Minister of Finance Jim Flaherty and Prime Minister Stephen Harper enter the House of Commons to deliver Budget 2010: Leading the Way on Jobs and Growth.

LETHBRIDGE -

With our country showing positive signs of emerging from the worldwide recession powered by one of the strongest economies in the G7, yesterday’s federal budget clearly indicates continued resurgence of Canada’s economy remains our government’s priority.

Budget 2010: Leading the Way on Jobs and Growth – aims to contribute to this recovery and sustain Canada’s economic advantage now and for the future. The budget plan has three broad aims, including:

• Confirmation of $19 billion in new federal stimulus under Year 2 of Canada’s Economic Action Plan to create and maintain jobs, complemented by $6 billion from provinces, territories, municipalities and other partners.
• Investments in a limited number of new, targeted initiatives to build jobs and growth for the economy of tomorrow, strengthen Canadian innovation, and make Canada a destination of choice for new business investment.
• Charts a course to bring Canada’s finances back to balance over the medium term and well before any other Group of Seven (G7) country.
 
By making timely investments that fit firmly within the government’s long-term economic vision for Canada and the resilience and ingenuity of Canadians, our country will emerge from the recession with a stronger economic advantage than before.

Although actions taken under Canada’s Economic Action Plan have helped ensure the worst of the global recession lies behind us, recovery remains fragile, with too many Canadians remaining out of work. This is why our government will follow through on its commitment to Canadians and its G7 and G20 partners to deliver Year 2 of the stimulus plan.

Over the next fiscal year, Year 2 of the Economic Action Plan will continue to maintain and create jobs, and help Canadian workers and families manage through still difficult economic conditions, including:

• $3.2 billion in personal income tax relief. This includes allowing Canadians to earn more income before paying federal income tax and before being subject to higher tax rates. It includes the enhanced Working Income Tax Benefit to strengthen work incentives for low-income Canadians. Tax measures for 2010–11 also include higher child benefits for parents and lower taxes for low and middle-income seniors.

• Over $4 billion in actions to create and protect jobs. This includes additional Employment Insurance (EI) benefits and more training opportunities to help unemployed Canadians through this difficult period, and help ensure they are equipped to re-enter the workforce and prosper in the future.

• $7.7 billion in infrastructure stimulus to create jobs. This will modernize infrastructure, support home ownership and improve social housing across Canada. This builds on the $8.3 billion investment in infrastructure and housing delivered in 2009–10.

• $1.9 billion to create the economy of tomorrow. This investment will help develop and attract talented people, strengthen our capacity for world leading research, improve commercialization, accelerate private sector investment, enhance the ability of Canadian firms to participate in global markets, and create a more competitive business environment.

• $2.2 billion to support industries and communities. This will support
adjustment and provide job opportunities in all parts of Canada that have been hit hard by the economic downturn. It provides support for affected sectors, including forestry, agriculture, small business, tourism, shipbuilding and culture. In addition, the proposed elimination of tariffs on manufacturing inputs and machinery and equipment will encourage investment in the manufacturing sector.

Canadians in all regions have already benefited from the implementation of
Canada’s Economic Action Plan in Year 1, as:

• Commitments are in place for almost 16,000 projects across the country, with over 12,000 of these projects underway or completed.
• One objective of the Economic Action Plan was to maintain or create 220,000 jobs. The Action Plan is on track, as it has contributed to the creation of over 135,000 jobs recorded in Canada since July 2009.

Creating economic growth and jobs through innovation is a significant component of Budget 2010, as it builds on earlier investments with $600 million over three years to help develop and attract talented people, to strengthen Canada’s capacity for world leading research and development, and to improve the commercialization of research.

The budget also encourages investment and trade to create jobs and growth by taking action to improve the environment for investment, enhance competition and reduce barriers for businesses. This includes making Canada a tariff-free zone for manufacturers, by eliminating all remaining tariffs on productivity-improving machinery and equipment and goods imported for further manufacturing in Canada. This initiative, when fully implemented, will provide $300 million in annual duty savings to Canadian business.

Canada’s financial sector has been widely acknowledged as being one of the strongest in the world. Budget 2010 will further strengthen the sector by moving forward with the majority of provinces and territories toward a Canadian securities regulator, extending access to financing for Canadian businesses, and enhancing disclosure and financial institutions’ business practices to better protect consumers.

Our government continues to support families and communities, in addition to standing up for those who helped build Canada. This budget also introduces measures to support single parents and persons with disabilities, makes investments to assist Aboriginal Canadians and their communities, and provides support for participation in sport. It also recognizes those who helped build our country, with measures for military families, investments to recognize the efforts of veterans, and additional support for seniors.

It is evident the actions taken by our government over the last two years are working. Stimulus measures are maintaining and creating jobs and securing the economic recovery.  As the economy improves, we will refocus our attention on Canada’s long-term economic plan. The cornerstone of which, is a return to balanced budgets.

Budget 2010 outlines a three-point plan for returning to budget balance once the economy has recovered. We intend to achieve this by:
• Following through with the exit strategy built into the Economic Action Plan of winding down temporary stimulus measures as planned;
• Restrain spending through targeted measures to achieve an objective, of $17.6 billion in savings over five years; and
• Undertaking of a comprehensive review of government administrative functions and overhead costs in order to identify opportunities for additional savings and improve service delivery.

Canada’s government will not raise taxes and will not cut major transfers to persons and other levels of government to achieve this proposed outcome.

Overall, this budget reflects the reality of today’s global economic situation and positions Canada to take advantage of the economic recovery.