Politics

Federal budget 2015: Joe Oliver slashes growth projection, will still balance books

Joe Oliver wasn't tipping his hand Thursday about what to expect in his first budget, except to suggest that things aren't looking good for the Canadian economy in the short term.

Chief economists from Canada's big banks discuss predictions with finance minister

Finance Minister Joe Oliver told an audience at the Economic Club of Canada in Toronto this week that he'll bring in a balanced budget for the coming year - and then introduce legislation to make balanced budgets the law except in exceptional circumstances. (Darren Calabrese/Canadian Press)

Joe Oliver wasn't giving any hints Thursday about what to expect in his first budget, except to suggest that things aren't looking good for the Canadian economy in the short term.

"The world's troubles have reached our shores," the federal finance minister said following a meeting with private sector economists in Ottawa, his last stage of gathering information before releasing the federal budget on April 21.

Oliver acknowledged that Canada is affected by low oil prices. Nonetheless, he insisted the economy remains sound.

Finance ministers routinely rely on private-sector economists' forecasts to make baseline assumptions about the direction of the Canadian economy as an indicator of expected revenues and expenditures for some programs.

This time, those economists predict that after a slowdown in the first quarter of this year, the economy will pick up steam and grow by two per cent overall in 2015.

That is down sharply from his prediction in the fall economic update of 2.6 per cent.

However, it is believed enough room to manoeuvre is left for the Conservative government to keep a key election promise from 2011 and deliver a balanced budget this year.

In fact, Oliver already revealed last week that will be the case.

Oliver didn't say more Thursday about what his budget will offer voters in light of the federal election set for later this year. He vowed the Conservative government will "continue our laser-like focus on one overarching objective of creating jobs, growth, and long-term prosperity."

Find more 2015 federal budget coverage on our topic page

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