Canada’s Finance Minister Jim Flaherty delivered Canada’s 2009 Budget on January 27 as the Stephen Harper led Conservatives attempt to stay in power. With many of the budget items leaked prior to the actual 2009 budget speech, many people were wondering if there would be anything new. Unfortunately for Canadians, Canada’s 2009 budget failed to deliver in some key areas, and failed to live up to the expectations of many economists who wanted to see more.
Canada plunged into the red once again, after 12 consecutive years of large surpluses delivered by previous Liberal governments. The projected deficit is expected to reach $64 billion over the next two years. The total deficit will be approximately $85 billion over the next five years.
In Canada’s budget there were income tax cuts across the board amounting to approximately $2 billion. There were also increased tax credits for home renovations, incentives for home buyers, money for infrastructure and social housing, as well as support for the automotive industry.
Jack Layton of the NDP was quick to criticize the 2009 budget, but given that Liberal leader Michael Ignatieff has indicated that he would support the budget and put the Harper government on “probation” means that Canada’s budget is likely to pass. This also ends the chances of a Coalition Government in Canada.
With very little room to maneuver, the Stephen Harper government tabled a budget that is based on the hopes of a short recession. Yet there are many that are not convinced that this economic “stimulus” package will do anything to turn the tide here in Canada. The money saved by households will do nothing to replace the jobs that are being lost from the economy. It is a very short-sighted document that will see Canada wade through very murky waters over the next five years.
Canada’s 2009 Budget will go down in history as one of the much anticipated political documents, but as rather insignificant to help Canada out of the recession.
