This submission comes as a supplementary to the fully-costed, 3 year budget we prepared for the May 2011 election campaign. The key components of our Green Fiscal policy remain.
We wish to highlight certain elements and offer the most politically practical elements for implementation by this Government. Given the existing policy parameters of Prime Minister Harper’s approach, we know that pressing for a carbon tax, for example, will not be warmly received. The following are designed to meet the current economic climate and be “do-able” despite the gulf that exists between the Green Party and Conservative Party policy goals.
Update since 2011:
The last year has seen the Canadian economy stagnate. Economic growth has slowed, and although the recession is officially over, Canadians are still nervous about our economic recovery. Some elements of the economy are particularly worrying. We are still lagging in innovation, research and development. The productivity gap with theUSis widening. Small and medium sized enterprises are struggling and the increases in EI premiums hit them hard. Youth unemployment is still persistently and unacceptably high at 14%. The construction sector has slowed and businesses need an injection to keep viable companies from going under. Overall, Canadians need to get back to work.
This is not the time for an austerity programme that runs the risk of further jeopardizing our recovery. At the same time, the growth in government spending under the current government needs to be brought to heel. Any cuts in government spending should focus squarely on waste and not critical services. We will vigorously oppose cuts in environmental science, environmental assessment, health care, or support to post-secondary education.
In that context, we offer the following recommendations:
Where to gain more revenue:
- Raise corporate tax rate to 19%, the level it was in 2009. This is still competitive with OECD rates. (+$4.5 billion )
- Go after off-shore tax havens. Close loopholes for the wealthiest who hide funds off-shore. Savings (+$1.2 billion)
- Implement Estate taxes on estates exceeding $5 million. (+$1.5 billion/year)
Subtotal Total revenue increase: +$7.2 billion
Where to provide tax relief to business, workers, youth:
- Eliminate increases in EI payments and deductions. (-$600 million)
- Increase access to EI benefits until employment improves. (-$500 million)
- Create Municipal Youth Employment Program combined with a Municipal Youth Employment Tuition Credit and an increase to post-secondary tuition bursaries. (-$1.5 billion)
- Pass a Small Business Act (similar to that in the EU) to ensure any new legislation takes into account the need to reduce the regulatory burden on small and medium sized enterprises. (No cost associated)
Subtotal Total expenditure increase: -$2.6 billion
Get out the Green Scissors:
The Green Party recommends that the Government of Canada leave intact all existing funding for Health, Education, Environment, and Veterans Affairs.
Where to cut:
- Fulfill commitments made at the G-20 and eliminate subsidies to fossil fuels. (+$1.2 billion)
- End subsidies to biotechnology, nuclear and asbestos. (+$256 million)
- Cancel purchase of F-35s. This is not a complete savings of funds as new planes are needed, howeverCanadadoes not need stealth fighters with the capabilities of takeoff and landing from aircraft carriers. We have no aircraft carriers. Instead, open a competitive bidding process for planes with search and rescue capability, surveillance, twin engines. At $128 million per unit (PBO) X 65 units = 8.32 billion. 50% savings estimate with open competition, and jets with more realistic capabilities. (+$4 billion)
- Reduce government spending on advertising to 2005 levels. (+$90 million)
- Cancel plans to build a crystal palace for the House of Commons in West Block, estimated at $115 million. Instead, convert the Government Conference Centre to a temporary House, for a cost savings of approximately. (+$100 million)
- Cut the Prime Minister’s Office budget by 50% to levels of the Chretien government. (+$5 million)
- Cancel plans for Financial Literacy Leader. Instead increase funding to Consumers Association of Canada to deliver on the goals of C-28. As this bill has not been costed, the estimate of savings is stated as a range. (+$2 million)
- Cancel plans to expand the House of Commons by 30 seats. (+$30 million)
- Invest in sophisticated telecommunications and video conferencing for federal government departments. Cut spending for governmental civil servant travel by 50%. Given total governmental transport and communications expenditures of $3 billion/year, we believe it is realistic to achieve annual cost savings of: (+$500 million)
- Cut funding from Carbon Capture and Storage projects from the Clean Energy Fund Program, for one time savings. Instead, set environmental and greenhouse gas goals for industry to meet. (+$450 million)
- Cut the bureaucracy at Aboriginal Affairs and Northern Development and provide more actual support to First Nations communities. (Revenue neutral)
Subtotal Green Scissors Savings: +$6,633 million
Where to invest for a stronger economy and healthier communities:
- Fund and expand the ecoENERGY Retrofit programme. Expand it to include hospitals, schools and universities. (+$1 billion)
- Invest in renewable energy and mass transit. (+$1 billion)
- Invest in First Nations Education, housing, water and health care. (+$1 billion)
- Establish a National Affordable Housing Program. (+$834 million)
Subtotal Investment for Healthy Economy and Communities: -$3,384 million
Subtotal Total revenue increase: +$7,200 million
Subtotal Total expenditure increase: -$2,600 million
Subtotal Green Scissors Savings: +$6,633 million
Subtotal Investment for Healthy Economy and Communities: -$3,834 million
Total changes to Revenue: +$13,833 million
Total changes in Spending: -$6,434 million
Deficit reduction: $7,399 million