By Sheldon Spackman

In Need Of A Fiscal Anchor

Chamber concerned with government spending in federal budget

Apr 20, 2021 | 10:57 AM

Some mixed reaction from the Red Deer and District Chamber of Commerce today following Monday’s release of the federal government’s first budget in two years.

Reg Warkentin, Policy & Government Relations Manager, says what really strikes him, however, is the country’s very large deficit.

“It’s really hard to digest exactly how much money $354 billion is,” he exclaims. “It’s staggering how much money that is. There’s no real fiscal anchor presented. There has to be some very serious concerns about how this type of spending is going to impact us long-term.”

He points-out, however, it is somewhat encouraging to see that the deficit will go down over the coming years.

“But still, the spending represents a 30 per cent increase to pre-pandemic spending which is certainly concerning,” adds Warkentin. “The real challenge in this document is trying to determine if the juice is worth the squeeze. There’s so many different programs and spending promises but they’re all very light on details, so it’s really going to be reliant on the implementation to see just how these programs look and what these spending promises end up actually looking like to the businesses they’re supposed to be helping.”

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Warkentin was pleased, however, to see federal support programs such as the Canada Emergency Wage Subsidy, Canada Emergency Rent Subsidy and Lockdown Support continue until September 25.

“But when they’re talking about $100 billion for the economic recovery, again, with no real clear detail on how exactly how that looks, there’s a lot of unanswered questions still at this point.”

Among some of the government’s budget highlights, is legislation to establish a federal minimum wage of $15 per hour, rising with inflation. Warkentin doesn’t feel that potential new legislation would be terribly impactful in Alberta.

“It is slightly worrisome whenever we see the federal government infringing on provincial jurisdiction,” says Warkentin. “That always kind of creates some concerns and some questions about how they’re trying to run the country and influence the provinces.”

A new Canada Recovery Hiring Program to provide eligible employers with a subsidy of up to 50 per cent on the incremental remuneration paid to eligible employees between June 6 and November 20 was also announced. According to government officials, the program would provide $595 million to make it easier for businesses to hire back laid-off workers or to bring in new ones.

In addition, $1 billion over six years is planned to start later this year to create the Universal Broadband Fund to support a more rapid rollout of broadband projects in collaboration with provinces and territories and other partners.

“I was really intrigued by that,” admits Warkentin. “I understand Red Deer County has undertaken some significant investments for rural broadband. Obviously in this day and age and this type of economy, it’s an invaluable addition that allows people to live where they want to live and work remotely, so it’s fantastic for places like rural Alberta and central Alberta and the economy of the future.”

The bottom line for Wakentin though, is that the business community just wants to get back to work.

“They want the vaccine rollout to get finished, they want the restrictions lifted, and they just want to get to work,” he declares. “And the vast majority of businesses, they’re not looking for government handouts or government programs, they just want to do what they know how to do at the end of the day.”