Feds could take steps this fall to boost weak economy: Morneau

Feds monitoring weak economy, could take action in fall

By Special to MoneySense on September 27, 2016
Estimated reading time: 2 minutes

Tax-bracket changes have started helping, says Morneau

OTTAWA – Canada’s finance minister is hinting the federal government could take steps as early as this autumn’s economic update to help the economy at a time of slower-than-expected growth. When asked today about the fall update, Bill Morneau said the government would continue to look at Canada’s economic situation in order to determine what should be done — not only in November but also in next year’s budget. Government insiders say Ottawa is considering using the update as a vehicle to help boost the sluggish economy, including potentially fast-forwarding billions in planned infrastructure investments. Morneau declined to share details about the contents of the fall update, nor would he provide a precise date for its release. He says existing measures announced in the government’s spring budget, such as tax-bracket changes and infrastructure spending, have begun to help the economy.

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Morneau also confirmed plans to meet with a group of private-sector economists on Oct. 13 in Toronto to seek their input as well as their latest economic projections. The finance minister launched the government’s pre-budget consultations today in Ottawa, saying the ideas he receives through the process will help him craft his next budget, expected in the spring. “We’ll remain vigilant in looking at economic realities to see what more we can do to make a difference for Canadians and for Canadian families,” Morneau said. “We will look at the economic situation in order to figure out what we should be doing, not only in November but in our upcoming budget.” Morneau also said that with growth a “little lower” than forecast, he believes the government made the right decision last spring when it added a layer of prudence to its fiscal outlook. In the March budget, the government included a larger-than-usual risk adjustment of $6-billion per year to an outlook that predicted a $29.4-billion deficit this year.