Canada's deficit will reach $382-billion, billions in new spending announced

An economic update is currently being announced in Parliament by Canada’s Finance Minister Chrystia Freeland, who began by delivering a summary of the COVID-19 pandemic price tag to date. The big news is that Canada’s deficit will reach $382-billion in 2020-21, with $322-billion in direct spending and aid and another $85-billion in duty and tax deferrals. Freeland projected that Canada’s deficit would drop to $121-billion in 2021-22.

Freeland also announced new spending for COVID-19 pandemic relief. The Canada Emergency Wage Subsidy, which has been offered at a lower rate in recent months than when it was first introduced last spring, is being boosted back up to 75% through March 2021. There are a series of measures in place for some of the sectors that have been hardest hit, including a new credit availability program offering government-backed loans below market rates for up to 10 years for the tourism, hospitality and hotel sectors.

There will also be direct financial support of $181-million for people who work in the arts and entertainment sectors, as well as financial support for the air travel sector, specifically small regional carriers and airports as well as some large airports.

An additional $1-billion will be invested in a safe long-term care fund to help with infection control and ventilation upgrades in long-term care centres. And last but certainly not least, the federal government is devoting an extra $100-billion for economic stimulus, to be spent over three years following the pandemic’s second wave. ■

For information about the fall economic statement from the government of Canada , please click here.

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