Finance Minister Chrystia Freeland announced another wave of spending to combat the COVID-19 pandemic on Monday, and projected and raised Canada’s projected deficit this year to $381.6 billion in the government’s fall economic update. Here’s a round-up of how some BNN Bloomberg guests reacted to the news.
“I've never seen a document like this in my lifetime. It's very different from the point of view of an update or ‘mini-budget,’ and I think it reflects the times where there's massive uncertainty ... It's very different and kind of a ‘fiscal policy forward guidance’ from the point of view of telling people the scope and what the size of a fiscal stimulus package could look like over the next few years.”
— Kevin Page, president and CEO, Institute of Fiscal Studies and Democracy, and former parliamentary budget officer
“[The deficit] was slightly higher than what I was expecting, but in the ballpark of what financial markets were anticipating. I mean, people had been expecting it could be as high as $400 billion. This is a massive deficit. It reflects the efforts to deal with the worst economic downturn in modern history. Limiting the damage on the Canadian economy is going to have a huge fiscal price tag.”
— Craig Alexander, chief economist and executive advisor, Deloitte Canada
“From the perspective of [the hardest-hit industries], the wolf is at the door and they need to know where they stand and they need to know that the government is there with them. What we had was an announcement in the case of some of those sectors on a credit availability program, the details of which we don’t have at this point. In the case of the airline sector, it’s even more vague than that ... What we heard is plans to make plans, and in the meantime [they’ll] continue to provide assistance, but what we need to do is to move away from where we are today to getting back into some level of normalcy.”
— Perrin Beatty, president and CEO, Canadian Chamber of Commerce
“There’s something about protecting parts of the economy that haven’t been doing well, but there’s also been this incredible surge in e-commerce and healthcare and AI businesses and using some of [the stimulus] to continue to have the growth in that I think is really important as we do this. The other thing I didn’t see today is that we are not looking at any help or support this massive amount of businesses that have really been hurt by COVID to become digital businesses.”
— Michele Romanow, co-founder of Clearbanc
“I think it makes it virtually impossible for entrepreneurs to sit here and plan. We cannot have that much uncertainty … There's just so many problems and holes. You'd think that 11 months into this that there would actually be substantially more plausible, common-sense solutions.”
— Andrew Oliver, president and CEO, Oliver & Bonacini
“There's a lot to like in the economic statement. For one, it does continue the focus on helping businesses and individuals get through the other side of the pandemic … So many businesses are really hanging on by a thread, so knowing that the rent and wage subsidy will be continued at current levels, in fact even with a little bit of a boost for the wage subsidy until mid-March, that is desperately needed and welcome.”
— Dan Kelly, president and CEO, Canadian Federation of Independent Business
“One of the big things that's changed as a result of the pandemic is that price and cost is now all relative. We've seen in the last number of months that the federal government has stepped in with large amounts of money to address very serious problems in the economy. So to ask for money to build an early and childcare system, one that would actually help economic recovery is not a big step any longer and everybody it seems is calling for greater public investments in early learning and childcare.”
— Morna Ballantyne, executive director at the Childcare Advocacy Association
“The real concern here is there was no fiscal anchor … and also the government's proposal to commit to spending up to $100 billion in so-called stimulus and they say they're going to do this after the pandemic ends. I think it's a very curious thing for a government to commit to spend that much money before they have even decided what to spend it on.”
— Aaron Wudrick, federal director, Canadian Taxpayers Federation
“I think [the government’s fiscal guardrails are] a nod to the bondholders that there'll be some level of responsibility here, that it is not completely fiscally irresponsible and that we plan to get back to something closer to normal, but the reality of the situation is that as long as the Bank of Canada wants to finance all the deficits, they can do whatever they want.”
— Ed Devlin, former Head of Canadian portfolio management, PIMCO
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