Friday April 6, 2018
Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Friday April 6, 2018
Federal infrastructure plan behind schedule: PBO
The Parliamentary Budget Officer says federal infrastructure spending created up to 11,000 new jobs over the past year and added 0.1 per cent to Canada’s GDP, falling short of Liberal government projections as the program falls behind schedule.
Parliamentary Budget Officer Jean-Denis Fréchette also cautions that rising interest rates are starting to offset the positive economic effects of infrastructure spending.
The PBO released a report Thursday that examines the impact of what the Liberal government calls its first phase of infrastructure spending. The plan was announced in the 2016 budget and initially promised about $12-billion over five years for projects that are primarily focused on repairs of existing assets. The PBO report looks at how spending from that budget – and top-ups announced in the 2016 fall update – will be spread over nine years, bringing the total to $14.4-billion.
In an interview, Mr. Fréchette said the amount of economic stimulus and employment created from the first phase of spending is relatively modest when compared with the promises made by the Liberals.
Thursday’s PBO report said phase 1 infrastructure spending added 0.1 per cent to Canada’s GDP in the 2016-17 fiscal year and 0.1 per cent in the fiscal year that ends March 31.
The 2016 budget included estimates from the Department of Finance that the announced infrastructure spending would boost Canada’s GDP by 0.2 per cent in the first year and 0.4 per cent in the second year.
That hasn’t happened, Mr. Fréchette notes. (Source: Globe & Mail)