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With snap polls in mind, the federal government’s first budget in two years poured another C$101.4-billion pandemic stimulus to chart out an economic course for pandemic-hit Canada. The fiscal deficit for 2020-21 now stands at a staggering C$354.2 billion, against an estimated C$ 380 billion.
Proposed investments will lead to job creation, support resilient and inclusive recovery, focus on ‘she-covery’ over a span of three years, summed up Finance Minister Chrystia Freeland. in her first ever budget presentation on Monday, April 19. Prime Minister Justin Trudeau looked on from a distance.
The COVID-19 pandemic caused Canada’s economy to sink to levels not seen since 1930s.
Budget 2021 Proposals
FM Freeland’s pandemic budget included a host of new proposals and extension of existing schemes.
As expected by market analysts, FM Freeland’s budget created C$ 30-billion provision towards early learning and child care support system in Canada to increase women’s participation in the workforce. This investment will be staggered over the next five years.
Budget 2021 proposed the extension of ongoing support measures till Fall and direct investments to create 1 million jobs by the end of the year.
The pandemic budget reiterated its ‘go green’ promise by 2025 to fight climate change with $17.6 billion-investment.
Ottawa also proposed C$ 15 federal minimum wage and support 35,000+ affordable homes to help the “most vulnerable Canadians”.
Some of the schemes extended include Canada Emergency Wage Subsidy, Canada Emergency Rent Subsidy, Lockdown Support, Canada Recovery Benefit, Canada Recovery Caregiving Benefit.
Employment Insurance sickness benefits also extended to 26 weeks from the current 15 weeks.
Budget 2021 also extended support to small and medium-sized businesses through the several measures via an additional C$2.2 billion investment.
Historic investment of over C$18 billion to bridge the gaps between Indigenous and non-Indigenous peoples was also proposed by the Liberal government.
The federal debt-to-GDP ratio is expected to fall to 49.2 per cent by 2025-26, while the deficit will reach 1.1 per cent of GDP that same year.
Ottawa also proposed a new luxury tax on pricey cars, boats, planes worth more than C$ 100,000.
The Liberals now need the confidence votes of at least one major political party to support the budget document in the House of Commons. Failure to do so will initiate snap polls.
