Conservatives To Fund For Family Benefit Package And Infrastructure Spending To Boost Economy In Canada

By @Shayani92 on
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IN PHOTO: Ontario Finance Minister Charles Sousa (R) accepts congratulations along with Ontario Premier Kathleen Wynne after he delivered the provincial budget at Queens Park in Toronto, April 23, 2015. REUTERS/Mark Blinch

Among Canada’s downgrades of growth prospects, the conservative has decided to plan a re-election in order to fight the prevailing recession. Last Tuesday Finance Minister Joe Oliver confirmed that the budget announced incorporated almost AU$ 13.42 billion into the economy. The cash would be spend on improving infrastructure and family welfare programs that would bring about economic prosperity amid the growing recession.

It has been announced that parents with children under 18 would be eligible for benefit cheques and a variety of new infrastructure projects would be funded with an extra amount of AU$2.15 billion in the next financial year. However, at the moment it is difficult to gauge which one of the schemes would have better impacts.

Although any fiscal measures to fight recession hasn’t been discussed yet and the situation is likely to remain the same till October polls. Don Drummond, a former senior Finance Canada official said that a motive to return to a “balanced budget” might have prevented them from adopting fiscal measures at the moment, reported Times Colonist.

Mike Moffatt, chief economist at the Mowat Centre has helped the Liberals to plan the costing of the family benefit package, which he believes would bring about positive outcome. He suggested that cheques should be deposited for starting the proposed works as soon as possible because the government was unaware of the recession. Vice-president of policy analysis at the C.D. Howe Institute, Finn Poschman, welcomed the  decision of family benefits scheme yet he expressed uncertainty as to whether putting cash in pockets of households would have positive impacts.

The infrastructure projects, which have been announced, are smaller projects, confirmed Mr. Drummond that might not have long-run economic benefits. According to Huffington Post, Bank of Canada could announce a cut on interest rates to boost the economy. However, Drummond pointed out that the present interest rate of 0.75 percent was as low as it could get and benefitting only house buyers and consumers eventually resulting in more debts.

Contact the writer on priya.shayani@gmail.com.