Canada's Budget Deficit Hits Record $282.67Bln As Election Prospects Dwindle

TORONTO (UrduPoint News / Sputnik - 20th April, 2021) Canada's budget deficit stands at a record $282.67 billion (C$354 billion) in the 2020-21 fiscal year amid record spending in response to the novel coronavirus pandemic, the country's 2021 Federal budget revealed.

On Monday, Canada's Deputy Prime Minister and Finance Minister, Chrystia Freeland, delivered the country's first budget since March 19, 2019 amid speculation that it would trigger a national election.

"We predicted a deficit for 2020/2021 of up to C$382 billion Dollars [US$312.84 billion]... our deficit for 2020-2021 is C$354.2 billion [US$282.67 billion], significantly below our forecast," the document said on Monday.

The document also revealed that the government of Prime Minister Justin Trudeau intends to keep government debt above 100 percent of the Canadian economy for the foreseeable future and that the federal debt-to-GDP ratio will remain above 50 percent until 2025-26.

While the government said that it is committed to reducing federal debt as a share of the economy, it did provide a number that would serve as a "fiscal anchor," a point that drew condemnation from official opposition leader Erin O'Toole.

The budget included a number of big-ticket spending items, including an allotted $80.93 billion (C$101.4 billion) over the next three years towards recovery from the economic devastation inflicted upon the country the coronavirus pandemic.

The stimulus package includes funding towards a child-care program, extending the Canada Emergency Response Benefit (CERB) - a $1,400 monthly benefit for workers affected by the novel coronavirus pandemic - and establishing a $11.

97 (C$15) federal minimum wage.

According to the budget, Canada's real GDP and employment levels are expected to reach pre-pandemic levels at some point during 2021, ahead of schedule according to the Department of Finance.

The budget also includes increases for Canada's foreign policy priorities, including increased funding for NATO commitments - $676.03 billion for the military bloc's various programs and ballooning costs - as well as an additional $131.68 million for increased humanitarian spending in the 2021-22 fiscal year.

O'Toole called the federal budget a "massive letdown."

"Justin Trudeau's budget is a massive letdown for Canadians. Canadians were expecting a pandemic budget. This is an election budget - and a poor one at that," O'Toole said during a press conference following the budget presentation.

However, despite the speculation throughout the winter, Canada's New Democrat Party leader Jagmeet Singh said ahead of the budget presentation that his party would not trigger an election, suggesting support for the document.

"It would be unsafe, it would be unfair to Canadians to have an election right now with the pandemic and a third wave where it is... we are not interested in triggering an election," Singh said.

Canada's two most represented opposition parties in the House of Commons - the Conservatives and the Bloc Quebecois - will now propose amendments and sub-amendments to the document after, which parliament will vote to pass the budget or trigger a federal election.