opted not to introduce one in 2020, pointing to the uncertainty the pandemic had caused to the domestic and global economic outlook.

Freeland asked the Finance Department in the fall to detail the difference between a budget and a fall economic statement.

A footnote in the responding briefing note, a copy of which The Canadian Press obtained under the Access to Information Act, said “while a budget is typically presented every year, the government is under no obligation to do so.”

Freeland delivered an economic statement in late November, which pegged the deficit at $381.6 billion this year, but closing in on $400 billion if widespread lockdowns caused demand for aid to increase again. The federal debt was likely to top $1.2 trillion.

The Liberals argue the debt is manageable because economic growth should outpace interest rates, meaning more money coming in than the federal treasury will have to pay out over time.

A report Tuesday from the C.D. Howe Institute said the fiscal sustainability the Liberals outline is possible, but far from guaranteed.

If repayments are bigger than economic growth, that could mean spending cuts, tax increases or a combination of the two may be needed to keep deficits from spiralling.

The think-tank’s paper argued for the government to cut business subsidies that don’t address a clear market failure. If tax increases are necessary, the think tank said taxes on business investment should be avoided because they drive capital overseas and could push down wages here.

federal budgetFederal Politics

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Victoria Police Department looks to identify a person of interest after a Friday night stabbing. (VicPD handout)
Police seek person of interest after Victoria stabbing

Friday night assault leaves one with potentially life-altering injuries

Daniel Foster, last seen in downtown Parksville on Saturday, May 1. (submitted photo)
RCMP seek help locating missing Victoria man, last spotted in Parksville

Daniel Foster, 43, seen via surveillance camera using an ATM

Police stopped, then let go this man and his large collection of cans during a stop Monday morning on Resthaven Drive. Police had received a report of a possible theft, but let him go after he had returned the property, which he believed was his to take after being left out in public. (Wolf Depner/News Staff)
Report of theft, balancing act on Sidney street draws curious onlookers

Incident happened just before 8:30 a.m. opposite of Vancouver Island Regional Library branch

Sean Hart, 34, unexpectedly left the Seven Oaks Tertiary Mental Health Facility in Saanich on Nov. 6, 2020 and has now been missing for six months. (Photo courtesy Penny Hart)
Search continues for Saanich man Sean Hart six months after his disappearance

Support from community, police keeps his mother hopeful

Victoria Police continue to investigate a stabbing in downtown Victoria. (Black Press Media file photo)
Passerby calls police after finding man stabbed, sobbing on Victoria street

One man was sent to hospital with non-life-threatening injuries

A bullet hole is seen in the windshield of an RCMP vehicle approximately 4 km from Vancouver International Airport after a one person was killed during a shooting outside the international departures terminal at the airport, in Richmond, B.C., Sunday, May 9, 2021. THE CANADIAN PRESS/Darryl Dyck
Homicide team IDs man in fatal YVR shooting as police grapple with spate of gang violence

Man, 20, charged in separate fatal shooting Burnaby over the weekend

RCMP are searching for Philip Toner, who is a ‘person of interest’ in the investigation of a suspicious death in Kootenay National Park last week. Photo courtesy BC RCMP.
RCMP identify ‘person of interest’ in Kootenay National Park suspicious death

Police are looking for Philip Toner, who was known to a woman found dead near Radium last week

Vancouver Canucks goaltender Thatcher Demko (35) makes a save on Winnipeg Jets’ Nate Thompson (11) during second period NHL action in Winnipeg, Monday, May 10, 2021. THE CANADIAN PRESS/Fred Greenslade
Vancouver Canucks see NHL playoff hopes dashed despite 3-1 win over Winnipeg

Montreal Canadiens earn final North Division post-season spot

The B.C. legislature went from 85 seats to 87 before the 2017 election, causing a reorganization with curved rows and new desks squeezed in at the back. The next electoral boundary review could see another six seats added. (Black Press files)
B.C. election law could add six seats, remove rural protection

North, Kootenays could lose seats as cities gain more

The Independent Investigations Office of B.C. is investigating the shooting of an Indigenous woman in the Ucluelet First Nation community of Hitacu. (Black Press Media file photo)
B.C. First Nation wants ‘massive change’ after its 3rd police shooting in less than a year

Nuu-chah-nulth woman recovering from gunshot wounds in weekend incident near Ucluelet

Nurse Gurinder Rai, left, administers the Moderna COVID-19 vaccine to Maria Yule at a Fraser Health drive-thru vaccination site, in Coquitlam, B.C., on Wednesday, May 5, 2021. The site is open for vaccinations 11 hours per day to those who have pre-booked an appointment. THE CANADIAN PRESS/Darryl Dyck
COVID vaccine bookings to open for adults 40+, or 18+ in hotspots, across B.C.

Only people who have registered will get their alert to book

Dr. Victoria Lee, CEO of Fraser Health, hosts an update on efforts to contain B.C.’s COVID-19 transmission in Surrey and the Fraser Valley and protect hospitals in the Lower Mainland, May 6, 2021. (B.C. government video)
B.C.’s COVID-19 infection rate slowing, 20 more people die

Deaths include two people in their 40s, two in their 50s

Most Read