Ottawa, ON – The Hon. Michael Chong, Conservative Shadow Minister for Finance, released the following statement on Mr. Carney’s lack of transparency on federal finances:
“Economists, the Parliamentary Budget Officer (PBO) and Conservatives continue to raise concerns about Prime Minister Carney’s lack of transparency on spending. The National Post reported today that he is spending $40 billion more of Canadians tax dollars than he projected in his Spring Economic Update without accounting for it.
“Former TD Bank Chief Economist and former Associate Deputy Minister of Finance Don Drummond said, ‘I’ve been involved in budgets since 1977, and I’ve never seen such a lack of transparency.’
“The PBO continues to warn the Carney government against abandoning longstanding definitions of capital and operational spending. Without clear definitions, the PBO cannot properly assess the government’s new fiscal anchor of balancing operational expenditures, raising questions about how the government is classifying billions of spending.
“The International Monetary Fund has called for the Liberals to adopt international accounting standards to ‘improve transparency, ensure comparability over time, and maintain a clear link between borrowing and the debt path.’
“This lack of transparency on spending is concerning because much of it is not budgeted for. Desjardins Deputy Chief Economist Randall Bartlett said Mr. Carney’s recent $40 billion in spending announcements goes beyond what was announced in April’s fiscal update.
“For every dollar Mark Carney spends that has not been budgeted for, a dollar must be borrowed, adding to the federal debt. One year ago, Fitch Ratings warned that a material rise in Canada’s deficits and debt-to-GDP could lead to a credit downgrade. More recently in November they warned that, ‘federal finances run a high risk of further deterioration.’
“This increase to deficits and debt is also generationally unfair. It saddles a younger generation of Canadians with debt, a generation already burdened with a stagnant economy, an unaffordable cost of living and out of reach housing prices.
“Mr. Carney has already doubled the projected deficits compared to Mr. Trudeau, from $31 billion forecast in Mr. Trudeau’s last Fall Economic Statement to $65 billion in April’s Spring Economic Update.
“By the end of the decade, interest on the federal debt is expected to reach $80 billion a year, or about $1,901 per Canadian every year, more than what the federal government spends on public healthcare.
“Mr. Carney’s recent spending announcements only add to these deficits and the national debt. The unaccounted for spending will also increase the already skyrocketing interest payments on the national debt, putting at risk the sustainability of federal finances and the social programs they pay for. “Conservatives call on Mr. Carney to respect the public purse and be transparent with federal finances – as previous governments have. Mr. Carney needs to provide Parliament, including the Parliamentary Budget Officer, details on all his unbudgeted spending.”