Finance Minister Jim Flaherty delivered his fall economic update in Edmonton yesterday, and faced a grilling inquiry by none other than the Conservative chair of the Finance Committee, James Rajotte. Ooh. Flaherty said that there will be a healthy surplus by 2015, paid for by frozen spending (aka de facto cuts when you factor in inflation), and asset sales that haven’t yet happened (which is one-time income, and not sustainable). Any future pay increases for public servants have to come out of those same frozen department budgets as well, which further limits any increases. As you can imagine, it went over like a lead balloon with the opposition. Flaherty also confirmed that he does plan to run again in 2015, despite his health challenges – for what it’s worth. Economist Stephen Gordon has a hard time seeing how the cuts will replace sluggish revenue growth, and remains sceptical about the projections. Former Parliamentary Budget Officer Kevin Page gives his read of the update, and sees a whole lot of missing information.
Tag Archives: Jim Flaherty
Roundup: The tale of the second cheque
Boom! The ClusterDuff exploded yet again yesterday, with yet more revelations from Senator Mike Duffy, who took advantage of what could be his final days of the protection of parliamentary privilege, and laid out yet more accusations against the PMO. This after a morning where Stephen Harper took to the radio waves and declared that Nigel Wright had been fired, in direct contradiction to all previous assertions that Wright resigned. So while the Commons fixated on this contradiction, Senator Duffy took the floor in the Senate, and detonated his next bomb – that there was not one cheque, but two, and that the talk of an RBC loan was actually a script from the PMO that he had been made to deliver. That second cheque was from the Conservative party lawyer, Arthur Hamilton, which paid for Duffy’s legal fees – and this time, he provided documents to prove it. The party doesn’t deny covering the legal expenses, saying that they will sometimes pay the legal fees of their caucus members. This is likely an indication, according to John Geddes, that the party was still keen to defend him and by extension their decision to appoint him as a PEI senator, with their particular reading of those rules. While Duffy contended that there remains a whole other email chain in the hands of his lawyers that he wants to see turned over to the RCMP, though an envelope was later handed to the CBC which appeared to cast some doubt as to Duffy’s version of events – or at the very least was a good trial run as to his scripting around where the money came from. If there is one bright side to all of this it’s the level of engagement that the public is demonstrating, and the fact that senators are pointing to the number of emails they are receiving from people who want to see due process – and one senator that I spoke with this afternoon brought this up without prompting. And while these senators have zero sympathy for their three embattled peers, they at least want to ensure that there is process followed.
Roundup: Flaherty’s national regulator, take two
While the attempt to eliminate interprovincial trade barriers has been on the government’s agenda since 1867 (no, seriously), Jim Flaherty took yet another stab at creating a national securities regulator – despite being shut down by the Supreme Court the last time. This time, however, he’s not imposing a system from Ottawa – he’s working with provinces to create a “cooperative capital markets regulatory system,” that ensures that each level of government give up their own powers to this new body, and he’s got Ontario and BC signed on, meaning it has oversight over some 90 percent of industry in the country already. While most other provinces will likely come aboard in short order, Quebec and Alberta remain opposed for the time being. It will likely be discussed further this weekend at a federal-provincial finance ministers’ meeting. John Geddes looks at Flaherty’s journey to this point, while economist Stephen Gordon points out that our patchwork of regulations may not be our biggest problem – but a national regulator can’t hurt.
Roundup: Visits to the Langevin Block
Yesterday in Senate-related news, the visitor logs of the Langevin Block – which houses the PMO – shows the dates of visits by Senators Mike Duffy, David Tkachuk and Irving Gerstein in the days around the news of Duffy’s audit, and leading up to the $90,000 cheque from Nigel Wright. It helps to further establish the timeline of who met with whom, as the investigation continues. Elsewhere, the Auditor General met with the Internal Economy committee and its audit subcommittee to discuss his forthcoming audit of the institution and its membership. The AG said that the audit will be “comprehensive,” but people shouldn’t think that it means “forensic,” because that’s not what his office does, and they don’t have the staff or expertise to do those kinds of audits. (That’s in large part why they get contracted out to Deloitte). The Internal Economy committee is also looking at an overhaul of the Senate communications office, which has shown itself to be unable to handle the increase in media requests given recent events, and their mandate is nebulous with too many masters. Fortunately, there seems to be an appetite to change this.
Roundup: Economic Action duds
Survey data shows that the Economic Action Plan™ ads are getting little traction with the public. In fact, of a sample size of 2003 Canadians, only three of them actually visited the website. And yet, the government was paying hundreds of thousands of dollars to show these ads during the hockey play-offs – which totally seems like an efficient use of tax dollars, and an important way of getting messages across to the public. Shall we also go back to the tautology about them being necessary to show consumer confidence?
Roundup: PR disasters and denials
The president of Montreal, Maine and Atlantic Railway visited Lac-Mégantic yesterday, but managed to strike all of the wrong tones in his delivery, giving a performance that mystified public relations experts. Meanwhile, Thomas Mulcair insists that he didn’t link the Lac-Mégantic explosion with budget cuts – and yet there’s video with him saying it. Huh. Andrew Coyne warns against those – including Mulcair – seeking to use the disaster to further their own agendas.
Liberal MP Scott Brison says that the weak labour market and high youth unemployment is “scarring” both those youths and their parents.
Roundup: Exit Ted Menzies, eventually
Minister of State for Finance Ted Menzies has announced that he won’t be running in 2015, and has taken him out of the running in the upcoming cabinet shuffle. With Vic Toews’ resignation said to be imminent (and I’ve heard this from caucus sources), this is likely the first of a number of such announcements to be made in the coming couple of weeks. It remains to be speculated if Menzies decision is a genuine desire to move on, of if this isn’t a face-saving exit with political capital intact if he was told that he wasn’t getting back in. Nevertheless, this fuels the shuffle speculation fire in the coming weeks.
Roundup: Distancing themselves from Duffy
After a powerful QP in the House yesterday, it was an equally exciting evening in the Senate – in particular, the Board of Internal Economy, which was opened to the public for the first time. And it was amazing. While Senate QP was focused on Senator Tkachuk, who was badgered incessantly about his decision to go easy on Senator Mike Duffy in the audit report because he had paid back his expenses (though they didn’t know at the time that it was with funds from Nigel Wright), Tkachuk nevertheless took the chair at the committee. But while there was an expectation that the Conservatives might try to defend or justify their actions, it was almost the opposite. In fact, the Conservatives on that committee, most especially Senators Claude Carignan and Elizabeth Marshall – the Whip and a former Auditor General in Newfoundland – were systematically tearing down all of the various excuses that Duffy had made previously about how it was a temporary assistant who filed improper per diem claims and so on. In fact, the whole committee meeting opened with the Senate Clerk and the financial officers describing that once they started looking at Duffy’s per diem claims, there was a systematic pattern of his claiming per diems for days when he was not in Ottawa and not on Senate business. (It should be noted that the audit didn’t pick this up because it was looking at Duffy’s residence claims, and was checking whether he was in Ottawa or PEI, but when the media began looking at the dates in the audit as compared to campaign claims and other business, this pattern emerged). In fact, the pattern that also emerged was one where Duffy was not only claiming Senate expenses when he was campaigning – which is clearly against the rules – he was also being paid by the campaigns for his appearances, which is clearly “double dipping.”
Roundup: On being anti-trade and avoiding another round of austerity
Economist Stephen Gordon has taken a second look at the budget, and declares that with higher tariffs on more countries, and tighter restrictions on foreign investment in Canada, the government is really more anti-trade than it lets on. He also calls out the logic about how the “preferential tariff” was some kind of a subsidy if its elimination means Canadian taxpayers end up paying more. Over in Hong Kong, Jim Flaherty says that the issue of the increased tariffs have not yet been raised, but closer to home, his plan to return to the issue of a single national securities regulator is still not getting a lot of traction from the more recalcitrant provinces. The NDP, meanwhile, have decided to call in the RCMP about the budget “leaks” that appeared in the media in the lead-up as part of the government communications strategy.
Roundup: Happy Budget Day, everybody!
It’s Budget Day, everyone! And in what looks to be an otherwise stay-the-course budget, it appears that the big shiny object is going to be…cheaper hockey equipment. Because that matters more than anything else, and Stephen Harper must solidify his credentials as the Hockeyest Prime Minister in the history of ever! Okay, so it’s actually lowering one specific tariff, but still. Meanwhile, Les Whittington gives the five myths of Conservatives budget making. Scott Brison finds a “leaked” copy of Flaherty’s budget speech.
MPs of all stripes – including a few Conservatives – were criticising Flaherty’s move in calling Manulife Financial to stave off a mortgage war. More surprisingly is that one of his own cabinet colleagues, Maxime Bernier, was publically critical. It remains to be seen if this will be treated as a case of “Mad Max” being a maverick, or if this is a breach of cabinet solidarity, Bernier not being a “team player,” and he’ll be bounced out of cabinet – yet again. Andrew Coyne finds the irony in Flaherty lecturing people about taking on too much debt considering how much he added to the national debt.