Five tests for Canada's next federal budget

    OTTAWA, Jan. 23 /CNW Telbec/ - The January 27 federal budget will be one
of the most important in Canada's history and should meet five key tests, says
the Canadian Centre for Policy Alternatives (CCPA).
    "What's in this budget matters, more than ever," says CCPA Senior
Economist Marc Lee. "Canadians expect a budget that will stave off the worst
of the current recession, keep and create jobs, and lay the groundwork for a
fairer, greener, and more sustainable economy."
    The five tests for next week's federal budget:

    1. Help the hundreds of thousands of newly unemployed Canadians by
       increasing Employment Insurance (EI) benefits from 55% to 60% of
       insured earnings and extending the period for receiving those benefits
       to 50 weeks.
    2. Support those who need it most, such as unemployed, low-income
       Canadians and hard hit communities, by making a commitment to reduce
       poverty in Canada by 25% in the next five years.
    3. Implement an ambitious social, physical and green public
       infrastructure program, creating jobs in both male- and female-
       dominated professions.
    4. Support key value-added sectors with restructuring criteria to ensure
       they become green and sustainable.
    5. Emphasize spending over tax cuts.

    "Broad-based tax cuts are a poor source of job creating stimulus compared
to government spending," says David Macdonald, Coordinator of the Alterative
Federal Budget (AFB). "Tax measures should be targeted at low-income Canadians
who are more likely to spend the money locally."
    A number of reports confirm that the job creation potential from tax cuts
is dramatically lower than for other stimulus measures. For instance, $1
billion in tax cuts only leads to 6,000 jobs whereas $1 billion in
infrastructure spending creates 16,000 jobs and for health care the figure is
18,000 jobs, as modeled by Informetrica Ltd.

    The five tests are part of the CCPA's Alternative Federal Budget, a
partner to the Alternative Federal Stimulus Plan released in early January.
The AFB is coordinated by the CCPA and is the result of collaborative
deliberations by representatives of a wide spectrum of civil society

    All Alternative Federal Budget 2009 materials are available on the CCPA
web site:

For further information:

For further information: Kerri-Anne Finn, CCPA Senior Communications
Officer, (613) 563-1341 x306

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Canadian Centre for Policy Alternatives

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