Higgs fears feds’ expensive programs will become N.B.'s responsibility

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OTTAWA • Premier Blaine Higgs says the federal budget introduces a “shocking” amount of new spending that learns no lesson from the country’s inflationary struggles.

That’s as Higgs fears a future that will see massive new national spending programs become provincial responsibility when federal dollars run out.

The premier’s words have also been echoed by federal Conservative Leader Pierre Poilievre who has described the budget as a “wasteful, inflationary” fiscal plan.

But that’s led to Prime Minister Justin Trudeau firing back on Wednesday that opposition from conservatives isn’t about spending and ongoing deficits, but instead about protecting wealthy Canadians from tax increases.

The federal Liberal government’s budget calls on Ottawa to spend $52.9 billion more than planned over the next five years.

It’s the price tag of a plan to fix the housing crisis, expand child care access, launch a national pharmacare plan, develop a national school food program, and create a new disability benefit, among other initiatives.

“We’ve seen their solution, nine years of deficits and inflationary costs that have been unheard of for generations, and no change in format in sight,” Higgs said in reaction to Tuesday’s budget.

“Shocking, absolutely shocking, totally out of control.”

The feds will hike capital gains tax paid by the highest earners and corporations to offset billions in new spending.

The government projects to post a $40-billion deficit this year, with deficit spending continuing on for the foreseeable future.

The debt will total more than $1.2 trillion this year.

That’s as the cost of servicing the national debt has grown substantially.

Budget projections show Canada’s debt servicing cost will be $54.1 billion this fiscal year. That’s $2 billion more spent on debt payments than the planned $52.1 billion that will be spent on health transfers to provinces and territories.

“The huge spending from this government has put us in this situation and it continues,” Higgs said. “How does this make life more affordable for the average Canadian? I don’t see it.”

Trudeau spoke to his caucus Wednesday morning in a campaign-style event, with the prime minister reading prepared remarks from a teleprompter and several of his MPs standing behind him.

“This budget lays out a plan to make sure Canadians can build homes, build companies, build solutions, and make the best country in the world even better,” he said.

Trudeau said tax increases on richer Canadians is about ensuring the government has the money to correct generational fairness.

“We’re asking them to pay their fair share so that younger generations can have the same opportunities that Gen-Xers, boomers and other generations had when they were starting their lives.”

He said if the Conservatives vote against the budget, as they have indicated they will do, it will be because they want to protect this small group from higher taxes.

“They’re voting against fairness. They will be voting against asking the ultra rich to pay their share.”

Finance Minister Chrystia Freeland said in the House of Commons during her budget speech that former prime minister Brian Mulroney had raised the capital gains rate to 75 per cent — much higher than the rate in the budget.

“Yet, I know there will be many voices raised in protest. No one likes paying more tax, even — or perhaps particularly — those who can afford it the most,” she said.

Freeland added that it comes down to the country’s direction.

“Do you want to live in a country where we make the investments we need – in health care, in housing, in old age pensions – but we lack the political will to pay for them and choose instead to pass a ballooning debt onto our children?” she asked.

“Tax policy is not only, or chiefly, the province of accountants or economists.

“It belongs to all of us, because it is how we decide what kind of country we want to live in and what kind of country we want to build.”

Higgs didn’t take direct issue with hiking the capital gains tax on the country’s most wealthy, if it was to go towards something like balancing the budget.

But he instead criticized using that money to spend on new programs, fearing who pays for them in the long run.

“What’s going to happen five years from now?” Higgs said, suggesting the feds are borrowing now to start new programs without the capacity to pay for them down the road.

He fears they could then become provincial responsibility in part or in whole.

“Dumping things into the provincial jurisdiction without thought, without any sort of real understanding, and expecting the provinces just to take it,” Higgs said.

He also questioned Canada’s competitiveness with other nations.

“All we’re seeing is a headline for more spending and a budget that is going to continue to put this country in a position where our neighbours and investors say ‘this is no place to be,’” Higgs said.

“There is no secret that the government can’t do things as efficiently as the private sector when it comes to economic development and spending money efficiently, but yet this government is obsessed with spending taxpayer dollars.

“It absolutely hasn’t worked, it will not work, and every Canadian is feeling it, but yet they continue to spend on the same track.”

-With files from Postmedia