Analysis: Quebec is directly targeting voters’ wallets with a $500 budget gift

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The good health of Quebec’s finances gives the Minister of Finance, Éric Girard, a great deal of leeway to deploy more electoral gifts in the future.

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QUEBEC — Don’t ask Quebec’s finance minister, Éric Girard, to describe his vision of what could be called an election budget.

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“I can’t say because I’ve never done any,” Girard told reporters on Tuesday before tabling the 2022-2023 budget in the National Assembly.

In other words, in Girard’s mind, the budget he presented, his fourth and last before the general election in October, should not be seen as an exercise in vote buying.

Premier Francois Legault said he even ordered that the budget not be electoral, arguing that such a move has been attempted by other governments and would be an insult to the intelligence of voters.

Political realities and timing, however, seem to indicate otherwise. Minutes after Girard’s budget was released, each of the opposition parties called it grossly electoral and paternalistic.

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“Francois Legault is looking no further than October 3 (the date of the election),” said Liberal Finance Critic Carlos Leitão. “We might even label this budget ‘horizon: election’.”

But despite the accusations, Girard’s budget is not as overtly electoral as it could have been, even if it does fall back on a few simple but politically profitable ideas, the very ones that have maintained the level of satisfaction of the Coalition Avenir Québec government at a high level for four years. of his mandate.

At the top of the list is the single most important budget item: relief from the soaring cost of living felt by millions at the grocery store and at the gas pump.

Girard offers inflation relief in the form of a one-time tax credit of $500 per adult with an income of 0,000 or less.

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With a cost of 3.2 billion dollars for the Treasury, 6.4 million Quebecers (out of a total of 7 million adults) in this income bracket will be eligible. Persons excluded from filing taxes, such as prisoners and foreign nationals, are not eligible.

There was a heated debate Tuesday about when the money would actually get into the hands of Quebecers.

While the tax credit will automatically be added to 2021 tax returns, the opposition suspects it will take weeks for bureaucrats to withdraw the money, meaning the transfer could come closer to Election Day after all.

But the surprisingly healthy state of Quebec’s finances despite the pandemic is helping Girard’s credibility and it means he will have plenty of leeway to roll out more campaign giveaways in the future, closer to the actual date voters will be attentive.

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The economic recovery is so robust that Girard is revising its projected deficit for 2021-22 down from $12.3 billion to $7.4 billion. Instead of $8.5 billion for 2022-23, the new total is $6.5 billion.

The employment situation in Quebec has returned to pre-pandemic levels, with an unemployment rate of 4.5% in February. Quebec achieved economic growth of 6.3% in 2021 after a decline of 5.5% in 2020. In 2022, it should return to an almost normal rate of 2.7%.

Girard announced that Quebec’s revenues will correspond to its expenditures in 2023-2024, the deficit being solely due to the annual contribution it pays to its Generations Fund to fight against the debt.

Expenditure increases in all areas, including 5.4% in education and 6.3% in health.

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The healthcare increase, totaling $55.8 billion in 2022-23, is meant to cover the costs of soon-to-be-announced reforms to the ailing and, at times, dysfunctional healthcare system. Its many flaws were all too apparent during the pandemic when the government discovered that health units were still communicating by fax while understaffed hospitals and CHSLDs bent under the pressure of COVID-19 deaths.

There are also other amounts available: $1.1 billion for community action groups and organizations, another billion for the implementation of the Quebec Green Plan, $12 million to speed up the processing of applications of immigrants.

One group that will be disappointed with the budget are Dawson College students who hoped the infrastructure section of the budget would contain some relief for their overcrowding problem. The CAQ government canceled a planned expansion in February – and students arrived in Quebec City last week with a petition of 20,000 names calling for the decision to be reversed.

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The budget makes no specific mention of Dawson. Quebec recognizes that overcrowding is a problem in higher education in general and adds $232.5 million for space rental as a “temporary solution”.

However, the financial situation is sufficiently rosy for Girard to open the door to a possible tax cut in the future. Girard said such a cut would be “legitimate” in the future even if Quebec does not expect a return to balanced books before 2027-2028.

As for warnings of future financial problems, Girard reiterated that he wanted the books to be balanced as painlessly as possible.

“The path to a balanced budget has been set without any austerity,” Girard said.

True to form in his other three budgets, Girard hedged his bets, noting that we live in uncertain times, which could mean surprises down the line.

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“We don’t know how the pandemic may evolve, inflation is currently high and central banks are tightening monetary policy,” he said. “Added to this is the tense geopolitical context, marked by the Russian invasion of Ukraine.”

The dormant question remains inflation. Girard forecasts that the cost of living will increase by 4.7% in 2022, which is much higher than what he forecast last November (2.9%). He predicts that inflation will fall to 2.3% in 2023.

If there are any election messages to voters, it can be summed up simply: you are better off with the ruling CAQ than any opposition party because the government cares about your wallet.

Girard’s speech notes that under Legault’s “inspired leadership,” Quebec has “weathered the storm of two years of pandemic,” and the CAQ has more to offer for the future.

“When we look at the home stretch of the mandate that Quebecers have entrusted to us, we can congratulate ourselves on our fiscal solidity, the vigor of our economy and the significant sums that we have put back in the pockets of Quebecers,” said Girard. .

“Even if there is uncertainty, Quebecers will persevere.”

pauthier@postmedia.com

twitter.com/philipauthier

  1. Click here to learn more about the 2022 Quebec budget

  2. Gasoline was selling for $1.84.9 per liter in Montreal on March 3, 2022.

    Quebec Budget 2022: payment of $500 to 6.4 million Quebecers to counter inflation

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