Of budgets, federal and provincial

By Admin Wednesday April 29 2015 in Editorial
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With Ontario’s Liberal government presenting its latest budget hot on the heels of the federal Conservatives’ budget, we have to ask if the timing was intentional. Was there some tweaking by the Kathleen Wynne government after hearing what federal finance minister Joe Oliver presented to Canadians as the Conservatives’ best hope for re-election in the fall?

 

As was expected, since the federal budget was being leaked with no subtlety in the preceding days, there was enough gravy for the target electorate the Harper Conservatives hope will give them yet another term.

 

People who can afford to save money will have an extra tax break on up to $10,000 annually through those tax-free savings accounts, while more tax savings are to come for families with only one income earner, allowing the income to be split between spouses and thus lowering the tax bracket into which the single income would otherwise be taxed. It’s called income splitting and when the previous federal finance minister, the late Jim Flaherty, was leaving the post, he opined that it was not a fair policy as it would be of no benefit to 85 per cent of households, but rather to families with higher incomes. In other words, those who least needed it.

 

The federal government seems to have heard the cry from the provinces on the need for more transportation infrastructure and promised more money in that direction. However, a promised $750 million would be spread over two years starting in 2017/18. Oliver also talked up $1 billion a year beyond that time to be put into a new Public Transit Fund. These funds, however, would have to be contingent on partnership funding from each province and municipalities as well. Asked why the money would not be available right away, Oliver suggested that there aren’t any shovel-ready projects going at the moment.

 

It read as a convenient excuse. Nonetheless, that funding news was given thumbs up by Toronto mayor John Tory since he ran his election campaign on building and improving local transportation infrastructure.

 

The larger implication of the federal government’s latest budget is that it is designed as an election budget, which means we will continue to hear with almost hypnotizing repetitiveness how much the federal government is doing for “families”, transportation and small businesses, ad nauseum, as the Conservatives build up steam ahead of the elections in October.

 

What you won’t hear from them is that they did absolutely nothing for the growing numbers slipping from middle income into the low-income bracket. They will not mention that their budget did not raise the minimum wage for federal workers, that the apparent $19 million boost over four years for college and university students will actually put them deeper into student loan debt, or that they have done nothing for the aging poor.

 

The Ontario Liberals on the other hand, knowing that they would have to at least give nodding recognition to the issue of rising poverty in this province, have made some effort. To that end welfare recipients have a one per cent increase coming, but like the feds there was no attention to affordable housing. That leaves Toronto’s subsidized housing stock right where it was before the budget was read by Ontario finance minister Charles Sousa, still awaiting $2.6 billion in backlogged repairs.

 

Raising the minimum wage floor to $16.50 for personal support workers, many of whom are female and from the Black community, was also welcome news. This will move many more out of the poverty income level.

 

However, the plan to sell off 15 per cent of Hydro One to generate revenue is questionable and looks like desperation. It is an acknowledgement that tax revenue, linked as it is to a fragile job market, is still weak. But, revenue has to come from somewhere to keep the promise of building transportation infrastructure.

 

At the same time, the Liberals also want to appease bond rating agencies by talking up a balanced budget, to show that they are gaining on their promise to have it balanced by 2017.

 

To do that they, like the feds, have once again sacrificed the needs of the poor.

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