Edmonton Chamber Sees No End to Deficit Spending

EDMONTON, CANADA - March 23, 2016

The recent federal budget offers little hope for restoring long-term fiscal discipline. As we see our deficit and debt levels rise even higher, the Edmonton Chamber of Commerce is concerned that government spending is outpacing Canada’s economic activity with no end in sight.

The federal budget did not meet many of the recommendations contained in our policy position, including:

• Confining program spending to core areas of federal responsibility;
• Limiting operational expenditures to zero-percent increases;
• Ensuring that Canada’s tax system is as neutral, simple, efficient and fair as possible; and,
• Continuing to examine new ways to reduce costs, modernize how government works and ensure value for taxpayers’ money.

“Running a significant deficit based on operational increases in this budget will be a burden on future generations,” said Janet Riopel, President & CEO of the Edmonton Chamber. “During this economic downturn, we need to look at reducing program spending and finding efficiencies in government spending.”

There were some positive measures taken by this Budget. The Edmonton Chamber was pleased to see growth in post-secondary, research and training dollars that can enhance our skilled labour supply. Also, we are pleased to see support for indigenous peoples by reducing barriers for success. Finally, the investment in innovation and protecting the environment will enhance Canada’s global reputation.

Our members wanted to see measures taken to improve current economic conditions. Reducing the tax burden on businesses and improving access to markets beyond our borders are key priorities for the Chamber.

Although the Federal Government held to the legislated .5 percent drop in the Small Business Tax rate for this year , they deferred future annual decreases designed to stimulate economic activity by taking the rate from 11 to 9 per cent by 2019. This will place further burden on an already stressed small business community – a community that very much needs the support of government.

While this budget speaks to enhancing trade and accessing markets, there was a lack of immediate actions that could be taken to accomplish this objective. The Edmonton Chamber feels that there should be more focus in this budget on improving our trade capacity and developing infrastructure that helps businesses succeed.

“Enhancing our reputation as a global trading partner that has efficient movement of goods and services from coast to coast to coast will boost our economy. We need to act now to fully capitalize on opportunities or we will get left behind.” said Riopel.

Closer to home, Edmonton residents are the only Albertans NOT eligible for the extended weeks of employment insurance benefits announced in the budget. Although we were only at 6.8 percent unemployment in February, we believe there are more challenges to come.

“There are many people in Edmonton who are now on EI who are going to be maxed out on their benefits soon. We would like a better explanation of what statistics the federal government uses and why we would be excluded,” added Riopel.

Warren Singh
Vice-President, Policy
780-409-2615