The federal Liberals have more than $85 billion in new spending room from a booming economic rebound and plan to spend some of the windfall on a series of measures aimed at keeping the good growth going.
The 2022 budget released Thursday includes more than $31 billion in new spending over the next five years. It’s targeted at speeding the flow of goods through the country’s supply chains, boosting housing supply and jolting businesses out of an anemic period of investment. Read more: Canada’s treasury ‘depleted’ as budget weans COVID spending, eyes uncertainty The new spending has increased the fiscal year’s deficit to $52.8 billion from earlier estimates of $44.1 billion.
Government officials framed the spending as a hedge against near-term economic uncertainty created by Russia’s unprovoked invasion of Ukraine and the sixth wave of the COVID-19 pandemic.
But the Liberals also say the spending is aimed at the long-term as well to address structural issues within the national economy that could hold back growth in the long-term. Read more: NDP expecting no ‘surprises’ in federal budget, want Liberals to honour spending promises It’s why the government is reprofiling $15 billion in existing spending for a new fund designed to lower business investment risk for research and new technologies, $3.8 billion over eight years for a critical minerals strategy, and $450 million over five years to unclog supply chains.