SCOOP: Freeland to cancel $250 checks promised for 'Canada workers' in Monday's mini-budgetcp173661108.jpg
Cancellation of controversial PMO gift could be a kind of victory for Freeland
Chrystia Freeland
Finance Minister and Deputy Prime Minister Chrystia Freeland takes a question from a reporter (not visible) during a news conference at the National Press Theatre in Ottawa
If you're one of the nearly 19 million Canadian workers expecting a $250 check from the Liberal government in the new year, don't spend the money just yet.
Sources have told the National Post that Finance Minister Chrystia Freeland is set to change the government's stance on the "Canada workers' discount" that would cost about $4.68 billion.
A person familiar with the plans said the measure will not appear in Monday's budget update, but the government hopes to consider it again next year, if it can find another party to support it.
Emails to Freeland's office and the prime minister's office seeking confirmation were not returned by deadline. The Liberal government's original plan was to send $250 checks to 18.7 million Canadians who worked in 2023 and earned less than $150,000, but they were unable to get the measure approved by Parliament.
Although the GST break received support from the NDP, Jagmeet Singh has made it clear that his party would refuse to support the deduction checks unless seniors, people with disabilities and injured workers were included. The Bloc Québécois has taken a similar approach. An expanded rebate could add another $2 billion to the cost.
An official, who was not authorized to speak publicly, said the government was trying to stay within certain spending limits. Abandoning a commitment to spend nearly $5 billion on a measure that the Treasury Department did not think made financial sense will be seen as something of a victory for Freeland.
It has been widely reported that the affordability plan came from the Prime Minister's Office, which initially proposed the two-month GST holiday that began Saturday and the $250 stimulus checks planned for the spring.
However, it is clear that Freeland was not enthusiastic and that there has been a breakdown in the relationship between the two senior government ministers.
The finance minister appeared tense and appeared to be in tears when asked about the spending tensions at a news conference on Friday.
The last time a finance minister disagreed with the prime minister on spending — Bill Morneau on the level of COVID benefits — Trudeau decided Ottawa wasn't big enough for both of them.
Freeland appears to be under similar pressure, despite the prime minister's alleged affinity for her. Not a day goes by without a new story about former central banker Mark Carney being rumored to be replacing him. The Globe and Mail reported that the Prime Minister's Office was planning two scenarios for a cabinet reshuffle: one that would include Carney and one that would not. Emails to Carney seeking comment were not immediately returned.
Chrystia Freeland speaks at a news conference in Ottawa on Oct. 1, 2024. In her hand is written
Canadians want to know: Why does Chrystia Freeland have handwritten notes? Taylor Swift will perform at the Eras Tour concert in Vancouver on Friday, December 6, 2024. Trudeau received tickets for Taylor Swift directly from concert promoter Eras, according to the PMO.
A cabinet reshuffle is long overdue: there are two vacancies and four other ministers have said they will not run in the next election.
It remains possible that a reshuffle will take place on Tuesday and Carney will be unveiled as the new finance minister, although one source suggested the timing was increasingly unlikely.
But that is no way to run a country. We have reached a level of dysfunction at the top that is even greater than during the Morneau-Trudeau feud.
This is a makeshift government, with all the inconsistencies and communication problems that come with improvisation all the time. "There are a lot of moving parts," said one official.
The best that can be said about the disappearing checks is that they are not missing.
The program has not had the desired effect with voters. A Postmedia-Leger poll conducted earlier this month found that seven in 10 respondents thought the measures were just a vote-rigging ploy, with only one in five agreeing they were "good measures that will help people deal with inflation." The poll suggests that Liberal support has fallen since the plan was announced.
The budget update is expected to reveal deficits for 2023/24 and 2024/25 that are much higher than the $40 billion Freeland promised in the last budget.
She told Bloomberg last week that the debt-to-GDP ratio will fall, as promised, but she did not comment on the size of the deficit. Financial sources suggest it could reach $60 billion last year and this year. After canceling the $4.68 billion donation, Freeland can at least argue that the money would be better spent on measures that help Canada weather the incoming Trump administration, such as those she announced last Friday.
At a press conference in Toronto, she said the government will invest an additional $1.9 billion over six years in the nation's leading innovation tax credit, the Experimental Research and Development Tax Incentive, and an additional $1 billion in the Entrepreneurship Capital Catalyst Initiative. These funds will help grow Canadian mid-sized businesses.
She said the government will also spend billions of dollars on a program to build data centres by attracting investment from Canadian pension funds. Under the program, the funds are expected to invest $2 for every dollar the government spends on AI data centres, up to a total of $45 billion.
If the fall economic statement is Freeland's swan song as finance minister, she can at least claim to have tried to do something meaningful, rather than just a liberal use of junk.