Taxpayers Federation: Budget 2019 shows Trudeau’s broken balanced budget promise will cost $100 billion
- Pre-election budget not only fails to balance budget as promised, but sees further borrowing and no plan to eliminate deficits
- Federal debt on track to rise by $127 billion by 2023 – a full $100 billion more than the 2015 Liberal plan
- Higher than expected revenues are more than offset by higher spending
OTTAWA, ON - The Canadian Taxpayers Federation today slammed the Trudeau government’s pre-election budget which officially left its balanced budget promise in tatters while continuing to hike spending.
“The Trudeau government has betrayed Canadians who entrusted it to manage their money responsibly,” said CTF Federal Director Aaron Wudrick. “They are now on track to add $127 billion in new debt by 2024 – a full $100 billion more than they promised during the last election.”
The federal debt is now projected to rise to $761 billion by 2024. The debt interest costs alone will jump from $26 billion per year in 2019 to $33 billion per year by 2024.
Wudrick noted that the government’s deficits are a result of higher spending, not lower revenues.
“Even with increased spending, higher than expected revenues could have meant a smaller deficit or even a balanced budget, but instead the government has chosen to simply spend every unexpected dollar – and then some,” said Wudrick.
In fact, the government has not even been able to stick to its own fiscal plans from previous budgets. For example, in the 2017 budget, program spending for 2020-21 was projected to be $328 billion and it’s now projected to be $339 billion.
“Time and again, this government has demonstrated it simply can’t control spending,” said Wudrick. “Whether the economy is hot or cold, there is always an excuse. It has proven incapable of making tough choices and instead just spent freely while sticking future generations with the bill.”
Wudrick also pointed to the government’s preference for micro-targeted measures over broad-based tax relief as a recurring problem.
“By offering a smattering of boutique tax measures, the government missed an opportunity to offer broad-based tax relief to Canadian families,” said Wudrick. “Our tax code is already mind-bogglingly complex and it needs to be simpler, not more complicated.”
Wudrick criticized the budget’s array of subsidies and handouts targeted at boosting “innovation” and expressed concern about the potentially high cost of the government’s pharmacare plan.
“Apparently the irony of teaching budding entrepreneurs that the path to success lies through taxpayer handouts is lost on this government,” said Wudrick. “The pharmacare program is concerning as the government hasn’t done any of its homework showing how to pay for it.”
The CTF did welcome several measures in the budget, including the government’s commitment to removing barriers to interprovincial trade, harmonize regulations with trade partners, eliminate GST/HST on certain health-care services and crack down on tax evasion.
Overall, Wudrick said the government cannot escape the fact it has shattered the central fiscal promise in its platform.
“There is no getting around it: the Liberals promised to balance the budget and they didn’t,” said Wudrick. “By failing to keep the core commitment that underpins every other spending promise, they have undermined their own fiscal credibility – and future generations will be the ones stuck paying for it.”