March 29 Federal Budget Won't Detail Cuts

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JIM FLAHERTY
CP


The federal budget will be delivered on March 29, Finance Minister Jim Flaherty announced Wednesday, but it won't contain all the details of the government's planned spending cuts.

All government departments were asked over the last year to find savings amounting to between five and 10 per cent of their budgets, with the ultimate goal of cutting $4 billion in spending annually.

Flaherty told reporters the results of the spending review won't be laid out in detail in the budget.

"There's not going to be intimate detail," he said. "We never have all the intricacies in the budget. The budget would have to be 1,000 pages if we did that. There will be enough information that it will be comprehensible — that it will describe what we're doing in terms of the deficit reduction action plan and much more than that."

Flaherty described the plan as "a jobs-and-growth budget" and said cuts are "just one aspect of it."

He would not indicate how deep the cuts will reach when he presents the budget in exactly one month.

'Relatively small' cuts

Though the announced total savings target is $4 billion a year, CBC reported recently that the government is becoming more aggressive in its targets and the overall target could end up reaching $8 billion.

"The key is this: We have a $265-billion budget. We're talking about relatively small spending reductions, certainly nothing more than moderate spending reductions in a budget of that size," Flaherty said.

Canadians shouldn't expect to see the kinds of austerity budgets that were experienced in the mid-1990s, the finance minister told reporters. "This is not in that order of magnitude."

The federal public service, which numbers about 300,000, is bracing for job cuts and is vowing to fight whatever cuts end up being made. Flaherty said some of the estimated job loss numbers he's seen from the unions are "outrageous."

"I don't know where they're getting their numbers from," he said, adding he thinks Canadians believe it's realistic to ask the public service to "participate in the belt-tightening that the rest of the country has been doing."

Flaherty said the government is still on track to erase the federal deficit by 2015. Last week, his department said the federal deficit stood at $17.7 billion at the end of December, prompting speculation about whether the books might be balanced sooner than 2015.

Sticks to fall projections

But Flaherty said Wednesday that he hasn't revised the projections given in his fall economic update.

"We have a track going forward and we are on the track," he said. "It's possible we'll do a bit better but I think right now when I look at the numbers we're still on the track we were on in the autumn."

In addition to possible spending cuts, recent government talk about changing Old Age Security has also raised the anticipation surrounding the budget. The Conservatives have given no details on how they intend to change the income program for seniors, only that changes must be made to ensure it is sustainable for future generations.

Human Resources Minister Diane Finley has promised that seniors now receiving the cheques and those nearing retirement will not be affected by changes to the program.

The NDP has been pushing the government in question period to say whether it plans to raise the eligibility age for OAS from 65 to 67 but the government has refused to answer.

"If [Flaherty] talks about cuts or raising the retirement age, he will see, I think, a very significant push-back from the Canadian public," NDP finance critic Peter Julian said after Flaherty's announcement.

Julian said the budget date is later than usual, and his party is "hoping what's happened is the government is backing off from what seemed to be a very precarious course that they were setting a few months ago — looking at massive cuts in services, massive cuts in jobs, that would lead inevitably to a worsening of what is a very precarious economic performance right now in Canada."

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