Changes to the Budgetary Process that Have Gone Largely Unnotic


Finance Minister Bill Morneau introduced some significant changes to the budgetary process in 2016 which went largely unnoticed by the media and financial commentators. In February last year he released  “Backgrounder – Economic Outlook”, which, included the Department of Finance’s latest survey of private sector economists for 2016 and 2017.  This in itself was not new. The previous government had also published revised economic forecasts in advance of the budget.

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MR. MORNEAU’S EMPTY FISCAL CUPBOARD


On the Friday before Christmas, when most Canadians were busy with their last minute shopping, the Department of Finance quietly released its “Update of Long-Term Economic and Fiscal Projections”. This is the first long-term fiscal sustainability report released by the Liberal government, and given its sombre conclusions it is not surprising that the Finance Minister released it hoping that few would notice.

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DEFICIT FOR 2016-17 COULD BE $3 BILLION LOWER THAN FORECAST IN NOVEMBER UPDATE

 

 

The November 2016 Update forecasts a deficit of $25.1 billion for 2016-17.  Based on the financial results for the first seven months of 2016-17, public debt charges could be as much as $1 billion lower than forecast in the Update, while direct program expenses could be at least $2 billion lower.  Budgetary revenues appear to be on track, with differences in components offsetting each other.  On balance, the final outcome for 2016-17 could be at least $3 billion lower than forecast in the November Update.

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DEFICIT FOR 2016-17 COULD BE $3 BILLION LOWER THAN FORECAST IN NOVEMBER UPDATE

 

The November 2016 Update forecasts a deficit of $25.1 billion for 2016-17.  Based on the financial results to date, public debt charges could be as much as $1 billion lower than forecast in the Update, while direct program expenses could be at least $2 billion lower.  Budgetary revenues appear to be on track, with differences in components offsetting each other.  On balance, the final outcome for 2016-17 could be at least $3 billion lower than forecast in the November Update.

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THE FINANCE MINISTER SHOULD INCLUDE A PRUDENCE RESERVE IN HIS BUDGET

 

 

The Parliamentary Budget Office (PBO) recently released its assessment of the federal government’s Fall Economic Statement and offered a number of issues for consideration by parliamentarians.  One of these related to the inclusion of prudence in the government’s economic forecast.

 

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WHY CREATE AN INDEPENDENT INFRASTRUCTURE BANK?

 

 

The Finance Minister’s Advisory Council on Economic Growth recently released its first report, concluding that its objective is to come up with ideas “that will more than double Canada’s growth trajectory”.

 

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