Federal budget comes as Canadians fear for financial security
OTTAWA—Justin Trudeau’s government takes the wraps off its first budget Tuesday at a time when many Canadians are worried about economic uncertainty and a majority fear for their own financial security, a new poll shows.
Trudeau’s promise of economic help for the middle class — an issue his Liberals campaigned on — comes as sluggish growth and more recent economic turmoil sparked by the sharp drop in oil prices has shaken the confidence of Canadians, according to the poll by Forum Research.
It found that 33 per cent of those surveyed believe the economy will worsen while just 24 per cent expect the economy to improve this year. Just over one-third of respondents think the economy won’t change.
And those economic jitters have most Canadians now fretting about their own prospects, with 69 per cent saying they are concerned about their financial security.
“There is no sense that people are getting ahead or moving forward. They’re treading water,” said Lorne Bozinoff, president and founder of Forum Research.
The poll found that younger people, ages 18 to 34, are among those most pessimistic about the economy and their own financial security.
That’s no surprise to Bilan Arte, national chairwoman of the Canadian Federation of Students, who says young people are struggling with “skyrocketing” tuition fees, growing debt and an uncertain job market.
“We need some strong leadership at the federal level to present a bold plan to save this generation,” she said, noting that youth unemployment is running at 13 per cent.
“Investing in young people today could actually provide for a strong and more robust economy in the future,” Arte said in an interview.
During the election, the Liberals promised action to make post-secondary education more affordable and help getting young people into the job market.
And Trudeau made himself the minister of youth, setting expectations high on the file. Young people will now be watching to see if those promises become a reality to help set them up for economic success, Arte said.
“We can’t do that if we’re not given the skills, the tools and the opportunities to be successful . . . that’s the hope that young people are placing on this budget,” Arte said.
When asked what they want to see in Tuesday’s budget, Canadians put tax cuts at the top of their list (23 per cent), followed by infrastructure spending (18 per cent) and action on jobs (15 per cent), the poll found.
But the priorities varied across the age groups. Older respondents put a priority on infrastructure (26 per cent), tax cuts (18 per cent) and pension reform (17 per cent). Those aged 35 to 44 ranked tax cuts as their top priority (31 per cent), followed by infrastructure spending (15 per cent) and job creation (14 per cent). Young people named affordable housing (18 per cent), tax cuts (16 per cent) and marijuana legalization (15 per cent) as their budget priorities, even though reform of marijuana laws is almost certain not to come Tuesday.
Concern the economy will worsen is found among younger Canadians, those earning between $100,000 and $250,000 and those living in Alberta and those in Ontario.
Tuesday’s budget will deliver on a new child benefit to assist parents, big ticket infrastructure spending — and a deficit that is likely to ring in at almost $30 billion in the coming fiscal year.
Conservative MP Tony Clement said the “spending spree bonanza” and growing deficit raise concerns whether the Liberals have a plan to balance the books.
“When you’re spending a lot of money, there’s going to be lots of interest groups and organizations that will praise the government,” Clement said in an interview.
“But we also have to look at the long-term impacts of whether they’ve got a fiscal plan that makes sense,” said Clement, MP for Parry Sound-Muskoka.
Bozinoff said the government’s budget spending is likely to find favour with voters — but only if they perceive it’s producing concrete results.
“Right now, they are in a honeymoon and Trudeau’s numbers are still looking good. They’re not going to take any heat over this,” he said.
“When they say ‘we’re going to run a deficit and investment in the economy,’ that’s all good. Everyone is in favour of that. But four years from now, it has to pay off,” he said.
Using interactive voice-response phone calls, Forum surveyed 1,567 people on March 15. The results are considered accurate plus or minus two percentage points, 19 times out of 20. Small samplings are less accurate. Forum houses its poll results at the data library of University of Toronto’s department of political science.
Five things to watch in Tuesday’s budget
1. Canada child benefit. This promises to be one of the signature items as the Liberals reform the system of child benefits. They say their program will put more money in the pockets of most families, though households making more than $200,000 will be out of luck.
2. Infrastructure. With $60 billion pledged over the next decade, expect infrastructure spending to be front and centre in the budget speech, starting with a quick infusion of cash for repairs and upgrades.
3. Jobs for young people and steps to make post-secondary education more affordable. Prime Minister Justin Trudeau made himself the minister of youth, setting expectations high that the government will act in this area.
4. Deficit. The government was projecting an $18.4-billion deficit for the coming fiscal year — and that was before the budget measures. Expect the new spending to drive that number higher, perhaps as high as $30 billion.
5. Middle class tax cut. The Liberals actually delivered on this campaign pledge Jan. 1, saving many couples an average of $540 a year. But expect the government to remind Canadians of that move on Tuesday.