June 6 federal budget: a repeat of March 22’s pre-election budget

MARK KENNEDY
Postmedia News

OTTAWA — The Harper government has delivered Round Two of a 2011 budget that once again promises tax breaks for families, increased benefits for poor seniors, and incentives for small businesses that want to create jobs.

The government will bolster the Guaranteed Income Supplement, which low-income seniors use to supplement Old-Age-Security payments — a “top-up” benefit of up to $600 annually for single seniors, and $840 for couples.

This will cost the treasury more than $300 million a year — still far short of the $700-million boost the NDP had been demanding in the March budget.

Small businesses will be provided a “temporary Hiring Credit to encourage them to hire extra workers.

A tax credit will be available for family members who act as caregivers for relatives who experience mental or physical illness.

Volunteer firefighters who perform at least 200 hours of service to their communities in one year will also receive a tax credit of up to $450.

People who want to make their homes more energy efficient will have access to a tax credit thanks to an extension of the ecoENERGY retrofit program.

To attract more health care workers to rural and remote communities, the government will forgive up to $40,000 in student loans for new family physicians and up to $20,000 for nurse practitioners and nurses.

The budget will also contain a range of spending initiatives.

There are funds set aside for repairs to Montreal bridges, construction of an all-season road in the Arctic, repairs to storm-damaged small-craft harbours, upgraded baggage-screening equipment at airports, improvements to the country’s weather forecast services and disease control in the hog industry.

Finance Minister Jim Flaherty tabled the budget in the House of Commons Monday afternoon as more than 300 freshly elected MPs watched from their seats in the new Parliament.

As expected, the fiscal blueprint is virtually identical to the March 22 budget that was tabled in the last minority Parliament.

Flaherty is continuing to put an emphasis on economic stability and low taxes, with a sprinkling of promises that were first unveiled nearly three months ago and re-announced throughout the spring campaign.

The budget was strikingly similar to the one tabled in March. It still bears the same title: “A Low-Tax Plan for Jobs and Growth” and the cover uses the same artwork, with the date as the only difference.

Inside the 374-page budget, Flaherty highlighted the relatively few additions or amendments by using blue text instead of the normal black ink.

Among the differences are the projected deficit figures because the fiscal outlook has been updated. Flaherty says the deficit has fallen from $40.5 billion to $36.2 billion in 2010-11. But it is projected to increase from $29.6 billion to $32.3 billion in 2011-12.

During the election campaign, the Tories committed in their platform that they would definitely eliminate the deficit a year earlier — by 2014-15 — if re-elected.

Flaherty is more cautious. He does promise the government will produce a surplus by 2014-15. But that wasn’t recorded Monday in his budget’s tables, which stick with the 2015-16 projection.

He told a news conference he could not do this until the money is identified in the program spending review now being led by Treasury Board President Tony Clement.

Still, he said he is determined that the government will find the savings and they will be recorded in the 2012 budget.

Flaherty acknowledged that some people who have a stake in the status quo won’t be happy, but the challenge is to convince all Canadians — not just stakeholders — that cutbacks are necessary.

“There will be some programs that do not continue. Not every program is designed to go on forever.”

He said the size of the cuts — $4 billion out of $80 billion — needs to be seen in context, suggesting that the cuts will only be “moderate.”

“In the private sector this would not be very ambitious,” he said.

“It’s challenging to do. Is it do-able? It’s absolutely do-able. I’m sure it can get done.”

As was the case with the March budget, this one does not contain massive tax or spending initiatives.

But the many promises outlined in the first budget remain on the Tories’ policy agenda.