Canadians will have to wait another month before finding out how the Conservatives will change Old Age Security and cut federal spending, as Finance Minister Jim Flaherty confirmed his 2012 budget will be released March 29.
Even then, after months of hints and suggestions about what may be on the chopping block as Ottawa moves to erase its estimated $31-billion deficit, there will still be questions about what is being cut.
Last March, the Conservatives launched a year-long process called the Deficit Reduction Action Plan, led by a special subcommittee of cabinet that scoured through hundreds of proposed cuts from all federal departments. The 2012 budget was billed then as the unveiling of that work.
But Mr. Flaherty said his budget will not include “intricate detail” about where the axe will fall.
“The budget would have to be a 1,000 pages if we did that,” he said. “But there'll be enough information that it'll be comprehensible, that it will describe what we're doing in terms of the Deficit Reduction Action Plan, and much more than that. This is a jobs and growth budget.”
He and other ministers have been playing down expectations lately, describing the government’s restraint plans as modest.
The budget will also reveal how Ottawa will phase in changes to Old Age Security, which the government says is needed over the long term to make it financially sustainable.
Mr. Flaherty promised the budget will nonetheless lay out a comprehensive plan for meeting the government’s target of eliminating the deficit by the 2015-16 fiscal year. The minister said it’s possible Ottawa could “do a bit better,” which could mean a balanced budget by 2014-2015. That later target is what the Conservatives announced during the 2011 election campaign, but Mr. Flaherty pushed that back by a year last November on the grounds that economic growth was coming in lower than expected.
NDP finance critic Peter Julian accused the government of trying to “hide the facts from the public” and said the minister’s actions are the exact opposite of Conservative campaign pledges to act transparently.
Liberal finance critic Scott Brison said that he recently urged Mr. Flaherty in a private meeting to be transparent about the budget cuts. He expressed disappointment that the minister’s comments suggest that won’t happen.
“It’s regrettable, but it’s not surprising,” Mr. Brison said.
Public-sector unions are warning that more than 100,000 public- and private-sector jobs could be lost as a result of federal spending cuts, a claim Mr. Flaherty dismissed as “outrageous.”
Police were ramping up security on Parliament Hill in advance of a union-led national “day of action” Thursday to protest federal spending cuts.
Mr. Flaherty told reporters unions have been protected during difficult economic times and that it was “realistic” to “ask the public service to participate in the belt-tightening.”
There is disagreement among economists over how quickly Ottawa should move to eliminate the deficit, with some worried that too aggressive an approach might drag down a fragile recovery. Finance Canada’s monthly tracking suggests the deficit for the current year will come in at about $25-billion, beating the minister’s November estimate of $31-billion.
But a broader public is more bullish on cuts. A poll by Nanos Research released this week showed that 74 per cent of those surveyed want to see cuts that exceed the 5-per-cent minimum the Conservatives have set as each department’s target.
The last week in March is later than usual for a budget, but Mr. Flaherty has said he wanted to give himself time to see how the Greek debt crisis plays out in case it creates a shock to the global economy.
The last week of March could be budget-heavy. Ontario Finance Minister Dwight Duncan also plans to bring down his budget that week, which could provide interesting contrasts as to how each government tackles its fiscal challenges.
“In theory it would be possible” that Ontario releases its budget the same day as Ottawa, Duncan spokeswoman Aly Vitunski said. The province usually releases its budget on a Thursday, but “it doesn’t have to be,” she added.