Budget 2015: 6 elements to watch for
Tories have promised that delayed 2015 federal budget will be balanced, despite plunge in oil prices
The Conservative government delayed this year's budget, pleading market uncertainty due to the plunge in oil prices. Federal budgets are normally delivered by the end of March, and sometimes as early as February, putting this one at least a month later than usual.
- Federal budget 2015: Join our live chat and watch CBC's budget specials
- More coverage of the federal budget
That alone is notable, but the budget also happens to be the last one before the 2015 federal election, which has to happen by Oct. 19, but could come at any time. And, increasing the pressure on Finance Minister Joe Oliver's first budget, the Conservatives promised to have the books balanced.
With all that in mind, here are six elements to watch for when Oliver stands in the House at 4 p.m. ET to deliver his speech, which will be carried live on CBCNews.ca and CBC News Network (full CBC broadcast plans below.)
1. How big will the 2015-16 surplus be?
The Conservatives have been promising to balance the budget since the 2011 election, and recently announced they'll introduce balanced budget legislation. Their critics say this is to distract from the fact that the government hasn't had a balanced budget since 2007.
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The projections tabled in last year's budget (a $6.4 billion surplus) and last fall's economic update ($1.9 billion) were based on higher revenues from more expensive oil prices, which dropped from around $110 a barrel last summer to under $50 in January (the surplus projected in the economic update was also lower after the Conservatives announced some expanded tax cuts and credits).
The big question today is whether the government has any fiscal room to manoeuvre following the tax cuts that were announced last October and the subsequent plunge in oil prices.
2. Did the government use its contingency?
Following months of plummeting oil prices, TD Economics has predicted a $2.3-billion deficit for this year's federal budget. But the government still has a $3-billion contingency fund into which it could dip. Conservatives haven't been clear on whether cheap oil is an acceptable reason to use the contingency fund.
3. Which boutique tax cuts will it contain?
One change that would be popular with seniors, who are more likely to cast ballots than younger Canadians, would be to ease the withdrawal rules for registered retirement income funds, or RRIFs. The current rules require seniors to withdraw a certain amount every year by age 71, but seniors' advocacy groups like CARP say Canadians are living longer, while returns on investments are lower than for generations past.
"The government should not be making it more difficult by forcing people to erode their savings and taxing them just when they should be trying to grow their savings for their later years, when they could face serious expenses for medical care and other challenges," said Susan Eng, a spokeswoman for CARP.
CBC budget coverage Tuesday
CBC News will have full coverage of Finance Minister Joe Oliver's budget on Tuesday, starting with a special Power & Politics with Evan Solomon at 2 p.m. ET on CBC News Network and streaming live on CBCNews.ca.
Join a live pre-budget chat on CBCNews.ca at 3 p.m. ET, then tune in to CBC News's budget special with Peter Mansbridge on CBC Television and CBC News Network at 4 p.m. ET, or watch a live stream of Joe Oliver's full budget speech on CBCNews.ca. CBC Radio will also have special coverage starting at 4 p.m. ET.
Our live chat continues at CBCNews.ca at 5 p.m. ET, while Power & Politics and The Exchange with Amanda Lang offer analysis and reaction on CBC News Network, followed by a complete wrap-up on The National at 9 p.m. ET.
4. What will the budget hold for business?
A spokesman for the Canadian Federation of Independent Business told The Canadian Press he is cautiously optimistic the government will lower the small business corporate tax rate. Dan Kelly said the organization would like it lowered to nine per cent from 11 per cent.
A spokesman for the Canadian Manufacturers and Exporters is equally optimistic the government will continue its accelerated write-off for manufacturing machinery, he told The Canadian Press.
5. Will there be new money for security?
During a year in which Prime Minister Stephen Harper and others have referred repeatedly to the threat of terrorism, it might be a good bet that any new spending could be directed to national security.
Employment Minister Pierre Poilievre, the cabinet minister whom the government provided for interviews ahead of the budget, said the Conservatives are "taking a close look" at the budgets of security agencies.
"We have an expanded effort to fight terrorism," Poilievre said.
"All of these things require resources and the prime minister is absolutely determined to degrade and defeat terrorism, to keep Canadians safe."
6. Will there be money for foreign policy?
International Co-operation Minister Christian Paradis has spoken frequently over the past few months about the need for a development finance institution, a lending agency that would help private interests take on investments in less-developed countries, which tend to be riskier.
While Canada has committed billions to improving the health of women and children in developing countries, its overall official development assistance, or ODA, has dropped to 0.27 per cent of gross national income, from its 10-year high of 0.34 per cent in 2010 (it also hit that level in 2005).
Leveraging private-sector investment would be a way to increase the amount of money going to developing countries without spending much more.
With files from Peter Armstrong, Chris Hall and Hannah Thibedeau