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Justin Trudeau's Liberal Party proposed CAD78 billion of new spending over the next five fiscal years in a platform ahead of a Sept. 20 election, and said new taxes on banks and the wealthy will help slim the deficit from CAD155 billion to CAD32.1 billion over that time.
The Liberals said they would stick to a "fiscal anchor" sought by business groups and economists, pledging to reduce the debt-to-GDP ratio "over time" and slim the deficit every year. The debt-to-GDP ratio now estimated at 48.5% will decline to 46.5% over five years under the Liberal plan. The ratio was 31.3% before the pandemic.
While the new spending measures exceed extra tax revenues each year, signs of a faster growing economy than was projected earlier this year in Finance Minister Chrystia Freeland's budget will help hold down the deficit, MNI understands. The deficit in the fiscal year that began April 1 would be CAD62.7 billion under the Liberal plan, versus a budget projection of CAD59.7 billion.
Conservative leader Erin O'Toole released his platform earlier without a projection of total cost, while saying it would take a decade to balance the budget. The Liberal platform didn't appear to have a signature major new policy but affirms past commitment for a national childcare program.
The Liberals also pledge: 10 days of paid sick leave for federally regulated workers; measures to help new homebuyers; adding self-employed workers to the employment insurance system; selling at least CAD5 billion a year of green bonds; mirroring Australia's recent law requiring large web platforms to share revenue with news outlets; and requiring six month mortgage deferrals if borrowers face financial stress.