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OverviewAn Ambitious AgendaThe Government of Canada has presented an ambitious agenda and a clear commitment to Canadians in the following areas: 1 Maintaining sound financial management 2 Securing our social foundations 3 Achieving a productive and growing economy 4 Moving towards a green economy and sustainable communities 5 Meeting our global responsibilities In Budget 2005, the Government is delivering on all of these commitments. 1 Maintaining Sound Financial ManagementEconomic OutlookRobust consumer spending, fuelled by low interest rates and stable inflation, led to solid economic growth in the first three quarters of 2004. This, in turn, helped boost employment levels and wages in Canada. Indeed, the Canadian economy created 255,000 full-time jobs in 2004. Private sector economic forecasters surveyed by the Department of Finance predict that Canada’s economy will grow by 2.9 per cent in 2005, rising to 3.1 per cent in 2006. However, Canada’s economy faces a number of challenges:
Fiscal ProspectsSince balancing the budget in 1997–98, the Government of Canada has recorded seven consecutive budget surpluses. Budget 2005 delivers on the Government’s commitment to keeping its books balanced and Canada’s debt on a permanent downward track. Specifically:
Expenditure ReviewBudget 2005 incorporates the nearly $11 billion in savings identified by the Government’s Expenditure Review Committee.
2 Securing Our Social FoundationsRecent Government of Canada commitments of over $75 billion in support of the 10-Year Plan to Strengthen Health Care and the new framework for Equalization and Territorial Formula Financing will provide provinces and territories with predictable and growing long-term support for the provision of health care and social services. Budget 2005 takes further action to secure Canada’s social foundations through a variety of measures. Health CareBudget 2005 provides $805 million over five years in direct federal health investments, including:
Investing in PeopleThe Government of Canada aims to ensure that all individuals have the chance to succeed, achieve their potential and participate fully in the promise of Canadian society. Budget 2005 supports these goals through a number of initiatives, including:
3 Achieving a Productive and Growing EconomyBudget 2005 proposes measures aimed at building on Canada’s economic strengths and ensuring that our economy remains globally competitive. Budget 2005 proposes the following tax reductions:
Budget 2005 also commits the Government to:
4 Moving Towards a Green Economy and Sustainable CommunitiesA Green EconomyBudget 2005 delivers on the Government’s commitment to address climate change and protect our natural environment by investing:
In addition, the budget includes tax incentives to encourage greater investment in and reliance on renewable energy sources. Delivering a New Deal for CommunitiesBudget 2005 implements the Government’s commitment to share $5 billion in federal gas tax revenues with communities across Canada over the next five years for investments in sustainable infrastructure. For 2005–06, communities will receive approximately $600 million. This annual amount will increase to $2 billion in 2009–10. As well, the Government has committed to renewing existing infrastructure programs as required. The Government will also provide an additional $300 million for the Green Municipal Funds in support of projects that deliver cleaner air, water and soil, as well as climate protection, to Canada’s communities. Half of these funds will be dedicated to brownfield remediation. 5 Meeting Our Global ResponsibilitiesBudget 2005 includes a wide range of initiatives, including:
DefenceLast October, the Government pledged to increase the size of Canada’s Armed Forces by 5,000 permanent members, along with 3,000 additional reservists. Budget 2005 delivers on this commitment while providing funding that goes far beyond it: $12.8 billion over five years (on a cash basis), the largest increase in defence spending in 20 years. This increased funding will be used to improve training and address the Forces’ operational readiness. The additional funding will also be used to purchase new medium-capacity helicopters, trucks, utility aircraft and specialized facilities for Canada’s elite anti-terrorist troops. How Can I Get More Information on Budget 2005?Information is available on the Internet at www.fin.gc.ca or by phoning: 1 800 O-Canada (1 800 622-6232) You can also obtain copies of this brochure and other budget documents from the: Distribution Centre Phone: (613) 995-2855 |
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