Over the weekend, the federal Liberals rejected balanced budgets as a party policy to conclude its first in-person convention since 2018.
Among the 24 non-binding policies to guide the party into the next election, the party membership voted 96-76 against balanced budgets to properly manage spiralling federal debt.
Environment Minister Steven Guilbeault did not back the motion despite supporters from his riding proposing a plan to return to balanced budgets.
"What I'm saying is that, of course, we want to balance the budget, and it's important, but we also have other important things we need to do," he said, though he did not rule out a path to balanced budgets before the next election.
"I think we have a couple of budgets before the next election, so we'll have all the opportunity to discuss this particular issue, especially leading to the election."
Party members expressed concerns over rising debt levels since the COVID pandemic and worried over calls from Conservatives to balance budgets next election.
While COVID pandemic expenditures partly increased federal spending to $644.2 billion in 2020/21 and an estimated $508 billion in 2021/22, much of the uptick in federal expenditures remained independent of the pandemic.
Ultimately, Guilbeault backed Budget 2023, demonstrating five consecutive deficits until at least 2027.
"A balanced budget means less debt for Canadian kids and grandkids to pay back, less money wasted on interest charges and room to cut taxes," Franco Terrazzano, Federal Director of the Canadian Taxpayers Federation (CTF), told Rebel News.
Canada's debt-to-GDP ratio is expected to rise in 2023/24 from 42.4% to 43.5% but declined to 39.9% in 2027/28.
The federal government spent $34.7 billion on debt servicing charges in 2022/23, more than childcare benefits ($29.4 billion) and employment insurance benefits ($24.8 billion) for the entire fiscal year.
"The Parliamentary Budget Officer's recent Economic and Fiscal Outlook projects the deficit to increase to $43 billion in 2023. The PBO is also projecting an $8.7-billion deficit in 2027, despite the government's claim in the mid-year fiscal update that it will run a $4.5-billion surplus that year," said the CTF on March 10.
Budget 2023 projects the deficit will be $40.1 billion this fiscal year — up from the $30.6 billion she said it would be just last fall.
"Trudeau first said he would balance the budget by 2019, and he was set to miss that target by $20 billion even before the pandemic," Terrazzano told Rebel. "The Trudeau Liberals have given taxpayers every reason to believe this government will never balance the budget."
On April 25, Cabinet sent Bill C-47, the Budget Implementation Act, to the Commons finance committee for debate. However, the Official Opposition filibustered the study as Finance Minister Chrystia Freeland failed to appear for questioning, according to Blacklock's Reporter.
"Where the government is spending $490 billion — $490 billion – asking the Minister of Finance to speak to Canadians for two hours, that's two hours," said Conservative MP Philip Lawrence, adding she has refused invitations from the committee thrice.
"Clearly, she doesn't want to show up," he said. "She has a record of ignoring our invitations."
The CTF's pre-budget submission recommended balancing Budget 2023 by bringing program spending to pre-pandemic levels in 2018/19, adjusted upward for inflation and population growth. Government spending reached all-time highs before the pandemic in 2018/19.
Between 2015 and 2019, the Liberal Party increased federal spending, as a share of the economy, from 14.5% to 16.2%, according to the Fraser Institute. They said expanding federal government involvement in the economy post-COVID would impede growth and prosperity.
"Once we include government spending by the provinces and local municipalities, the International Monetary Fund (IMF) estimates all government spending reached 41.2% of the Canadian economy in 2019 — well above the optimal level," said the institute.
"Current projections already indicate federal program spending in 2021 will reach $11,370 per person — or 18.7% of the economy — considerably higher than the size of government in 2019, the year before the pandemic."
"All taxpayers get from this government are big deficits, more money wasted on interest charges and higher taxes," added Terrazzano. "Canadians are paying too much tax because the government wastes too much money and doesn't want to balance the budget."
A Leger poll found three in four (74%) Canadians feel they are overtaxed, prompting Terrazzano to accuse the feds of not caring about taxpayers. "Canadians pay too much tax because the government wastes too much money," he said.