Published Tuesday, February 11, 2014 3:36PM EST
Last Updated Tuesday, February 11, 2014 11:37PM EST
OTTAWA -- The Harper government unveiled a mixed-bag budget Tuesday with a focus on skills training, infrastructure projects and a handful of consumer-friendly measures that will largely be paid for by hiking cigarette taxes by $4 a carton.
In delivering his 10th budget, Finance Minister Jim Flaherty kept a tight rein on spending, promising a significant surplus next year just in time for the federal election.
“Some people will say the budget is boring,” Flaherty said. “I consider that a compliment.”
Flaherty acknowledged that the budget does not contain “flashy spending” or “baubles.” But he told reporters Tuesday afternoon that “it’s the right budget for Canada.”
Here is how Economic Action Plan 2014 breaks down:
The budget includes a handful of measures to connect with workers with unfilled jobs, as unemployment hovers around 7 per cent, about one percentage point higher than before the recession.
Citing high demand for skilled tradespeople, particularly in Alberta and Saskatchewan, the federal government plans to expand the Canada Student Loans Program with the creation of the Canada Apprentice Loan. Under the program, apprentices enrolled in a Red Seal trade apprenticeship can apply for up to $4,000 in interest-free loans “per period” of training.
The government expects to assist about 26,000 apprentices per year with more than $100 million in loans. Employment Minister Jason Kenney will announce further details about the program in the coming months.
Other jobs training measures include:
- $75 million over three years to expand the Targeted Initiative for Older Workers program, to help unemployed older Canadians in smaller communities find jobs.
- $40 million for the Canada Accelerator and Incubator Program for entrepreneurs creating new businesses.
- $40 million over two years for up to 3,000 internship positions in “high-demand fields.”
- $15 million over three years to connect persons with developmental disabilities with jobs.
- $11.4 million over four years to expand vocational training programs for Canadians with Autism Spectrum Disorders.
The grant was introduced in last year’s budget and is a key plank in the train-workers-for-unfilled-jobs push, but was met with resistance from the provinces over concerns that money would be diverted from programs for vulnerable populations. Employment Minister Jason Kenney has been negotiating with the provinces, and Flaherty said over the weekend that those talks are going “well.” But the federal government is prepared to go ahead with the program on April 1 whether or not the provinces sign on.
The 2014 budget says the grant “will encourage greater employment participation in skills training decisions and ensure that training is better aligned with job opportunities, particularly in sectors facing skills mismatches and labour shortages.”
When it was first announced, the $15,000 grant was to be divided three ways, between the federal government, the provincial government and the employer. However, Kenney offered an olive branch to the provinces late last year when he said the federal government would cover the provinces’ portion. Tuesday’s budget document confirms the federal commitment of up to $10,000.
The “major” funding for infrastructure projects Flaherty promised in interviews last weekend includes more than $392 million over five years to repair and maintain highways, bridges and dams in Canada’s national parks.
In addition, the budget pledges:
- $237 million over two years to repair and maintain federal bridges in the Greater Montreal Area, including the Champlain Bridge.
- $48 million over two years for a new bridge over the St. Lawrence.
- $40 million over two years to repair and maintain small craft harbours across the country.
In addition to jobs and infrastructure, the federal government has pledged some measures for consumers. As was reported before the budget was tabled, the government is pledging $305 million over five years to extend and enhance broadband high-speed internet access for rural and Northern communities.
The initiative will affect about 280,000 households. However, details of how the government plans to meet this objective will only be unveiled “in the coming months.”
The budget also includes pledges to introduce two key pieces of legislation, including a bill to cap domestic wireless roaming rates.
The government also wants to tackle the price gap between the United States and Canada by introducing legislation “to address price discrimination that is not justified by higher operating costs in Canada.” The bill would also give Canada’s Competition Commissioner the power to enforce the new guidelines. Again, more details are expected at a later date.
Pay-to-pay billing, or paying a fee to continue to receive a paper bill, will also be on its way out if the government has its way.
Late last week, Flaherty indicated that the budget would include measures to crack down on terror groups or states that fund terrorism from using Canadian charities to launder money.
The federal government proposes that when a Canadian charity receives a donation from a state that is known to sponsor terrorism, or an agent acting on behalf of that state, the Minister of National Revenue can refuse to register the charity or may revoke its charitable status.
The federal government has come under fire from veterans and their advocates to address a rash of recent soldier and veteran suicides, and for the recent closure of nine Veterans Affairs offices.
While the budget contains no new programs to serve veterans, it allocates an additional $6 million over two years in funding for veterans’ funerals -- $102 million was previously pledged for 2013-14, and Tuesday’s budget adds $3 million for 2014-15, and $3 million for $2015-16. It also expands the funeral fund to soldiers who served in modern conflicts.
The budget also pledges $2.1 million to enhance a web-based tool for veterans to access services.
Overall, the new spending totals $1.8 billion, most of it to be paid for by an increase in tobacco taxes of some $4 per carton, or 50 cents per pack.
The government expects the budget deficit to be $2.9 billion this year, and expects a surplus of $6.4 billion in 2015-16, taking into account a $3 billion risk cushion. However, factoring in that risk fund, the books will appear set to balance this year.
“We want to make sure our country can weather a storm if and when it comes,” Flaherty said.