On November 30, Chrystia Freeland, Minister of Finance, presented the Government's long-awaited Fall Economic Statement, which outlines its “fiscal policies for dealing with the ongoing COVID-19 pandemic, as well as plans for restructuring and rebuilding the economy.” The Economic Update was accompanied by a report that can be accessed here.
CAPE reviewed the broad outlines of this economic statement for highlights and points of interest to its members.
Key Highlights
The Government is projecting a deficit of $381.6 billion by March 2021, with the possibility that it could be as high as $400 billion. Nevertheless, they are prepared to spend another $100 billion over the next three years to help rebuild the economy.
Most of the proposed changes would not come into effect until July 1, 2021 and many of the details will only be available when the Government releases its next budget, likely in the first half of the year. Prime Minister Trudeau has already announced that the new spending measures will be put to a vote.
A few takeaways from the Fall Economic Statement:
- Center for Diversity: The Government is earmarking $12 million over three years towards a dedicated Centre for Diversity in the Federal Public Service at the Treasury Board Secretariat. This will accelerate and increase the government’s efforts to achieve a representative and inclusive public service. It includes implementing a government-wide strategy and action plan with specific actions necessary to accelerate progress on diversity and inclusion.
- Fighting racism: Through this Fall Economic Statement, the Government of Canada is reiterating its commitment to fight racism in all its forms through clear and meaningful investments in a number of key areas: economic opportunity, representation at the highest levels of and throughout the public service, diversity in corporate Canada, modernization of equity legislation to be truly inclusive, community empowerment, and action to address systemic racism in the justice system.
- Employment Equity Act: The Government is committing $6.6 million to support a task force on modernizing the Employment Equity Act. The task force will have a mandate to study, consult and advise on how a renewed Employment Equity Act can help ensure that Canada’s economic recovery is equitable, inclusive and fair. The government is also committing $3.6 million on an ongoing basis to expand the Workplace Opportunities and Barriers to Equity Program, to promote projects that help federally regulated workplaces become more representative of Canada’s diversity.
- Home expenses claims: To simplify the process for both taxpayers and businesses, the CRA will allow employees working from home in 2020 due to COVID-19 who have modest expenses to claim up to $400, based on the amount of time working from home, without the need to track detailed expenses, and will generally not request that people provide a signed form from their employers. This measure will help taxpayers access deductions they are entitled to receive and simplify the tax filing process. Further details will be communicated by the CRA in the coming weeks.
Reflections
While some of the proposed measures are commendable and demonstrate a willingness to support economic and social justice, we will still have to wait and see when and how they will be implemented. The pandemic will have serious economic implications that are not fully measured or measurable today. One would expect this crisis to force a profound shift in priorities in the coming year. CAPE remains concerned about the impacts of the crisis on the federal government and the well-being of its members and all federal public service employees.
