MNI POLICY: Trudeau Signals Shift to Taper Off Covid-19 Relief

By Greg Quinn

     OTTAWA (MNI) - Canadian Prime Minister Justin Trudeau signaled he plans to

scale back some Covid-19 relief programs as the economy re-opens, a shift from

months of almost daily spending announcements.

     Fewer people will need the flagship CERB checks aimed at those who didn't

qualify for regular unemployment benefits, Trudeau said at a press conference

Wednesday. There will be relatively more need for the wage subsidy that helps

employers avoid layoffs, he said.

     "Right now we're very focused on getting through this particular crisis,"

Trudeau said. "We will however look very carefully at how we end certain

programs, how we modify others, to get our economy going again."

     Parliament is moving towards a summer break that stretches to

mid-September, ending a session without a budget accounting for record deficit

spending. Parliament's independent budget officer told lawmakers Tuesday the

shortfall has climbed to CAD260 billion from a CAD252 billion estimate tallied

around the end of last month, itself a record 13% of GDP.

     --GRADUAL RE-OPENING

     The prime minister again declined when asked about a potential budget,

saying Canadians are focused on the economic restart he said will be "gradual."

While Trudeau's Liberals need opposition votes to pass a budget and stay in

power, other parties have signaled little appetite to force a new election. 

     The government in the last month extended the CERB program set to last 12

weeks into early June to August, and offered up unlimited lending to large

companies. The Bank of Canada has said fiscal policy must take the lead at a

time when near-zero interest rates do little to boost spending with most people

forced to stay at home.

     Canada has reported 87,000 coronavirus cases and 6,671 deaths, and several

provinces have pushed back restart plans because of slow progress setting up

testing and reducing the outbreak itself. 

--MNI Ottawa Bureau; +1 613-314-9647; email: greg.quinn@marketnews.com

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