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Chapter 4
Conclusion and Next Steps

Canada's Economic Action Plan is the right plan. The Plan puts in place an unprecedented economic stimulus that will help Canadians weather the global recession, will protect jobs now and allow Canada to emerge with an even stronger economy.

The Government has put forward this Plan from a position of strength. The global recession has put a spotlight on Canada's comparative strengths, including a real estate market that has avoided the excesses seen in other countries, a banking system that is the strongest in the world and public finances that are sound.

Because of these strengths, we have been able to put in place one of the most comprehensive stimulus packages in the world. Canada's Economic Action Plan represents our contribution to the G7 effort to lessen the impact of the global recession on jobs and output and to hasten the recovery.

The Plan has mobilized the resources of all governments in Canada. Federal, provincial and local governments are working toward a common purpose of building infrastructure, enhancing training, helping the unemployed, improving incentives for low-income Canadians to participate in the labour force, and making our businesses more competitive internationally.

The Action Plan is a vast set of initiatives that are being implemented in record time. Just 72 days into the fiscal year, 80 per cent of measures are either flowing, or there are commitments in place that will allow the funds to flow to specific projects and initiatives. In many cases, important benefits are already flowing to Canadians.

• Canadians have been seeing the benefits of income tax reductions since April 2009.
• The Home Renovation Tax Credit is available to homeowners.
• Enhanced Employment Insurance benefits and training are available and flowing.
• The number of Canadians benefiting from the work-sharing provisions of the Employment Insurance program are up more than fourfold since January to about 120,000 in May.
• Infrastructure projects are under way and will accelerate over the summer, creating jobs and economic activity.
• Important aid is being provided to sectors and communities affected by the global recession.
• $119 billion has been provided to support the flow of credit to businesses and households.

The Action Plan, together with the effects of the global recession, has resulted in a $50.2-billion deficit for the fiscal year under way. More than one-half of this deficit is the result of temporary measures under Canada's Economic Action Plan, higher Employment Insurance benefits, and the decision to freeze premium rates. These measures will not weigh on the deficit after 2010.

The remaining deficit of $23.2 billion, or 1.5 per cent of GDP, is primarily a reflection of the weak economy and will be reversed as the economy recovers.

The Government has provided an update of the fiscal situation for the current year because of the weaker-than-expected economy in late 2008 and early 2009 and because of the significant actions required since the Action Plan was tabled—in partnership with the new U.S. administration—to stabilize the North American auto industry.

There are now encouraging signs that the economic situation is stabilizing. The Government has judged it appropriate to monitor economic developments over the summer with a view to providing an update in the fall report.

Over the coming months, the Government will continue to implement the Plan as aggressively as possible, appropriately balancing effective stewardship and governance of taxpayer dollars with speed of delivery. Achieving this balance will support Canadians through the global recession and will ensure Canada emerges in a strong position.

The Government remains focused on further progress in implementing the Plan.

The immediate priority is to start the remaining funds flowing as soon as possible. This means:

• Concluding any outstanding agreements and identifying projects for training, social housing and infrastructure with provinces and territories.
• Identifying the next set of projects under the Community Adjustment Fund.
• Moving ahead with additional work on federal infrastructure such as bridges, harbours and buildings.

The Government will update Canadians with a third progress report in the fall. At that time, the Government will provide further information on the amount of stimulus funding that has been spent, as well as an update on the effect of this stimulus on maintaining and creating jobs. Canadians are invited to monitor progress in implementing the Economic Action Plan on the Government's website, www.actionplan.gc.ca.

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