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Marc Edge: Federal handouts are getting out of hand

Commentary

PM Justin Trudeau and Honda executive Toshihiro Mibe announcing plans for a Honda electric vehicle battery plant in Alliston, Ont., April 25, 2024. Nathan Denette/The Canadian Press.

Pierre Poilievre, by all indications, is poised to be the next prime minister of Canada. He has not, in the long lead-up to the next election, been shy about his intentions to get federal spending under control. The chatter in Official Ottawa, amongst those in government and those in media with a keen eye on those in government, is that this may be a more difficult task than he’s proclaiming it to be. How much wiggle room is there, really, once you factor in much-needed fiscal transfers to the provinces—and is it really politically feasible to coldly cut them off in a fit of budget-balancing pique?

Maybe, maybe not. But it is worth taking a look at the state of the government’s actual accounting when it comes to how much they are spending—and on what—to see where a future government might find some savings.

The numbers coming out of Ottawa are simply staggering. The federal deficit was forecast in the last budget to hit $40 billion this year, up from $35 billion the year before, but it could come in at more like $56 billion with the way that spending keeps increasing. As a result, our national debt is now forecast to hit more than $1.2 trillion, or almost double what it was when the Trudeau Liberals took power in 2015. Rising interest on that debt will cost taxpayers $54 billion this year alone.

Federal spending is up this year by $37.1 billion to more than $534 billion, an increase of 6.9 percent. The civil service added more than 10,000 names to the federal payroll last year, bringing its bloated total to 367,772, which is up by 42 percent since Trudeau took over. The cost of paying their ever-increasing salaries hit a record $67 billion last year, up by 68 percent since 2016.

Where does all the money go? Social spending keeps increasing under new programs such as the dental care plan, while corporate subsidies are soaring out of sight, hitting $11.2 billion at last count in 2022, which is more than twice what they were in 2015. About $57 billion has been promised to multinational corporations including Honda, Volkswagen, and Stellantis to produce EVs alone.

It’s no wonder that we have such a bloated bureaucracy in Ottawa. The government has to keep hiring more and more staff just to keep giving away more and more of our money. To keep up with its ever-increasing spending, Ottawa is scrambling to raise taxes as fast as possible, increasing capital gains taxes and breaking new ground by taxing and regulating the internet with legislation such as the Online Streaming Act and the Digital Services Tax.

The granular detail of Ottawa’s out-of-control spending is outlined annually in Canada’s public accounts, so the truth is out there for anyone who has the time, inclination, and iron stomach needed to go through the more than 400 pages listing who gets what. For 2022-23, which is the most recent year available, transfer payments totaled $249,493,365,140, or a quarter of a trillion dollars.

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