Nov 30, 2020
7 things you may have missed in the Fall Economic Statement
Ottawa is prepared to pump and prime the economy for the next three years: Former PBO
The federal government is forecasting a record $381.6-billion deficit this fiscal year, with big-ticket items like extending supports for businesses and workers grabbing much of the attention, but there were plenty of other details in the Fall Economic Statement. Here’s what you may have missed in the latest fiscal plan from Ottawa.
A $50-billion hit to future growth
Ottawa has warned the scars left by the pandemic and resulting shock to consumers and businesses aren’t likely to fade any time soon. The feds say the pandemic could leave Canada with reduced productive capacity, potentially capping annual economic growth at around 1.4 per cent, down from the 1.8 per cent forecast pre-crisis. That reduction in capacity could reduce overall economic output by about $50 billion, the equivalent of $2,000 per working-age Canadian.
$400 for working from home
With millions of Canadians still working from home and questions over potential tax deductions, the Canada Revenue Agency is introducing a simplified claim. Those working from home in 2020 due to the pandemic who have modest work-related expenses can claim up to $400 on their taxes without providing a detailed rundown of their expenses or a signed form from their employer.
Prepping a plan for early learning and child care
While no concrete plans for a comprehensive national child care program was unveiled, the federal government is planning to gather members of the provincial governments, experts and stakeholders to map out and implement a plan for early learning and child care in this country. The federal government said further details on its plans to provide affordable, accessible and high-quality child care will be outlined in Budget 2021.
$274.2 million for skills training
With plans to transition Canada to a more resilient economy in the digital age, the federal government is earmarking a further $274.2 million over the next two years for skills training. The funding will be deployed through the Indigenous Skills and Employment Training Program, the Foreign Credential Recognition Program, the Opportunities Fund for Persons with Disabilities, and the Women’s Employment Readiness Canada pilot project. The $274.2 million is in addition to $4.9 billion the feds are currently providing for skills training.
Boost to the Canada Summer Jobs program
With younger workers facing yet another year of uncertain employment prospects amid the fallout from the pandemic, the federal government is planning to boost funding for the Canada Summer Jobs program by $447.5 million next year. The feds are aiming to support up to 120,000 job placements in 2021-22, an increase of 40,000 from 2020-21 levels.
Temporarily eliminating interest on student loans
Ottawa is planning to eliminate interest on repaying the federal portion of the Canada Student Loans and Canada Apprentice Loans in 2021-22, a move it says will provide $329.4 million in repayment relief to 1.4 million Canadians.
Tweaks to the First-Time Home Buyer Incentive
The federal government is making changes to the First-Time Home Buyer Incentive for prospective homeowners in some of Canada’s priciest real estate markets. The changes will allow eligible buyers in Victoria, Vancouver and Toronto to purchase a home worth up to 4.5 times their household income, up from the current cap of four times annual income. It also raises the maximum household income threshold to $150,000 from $120,000, a move the feds say will make first-time buyers in those cities eligible to buy a home for as much as $722,000 from the current $505,000.