Prime Minister Justin Trudeau said today his government’s promised update on the health of federal finances won’t have a specific anchor to keep spending from spiralling out of control.
He said officials are working on a robust update that will provide some guidelines on spending to help the economy.
Speaking to the Canadian Chamber of Commerce today, the prime minister said it would be premature to lock in a spending anchor while the country is still dealing with the pandemic.
He defended the unprecedented scale of federal aid, saying that anything less would have cost the country far more in terms of lost businesses and jobs.
Trudeau used his morning address to announce that businesses that use personal banking accounts can finally apply for a popular federal loan program.
He added that legislation would be soon tabled in the House of Commons to create more direct rent relief for companies and an extension to the wage subsidy program.
Trudeau said the low cost of borrowing gives the government the fiscal capacity to continue helping Canadians and businesses through the pandemic, and promised it would do “whatever it takes” to support them.
Stimulus to kick-start economy post-pandemic
“At the end of the pandemic, once we’ve got the vaccine, there is going to be a need for stimulus — we’ve seen other countries do it — to kick-start our economy into gear and get it growing back. That, of course, will be a one-time investment that we need to target to make sure everybody is benefiting from this relaunch as we get roaring back,” he said.
Speaking at the same virtual Chamber event, Conservative Leader Erin O’Toole called the Liberal government’s economic response “late and confused.” The government’s response left out large swaths of the economy and has led to high unemployment and massive deficit spending, he said.
O’Toole said the suggestion that it’s okay to keep spending as long as interest rates are low is “scary” because those rates are likely to change. He said a Conservative government would get spending under control and spur GDP growth.
“We are on a precipice, and that’s why I think this next election will be a critical choice for Canadians and for our economy,” he said.