From A Mandate For Change To A Plan To Govern series wraps up with a look at Budget 2016
OTTAWA, March 24, 2016 – A return to long-term deficit spending is casting a long shadow over some of the positives in the new federal government’s first budget, says a new commentary from the Macdonald-Laurier Institute.
Brian Lee Crowley and Sean Speer, in the final entry in MLI’s From A Mandate For Change To A Plan To Govern series, evaluate the good and the bad in Prime Minister Justin Trudeau’s first crack at developing a comprehensive fiscal plan for the nation’s finances.
“Protracted deficit spending is the major story of Tuesday’s budget”, write Crowley and Speer. “There is a real risk that government has fallen in fiscal quicksand”.
To read the full commentary, titled “From A Mandate For Change To A Plan To Govern: The federal budget and the start of the new government’s next phase”, click here.
That wasn’t all. Crowley and Speer said the budget missed in its plan to lower the age of Old Age Security eligibility back to 65 from 67, restore tax credits made for investments in labour-sponsored venture capital corporations and revisit the previous government's proposed changes to sick-leave benefits for federal employees.
The authors urge the government to immediately adopt a plan for returning the country to a surplus. Among their recommendations: Setting out a clear set of fiscal rules for when the government should deploy fiscal stimulus spending; Maintaining the previous government’s balanced-budget legislation to bring discipline and transparency to federal fiscal policy; and reviewing spending to close the gap between revenues and outlays in the medium term.
But Crowley and Speer also praise the government for making progress in many key policy areas.
Lowering personal income taxes for middle-class taxpayers is a good step to help families manage their household budgets and to encourage savings and investment, while funding for Aboriginal education and restoring health services to refugees are welcome.
“It is still early days”, write the authors. “The budget has strengths and weaknesses but there remains plenty of time for fresh thinking and sound policy”.
This is the 14th and final paper in MLI’s series, From A Mandate For Change To A Plan To Govern.
The series, which is publishing weekly from the Throne Speech to the first budget this spring, is designed to offer practical policy recommendations that help the newly-elected government follow through on its election promises.
Brian Lee Crowley is Managing Director of the Macdonald-Laurier Institute.
Sean Speer is a Senior Fellow at the Macdonald-Laurier Institute. He previously served in different roles for the federal government including as senior economic adviser to the Prime Minister and director of policy to the Minister of Finance.
The Macdonald-Laurier Institute is the only non-partisan, independent national public policy think tank in Ottawa focusing on the full range of issues that fall under the jurisdiction of the federal government.
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