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Caledon

The Déjà Vu All Over Again Budget

Published on 08/03/2010

The 2010 federal Budget arrived with less drama than usual.  Why?  Because we have seen echoes of it before – notably last year in 2009, four years ago in 2006 and 15 years ago in 1995.  The 2010 Budget is effectively the second year of the stimulus package introduced in 2009.  There was a thin sprinkling of new measures in 2010 related to Employment Insurance, youth, First Nations education, the Registered Disability Savings Plan, the Enabling Accessibility Fund and New Horizons for seniors.  Aside from that, the Budget was déjà vu.

The jury is still out on whether the stimulus was enough.  The measures have undoubtedly helped keep the lid on rising unemployment.  At 8.3 percent in 2009 and up from 6.2 percent in 2008, unemployment it is still unacceptably high and projected to grow further to 8.5 percent in 2010 before it gradually eases in future.  Thousands of jobs lost in the past two years, including well-paid full-time employment, have not been recovered and may never come back.

The 2010 Budget’s response to unemployment is to point to the measures that comprise its stimulus package.  The government also turns our attention to its new – or should we say renewed – interest in supporting innovation.  The last foray into the innovation field was in 2006 when the government introduced a manifesto called Advantage Canada.  The document was billed as a long-term plan to help create conditions for economic success.  There are loud echoes of this strategy in the Déjà Vu Budget.

Deficit reduction is the third theme of the 2010 Budget that hearkens back to an earlier time.  This is not the first time that Ottawa has wrestled with a deficit dragon.  The last round of major deficit reduction took place 15 years ago in the 1995 Budget.  The drastic cuts at the time left deep and lasting scars, especially for low-income households.  We were pleased that the Déjà Vu Budget came with a commitment not to cut transfers to individuals or the provinces and territories.  At least that is the commitment it makes now – pre-election.  But there is lots of spending that could be trimmed.  A good start would be the fortune we currently spend on the fortunate.

ISBN – 1-55382-453-9

Summary

The 2010 federal Budget arrived with less drama than usual.

Topic(s)

Government spending and tax