The government has just weeks to decide whether to meet a $16 billion demand from the Bloc Québécois to stave off the election for several more months, but the stipulation may be at odds with the Liberals’ political and fiscal plans.
The Liberals have struggled over the past year to shape their policy strategy around a sense of injustice among millennials and Gen Z Canadians who feel their work isn’t paying off the way it did for previous generations.
While Prime Minister Justin Trudeau has promoted policies aimed at “fairness for every generation,” the Bloc has given him until Oct. 29 to greenlight a private member’s bill to increase old-age security for people under 75 year old.
If the government does not support the bill by then, Bloc leader Yves-François Blanchet says he will begin talks with other parties to topple the minority Liberal government before the new year.
“I don’t see clearly what the political advantage is for the Trudeau Liberals to spend more on seniors,” said Andrew Perez, a Liberal strategist at Perez Strategies.
That appears to be the only demographic the Liberals are still competitive with, Perez said.
Younger voters who helped propel Trudeau to popularity in 2015 appear, according to polls, to have drifted to the right to support Conservative leader Pierre Poilievre.
“Liberals historically are always ahead of conservatives among younger generations. So it’s anathema to the liberal brand, it’s quite shocking to see these numbers,” he said.
It will be difficult for any party to stand up in the House of Commons and oppose more money for seniors, said Tyler Meredith, a former top economic adviser to Trudeau and two finance ministers and a founding partner of policy consulting firm Meredith Boessenkool & Phillips . .
“The challenge is implementation and cost,” he said.
The Liberal government has increased old age security payments for people over 75 in 2022, with the intention of targeting the most vulnerable seniors.
The Parliamentary Budget Officer estimated that increasing old-age security for the under-75s would cost a further $16 billion over five years.
For the Liberals, that’s another $16 billion in deficit spending.
Adding that to the budget, on top of money for housing and other issues the government wants to tackle before the next election, would be difficult, Meredith said.
“I’m not sure it’s necessarily intergenerationally unfair. I’m just saying I’m not sure it’s the most efficient use of money,” he said.
Finance Minister Chrystia Freeland last year promised new fiscal safeguards aimed at curbing spending and deficits. The move came as there was growing pressure to ensure that federal spending does not impede the Bank of Canada’s ability to control inflation.
“When it comes to additional support for seniors, we’re having good conversations about all possible economic measures with both the Bloc and the NDP,” Freeland said last week.
Seniors’ benefits are a major expense for the federal government, and one that has grown significantly over the past year as the population ages: Ottawa has spent nearly $70 billion on payments for Old Age Security, the Guaranteed Income Supplement and the Social Security Allowance. husband in 2022.
The bloc argued that the decision to increase old age insurance payments only for people aged 75 and over was discriminatory.
But Laval University economics professor Stephen Gordon disagrees, noting that older seniors are typically needier.
“People who are over 75 are much less likely to be able to work if they need to supplement their income,” Gordon said, adding that older seniors are also more likely to have exhausted their savings.
Gordon said that of all the federal government’s priorities, giving more money to seniors probably isn’t at the top of the list. He also noted that seniors have lower poverty rates than other age groups.
“Think about all the other priorities: housing, education, health — my God, health. It’s like very, very low priorities and the finances of the federal government are getting more and more suspect,” Gordon said.
According to Statistics Canada, the poverty rate in 2022 for people aged 65 and over was six per cent – lower than the country’s overall poverty rate of 9.9 per cent.
Liberals don’t have much to think about their options. In addition to the Bloc deadline, they must submit an autumn economic statement outlining their spending plans and economic outlook before the end of the year.
Meanwhile, the House of Commons is expected to vote on several confidence motions that could topple the government in the coming weeks.
This report by The Canadian Press was first published on September 29, 2024.
#demands #pension #block #contradiction #liberal #political #strategy #economic #plans