Sudbury MP and North Bay professor explain what a historic $382B deficit means for Canadians

Finance Minister Chrystia Freeland delivered a much anticipated fiscal and economic update on Monday, presenting the federal government’s fiscal strategy for coping with the ongoing COVID-19 pandemic and shaping Canada’s recovery.

Sudbury Liberal MP Paul Lefebvre joined Morning North host Markus Schwabe on Tuesday morning to share some of his reactions. 

“We needed to show Canadians the state of our economic situation,” Lefebvre said, “Given these unprecedented times, in this pandemic that we are still in.” 

“Now I think, we’re also showing our hands as to where we want to go,” he said, “I think we’re giving Canadians the direction they are seeking and continuing to help them during these very, very difficult times.”

‘This is the world we live in now, economists across the board, more or less agree that this kind of deficit spending is the only way to keep the economy, to keep it pumping, to have money in people’s pockets,’ says David Tabachnick, political science professor at Nipissing University. (Tyson Koschik/CBC)

‘Making sure they keep the roof over their heads’ 

Monday’s fiscal update projects the country’s deficit will reach $381.6 billion by the end of March 2021. What’s more is, it could climb even higher, depending on factors such as the severity of future shutdowns and the rate of COVID-19 infections.

Going into debt, Lefebvre said, has been crucial in helping Canadians stay afloat since March.

“We’ve said from the beginning, we would have Canadians’ backs by making sure they keep the roofs over their heads, keeping food on the table and that’s what’s basically been driving us since day one. Really, trying to help Canadians make sure they can continue on with their lives even though their lives have been turned upside down,” he said. 

There are measures … that will provide the hospitality sector more supports as we move forward.— Sudbury Liberal MP Paul Lefebvre

“The Conservatives are saying we’re being way to generous with Canadians and the NDP are saying that this is an austerity budget after investing [$382] billion into Canadians in one fiscal year.” 

All things considered, however, Lefebvre said, northern Ontario is doing well despite continued challenges facing both the tourism and hospitality sectors, relating to the pandemic. 

“There are measures … that will provide the hospitality sector more supports as we move forward,” he said.

Green incentives

The Liberals also took the opportunity to make some announcements on Canada’s green economy, announcing that Canadians will be able to qualify for grants of up to $5,000 for work to improve the energy efficiency of their homes.

The Home Energy Retrofit program will cost $2.6 billion over 7 years, starting in 2020-21. The funding also will cover the cost of providing one million free EnerGuide efficiency assessments and pay for the recruiting and training of auditors to perform the work.

I mean there’s more spending here and a little bit of a question mark for planning.— David Tabachnick, policital science professor at Nipissing University

“That was in our platform, that was in the speech from the throne,” he said, “This is very exciting times certainly on nature-based solutions, tackling climate change.” 

“And I know there is more information, and more plans coming of certainly reducing our greenhouse gas emissions.” 

David Tabachnick, a political science professor at Nipissing University, caught up with Up North’s Jonathan Pinto on Monday afternoon to offer some insight into the fiscal update and what it could mean for northern Ontario. 

Tabchnick said much of the fiscal update didn’t come as a surprise.

“I mean there’s more spending here and a little bit of a question mark for planning,” he said, “We still don’t quite know when we are going to get to the end of this very dark tunnel … when these vaccines are going to arrive.”

‘Put this money in our pockets and into the economy’

“So the government is planning on spending our way out of this problem and that will go along with a very large deficit. Even larger than what we heard about earlier in the year.”

The deficit, which was unveiled on Monday, Tabachnick pointed out is a historic high. 

“So [Monday] we learned that about $25 billion more to be spent this year and potentially $100 billion more to be spent … over the next three years in stimulus,” he said, “This is the world we live in now, economists across the board, more or less agree that this kind of deficit spending is the only way to keep the economy, to keep it pumping, to have money in people’s pockets.” 

“We need the government to put this money in our pockets and into the economy to keep things going.” 

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