Revised federal budget is affordable and should be passed: economists

While not perfect, revised budget is “substantial improvement” over previous budgets
May 10, 2005

OTTAWA – The revised federal budget is affordable and should be passed in the House of Commons, Alternative Federal Budget (AFB) economists said in an assessment released today.  

Saying that the revised budget, which includes changes negotiated with the NDP, goes further to meet real social needs than the budgets of recent years, the economists urged Parliament to judge the new federal budget on its merits, register its shortcomings for future action and put partisan interests aside.

“While the revised budget falls short of major prescriptions advanced in the Alternative Federal Budget, it is both affordable and a substantial improvement over past budgets,” said Ellen Russell, senior economist with the Canadian Centre for Policy Alternatives (CCPA).

Russell said that the government would have sufficient resources to pay for all of the new spending outlined in the government’s original budget, as well as the $4.6 billion in new measures negotiated with the NDP, with room left over.  The analyses of all of the independent forecasters engaged by the House of Commons Finance Committee indicate that this additional spending could be accommodated without incurring a deficit.  

Combined with larger federal surpluses in reality than what the government predicts in theory adds up to an affordable, improved budget.  Russell noted that the AFB has been correct in pointing out that federal fiscal resources are greater than Canadians have been led to understand.  For the last seven budgets, AFB forecasted surpluses have been more accurate than those of the Department of Finance.  

“It’s not perfect, but it is the best federal budget we have seen in the last thirty years,” said Andrew Jackson, National Director of Social and Economic Policy for the Canadian Labour Congress.  “The significant increases in social investment will promote a more equal, prosperous and sustainable society and must survive partisan positioning.”

Notable improvements include smarter investment in child care, urban and environmental infrastructure and labour training, said Jackson, adding that the overall revised budget more accurately reflects the priorities of working families.   

The AFB assessment also acknowledged the revised budget’s shortcomings, not least that it provides funding commitments for only two years instead of ensuring ongoing support.

“Stable and predictable public funding is key to the long-term success of all policy goals, and this budget doesn’t provide that,” said John Anderson, Vice-President of Strategic Partnerships for the Canadian Council on Social Development (CCSD).  He also noted that many pressing needs received scant attention in the revised budget.

“We can do this – and more,” said Russell.  “In the meantime, Parliament should act on Canadians’ real priorities and pass this revised budget.”

The AFB assessment is available online at



David Robbins, CUPE Communications, cell (613) 878-1431

Kerri-Anne Finn, CCPA Communications Officer, (613) 563-1341 ext. 306