Joe Oliver's promises-kept budget. Ignore the sleight of hand
All three main parties now determined to help the middle class, whoever they are
If there's one theme coming out of Tuesday's federal budget it's this — the Conservatives are more interested in telling Canadians what they've already done for them than what they intend to do.
And that's what makes this budget, delivered just a few months before the Conservatives are set to go to the polls in search of a fourth consecutive mandate, so interesting.
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The focus, in both the budget documents and Finance Minister Joe Oliver's speech, is on reinforcing the Conservative brand as Stephen Harper would have it.
It begins with the budget's title: Strong Leadership: A Balanced Budget, Low-Tax Plan for Jobs, Growth and Security. The phrase "the Harper Government" is back after a lengthy hiatus.
Promises, Oliver said, have been kept.
"We have cut taxes to their lowest level in more than half a century," he told the Commons early in his budget speech. "We have made the largest long-term federal infrastructure commitment in our country's history."
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The books are not only balanced on time, but Oliver is forecasting a modest $1.4 billion surplus. What investments there are will be strictly focused to promote the automobile industry, small business and national security.
The beneficiaries of new tax cuts are important Conservative voting constituencies: parents with children. Small business owners. Seniors.
"For generations Canadian families have understood the path to prosperity," Oliver said. "Don't compromise tomorrow by spending recklessly today. Don't pile on debt you can't afford. And invest sensibly for a secure future."
The Conservatives, Oliver said, have the same principles.
"We have been prudent. We have been practical. And we have stuck to our plan.''
Sleight of hand
Mind you, none of those things stopped this government from employing a little fiscal sleight of hand.
To get to balance, Ottawa sold its remaining shares in General Motors.
The $3-billion contingency fund was cut to $1 billion. EI premiums will continue to take in more than the fund pays out to the unemployed. All together, those decisions gave Oliver billions in additional revenue.
And then there's the spending.
Topping the list, a new Public Transit Fund. The investment of $1 billion seems small, but the news isn't the amount, it is how the money will be spent.
Ottawa will no longer cover its usual one-third share of construction costs; instead it will cover the loan payments taken out by cities to improve public transit, with a goal of helping finance more projects, over a longer period of time.
The government also announced it will spend nearly $300 million more on national security.
But the catch in both initiatives is in the fine print.
Spending on security starts out small, and grows over time. The Public Transit Fund, and new spending on defence, don't kick in until 2017, leaving the government wiggle room to backtrack if the economy stalls.
Promising the money will be spent AFTER the election also provides an incentive for Canadians to stay with the Conservatives. At least that's the thinking.
One commitment won't be re-thought. The Conservatives' already announced plan to allow income splitting by parents with children is untouchable, despite its $4.5- billion price tag.
It's the foundation of the government's family-first agenda, and a significant piece of the budget's claim that the average two-earner family has $6,600 more in their pockets under the Conservatives.
Let's all help the middle class
Saskatchewan's former NDP finance minister Janice MacKinnon says there's a risk in this Conservatives plan. The budget forecasts growth of just two per cent a year for the next five years, leaving the government very little margin of error.
"Many economists questioned why the government needed to balance the books this year,'' she said. "Canada has the best debt-to-GDP ratio among the G7, and there's a strong argument that a better approach would have been to spend more to stimulate economic growth.''
The New Democrats and Liberals both proposed greater spending on infrastructure. Both argue it can be done without running a deficit.
And they continued a refrain that the middle class — whoever they are and wherever they live — are not the beneficiaries of the Conservative budget.
"This is not a budget for middle-class Canadians,'' said NDP Leader Tom Mulcair.
He said it's only the richest few who have the money to contribute the new $10,000 maximum to tax free savings accounts each year. The richest few who will benefit from income splitting, and who will benefit from the reduced mandatory withdrawals from Registered Retirement Income Funds.
New Democrats will provide real help to the middle class, he promises, by bringing in a national child care program costing just $15 a day. By raising the minimum wage in federal industries to $15 an hour.
The Liberals echo similar themes.
"The middle class gets nothing from this budget," Liberal finance critic Scott Brison said. "We will be offering Canadians a real plan for jobs and growth, real support for middle-class families in a fully costed plan.''
So the budget is in. It will occupy a central role in an election campaign that for all intents and purposes began this week.
And those elusive middle-class voters will have a choice, between a governing party that says it has made them so much better off already, and two opposition parties who insist the middle class could be so much better off in the future under a different government.