OTTAWA— The 2014-15 federal budget contains the largest annual spending cuts to date, says the Canadian Centre for Policy Alternatives (CCPA).
There are $14 billion worth of spending cuts announced in previous budgets that will come into effect this fiscal year. Those cuts will cause real damage to Canada’s fragile economy, by removing 0.7% from the country’s already anemic GDP growth.
“The government is happy to re-announce infrastructure funding from previous budgets but what it isn’t telling you is that there are $14 billion worth of previously announced spending cuts already built into this year’s budget,” says CCPA Senior Economist David Macdonald. “Canadians can expect to see more and deeper cuts to services and a sluggish economy as a result.”
“If previous cuts are any indication, there will be further reductions to front line services, like those in Veteran’s Affairs and the Coast Guard,” says Macdonald. “All this so the government can implement its promise of extending income splitting to families with children—a hugely expensive tax cut that 86% of families won’t benefit from.”
The federal budget will do little to boost Canada’s weak labour market. Since 2009, the reduction in the unemployment rate has been 20% due to the jobless finding work and 80% due to them giving up looking.
“The entire decline in youth unemployment from its worst in 2009 was due to jobless young people giving up their search, not finding a job. The 4,000 youth internships in this budget will have no substantive impact,” says CCPA Senior Economist Armine Yalnizyan. “This is no time for small measures. An entire generation of young workers is on the line and the federal government has a serious role it could be playing.”
The CCPA calls on all parties to review its Alternative Federal Budget, which proposes solutions that connect with what matters to Canadians: income inequality, job creation, health care, and climate change.
For more information contact Kerri-Anne Finn, CCPA Senior Communications Officer, at 613-563-1341 x306.