The Free Government wants Congress to approve billions of dollars in new spending to expand COVID-19 bailouts, but a vacation from 17 December is scheduled for 31 March. There are reports of over $ 600 billion in spending last year that ended on the day. It wasn’t offered until December 14th.
Finance Minister Chrystia Freeland’s April budget estimates that $ 634.9 billion will be spent in 2020-21, leaving a $ 354.2 billion deficit.However, page 402 Volume 1 Public accounting breakdown shows that the government has spent a total of $ 608.5 billion on program costs, an additional $ 20.4 billion on repayment of public debt, for a total of $ 628.9 billion. This will result in a record deficit of $ 327.7 billion and more interest each year until the cumulative surplus equals that amount.
Public accounting has been publicly announced only twice in the last decade until December. The public account, along with relevant documents, details how federal funds were used.
Philip Cross, a senior fellow at the McDonald’s Laurier Institute and a former Chief Economic Analyst at Statistics Canada, believes that the federal government would have been able to provide information sooner if it chose to do so.
“The Finance Commission, the auditors, and all the people who oversee all of this haven’t gone out of business. I’ve never heard people say they can’t work, so why accountability wasn’t possible? There is no reason to believe it, “Cross said in an interview.
Parliamentarians were still in the dark about Canada’s largest deficit, but on December 9, they were asked to approve a new spending of $ 8.7 billion for the fiscal year. This margin covers Bill C-2, a $ 7.4 billion COVID-19 aid bill that extends bailouts until May 2022.
The Liberal Party wants the C-2 to be approved before the MP takes a vacation for the winter vacation on December 17th.
Parliamentary Budget Officer (PBO) Yves Giroux said the four specific measures contained in Bill C-2 include rent subsidies, additional weeks added to sickness and long-term care benefits, and extended wage subsidies. It is estimated to cost nearly $ 7.1 billion. However, he told the Senate Committee on December 10th: “But I’m concerned about the fact that the government is seeking Congressional approval for this additional spending without revealing the previous year’s spending.”
Many questions, some answers
According to the PBO, the new round of pandemic support will push the overall cost of the program to nearly $ 106.7 billion. Mr. Cross said the policy had a strange impact that deserved more disclosure for analysis.
“Employment increased significantly in November, just one month after the CRB (Canada Recovery Benefit) expired …. There was a shift from self-employed to paid employment. Is it related to CRB? I don’t know. “
“There are a thousand and one such questions that may be useful for future public policy …. There are many questions and few answers.”
Freeland is expected to reach $ 144.5 billion on December 14, when public spending is announced, with a current fiscal year 2021-22 deficit below the April forecast of $ 154.7 billion. We also announced a financial renewal to show that.
According to Cross, Canada’s COVID bailout was proportionally the largest of the G7, but Canada’s GDP growth was below that of the United States and employment was below that of Europeans.
“We’ve been running these broad programs for so long that we should have been more accountable for them,” he said.
“Someone will pay for this, whether it’s today’s taxpayer or tomorrow’s taxpayer.”
Inflation “people are aware”
Malcolm Bird, a professor of political science at the University of Winnipeg, says the state is in a worse position than the federal government when it comes to deficits and “space to rent.”
“The federal government is probably in better shape in terms of borrowing and spending capacity. Remember that they can use it, whether to give people cash. They are much more flexible. Health. It is the state that is tied to all of these very expensive and important programs, such as care and education, “Bird said.
“There’s a new conservative prime minister here in Manitoba. She’s not talking about inflation, deficits, etc. It’s all gone …. This year we have a $ 1.6 billion deficit and we don’t even peep at debt. . “
The federal government has more ropes, but it could eventually become a territory, Bird said.
“We haven’t even talked about the fact that this really can’t be continued. This isn’t a viable solution. And, of course, the NDP has completely given up. Many leftists, including the Liberal Party, have financial responsibility, a balanced budget, I gave up on the concept of financial prudence, “he said.
“”[The Liberals] Spent, spent, spent the last two years. Now, what do they do when you can’t keep spending, and when the effects of that spending come back to annoy them? Inflation is now a part of public discourse, and the story is emerging. … People are aware and people are reacting. “