Federal Budget 2019

Federal budgets are highly political documents. Budget 2019 is both a pre-election budget and an effort to change the channel from the recently SNC-Lavalin controversy.

The details of the Budget Plan with live links to different chapters can be accessed here: https://www.budget.gc.ca/2019/docs/plan/toc-tdm-en.html

The political nature of the budget is shown by the Poverty Reduction, Health and Well-Being section which is itself buried in the Gender Equality Chapter. Much is made in this section of the ways poverty is being reduced as a result of the significant increases to child benefits made in Budget 2016. But there were nothing further announced in Budget 2019 such as increasing the child benefit amounts beyond the indexing introduced in Budget 2018.

The chapter on Indigenous Reconciliation does propose significant additional investments totaling $4.7 billion over the next five years which are in addition to the investments made in previous budgets. Significant additional investments are being made to settle land claims, eliminate boil water advisories, and ensure that funding for education and child protection are more on par with that provided by provinces for non-Indigenous children.

Other than committing to establish a legislated National Housing Strategy, no additional details on the proposed Canada Housing Benefit tailored to low income renters were announced in Budget 2019. Several housing measures not tailored to low income Canadians were announced targeted to young millennials seeking to become home owners. Additional funding was also announced to extend a Rental Construction Financing Initiative from four years to 10 years.

As would be expected in a pre-election budget, there are a number of new initiatives (goodies) announced that potentially benefit low income Canadians such as:

• a Canada Training Benefit for those needing to re-train for a new career
• improvements to make Canada Student Loans more accessible and affordable
• some additional detail on a national pharmacare programs including the establishment of a new federal agency to rein in rising drug costs,
• reducing claw backs of the Guaranteed Income Supplement from employment earnings for low income seniors who continue to working beyond age 65, and
• establishing a Canada Food Policy to improve access to nutritious food, address food security in Northern Canada and Indigenous communities, and reduce food waste.

The new measures in Budget 2019 are affordable due to higher than expected government revenues from income taxes and the GST. Despite the additional investments, many focused on what are seen as priorities for middle income Canadians, budget deficits for this year and next are expected to be slightly lower than previously forecast.

Prepared by

John Kolkman, Research Associate,
Edmonton Social Planning Council