The Commerce Times

Roadmap to a Balanced Budget

The Honourable Stockwell Day, president of the Treasury Board and Minister of the Asia-Pacific Gateway, discussed the importance of budget balancing at the Economic Club of Canada’s March 29 event held at Toronto’s Sheraton Centre.

Day outlined the detailed plan to return to a balanced federal budget, which he says is essential to sustaining Canada’s economic advantage, now and for the future. As part of the plan, he mentioned the government’s three-point approach: stopped spending through a salary freeze for all departments, MPs, senators and other civil servants, cuts in the public sector, and the end of stimulus spending to eliminate this year’s $53 billion deficit.

According to Day, this three-point approach will lead to a zero on the budget by 2014.

The minister berated the Liberal Party plans to freeze corporate tax cuts, since he says such a move would weaken Canadian competitiveness internationally.

“I’ll give credit to them, the Liberals have been forthright saying they don’t buy our approach,” Day said. “They’re saying they’ll freeze reductions, and invest taxes in areas other than competitiveness.”

The Liberal party promises to forgo the minority Conservative government’s planned corporate tax cuts, from the current yearly rate of 18 per cent to 15 per cent by 2012. Liberals then plan to apply the resulted $5 billion to $7 billion of savings to budget deficit reduction.

The government will end its stimulus spending after 2010, an immediate savings of $19-billion and about 40 per cent off the deficit.

But despite Canada’s deficit, Day expects the dollar to stay strong.

“A strong dollar is good for Canada, but we will keep taxes and regulation down so businesses will continue to be competitive,” said Day.