Thursday, April 10, 2008

Flaherty: Privatization of BCE will lead to $1 billion in program spending cuts



News item #1:

Paul Vieira, Financial Post
July 04 2007

OTTAWA -- In the interview, the finance minister indicated he was comfortable with the role private equity and pension funds are playing in the economy. As a result, he does not believe Ottawa needs to review either the tax-exempt status of pension funds - which vied to take over Bell Canada - or rules that would apply to leveraged buyouts.

It is estimated Ottawa stands to lose over $1-billion in annual tax revenue should Bell Canada be privatized.

News item #2:

Les Whittington, Toronto Star
Apr 10, 2008
Flaherty says he'd cut to avoid a deficit

OTTAWA -- Finance Minister Jim Flaherty says the Conservatives will cut government spending if need be to avoid a budget deficit caused by the economic slowdown.

"No deficit – balanced budget," he said outside the Commons.

"We're not raising taxes," Flaherty added when asked how the federal Tories can avoid a budget shortfall if the weakening economy deprives Ottawa of expected tax revenues.

"There are other ways that governments can balance budgets, of course," Flaherty continued. "We can always restrain spending if that becomes necessary."

But he said the "cushion" in the Feb. 26 budget should be "adequate" to keep the books balanced.

The Conservatives have ushered in large hikes in program spending, which is expected to rise to $218 billion next year from $201 billion in 2007. At the same time, Flaherty has brought in cuts to corporate and personal taxes and the GST totalling $60 billion over six years.

As a result, the government's forecast surplus is only $2.3 billion for this year, and $1.3 billion next year.

With the Canadian economy performing worse than expected by the Bank of Canada and most private economic analysts, the lower-than-expected tax revenues could put the government on the edge of the first budget deficit in a decade.

"It's a combination of record increases in spending and big tax cuts – especially the GST, which is the biggest cut of the lot – bringing us perilously close to a deficit, so it doesn't take much of a further drop in forecasts to tip us into deficit," said Liberal finance critic John McCallum (Markham-Unionville).

"I hope it doesn't happen, but if it does, he (Flaherty) would have only himself to blame because he didn't leave enough of a cushion."

The Conservatives provoked widespread objections in 2006 when they announced $1 billion in spending cuts to status-of-women programs, as well as a program to help minorities mount court challenges and a range of other social and cultural projects.

Flaherty's comments on Ottawa's fiscal position came as the Washington, D.C.-based International Monetary Fund reduced its economic growth forecast for Canada as a result of the problems in credit markets and the slump in the United States, which buys most of this country's exports.

The IMF said Canada's economy would expand by 1.3 per cent this year, down from its January forecast of 1.8 per cent. The prediction for Canadian growth in 2009 is 1.9 per cent.

Both projections were well below the IMF's forecasts for world growth of 3.7 per cent this year and 3.8 per cent in 2009.

4 comments:

Robert Gibbs said...

TheStar.com

Committee work grinds to halt

Environment groups protest Tory filibuster

Apr 10, 2008 04:30 AM
Richard Brennan
OTTAWA BUREAU

OTTAWA–The Commons environment committee took on the air of a sideshow yesterday with young people threatening a sleep-in and singing "grannies" raging against big oil companies.

It's all part of the political madness that has gripped at least five of the 26 parliamentary committees.

"You may feel like you have fallen through the rabbit hole and you are in Alice in Wonderland," Green Leader Elizabeth May said yesterday, insisting important business of committees is being obstructed by the Conservative government.

The environmentalists, including the Raging Grannies and the Sierra Youth Coalition, were trying to bring attention to the fact Tory MPs have been filibustering NDP Leader Jack Layton's private member's climate change bill, as of yesterday, for more than 17 hours.

"It is an obscene abuse of democracy. ... We have never in Canadian parliamentary history had filibusters before parliamentary committee," May said. Work has also been stalled or halted at the justice, house affairs, government operations and ethics committees.

Commons Speaker Peter Milliken has said the situation borders on anarchy, while the minority Tories argue the opposition parties are using the committees as quasi tribunals to embarrass the government, and that it's just not fair.

After agreeing that the environment committee was dysfunctional, Conservative MPs continued to tie up the committee by filibustering a motion to limit debate.

Before the meeting even started there was controversy over the number of chairs, which was seen by some as a conspiracy to limit the crowd. Then, young environmentalists complained about not being able to bring their sleeping bags and pillows into the room.

"The environment is the number one issue in the country and we think it is extremely inappropriate that the Conservative are filibustering this bill, and we here to show that we are prepared to stay as long as we need to stay," Anjali Helferty, of the Sierra Youth Coalition, told reporters.

Before the debate got underway, Conservative committee chair Bob Mills (Red Deer) got into a debate with Liberal David McGuinty (Ottawa South) as to whether he could use a prop, in this case a sign showing how many hours government members have been filibustering.

Robert Gibbs said...

Mr. Speaker, contrary to their propaganda slogans...
This Conservative government is not open, honest or transparent.
This Conservative government does not "ply by the rules."
This Conservative government is not burdened by the facts.

In fact, Mr. Speaker...
This Conservative government regularly misleads the House, lies to Canadians and blacks out access to information documents.
This Conservative government regularly obstructs parliamentary committees, procedures and witnesses, and the will of the people.
This Conservative government regularly creates policy on the back-of-an-envelope, without benefit of thought or objective factual based evidence.

In brief, Mr. Speaker...
This Conservative government is incompetent and down right undemocratic.

And I'm just speaking about yesterday's events.


P.S.:

This speech is available for the low, low sum of only $122,000.

Dr Mike said...

Good picture of Jimmy.

The gospel according to Jim.

He is just like some Televangelist like Jimmy Swaggart who spouts half truths & innuendos to fleece the flock of their last few bucks.

Jimmy , I bet you would love to have the income trust tax money that you removed personally from the government coffers since 2006.

I continue to marvel at your uncanny ability to mismanage the economy of this country.

I am not sure why I am so surprised--you left Ontario in a fiscal mess that has taken many years to turn around (yet you continue to give advice).

I had someone I was talking to yesterday say to me what is a billion dollars here or there when it comes to an economy as large as ours--I guess it isn`t much unless you need a medication that will no longer be paid for by a provincial health plan because Jimmy had to cut transfer payments.

This guy is clueless & needs to be gone ASAP.

Dr Mike.

Robert Gibbs said...

Dim-Jim-Flatulent-Flahery:

The Forrest Gump Of Finance Ministers.