The federal budget touches on all four key elements from the Harper government’s messaging ahead of a planned fall election.
And in his budget speech, Finance Minister Joe Oliver issues several dire warnings of what would happen to the government’s books – and the economy – if the opposition Liberals and New Democrats were in power.
The document calls for a $1.4 billion surplus for fiscal 2014-15, just enough to put the government in the black for the first time since it plunged into a record-sized deficit at the height of the recession.
But it had to dip into its rainy-day fund, take cash out of the Employment Insurance program and sell off assets to get there.
Randall Bartlett with TD Economics says if any one of those reserves hadn’t been available, the Conservatives would not have been able to achieve that goal – mainly because it lost about $6 billion in revenues as a result of drastically lower oil prices.
The government reduced its contingency reserve from $3 billion – where it has stood for years – to just $1 billion, leaving it with far less money to help deal with economic emergencies.
It also used a surplus that had accumulated in the EI fund.
And the sale earlier this month of the government’s remaining shares in General Motors also netted over $2 billion that were applied to the bottom line.
The budget also introduces a number of measures aimed at stimulating growth in jobs and economic performance, including infrastructure spending and more money for skills training.
As was earlier promised, the government is adopting family-targeted tax cuts and other support measures it says will help families and communities prosper.
And there is money for the Canadian Armed Forces, the RCMP and Canada’s spy agencies to bolster activities to counter terrorism threats both at home and abroad.
While Oliver boasts in his first budget that the Conservative government paid down $37 billion dollars from the national debt before the recession hit in 2008, what he doesn’t mention in his accompanying speech is how the debt ballooned since then.
The national debt in fiscal 2007-08 was pegged at $457.6 billion.
Oliver’s budget projects that it will reach $617 billion in the current fiscal year.
Still, he says, Canada’s total net government debt burden is lower than any other G7 country.