Category: Media

Chrystia Freeland’s fourth budget is less a fiscal plan than a political manifesto. She’s chosen again to spend in areas where the Liberals understand they are politically vulnerable while raising taxes on those who will cost them the fewest votes in the next election.

The finance minister and others in cabinet have been rolling out in a steady stream of new spending initiatives since Easter, $53 billion in total for housing, school food programs, a national disability benefit and other measures.

The goal is clear. The Liberals want to convince Millennial and Gen Z voters that they will help make life more affordable.

The flip side is that Freeland had to raise taxes to pay for these promises and to remain inside her fiscal guardrails – keeping the deficit at or below $40.1 billion while lowering the debt-to-GDP ratio this year and into the future.

The cost, according to many economists, is that there’s little in the budget to address Canada’s growing productivity gap with other industrialized nations, a gap the OECD projects will continue in the decades ahead threatening Canadians’ standard of living.

But the future for the Liberals is now with an election at most 18 months away. They need this spending to shore up support among younger voters, the ones who helped them win the past three elections, and to retain the support of their junior partners, the NDP.

The budget title sums up the theme, “Fairness for Every Generation.”

Fairness in this budget means higher taxes of more than $20 billion to be borne by a select group of mostly older Canadians.

Freeland is raising the capital gains inclusion rate from 50 per cent to 66 per cent for individuals, corporations and trusts reporting more than $250,000 in capital gains. The government says the change will affect only the wealthiest 0.13 per cent of Canadians.

No surprise there. A Navigator Discover poll conducted from March 26 to April 1 of 1,500 adults found the vast majority of respondents – 78 per cent – support taxing the ultra-wealthy.

The same poll suggested 85 per cent of respondents across age groups, regions and genders listed the high cost of living as the most important issue for government to address. When asked who was most to blame, they identified corporate greed and Justin Trudeau as the top two culprits.

One of those two is easier to blame than the other. Cue higher taxes on the wealthiest few. Spend billions on the young and the politically restless.

You can find our full analysis of the budget below. For more analysis, or support engaging government on any of the budget announcements, contact your Navigator team or reach out at info@navltd.com.

The province is returning to a nearly double-digit deficit of $9.8 billion from a reported surplus in its Q3 finances, the largest since Kathleen Wynne’s election year budget in 2018. The Ford government is hoping to pull out all the stops to grow Ontario’s economy through targeted investments in infrastructure, housing, and skills training, all while keeping costs down for Ontarians.

To explain the red ink, the Ford government is pointing the finger at a host of factors – inflation, interest rates, and $6 billion in desperately needed payments to the broader public sector due to the court’s ruling against the PCs’ Bill 124 public sector wage constraint legislation.

Central to the government’s plan to stay on course are massive investments in infrastructure. With over $190 billion set aside over the next 10 years (an increase of roughly $6 billion since last year’s plan), the government continues to prioritize new builds and redevelopments in the health and long-term care, housing, and public transportation sectors.

As high interest rates persist and the global economy prepares to weather more headwinds, Ontario’s deficit is expected to triple in the short term. The PCs continue to stick to “third road” fiscal planning – no new taxes, no deep cuts, balancing the budget through growth – but will that be enough?

You can find our full analysis of the budget below. For more analysis, or support engaging government on any of the budget announcements, contact your Navigator team or reach out at info@navltd.com.

Budget 2024: A Responsible Plan for a Growing Province

Albertans are likely to face headwinds this year as the broader economy is expected to slow slightly, experts predict another summer of worsening drought and wildfires, and debt servicing/debt refinancing costs increase significantly due to the current high interest rate environment. If Budget 2023 was a pre-election budget intended to keep Danielle Smith in the premier’s chair, Budget 2024 is a governing budget, leaning into themes of responsible spending and saving.

Budget 2024 prepares for these challenges while maintaining economic growth and labour attraction policies and safeguarding spending so Albertans continue to receive the high levels of service they are accustomed to.

Premier Smith’s vision for a reinvigorated Alberta Heritage Trust Fund remains a top priority for the year and likely for her mandate, having previewed the budget as Alberta’s last shot at getting off the resource revenue rollercoaster and saving for the future. The government is retaining more than $1 billion in investment earnings from the previous year and will deposit another $2 billion increasing the value of the fund to $25 billion.

This is a potentially fraught year to chart a new course and, to succeed, the Finance Minister and Premier will need to resist the temptations of stimulus spending and hold firm to the plan, more details of which are promised later in the year.

You can find our analysis of the budget below. For more analysis, or support engaging government on any of the budget announcements, contact your Navigator team or reach out at info@navltd.com.