There's an election coming, so yesterday's budget was aimed at that reality. But, Alan Freeman writes, even though there is a considerable amount of spending, it's not very showy:
What we got today was an unusual pre-election budget, with few shiny baubles and lots of measures that promise a lot more in the future than deliver much in the present.
The Liberals continue to unbothered by their long-forgotten 2015 promise to balance to budget, figuring that the zero-deficit voters are all captured by the Tories and that Liberal and NDP leaners don’t give a fig whether the budget deficit is $20 billion, $10 billion or zero, provided that the economy is still growing and taxes are basically flat.
In fact, the government did better than expected in the current year, because of robust revenues, and now say the 2018-19 deficit will come in at $14.9 billion. And that’s after a year-end spending spree of $4.2 billion. That mad money includes $3.2 billion in cash going to municipalities in a one-time boost of federal gas-tax revenues and money for energy efficiency programs administered by the Canadian Federation of Municipalities.
On housing, Morneau expanded the amount of money that first-time buyers can borrow tax-free from their RRSPs to $35,000 from $25,000 — enough to say he’s done something, but hopefully not enough to threaten the future of Canadians’ future pension security, which is what RRSPs are for in the first place.
Then he introduced a First-Time Buyer Incentive, a complex financial instrument that gets the CMHC in the business of providing shared equity mortgages of up to 10 per cent of a home purchase but would not add to buyers’ monthly payments and only be repayable on resale.
Sounds like free money but there will be strict limits on eligibility, including a maximum household income of $120,000 and the requirement to fill all the other rules of insured mortgages, including a $1-million maximum.
Still nothing for low income housing. But with the average Toronto home selling for $870,000, maybe it will make some difference.
And, as the father of three sons who are still paying off their university debt, I welcome the lower interest rates on student loans.
But, most important of all, there is the beginning of a pharmacare plan:
On pharmaceuticals, there’s creation of a new Canadian Drug Agency, set up with the goal of cutting drug costs by $3 billion but no commitment to go through with an expensive National Pharmacare plan. That promise will have to wait until the election campaign.
Will that be another broken promise?
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