A (Too?) Timid Response to Challenging Times
Budget 2023 notionally delivers the response that had been expected of the government to address affordability issues facing Canadian families, reflects recent intergovernmental agreements on health care funding, and addresses the US administration’s “green industrial policy” investments. In actuality, the budget seems too timid a response to too many disparate policy and political imperatives to make a meaningful impact on any single one of them.
From a political perspective, the suite of measures aimed at addressing the rising cost of living is understandable. Exclusive public opinion data collected by Discover by Navigator in the days leading up to today’s budget confirm that addressing cost of living issues was the top priority of Canadians at 39 per cent, beating out lowering taxes (21 per cent) and reducing government spending (20 per cent). These measures will also serve to buttress the deal negotiated a year ago with the New Democratic Party, notably the additional investments in dental care – a long-standing NDP priority.
Like Budget 2022, which was shaped by rising inflation and Russia’s invasion of Ukraine, Budget 2023 is more a response to outside pressures than the expression of the Government of Canada’s desired policy direction. The question is whether the measures announced today will constitute a robust enough response to the Biden Administration’s Inflation Reduction Act, the demands of our increasingly strained health care system or the still-too-heavy burden of the rising cost of living on family budgets to make a meaningful; difference. Only time will tell, which may, in the end, be the one thing the government was playing for in designing this budget.
You can download our budget analysis here.
For more analysis, or support engaging government on any of the budget announcements, contact your Navigator team or reach out at info@navltd.com.