Federal budget promising pricing parity with U.S.

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(Updated) Federal finance minister Jim Flaherty has delivered what he is happily calling a “boring” budget, one that he says is nearly balanced – but he adds we’re not quite there yet.

It was a very fiscally focused budget, promising to concentrate creating jobs and curbing spending.

Flaherty says the deficit has dropped to $2.9 billion. But because the Harper government has a $3 billion contingency fund, they can eliminate that deficit completely. And it’s projecting a $6.4 billion dollar surplus just in time for the 2015 election.

Despite those impressive numbers, years of deficit spending have pushed Canada’s accumulated debt to a whopping $619 billion.

There are a few really tangible points in the budget; one of those being a $4 hike in the price of a carton cigarettes. And they’re doing away with the duty free discount. That’s a way the Conservatives promise to save money without gouging the majority of Canadians.

Exact execution for the rest of the budget’s plans aren’t quite as clear, but the message of job creation featured prominently.

Flaherty promises to offer interest-free loans to students registered as apprentices with red seal trades. He also says the government will support internships in high-demand fields, with both points targeting a shortage of skilled workers.

The budget also suggests a renewed attempt at the Canada job grant will go forward with or without provincial support.

The plan to help vulnerable and young people find jobs was blocked by the provinces last year. They feared the feds would cut $500 million in transfer payments to fund the program. The budget promises money to help intellectually disabled Canadians find jobs and to match unemployed with employers.

It also includes a $500 million contribution to the Automotive Innovation Fund. This comes as the Windsor-based Chrysler minivan plant asks the government to fund a quarter of its $2 billion upgrade, in an attempt to revive Canada’s faltering auto sector.

Further down in the budget, Flaherty commits to decreasing price disparity between Canadian and U.S. goods — saying Canadians shouldn’t have to pay more at home for a product they could get in the states for a fraction of the cost.

He also highlights attempts to lower cell phone rates within Canada, and says his government will give the CRTC power to impose financial penalties on companies that gouge consumers. Both of these strategies aim to bring Canadian cell rates closer to those of American competitors.

The budget also promises to make high-speed internet more accessible in rural and northern communities.

Flaherty says these additions to service won’t happen on the backs of working-class Canadians.

“We’d rather we did this by getting our own fiscal house in order. And Mr Speaker that is exactly how our government will continue. Our government has reduced direct program spending for the third year in a row in 2012-13.”

Part of that fiscal order is increasing the price public sector retirees will have to pay for their public service health program by 50 per cent, and barring suspended senators from accruing pension benefits.

Late this afternoon Ontario finance minister Charles Sousa weighed in on the budget from Queen’s Park and called it “a kick in the teeth.” He says the Harper government is ripping off the province mainly because of a $641 million cut in equalization payments.

“Mr Flaherty cited the fact that Ontario’s done a fantastic job of diversifying its economy, citing that that is one of the reasons that we got hit with equalization payments. Citing the fact that as a result of the work and the sacrifice that Ontarians have made to position ourselves now, and poise us to do even better in the coming months, you’re going to be cut. You’re going to be cut at a time that we’re just at the midst of trying to do more.”

“That’s not fair.”

“And, there was no mention either about helping Canadians, as well as Ontarians, with retirement security, and that’s something that we’ve been calling for as well. Something that would enable us to be positioned in the years to come in a much better format, and not only would it cost us less in social programs, it would also provide greater security for individuals. And that’s unfortunate as well.”

“There’s no vision in this budget and that, in the end, is what disappoints us most.”

Sousa says the federal Tories are balancing their books on the backs of Ontarians, making themselves look good while the province struggles. But Ontario’s minister of finance adds the province will do what it takes to stay on track to balance its books by 2017-18.