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Cardus Budget Analysis: Good News for Economy, Ho-Hum for Society

OTTAWA, March 22, 2011—Ray Pennings, Director of Research for Cardus, suggested that although the details of today’s Canadian federal budget will likely be overshadowed by the immediate political considerations, the budget should also be examined for the vision of prosperity it presumes for society. “The progress made in reducing spending and restoring financial stability needs to be accompanied by the recognition that social enterprise, charities and natural communities including families also must flourish if Canadians will enjoy prosperity,” said Pennings.

Cardus focused its analysis of the budget on the impact it would have on four sectors: natural communities, the social enterprise sector, the private for-profit sector and the public sector.

1. Natural communities: This budget promises support for seniors and caregivers, and targeted tax measures that will help students. All other natural community elements will presumably be helped only by the government’s job creation and overall low tax policy. Other measures, like family income splitting, remain ripe for election platforms at all levels.

2. Social enterprise, voluntary and charitable sector: There was relatively little here for the non-profit, charitable sector. It appears the House will wait for the report from the Standing Committee of Finance on charitable incentives.

3. Vocational, for-profit sector: The government has emphasized a reliance on the private sector as the engine of the economy. Continued low tax policy and targeted investments in particular industries are the policy mechanisms of choice. The government is also investing significantly in physical infrastructure designed to support trade.

4. Public, not-for-profit: The government is focused on restraining the growth of its expenditures and returning to surplus as originally projected in 2015. Little mention or allowance was made of public entitlements and their impact on budgets for years to come.

In sum, this budget is good news for a deficit-economy, but ho-hum for Canadian society. Canada continues to perform as well, or better, than expected compared to other developed countries but very little in this budget could be called visionary or long-term. Despite a broad framework of relying on low taxes and a vibrant private sector, the role of social enterprise and charities is almost totally ignored and the impact on families (and particularly seniors) is only minimally addressed through tax gestures. There may be more creative energy in the government tank, but this budget didn’t show it. Whether it will show up in an election to come, time will tell.

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Media Contact:
Ray Pennings (403)479-4590
[email protected]

A copy of the proposal and background paper is available at http://go.cardus.ca/budget2011.

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