Canada's incredibly shrinking surplus
By SANDRA CORDON
Thursday, September 8, 2005 Updated at 6:20 PM EDT
Canadian Press
Ottawa Finance Minister Ralph Goodale is poised to announce an unusual small federal surplus bad news in normal times, but curiously good news for the beleaguered minority Liberal government.
Sources say Ottawa's surplus for the past fiscal year will total only about $2.6-billion a bit below the $3-billion that was expected for 2004-05.
Normally, having such a small cushion against deficit wouldn't be cause for celebration.
But after years of being politically reviled for consistently underestimating by large amounts the size of the federal surplus, Mr. Goodale will this year be close to the mark.
Last year was particularly embarrassing for the minister and the Finance department.
After predicting a surplus of $1.9-billion for fiscal 2003-04, the real year-end figure turned out be the exact reverse: a whopping $9.1-billion.
Mr. Goodale's political opponents weren't celebrating the unusual accuracy Thursday.
Monte Solberg, the Opposition Conservative Finance critic, said Mr. Goodale's office made several last-minute spending plans to soak up enough surplus cash to bring the final amount below the expected $3-billion.
Mr. Solberg said that explains the inaccuracies by private-sector forecasts analysts, hired by the opposition parties to do their own budget predictions.
Those estimates have ranged from almost $7-billion to $8-billion in surplus cash left over after fiscal year-end March 31.
Forecasters simply didn't have all the information about the government's last-minute spending plans, said Mr. Solberg.
Some of those (items) are completely subjective, they could have announced some things whenever they wanted, he said.
This is their (Liberals) way of coming in on target and trying to discredit the numbers (the private-sector analysts) have produced.
Following a speech Thursday in Vancouver, Mr. Goodale said he intends to announce a small surplus in a week or two and warned it won't be any where as large as the private estimates suggest.
They're simply wrong, Mr. Goodale said.
I would expect the actual surplus to be generally in line with my projections in the budget last February probably a bit lower as I have said all through this summer.
All surplus dollars at fiscal year-end go to pay down the federal debt.
Pricey plans announced after the last budget include a $1-billion farm aid announcement financed from last year's surplus since it was channelled through an existing program as well as a $2.3-billion cost of winding up some projects at Atomic Energy of Canada Ltd.
There were other big-ticket spending items in February's budget, which ate into extra cash in the federal kitty.
That included $700-million for child care and a $4.25-billion fund to reduce hospital wait times.
Some other major spending plans announced last spring weren't covered by the last year's surplus.
Those include the minority Liberal government's deal with the NDP which boosted social spending by $4.6-billion, to be financed this year and next.
:angry: :rossz
By SANDRA CORDON
Thursday, September 8, 2005 Updated at 6:20 PM EDT
Canadian Press
Ottawa Finance Minister Ralph Goodale is poised to announce an unusual small federal surplus bad news in normal times, but curiously good news for the beleaguered minority Liberal government.
Sources say Ottawa's surplus for the past fiscal year will total only about $2.6-billion a bit below the $3-billion that was expected for 2004-05.
Normally, having such a small cushion against deficit wouldn't be cause for celebration.
But after years of being politically reviled for consistently underestimating by large amounts the size of the federal surplus, Mr. Goodale will this year be close to the mark.
Last year was particularly embarrassing for the minister and the Finance department.
After predicting a surplus of $1.9-billion for fiscal 2003-04, the real year-end figure turned out be the exact reverse: a whopping $9.1-billion.
Mr. Goodale's political opponents weren't celebrating the unusual accuracy Thursday.
Monte Solberg, the Opposition Conservative Finance critic, said Mr. Goodale's office made several last-minute spending plans to soak up enough surplus cash to bring the final amount below the expected $3-billion.
Mr. Solberg said that explains the inaccuracies by private-sector forecasts analysts, hired by the opposition parties to do their own budget predictions.
Those estimates have ranged from almost $7-billion to $8-billion in surplus cash left over after fiscal year-end March 31.
Forecasters simply didn't have all the information about the government's last-minute spending plans, said Mr. Solberg.
Some of those (items) are completely subjective, they could have announced some things whenever they wanted, he said.
This is their (Liberals) way of coming in on target and trying to discredit the numbers (the private-sector analysts) have produced.
Following a speech Thursday in Vancouver, Mr. Goodale said he intends to announce a small surplus in a week or two and warned it won't be any where as large as the private estimates suggest.
They're simply wrong, Mr. Goodale said.
I would expect the actual surplus to be generally in line with my projections in the budget last February probably a bit lower as I have said all through this summer.
All surplus dollars at fiscal year-end go to pay down the federal debt.
Pricey plans announced after the last budget include a $1-billion farm aid announcement financed from last year's surplus since it was channelled through an existing program as well as a $2.3-billion cost of winding up some projects at Atomic Energy of Canada Ltd.
There were other big-ticket spending items in February's budget, which ate into extra cash in the federal kitty.
That included $700-million for child care and a $4.25-billion fund to reduce hospital wait times.
Some other major spending plans announced last spring weren't covered by the last year's surplus.
Those include the minority Liberal government's deal with the NDP which boosted social spending by $4.6-billion, to be financed this year and next.
:angry: :rossz
