Today’s throne speech was notable for its brevity, but there wereÂ certainly a lot of priorities packed into those 1600 words. A small selection:
- “The Government will, as an immediate priority, deliver a tax cut for the middle class.”Â This is quite easily my least favourite action promised by the new Liberal government. The plan increases the marginal tax rate on high income earners, and gives it back on earned income between $45K – $89K. Thanks to the magic of marginal tax rates, this means you only get the maximumÂ $670 if you earn more than 89K. Combine that with median incomes in the $30K range, and you can see that this does very little for middle income earners. The NDP have proposed changes that would reach more Canadians, which I hope the government takes seriously.
- “The Government has also committed to provide more direct help to those who need it byÂ giving less to those who do not. The new Canada Child Benefit will do just that.” This change will make a real difference for low income families with children. 5 thumbs up.
- “To give Canadians a more secure retirement, the Government will work with the provincesÂ and territories to enhance the Canada Pension Plan.” This will be huge for the 11 million workers in Canada who don’t have a workplace pension plan, particularly young workers.
- “The Employment Insurance system will be strengthened to make sure that it best serves bothÂ the Canadian economy and all Canadians who need it.”Â This is one social program that is particularly close to my heart, and I am cautiously optimistic that this will bring positive change to a key pillar ofÂ our badly frayed social safety net.
- “The Government will undertake these and other initiatives while pursuing a fiscal plan thatÂ is responsible, transparent and suited to challenging economic times.”Â So this is pretty vague, but I think we need to look at what wasn’t said. There is no mention of returning to balance in 2019 (hallelujah!), and not even any mention of debt-to-GDP targets. In conjunction with public statements by Bill Morneau, let’s hope this means that the new government is comfortable with a probable $15B – $20B deficit for FY2016/17. In the face of today’s job numbers, it looks like we’ll be needing that lift.