Federal budget | Teeth or R&D?

For some observers, the measures proposed by the Minister of Finance, Chrystia Freeland, in her recent budget have spared us the anticipated cataclysm. The Liberals’ propensity to overtax and spend, juxtaposed with the many commitments enshrined in their election platform last fall, raised fears of the worst. And, as if that weren’t enough, the left was gaining even more prominence following the agreement reached between the Liberals and the New Democrats to keep Justin Trudeau in power.

The English have a phrase that perfectly sums up the Liberal approach to budgeting – spray and pray (spray and pray). The number of new programs is astonishing each time, as is the contrast between those geared towards the economy and the others. Programs supporting economic growth or assistance to businesses too often remain imprecise or require “consultations” with “experts” before the sums are disbursed.

This is rarely the case with other programs. I could cite as an example the new dental insurance plan. The terms and conditions, clear and limpid, reassure parents that everything will be in place for the next visit of their children to the dentists this summer.

Lack of details disappoints

A reading of some of the new measures affecting business support leads to the conclusion that the proposed investments will not materialize soon – and most certainly not in 2022. This is the case with the Canada growth fund into which the government will inject 15 billions of dollars to mainly propel the new economy – especially the climate transition. The sum impresses, but the absence of details disappoints, as does the omission of links with other already existing programs.

A bit like an orchestra playing without a conductor – we hear the sounds, but we don’t recognize the music.

Moreover, since the fund will operate as an independent entity, the government will have to recruit qualified personnel in a more unfavorable employment context, especially in a specialized sector such as that of the investment fund.

The creation of a new innovation and investment agency – which will also deal remotely with the government – ​​is frankly breathtaking. Its budget ($1 billion over five years) is modest when you realize that Canada ranks dead last in the G7 for investment in research and development. But why create an “independent federal agency”? The last 30 federal budgets have probably devoted dozens of pages to research and innovation. The federal machine had to consult every expert on the planet.

The government must not absolve itself of the importance of making choices in R&D. As with the Canada fund, the insane amount of time that the federal apparatus will lose finding the management team to manage this agency discourages me .

And if the independence of this agency and that of the Canada fund were essential, why not combine them? The trades are a bit different, but there is no reason to build two separate infrastructures.

A return on military investment

I wholeheartedly applaud the decision to increase our military spending to $8 billion over five years. The naive left, which has too often immobilized our elected officials on this subject, takes note that a daisy and Give peace a chance of John Lennon on a loop will not be enough to deter tyrants like Vladimir Putin. However, this measure must translate into gains for Canadian companies in the aerospace and defense sector.

Although Canadian companies have nothing to envy their foreign peers, the Department of Defense has always had a bias towards American suppliers. It was true when I was in Ottawa and the heavy trend remains. Several other countries do not hesitate to allow their companies to benefit from expenditures of a military nature. They see them – with good reason – as sound economic development policy. The Americans, of course – but the British, Italians and French too.

Canada is the boy scout of the bunch – our civil servants prefer to hold processes that are very broad and disconnected from Canadian economic reality and elected officials are reluctant to call them to order.

I have the same concerns with Ottawa’s recent decision to enter into exclusive talks with Lockheed Martin for the acquisition of 88 F-35 fighter aircraft. The envelope devoted to this purchase ($19 billion) must absolutely guarantee thousands of jobs in Canada. The government has performance obligations vis-à-vis the Canadian aerospace industry.

I will not accuse the government of underspending on the promotion of the economy. I am especially critical of the lack of rigor – a diffuse rather than surgical effort. As if this element of budget planning matters less than the oral health of Canadians.