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Restoring Fiscal Balance
- Budget 2007 restores fiscal balance in Canada. A restored fiscal balance will ensure the provinces and territories have the means to provide programs and services to their residents, including health care, post-secondary education, infrastructure, child care and social services.
- Budget 2006 took a major step to resolving fiscal balance by setting out a plan based on the following principles:
- Accountability through clarity of roles and responsibilities;
- Fiscal responsibility and budget transparency;
- Predictable long-term fiscal arrangements;
- A competitive and efficient economic union; and,
- Effective collaborative management of the federation.
- Budget 2006 also took immediate action to restore fiscal balance, including major tax reductions, significant new investments in areas of core federal responsibility, and an additional $3.3 billion to provinces and territories for shared priorities.
- Budget 2007follows through on the commitments of the plan and goes further.
- It restores fiscal balance with provinces and territories by putting transfers on a long-term principles-based footing.
- It takes another step towards restoring fiscal balance with Canadian taxpayers through major tax reductions and the Tax Back Guarantee.
- It makes governments more accountable to Canadians by clarifying roles and responsibilities.
- It strengthens the economic union based on the plan set out in Advantage Canada.
- Budget 2007 provides an additional $39 billion to provinces and territories over the next 7 years in long-term, equitable and predictable funding for shared priorities, including:
- Renewed and strengthened Equalization and Territorial Formula Financing programs that provide $2.1 billion more in the next two years from the federal government to eligible provinces and the three territories.
- An $800 million increase in annual support for post-secondary education.
- An investment of $250 million per year starting in 2007-08 to provinces and territories for the creation of new child care spaces.
- New and long-term funding of $500 million per year starting in 2008-09 for labour market training.
- More than $16 billion over seven years to fund infrastructure projects.
- More than $1.5 billion through the new Clean Air and Climate Change Trust Fund.
For more information:
Budget 2006 Companion Paper - Restoring Fiscal Balance in Canada
Budget 2007 Companion Paper - Restoring Fiscal Balance for a Stronger Federation
