With a deficit of titanic 343,2 billion $ in 2020, Canada is facing one of the most important challenges in its history, acknowledged yesterday the minister of Finance, Bill Morneau, presenting his economic update.
But Ottawa aside for the moment any form of austerity, while the crisis of the COVID-19 continues.
The minister of Finance of Canada, Bill Morneau, has offered few details on how they intend to repair the public finances, yesterday, during the presentation of the “economic portrait of Canada” in the House of commons.
These 343,2 billion $ represent 10 times the deficit of last year, and much more than the 256 billion predicted three weeks ago by the parliamentary budget officer, Yves Giroux. Thus, the debt will jump to 1200 billion by next march, compared with 765 billion in march 2020.
- Listen to the analysis of the chronicler, François Lambert, Jean-François Baril at QUB Radio:
“Our government had two options “, justified Justin Trudeau. “We could let the Canadians fend for themselves and hope that it all ends soon, or we could act quickly to help. “
As Quebec city, Ottawa hopes that the economic recovery – and a possible return to balance – is going through the growth of the economy, rather than by the cuts and tax increases.
“We must make investments for our growth,” said Bill Morneau. “We are going to invest, and not make cuts or changes in our tax system. “
But Ottawa provides few details on how this is going to be done.
Up to now, the federal aid amounted to $ 230 billion in direct support to Canadians and businesses, for example, by Providing canadian emergency (PCU) and the wage subsidy. Ottawa has also agreed to $ 85 billion in indirect aid.
It is necessary to go back to the Second world War to find a financial effort comparable.
Bill Morneau is committed to presenting a “true” budget this fall, seven months after the cancellation of the federal budget 2020 because of the COVID-19. Beyond that, very little is known about the concrete measures that will be taken in the fall, apart from the progressive end of the Delivery canadian emergency (PKU).
Mr. Morneau said he hopes that the wage subsidy and the employment insurance took over the PCU from September.
In other words, cheques of $ 2000 for most Canadians ; the aid will mainly go through the company that employs them. Nearly one in four employees in the country currently reaches the wage subsidy offered to his employer, much less than what was envisaged in Ottawa to launch.
Go up the coast
On the waves of LCN, the chief economist ai Group financial, Clement Gignac, has determined that it would take seven to eight years to return to a debt ratio similar to the before-COVID.
“Yes, it’s big numbers, but when you look at it, it is the right thing to do “, he noted. “We can get through this without tax increases. “
He added that the federal government has significantly reduced its debt since the mid-1990s. In 1995-1996, federal debt amounted to 66,6% of the GDP.
The financial situation of canada by the numbers
- 49.1 per cent of GDP in 2020-2021
- 31.1 per cent of GDP in 2019-2020
- 1060 G$ 2020-2021
- 718,6 G$ 2019-2020
- 269 G$ 2020-2021
- – a decrease of 72 G$
COST Of THE INTERVENTION PLAN COVID-19 (228 G$)
- Of 82.3 G$ | wage Subsidy emergency
- 73,1 G$ | Delivery canadian emergency
- To 21.3 G$ | business Support