With the final break week of the year in the rearview mirror, Parliamentarians are entering the home stretch of the 2022 sitting calendar. Only five weeks remain before the House rises for the holidays in mid-December. At the top of the government’s agenda is bill C-32, the Fall Economic Statement Implementation Act.
Introduced earlier this month by the Deputy Prime Minister and Minister of Finance, the bill will enact the key promises made in the Fall Economic Statement (FES) and the remaining pieces of Budget 2022 that have not passed. C-32 is an integral element of the Liberals’ agenda, and will also be a confidence vote for the government in the House of Commons.
It is unlikely that the government will be defeated, as the supply and confidence agreement with the NDP remains in place. The goal for the government will be to pass the bill before the House breaks in December. Not only will passing C-32 be a legislative success for the government, but it will also provide Canadians with some economic relief before Santa comes riding into town.
Though the theme was fiscal prudence, there are still some goodies in the FES for all Canadians. Federal student loans will be interest-free and low-income families are getting a top-up of their GST credit. The government is also cracking down on labour code violations and investing in training programs for workers, while promising – again – to lower credit card fees for small businesses.
To promote the use of clean technologies and reduce emissions, the government announced a new refundable Clean Technology Investment Tax Credit equal to 30% of the capital costs for qualified equipment. The government also announced the creation of the Canada Growth Fund, a new $15 billion program that will spur private sector investment. The government believes that supporting this sector will spur innovation, create good-paying jobs, while helping the government meet their emission goals.
Ministers spent the past week travelling across Canada to announce the new programs outlined in the FES, hoping to build political support and calming Canadians’ fears about tough economic road ahead.
At the same time, the NDP and Conservatives were also on the road this week highlighting their concerns about the FES. For the Conservatives, it falls short of what they would describe as fiscal prudence while adding that the the government’s overspending during the pandemic directly fuelled inflation.
On the other side of the aisle, the NDP were not completely satisfied with the fiscal update either. Ahead of the FES, the NDP sent a letter to the Prime Minister calling for the government to enhance the EI program, accelerate investments to reduce Canadians’ vulnerability to inflation, and create a strategy for more well-paying jobs in Canada. The NDP know that they wield the balance of power and will continue efforts to exert that influence. Despite the NDP’s reservations with the FES, it is likely that the NDP will stay true to their supply and confidence agreement and support the government.
In the weeks ahead, political battlelines will be drawn over how Canada should position itself to minimize further economic hardship. As the Deputy Prime Minister and Finance Minister alluded to earlier this month, the country is not out of the woods with a potential recession looming. The Liberal’s fiscal update was merely a scene setter for the government’s next big challenge – Budget 2023.
