Fall budget? It's a pretty safe bet...
By Walter Robinson
It has been almost 14 months since Paul Martin brought down his last budget on February 28, 2000. Sure, some will point to last October's Economic Statement as a mini-budget, but let's be blunt, that effort was merely Chapter 1 of the Liberal campaign platform.
Don't get me wrong: $100 billion of "paper" tax relief was welcome. However, this number was really $55.4 billion when net payroll tax increases (EI cuts dwarfed by CPP increases) and the disingenuous counting of foregone future "bracket creep" revenues are discounted.
On February 1st, the CTF called for a budget to be tabled by mid-March.
Sadly, the best Canadians can expect from Paul Martin at this point is
a budget update, probably on May 25th.
We cautioned that failure to table a budget would result in a neutering of Parliament and worse still, a lack of accountability, as the feds would surely conduct their affairs by press conference and news release. At the risk saying "we told you so" these fears very prescient.
Question Period (QP) has become the "Shawinigate" soap opera. Committee work outside of QP while it continues can hardly be described as exhaustive. And yes, Ministers have trotted around the country freely announcing spending initiatives. Government by press conference; sounds familiar indeed.
Exaggeration? Log on and surf by www.canada.gc.ca, chose any department and click on recent news releases. You'll quickly see the millions of dollars of spending that the Ministers are announcing in every province and every time zone on weekly, if not daily, basis.
Finance folk point to the Estimates process as justification that nothing untoward is happening. But a full-blown Budget and its requirement to present a coherent fiscal plan is the only vehicle to capture the attention of politicians, the media and taxpayers. So what happened?
Well, to start, tabling of a budget this past March would have forced Finance to cost out the 14 new (and major) initiatives that were announced in the Throne Speech. This would have shattered domestic and international confidence in our ability to keep our books balanced if everything (read: billions in new spending) was factored in.
And if everything wasn't factored in, the Throne Speech would have been seen as more empty rhetoric and hollow promises from a crew that has turned evasion, obfuscation, and broken promises into a consistent mode of governing.
But many signs now point to a fall budget. To start, Paul Martin himself told Bloomberg News last week "the good thing about November is that if there are measures to announce that take effect January 1st, we can do it." In addition, there are signs that the U.S. slowdown is starting to correct itself as surplus inventories are now being depleted.
This correction should have full momentum by late summer and result in positive 2nd quarter numbers coming out of the U.S. And Paul Martin's Jan. 1 tax cuts will have worked themselves through our economy by this time and probably point to solid Canadian consumer spending numbers.
Finally, we also learned last week that the influential commons Finance Committee will start its pre-budget hearings next months as opposed to its customary commencement of this process in September. Of course the CTF will be ready arguing for further personal and business tax relief, legislated debt reduction and expenditures limited to inflation plus population growth. Better keep October and November free you wouldn't want to miss the 2001 Budget lock up!
Walter Robinson is the Federal Director of the Canadian Taxpayers Federation.
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