The 2012 federal budget will be moderate, not “draconian,” and will focus on making government programs sustainable for future generations, Finance Minister Jim Flaherty says.
When this budget will actually be released, however, remains a government secret. Mr. Flaherty says no decision has been made.
Speaking with reporters in Toronto Thursday, Mr. Flaherty picked up on a theme raised earlier in the week by Human Resources minister Diane Finley. The government seems to be broadening its argument for changing Old Age Security eligibility as part of a larger effort to ensure existing programs aren’t too expensive as the baby boom generation retires.
“We do want to look ahead and look down the road so that we can make sure that the important government programs we have are available down the road for younger Canadians, so that we have inter-generational equity, fairness between generations and that my generation,” he said.
With provincial governments also planning budgets that will involve spending cuts, economists and rating agencies have cautioned the federal Conservatives not to harm the economy by moving too aggressively on program restraint.
Mr. Flaherty maintains Ottawa’s plans are simply to slow the rate of growth in federal spending.
“This is not austerity. This is not draconian. It will be moderate in its approach,” he said of the next federal budget.
Mr. Flaherty insisted that Ottawa’s plan will be moderate, but urged the provinces to focus on spending cuts so that they will not have to raise taxes in the future.
“It’s very important that the provinces also move in the direction of getting their fiscal houses in order because the long term effects of accumulated deficits, large public debts, are not good,” he said. “Especially when interest rates go up and the cost of borrowing for a province or for the federal government is challenged. Now we have the best credit rating in the world, the government of Canada.”
Original Article
Source: Globe
Author: Bill Curry
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