A NEW APPROACH
In electing a new government, millions of Canadians signalled their desire for change.
Our government was elected, in part, because we took that desire seriously. We offered Canadians an ambitious new plan for a strong middle class and promised that we would do all we can to help every Canadian succeed.
Budget 2016 is an important part of fulfilling that promise.
It offers immediate help to those who need it most, and lays the groundwork for sustained, inclusive economic growth that will benefit Canada’s middle class and those working hard to join it.
In particular, this budget is about Canadian families. We’ve met with them, we’ve heard their stories and we share their concerns. This budget is about the things that matter most to them.
THE PROMISE OF PROGRESS
For generations, Canadians worked hard, secure in the belief that their hard work would be rewarded. They trusted that in exchange for their honest efforts, they would realize greater opportunities for themselves, and for their families.
This sense of optimism, paired with government policies that strengthened the middle class, helped to make Canada the country that it is today.
AN UNCERTAIN FUTURE
In recent years, however, the benefits of economic growth have been shared by fewer and fewer Canadians. Even though household costs continue to rise, for most families, income has barely risen over the past 30 years, making it harder to make ends meet.
Some families have responded to this pressure by taking on more debt – but the more families owe, the more difficult it is for them to save and plan for the future.
As the ability to pay for their kids’ education, for their ageing parents’ care, and for their own retirement diminishes, Canadians are questioning whether the promise of Canadian progress has passed.
THE RISE OF INEQUALITY
This is not true for all Canadians, however. Members of Canada’s wealthiest 0.01 percent have seen their incomes more than double over the past 30 years.
The net result is that even though there has been economic growth over the past three decades, too often, the benefits have been felt only by already wealthy Canadians, while the middle class and those working hard to join it continue to struggle.
The need for more inclusive growth is not new. It has long been understood that a strong economy starts with a strong middle class. When middle-class Canadians have more money to save, invest and grow the economy, everyone benefits.
With Budget 2016, our government seeks to help more Canadians, and restore Canadians’ confidence in a brighter, more prosperous future.
RESTORING HOPE, REWARDING HARD WORK
To do that, Budget 2016 focuses on growth, not austerity. It includes measures that will grow the economy for the benefit of every Canadian.
By making smart investments now, we can help strengthen and expand the middle class, reduce inequality among Canadians, and position Canada for sustained economic growth in the years to come.
A SHIFTING WORLD ECONOMY
Of course, the decisions we make cannot be made in isolation. Here at home and across the world, dramatic shifts are taking place that represent both challenges to, and opportunities for, Canada’s economy.
Managing Canada’s ongoing demographic shift means that we must do more to invest in young Canadians, in post-secondary education, in training and innovation.
Global shifts in trade will allow us to strengthen economic ties with other regions and countries, but may make us more vulnerable to external economic shocks.
Finally, shifts in technology – toward cleaner economies and more digitally connected ones – cannot be ignored. Canada can either take advantage of these opportunities or be left behind.
A LONG-TERM PLAN FOR GROWTH
Budget 2016 recognizes that there are no quick solutions to these kind of challenges.
The good news is that Canada is in a relatively strong fiscal position.
We have the lowest debt-to-GDP ratio of all G-7 countries, which gives us room to make strategic investments now that will grow the economy well into the future. Interest rates remain at historic lows, making now the ideal time to invest. And our highly educated workforce and our low business tax costs mean that Canada is well-positioned to compete globally.
Economic challenges like the ones Canada is facing can’t be solved with short-term solutions, and opportunities can’t be realized without smart, sustained investments. By investing in the things Canada’s economy needs to prosper over the long term, this budget sets the stage for stronger economic growth that will benefit more Canadians in the years to come.
TOWARD MORE INCLUSIVE GROWTH
Whatever their circumstances, Canadians overwhelmingly believe in fairness. They believe that benefits that come from a strong and growing economy should be accessible to all who work hard for them.
Our government agrees. It is why we campaigned on a commitment to strengthen the middle class –giving more help to those who need it, and less to those who don’t.
This budget sets a course for fairer, more inclusive growth. It reflects the priorities of Canadians.
These priorities include:
Help for the middle class – A strong economy starts with a strong middle class. Budget 2016 introduces the new, fairer, tax-free Canada Child Benefit, eliminates unfair tax breaks for the wealthy and creates the student grant boost. These measures, combined with the new tax cut for the middle class and a new tax bracket for those earning more than $200,000 per year, will give Canada’s middle class the help it needs to grow and prosper.
Growth for the middle class – To strengthen the middle class and deliver more inclusive growth for more Canadians, Budget 2016 makes historic investments in infrastructure and innovation. These investments will provide both immediate help to Canada’s middle class and help expand opportunities for those working hard to join it.
A better future for Indigenous peoples – It is time for a renewed relationship between Canada and Indigenous peoples, one based on trust, respect and a true spirit of cooperation. The investments in education, infrastructure, training, and other programs contained in Budget 2016 will help to secure a better quality of life for Indigenous peoples – and build a stronger, more unified, and more prosperous Canada.
A clean growth economy – A clean environment and a strong economy go hand in hand. Budget 2016 recognizes this, making strategic investments in clean technology and taking concrete steps to address the causes and effects of climate change.
An inclusive and fair Canada – Canada is at its best and most prosperous when all Canadians have a real and fair chance at success. The investments in Budget 2016 help to extend opportunities to more Canadians, and will help to build a healthier, more creative, more generous and more just Canada.
Canadians understand that a country can’t cut its way to prosperity. A new approach – one that includes smart investments and fair choices – is needed.
Budget 2016 reflects this new approach.