Penniless and in anticipation of a recession, the Trudeau administration is betting what little is left in the coffers on the green transition in a minimalist budget that offers few new measures.
Follow our live coverage on all our platforms
“It’s relatively limited in terms of priorities. We focused on the green economy, that’s the big chunk,” summarizes Jimmy Jean, chief economist at Desjardins, while going through the 288 pages of the 2023 federal budget presented yesterday.
This plan earmarks more than $18 billion for the green transition. Most of the money will go to tax credits, specifically to encourage investment in clean power.
“The backbone of the plan is clean power, which is a major industrial advantage that we have and that we need to stimulate,” said a senior Finance Canada official, noting investment in the sector.
This is Canada’s response to the massive green investment of nearly $400 billion that the US government has unleashed in recent months with its Inflation Reduction Act.
social programs
So it’s a lot less than what our neighbors to the south expect, but the government should set aside some money for other things. He decided to allocate $13 billion to the Canada Dental Care Plan promised to the New Democratic Party (NDP).
The other significant spending goes to First Nations and Inuit: US$4 billion, mainly to implement an Aboriginal housing strategy in urban, rural and northern areas.
Nothing, however, for the other Canadians who are struggling to find housing while “there is an emergency in this sector”, worries Mr Jean and regrets that this issue has clearly been “sacrificed” from the 2023 budget.
The box is empty
But Treasury Secretary Chrystia Freeland “went to the limit of what she could afford,” said Robert Asselin, vice president for public policy at the Business Council of Canada.
The ex-economist and advisor to the Trudeau team emphasizes that after years of lavish spending, the government has “no longer any room for manoeuvre” and has used up the surpluses that it needs today in a clearly gloomy global economic context.
After insisting the shadows were only temporary, Ottawa has taken off its rose-colored glasses and now admits even a “mild” recession is on the horizon, a senior Finance Canada official has said. It puts a strain on economic growth, i.e. the money that the state receives and can spend little on.