Budget 2009 – Budget in Brief
The world is passing through an extraordinary time. Canadians share in the
global consensus that extraordinary times call for extraordinary measures.
Budget 2009 will help Canada to meet the challenges of our times. It aims to
protect our country from an immediate economic threat while providing the
solutions we need to secure our long-term growth and prosperity.
Canadians in all regions have begun to feel the effects of the deepening
global economic crisis. They worry about their jobs, their hard-earned savings
and their homes. They are concerned about their families, their businesses and
Fulfilling Canada’s G20 Commitment
Canada is not acting alone but in full cooperation and coordination with
other industrialized countries. The world economy is highly globalized. It is
only by acting together to boost global economic growth that countries can
derive maximum impact from their actions. The Government’s actions in this
budget fulfill Canada’s commitments at the recent G20 leaders’ summit to provide
timely stimulus to domestic demand, while maintaining long-run fiscal
The International Monetary Fund has suggested that countries in a position to
do so should inject fiscal stimulus of 2 per cent of gross domestic product
(GDP) to reduce the effects of a damaging global recession. Canada must join
It is now clear that Canada has entered a recession. We entered it later than
other G7 countries, and it is shallower here than elsewhere. Budget 2009 not
only will help Canadians affected by the current crisis but also position Canada
to emerge from this recession in a stronger position.
Consulting with Canadians
The Government has listened to the concerns of Canadians. In putting together
Budget 2009, it has undertaken an unprecedented consultative effort.
It has consulted the provinces and territories. It has considered the views
of private sector economists, academics, business leaders and thousands of
Canadians who participated in on-line consultations. The Minister of Finance
also sought advice from his Economic Advisory Council and Members of Parliament
from all parties. Budget 2009 is a reflection of this extensive effort.
Budget 2009 reflects a strong consensus among Canadians that the Government
must deliver a potent economic stimulus to encourage growth and restore
confidence in our economy. The Economic Action Plan is based on three guiding
principles—that stimulus should be timely, targeted and temporary.
Timely. Canada is in recession today. Measures to support the economy
must begin within the next 120 days to be most effective.
Targeted. Measures that target Canadian businesses and families most in
need will trigger the largest increase in Canadian jobs and output.
Temporary. The stimulus plan should be phased out when the economy
recovers to avoid long-term structural deficits.
The Government’s Economic Action Plan will provide almost $30 billion
in support to the Canadian economy, or 1.9 per cent of our gross
It will create or maintain close to 190,000 Canadian jobs.
Improving Access to Financing, Strengthening the Financial System
Budget 2009 begins where the global recession began: with financial markets.
By providing up to $200 billion through the Extraordinary Financing Framework,
this budget will improve access to credit for Canadian consumers and allow
businesses to obtain the financing they need to invest, grow and create new
The Government is also taking steps, in partnership with willing provinces
and territories, to establish a single securities regulator for Canada to
simplify its regulatory system, reduce costs and attract investment to our
Action to Help Canadians and
The Government is providing $8.3 billion for the Canadian Skills and
Transition Strategy. This includes extra support for people who have lost their
jobs, including enhancements to Employment Insurance and more funding for skills
and training development to help Canadians get better jobs, while giving Canada
a more flexible, knowledgeable workforce and a competitive edge in the global
Budget 2009 takes action to build on the Government’s impressive record of
tax relief to further stimulate the economy and help Canadians face the global
recession with $20 billion in personal income tax relief over 2008–09 and the
next five fiscal years.
Action to Stimulate Housing Construction
The Government is providing $7.8 billion to build quality housing, stimulate
construction, encourage home ownership and enhance energy efficiency. Measures
include a Home Renovation Tax Credit providing up to $1,350 in tax relief to an
estimated 4.6 million Canadian families, up to $750 in tax relief for first-time
home buyers, funding for energy retrofits, investments for social housing to
support low-income Canadians, seniors, persons with disabilities and Aboriginal
Canadians, and low-cost loans to municipalities.
Immediate Action to Build Infrastructure
Budget 2009 accelerates and expands the recent historic federal investment in
infrastructure with almost $12 billion in new infrastructure stimulus funding
over two years, so that Canada emerges from this economic crisis with more
modern and greener infrastructure.
This includes funding for shovel-ready projects that can start this upcoming
construction season, including roads, bridges, clean energy, broadband internet
access and electronic health records across the country.
Action to Support Businesses
Budget 2009 protects jobs and supports sectoral adjustment during this
extraordinary crisis with $7.5 billion in extra support for sectors, regions
and communities. This includes targeted support for the auto, forestry and
manufacturing sectors, as well as funding for clean energy.
Protecting our Fiscal Advantage
A strong consensus emerged from the Budget consultation process that Canada
needs to run a temporary deficit to protect our economy and invest in our future
Although many of the measures presented in Budget 2009 are extraordinary,
they are consistent with the Government’s long-term economic plan, Advantage
The Government followed this long-term plan by reducing taxes for families
and businesses, reducing debt and investing in knowledge and infrastructure. The
Government also took early action in 2007 to protect Canada’s businesses and the
economy as the global financial crisis was beginning.
This course of action has placed Canada in a stronger position than most
other countries to face the present crisis. We can afford to spend what is
necessary in today’s plan of action to secure our future prosperity.
The Government will preserve Canada’s fiscal advantage by focusing spending
measures in two years, to allow an early return to balanced budgets, so that
Canada emerges from recession in at least as strong an economic and fiscal
position—relative to other countries—as it is today.
Building a Stronger Canada
With this Economic Action Plan, Canada will emerge from this economic crisis
with a more modern and greener infrastructure, a more skilled labour force,
lower taxes and a more competitive economy.
In Budget 2009, the Government is protecting the Canada we have built and the
values we share, while investing in the foundations of long-run economic growth.
Recent Economic Developments and Prospects
- The global economy is in the most synchronized recession in
the post-war period and the ongoing financial market crisis is the worst
since the 1930s.
- The economic slowdown is particularly evident in the United States
and other advanced economies where the economic outlook has deteriorated
markedly in recent months, but is also increasingly apparent in emerging
- Weaker expectations for global growth have led to a further decline
in the prices of many of the commodities produced in Canada.
- Global credit markets remain seriously disrupted, with credit
conditions remaining tight both in terms of the cost and availability of
- As a result, the private sector outlook for real and nominal GDP
in Canada has been revised down significantly since the time of the Economic
and Fiscal Statement:
- There is now a broad-based consensus that the Canadian economy
entered a recession in the fourth quarter of 2008. Private sector
forecasters expect the recession to last three quarters.
- Real GDP is now expected to contract by 0.8 per cent in 2009,
compared to a forecast of 0.3 per cent growth at the time of the
- Nominal GDP is expected to fall by 1.2 per cent for 2009, compared
to an increase of 0.8 per cent in the Statement.
- The risks to the outlook for real and nominal GDP remain tilted to
- In light of this risk, the Government has judged it appropriate
to adjust downward the private sector forecast for nominal GDP for
budget planning assumptions. The planning assumption is for a
contraction of 2.7 per cent in nominal GDP in 2009, rather than the
-1.2 per cent average private sector forecast.
- This means that the budget planning assumption for the level of
nominal GDP is forecast to be about $30 billion lower than expected by
the private sector in 2009 and 2010.
- The Government will continue to evaluate economic developments to
determine whether or not it would be appropriate to maintain
the adjustment for risk in future budgets and economic and fiscal
Canada’s Economic Action Plan
Improving Access to Financing and Strengthening Canada’s Financial System
Improving Access to Financing
The Government is responding to gaps in credit markets by providing up to
$200 billion through the Extraordinary Financing Framework to improve access to
financing for Canadian households and businesses, by:
- Committing an additional $50 billion to the Insured Mortgage Purchase
Program, increasing the overall size of this program to $125 billion.
This will provide lenders with stable long-term financing, allowing them
to continue lending to Canadian consumers and businesses.
- Delivering $13 billion in additional financing by increasing the
flexibility and capacities of the financial Crown corporations,
the Canada Mortgage and Housing Corporation, Export Development Canada,
and the Business Development Bank of Canada. This includes at least
$5 billion in new financing to be delivered through enhanced cooperation
between these financial Crown corporations and private sector financial
institutions under the new Business Credit Availability Program.
- Increasing the maximum eligible loan amount a small business can
access under the Canada Small Business Financing Program.
- Creating the Canadian Secured Credit Facility, with up to $12 billion
to support financing of vehicles and equipment for consumers and
- Extending the deadline for issuing guaranteed instruments under the
Canadian Lenders Assurance Facility, which helps ensure that lenders are
not put at a competitive disadvantage when raising funds in global
- Establishing a new Canadian Life Insurers Assurance Facility to
guarantee wholesale term borrowings for life insurers, modelled on the
Canadian Lenders Assurance Facility.
- Facilitating the provision of extraordinary liquidity to financial
institutions by the Bank of Canada, as required, through the
modernization of the Bank’s authorities in Budget 2008.
- Adding a 10-year maturity to the Canada Mortgage Bond program to
raise supplementary funding for financial institutions.
Strengthening Canada’s Financial System
Budget 2009 will further strengthen our financial system by:
- Broadening the authority for the Minister of Finance to
promote financial stability and maintain efficient and well-functioning
- Providing the Canada Deposit Insurance Corporation with greater
flexibility to enhance its ability to safeguard financial stability in
- Providing a standby authority for the Government to inject capital
into federally regulated financial institutions to support
A New Canadian Securities Regulator
Canadians need and deserve a more efficient, streamlined securities
regulatory system that reinforces financial stability, strengthens enforcement,
protects investors and is more accountable. To this end, the Government will:
- Work with willing partners to establish a Canadian securities
regulator that respects constitutional jurisdiction, regional interests
Measures to Help Consumers of Financial Products
The Government will assist consumers of financial products by:
- Enhancing disclosure and improving business practices in respect of
credit cards issued by federally regulated financial institutions.
- Establishing an independent task force to make recommendations on a
cohesive national strategy on financial literacy.
- Moving forward on measures to make mortgage insurance more
transparent, understandable and affordable.
Federally Regulated Private Pension Plans
The Government is acting to address issues facing federally regulated private
pension plans by:
- Assisting the Office of the Superintendent of Financial Institutions
in providing flexibility to supplement the temporary solvency funding
relief proposed in the November 2008 Economic and Fiscal Statement.
- Consulting on the legislative and regulatory framework for federally
regulated pension plans with a view to making permanent improvements
before the end of 2009.
Action to Help Canadians and Stimulate Spending
Strengthening Benefits for Canadian Workers
Budget 2009 will support Canadian workers affected by the global economic
- Increasing for two years all regular Employment Insurance (EI) benefit
entitlements by five extra weeks and increasing the maximum benefit
duration to 50 weeks from 45 weeks.
- Providing $500 million over two years to extend EI income benefits
for Canadians participating in longer-term training, benefiting up to
- Extending work-sharing agreements by 14 weeks, to a maximum of 52
weeks, so more Canadians can continue working.
- Extending the Wage Earner Protection Program to cover severance and
termination pay owed to eligible workers impacted by employers’
- Consulting with Canadians and developing options to provide
self-employed Canadians with access to EI maternity and
Enhancing the Availability of Training
Budget 2009 will create more and better opportunities for Canadian workers
through skills development by:
- Increasing funding for training delivered through the Employment
Insurance program by $1 billion over two years.
- Investing $500 million over two years in a Strategic Training and
Transition Fund to support the particular needs of individuals who do
not qualify for EI training, such as the self-employed or those who have
been out of work for a prolonged period of time.
- Providing $55 million over two years to help young Canadians find
- Supporting older workers and their families with an additional
$60 million over three years for the Targeted Initiative for
Older Workers and expanding it to include workers in small cities.
- Responding to skilled labour shortages with $40 million a year
to launch the $2,000 Apprenticeship Completion Grant.
- Providing $50 million over two years for a national foreign
credential recognition framework in partnership with provinces
- Investing an additional $100 million over three years in
the Aboriginal Skills and Employment Partnership (ASEP) initiative,
expected to support the creation of 6,000 jobs for Aboriginal Canadians.
- Investing $75 million in a two-year Aboriginal Skills and Training
Strategic Investment Fund.
Keeping Employment Insurance Rates Frozen
- Freezing EI premium rates at $1.73 per $100 for both 2009 and
2010—their lowest level since 1982—a projected $4.5 billion stimulus
relative to break-even rates.
Further Developing a Highly Skilled Workforce
Budget 2009 builds on previous investments in knowledge by:
- Providing an additional $87.5 million over three years to temporarily
expand the Canada Graduate Scholarships program.
- Allocating an additional $3.5 million over two years to offer
an additional 600 graduate internships through the Industrial Research
and Development Internship program launched in Budget 2007.
Strengthening Partnerships with Aboriginal Canadians
Budget 2009 builds on past budgets by investing in new partnership approaches
to deliver crucial services. These include:
- Committing $305 million over the next two years to improve health
outcomes for First Nations and Inuit individuals.
- Providing $20 million over the next two years to extend partnerships
with provinces to further improve child and family services on reserves.
Tax Relief for Canadians
Budget 2009 will deliver $20 billion in personal income tax relief over
2008–09 and the next five fiscal years. Effective January 1, 2009, this
- Increasing the basic personal amount and the top of the two lowest
personal income tax brackets by 7.5 per cent above their 2008 levels, so
that Canadians can earn more income before paying federal income taxes
or before being subject to higher tax rates.
- Raising the level at which the National Child Benefit supplement for
low-income families and the Canada Child Tax Benefit are phased out,
providing a benefit of up to $436 for a family with two children.
- Effectively doubling the tax relief provided by the Working Income
Tax Benefit to encourage low-income Canadians to find and retain a job.
- Providing up to an additional $150 of annual tax savings for low- and
middle-income seniors through a $1,000 increase to the Age Credit
Action to Stimulate Housing Construction
The Government is proposing to provide up to $7.8 billion in tax relief and
funding to help stimulate the housing sector and improve housing across Canada.
Support for Home Ownership and the Housing Sector
- Implementing a temporary Home Renovation Tax Credit that will provide
up to $1,350 in tax relief, reduce the cost of renovations for an
estimated 4.6 million Canadian families, and provide needed stimulus to
- Providing an additional $300 million over two years to the ecoENERGY
Retrofit program to support an estimated 200,000 additional home
- Providing first-time home buyers with additional access to their
Registered Retirement Savings Plan savings to purchase or build a home
by increasing the Home Buyers’ Plan withdrawal limit to $25,000 from
- Assisting first-time home buyers by providing up to $750 in tax
relief to help with the purchase of a first home.
Investments in Housing for Canadians
Social housing provides many Canadians with quality housing at affordable
rates. Budget 2009 will invest in social housing by:
- Providing a one-time federal investment of $1 billion over two years
for renovations and energy retrofits for up to 200,000 social housing
units on a 50–50 cost-shared basis with provinces.
- Investing $400 million over two years for the construction of social
housing units for low-income seniors.
- Investing $75 million over two years for the construction
of social housing units for persons with disabilities.
- Dedicating $400 million over two years to new social housing projects
and to remediation of existing social housing stock on First Nations
- Supporting social housing in the North with an additional
$200 million over two years.
Helping Municipalities Build Stronger Communities
Budget 2009 will help local governments meet their needs by:
- Making available up to $2 billion over two years in direct, low-cost
loans to municipalities to finance improvements to housing related
infrastructure, such as sewers, water lines, and neighbourhood
regeneration projects. Municipalities will also have access to
significant new funding available under major new provincial,
territorial and municipal infrastructure initiatives.
Immediate Action to Build Infrastructure
Budget 2009 accelerates and expands recent historic federal investments in
infrastructure with almost $12 billion in new infrastructure stimulus funding
over two years.
Investments in Provincial, Territorial and Municipal Infrastructure
Building on previous infrastructure commitments, Budget 2009 invests in a
more modern and greener infrastructure by:
- Establishing a two-year, $4-billion Infrastructure Stimulus Fund that
will provide funding to renew infrastructure.
- Providing $1 billion over five years for the Green Infrastructure
Fund to support projects such as sustainable energy.
- Providing $500 million over two years to build and renew community
recreation facilities across Canada.
- Accelerating up to $1 billion in payments over two years under the
Provincial-Territorial Base Funding Initiative to expedite "ready-to-go"
- Providing up to $500 million over the next two years for
infrastructure projects in small communities.
Investments in First Nations Infrastructure
Budget 2009 will support investments in First Nations infrastructure by:
- Providing $515 million over two years for "ready-to-go" First Nations
projects in three priority areas: schools, water and critical community
Investments in Knowledge Infrastructure
The Government will advance Canada’s knowledge advantage by:
- Dedicating up to $2 billion to repair, retrofit and expand facilities
at post-secondary institutions.
- Providing $750 million for leading-edge research infrastructure
through the Canada Foundation for Innovation.
- Providing $50 million to the Institute for Quantum Computing in
Waterloo, Ontario to build a new world-class research facility.
- Allocating $87 million over the next two years to maintain or upgrade
key Arctic research facilities.
- Providing $250 million over two years to address deferred maintenance
at federal laboratories.
- Providing $500 million to Canada Health Infoway to encourage the
greater use of electronic health records.
- Providing $225 million over three years to develop and implement a
strategy on extending broadband coverage to unserved communities.
Investments in Federal Infrastructure Projects
Budget 2009 will set aside funds to build and renew federal public
- Increasing funding to VIA Rail Canada by $407 million to support
improvements to passenger rail services, including higher train
frequencies and enhanced on-time performance and speed, particularly in
the Montréal–Ottawa–Toronto corridor.
- Investing $7.9 million for new capital projects of two First Nations
railways: the Keewatin Railway Company in Manitoba and the Tshiuetin
Rail Transportation in Quebec and Labrador.
- Providing $72 million over five years to improve railway safety.
- Providing $130 million to Parks Canada for twinning a section of the
Trans-Canada Highway through Banff National Park.
- Allocating $212 million to renew the Champlain Bridge in Montréal,
Canada’s busiest bridge.
- Providing up to $14.5 million for two bridges at two of the busiest
U.S–Canada border crossings: the Blue Water Bridge in Sarnia and the
Peace Bridge in Fort Erie.
- Setting aside up to $42 million for other federal bridges in need of
rehabilitation throughout Canada.
- Providing up to $217 million to accelerate the construction of the Pangnirtung
Harbour in Nunavut and repair core small craft harbours across Canada.
- Allocating $323 million over two years for the restoration of
federally owned buildings.
- Providing $20 million in each of two years to improve
the accessibility of federally owned buildings for people
- Committing $2 million to develop a plan for the future of
the historic Manège Militaire in Québec City, destroyed by fire in 2008.
- Increasing funding by $80 million over the next two years to manage
and assess federal contaminated sites, facilitating remediation work
totalling $165 million over two years.
- Providing funding to modernize and expand border service facilities
at Prescott, Ontario; and at Huntingdon, Kingsgate, and the Pacific
Highway in British Columbia.
- Supporting the development of aviation security plans, improving
operations of the Canadian Air Transportation Security Authority, and
implementing a new air passenger assessment system and a new security
program for air cargo.
Action to Support Businesses and Communities
Tax and Tariff Relief to Stimulate Business Investment
Budget 2009 includes significant measures to position Canada’s economy for
long-term recovery by:
- Introducing a temporary 100-per-cent capital cost allowance (CCA)
rate for computers acquired after January 27, 2009 and before
February 1, 2011.
- Extending the temporary 50-per-cent straight-line accelerated CCA
rate to investment in manufacturing or processing machinery and
equipment undertaken in 2010 and 2011.
- In the context of the current global financial environment, repealing
the interest deductibility constraints in section 18.2 of the Income Tax
- Providing over $440 million in savings for Canadian industry over the
next five years by permanently eliminating tariffs on a range of
machinery and equipment.
Budget 2009 provides significant short-term support for key sectors by:
- Providing $170 million over two years to secure a more sustainable
and competitive forest sector.
- Supporting farmers with a $500 million agricultural flexibility
program that will help the sector adapt to pressures and improve its
- Investing $50 million over the next three years to strengthen
slaughterhouse capacity across Canada.
- Amending the Farm Improvement and Marketing Cooperatives Loans
Act to help make credit available to new farmers, support
inter-generational farm transfers, and modify eligibility criteria
for agricultural co-operatives.
- Supporting shipyards with $175 million for the procurement of 98 new
Coast Guard vessels and to undertake refits and vessel life extensions
for 40 aging vessels.
- Offering short-term repayable loans to the automotive sector,
in collaboration with the Ontario and U.S. governments.
- Providing $110 million over three years to the Canadian Space Agency
to support the development of advanced robotics and other space
- Providing targeted two-year funding of $60 million to support
infrastructure-related costs for local and community cultural
and heritage institutions such as local theatres, libraries and
- Increasing funding by $20 million over the next two years and
$13 million per year thereafter to the National Arts Training
- Providing $30 million over the next two years to support continued
access to Canadian magazines and community newspapers.
- Providing $28.6 million over the next two years to the Canada New
Media Fund, and $14.3 million annually thereafter.
- Providing the Canadian Television Fund with $200 million in funding
over the next two years.
- Providing $40 million to the Canadian Tourism Commission over two
years to support marketing activities, such as the Vancouver 2010 Winter
Olympic and Paralympic Games.
- Providing $12 million per year in 2011–12 and 2012–13
for infrastructure to promote international cruise ship tourism along
the Saint Lawrence and Saguenay Rivers.
- Providing $100 million over two years for marquee festivals
and events that promote tourism.
- Supporting Canada’s parks with $75 million over two years
for improvements and enhancements to Parks Canada’s visitor facilities,
such as campgrounds and visitor centres.
- Providing an additional $75 million to Parks Canada for upgrades to
National Historic Sites, including a number of sites connected with the
200th anniversary of the War of 1812.
A More Sustainable Environment
Budget 2009 will take actions to ensure a healthy environment, including:
- A new Clean Energy Fund that supports clean energy research
development and demonstration projects, including carbon capture and
- Improving the Government’s annual reporting on key environmental
indicators such as clean air, clean water and greenhouse gas emissions
with $10 million in 2009–10.
- Strengthening Canada’s nuclear advantage with $351 million to Atomic
Energy of Canada Limited for its operations, including the development
of the Advanced CANDU Reactor, and to maintain safe and reliable
operations at the Chalk River Laboratories.
Supporting Small Businesses
Small businesses are dynamic and drive economic growth and job creation.
Budget 2009 supports their growth by:
- Increasing the amount of small business income eligible for the
reduced federal tax rate of 11 per cent to $500,000 from the current
limit of $400,000 as of January 1, 2009.
- Increasing access to credit for small businesses through proposed
amendments to the Canada Small Business Financing Program and the
Business Development Bank of Canada.
- Providing $30 million over two years for the Canada Business Network
and $10 million to the Canadian Youth Business Foundation.
- Allocating $200 million over two years to the National
Research Council’s Industrial Research Assistance Program to enable it
to temporarily expand its initiatives for small and medium-sized
Helping All Regions Prosper
Budget 2009 provides new resources to support economic diversification across
- Providing more than $1 billion over five years for a Southern Ontario
development agency to help workers, communities and businesses in this
- Providing $1 billion over two years for a Community Adjustment Fund
that will help mitigate the short-term impacts of restructuring in
communities. This support for communities in all regions will be
provided through regional development agencies.
- Strengthening support for economic activity in the North with
$50 million over five years to establish a new regional economic
development agency for the North and $90 million over five years to
renew the Strategic Investments in Northern Economic Development
- Providing $37.6 million in support of environmental assessments,
regulatory coordination, science, and Aboriginal consultations related
to the Mackenzie Gas Project.
- Extending for one year the temporary 15-per-cent mineral exploration
tax credit to help companies raise capital for mining exploration.
- The deterioration of the economic outlook has led to a significant
reduction in projected revenues, particularly in 2009–10 and 2010–11.
- The projections in this budget are based on the average of
private sector economic forecasts. However, given the degree of
uncertainty in the global economy, the Government is including an
explicit adjustment for the risks to the private sector forecasts. This
adjustment amounts to a reduction in the budgetary balance of
$0.8 billion in 2008–09, $4.5 billion in 2009–10 and 2010–11, $3 billion
in 2011–12, $1.5 billion in 2012–13 and $0.8 billion in 2013–14.
- After this adjustment for risk and before accounting for the impact
of the actions proposed in this budget, the Government is projecting a
small surplus in 2008–09, followed by deficits of $15.7 billion in
2009–10, $14.3 billion in 2010–11, $8.3 billion in 2011–12, $2.3 billion
in 2012–13 and a surplus of $5.5 billion in 2013–14.
- After taking into account the cost of the measures proposed in Budget
2009 to support the economy, the Government is projecting deficits of
$1.1 billion in 2008–09, $33.7 billion in 2009–10, $29.8 billion in
2010–11, $13.0 billion in 2011–12, $7.3 billion in 2012–13 and a surplus
of $0.7 billion in 2013–14.
- The Government has designed its Economic Action Plan to concentrate
new spending in 2009–10 and 2010–11, when the economy is expected to be
weak. Starting in 2011–12, the fiscal position of the Government is
projected to improve rapidly, as time-limited stimulus measures expire
and the economy recovers. By 2013–14, the budget is projected to be in a
- Program spending is expected to increase through 2010–11, reflecting
the impact of the measures in this budget. Over the medium term,
spending as a share of GDP is expected to return close to its 2007–08
level. The Government remains committed to ensuring that spending is
focused and disciplined.
- The debt-to-GDP ratio is expected to increase from 28.6 per cent in
2008–09 to 32.1 per cent by 2010–11, as a result of projected deficits.
The debt-to-GDP ratio is projected to be below its 2008–09 level by
- Canada’s net debt-to-GDP ratio will remain below other G7 countries
over the forecast horizon.
- The Government’s priority is to support the economy. The Government
will use budget surpluses first of all to repay the deficits expected in
the upcoming four years.
Summary Statement of Transactions
||(billions of dollars)
|Public debt charges
|Per cent of GDP
| Budgetary revenues
| Program expenses
| Public debt charges
| Total expenses
| Federal debt
|Note: Totals may not add due to rounding.
Summary of Economic Action Plan
||(millions of dollars)
|Economic Action Plan
|Improving Access to Financing and
Canada’s Financial System
|Action to Help Canadians and Stimulate
|Action to Stimulate Housing Construction
|Immediate Action to Build Infrastructure
|Action to Support Businesses and
|Fiscal cost of measures1
|Capital Spending (cash adjustments)
| Loans to Auto Sector
(announced in December 2008)
| Loans to Municipalities for Housing-Related
|Timing of Home Renovation tax credit
|Total Federal Stimulus2
|Total Stimulus (with leverage)
|As a share of GDP (%)
|Total Federal Stimulus
|Total Stimulus (with leverage)
|1 Fiscal cost does not include
other tax measures.
2 Financial Market measures not included as stimulus.