MINI-BUDGET SHOWS GRITS STILL ADDICTED TO DEFICITS

Winter is coming, but I’m not sure the Justin Trudeau Liberals see that based on the fall fiscal update released last Thursday afternoon.

They have increased spending and increased debt charges, but declared victory because they will spend less during the current year and coming months due to COVID-19 supports ending.

Compared to the April budget, the annual charges just to service the debt – just paying the interest, but not a penny more – has risen from $26.9 billion this year to $34.7 billion. For next year, the projected cost of servicing the debt will rise to $43.3 billion.

To put that in perspective, the increase in what it will cost to service the debt is three times what the Trudeau Liberals will spend on their signature early learning and childcare program. It also means the cost to service Canada’s debt is about 43% higher than what we will spend on our military each year.

That is nothing but a sad state of affairs.

The Trudeau Liberals are finally promising to turn the deficit into a surplus, but only after spending a lot of money along the way. Anyone who thinks the Trudeau Liberals will actually turn a small surplus by fiscal year 2027-28 hasn’t been paying attention.

In 2015, the Trudeau Liberals were elected on a promise of spending to boost what they said was a stagnant economy. We weren’t in a recession, but they

said we needed to prime the pump and have government spend money to keep things going.

The problem is that even as the economy improved, they kept spending. When COVID happened, they spent even more. And now that many of us are looking at COVID in the rear view mirror, they keep spending.

The Trudeau Liberals now plan to spend $20 billion more in the current fiscal year than they announced in the April budget. In each of the next two years, they plan to spend about $24 billion a year more than announced in the budget. Revenue for the current fiscal year is expected to be up by $37 billion compared to the spring budget; next year it is expected to be up by just $33 billion.

As mentioned, when the budget was tabled earlier in this year, the Trudeau government doesn’t have a revenue problem, it has a spending problem. The 2019 budget, the last tabled before COVID-19 shook the world, put federal revenue at $338.8 billion and federal spending at $355.6 billion. At the worst of the pandemic, the 2021 budget projected $296 billion worth of revenue and $614 billion worth of expenses.

Yet now, even with virtually all pandemic spending behind us, total government spending is up by 44% and revenue is up by 28% compared to pre-pandemic levels. The idea that our deficits and our spending are driven by the pandemic are not supported by the facts and figures the government puts before us.

Trudeau was elected seven years ago on the promise of just three small deficits to help boost economic growth. Lots of Canadians believed that false promise and perhaps some still do, but it’s not reality. Spending is projected to keep outpacing ever growing revenues for the next several years.

If, and only if, you elect Justin Trudeau to a fourth mandate, he might balance the budget a decade after he said he would.