Parliament’s budget watchdog, Parliamentary Budget Officer (PBO) Yves Giroux, is raising questions about the lack of details in the Liberal government’s 100 billion stimulus plan, suggesting Finance Minister Chrystia Freeland’s phone is likely “ringing off the hook” from lobbyists wanting a piece of the action.
Last month, Freeland presented plans to help recover from the COVID-19 pandemic by opening a spending spike over the next three years to build a greener and more diverse economy.
Parliamentary budget official Yves Giroux said he was concerned about the government’s lack of details about his plans, during a press conference on Thursday.
The government has said it cannot provide more details on its plans now because the money will start to roll out only after the pandemic is under control and the economy is ready for new investments to boost jobs and growth.
Freeland spokesperson Katherine Cuplinskas said in an email: “Given the uncertainty of the virus, and our eventual recovery, it is premature for anyone to project exactly how the recovery will play out, or when spending will need to be wound down.”
The government says spending will continue until some of the “fiscal barriers” associated with the labor market are met. Those improvements include improvements in employment, unemployment, and total hours worked, although the Liberals did not disclose specific targets for each category.
Giroux predicts that each of those hurdles will return to pre-pandemic levels within the next 18 months, which “suggests that the size and timing of planned fiscal stimulus could be misaligned. otherwise, this could be too much and too late. “
The budget officer also raised questions about the Liberal Party’s long-term plan to deal with a freeze on employment-insurance premiums implemented during the pandemic, which Giroux said will leave the government with a $52-billion deficit in the EI operating account.
He also highlighted concerns surrounding a plan to expand the amount of money the finance minister can borrow on behalf of the government to more than 50%, including 100 billion unallocated stimulus funds.
Freeland defended that plan during a congressional committee meeting earlier this week, calling it a “prudent measure” to ensure the government has the flexibility it needs to respond to the pandemic, but they does not intend to borrow money.
Conservative financial critic Pierre Poilievre told Freeland that if the Liberals did not need the money, there was no need to raise the limit.
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