Federal financial plan from the Liberal Party set for release
OTTAWA – Finance Minister Chrystia Freeland plans to release an updated account of the federal finances today and outline the government’s economic outlook for the coming months.
The government predicts the deficit for the previous financial year will be $354.2 billion and close to $155 billion this year.
But the federal books could add billions of dollars in additional financial space due to higher oil prices, which also helps push up inflation rates.
Freeland did not directly respond to a question Monday about how that would be reflected in today’s update, saying she would have more to say when the document is released.
While the Liberals have promised billions of dollars in new spending on the election campaign, the Treasury Department has signaled that the update will not feature a long list of new spending measures.
A measure was announced Monday, as the government sets aside $40 billion to compensate First Nations children and implement long-term reforms to the child welfare system.
Economists say some promised spending could be delayed as it could add to inflationary pressures.
While the Bank of Canada has a mandate to keep inflation in check, the government agreed on Monday that it would play a role in helping the central bank keep inflation around its target. spend your two percent.
BMO Canadian rates director Benjamin Reitzes said the wording could be a sign that the government thinks it’s time to ease its stimulus spending.
Freeland is facing calls to increase spending for the benefit of labor groups and demands from business groups for a plan to address supply chain issues, “Buy American” terms. that the White House is promoting and the labor shortage in the country.
Dennis Darby, president of manufacturers and exporters Canada, said that these issues could undermine the economic recovery from COVID-19.
This Canadian Press report was first published on December 14, 2021.