Search site Search ticker symbol

Are you looking for a stock?

Try one of these

Focus on deficits, Flaherty tells provinces

FLAHERTY
A
A
 

Federal Finance Minister Jim Flaherty was set to tell his provincial counterparts on Monday that eliminating budget deficits is his biggest concern following the economic crisis.

Economic uncertainty is also behind his government's contention that now is not the time to heap more costs on employers by expanding the country's public pension plan, Flaherty said before heading into a meeting of finance ministers from across Canada.

"We were well prepared for the recession because we were paying down debt and running balanced budgets in Canada," Flaherty told reporters.

"We need to get back on that track again and stay on the track so that Canada preserves its competitive advantage."

Flaherty and provincial finance ministers are meeting in the Rocky Mountain resort of Kananaskis, Alberta, to discuss the economic and fiscal outlook as well as pension reform, which is an area of shared responsibility.

He said stimulus measures taken by his government helped the provinces weather the economic crisis and now governments at both levels need to cut the deficits that fueled the programs.

Canada's 2009-10 deficit totaled $55.6 billion, or 3.6 percent of gross domestic product. Ottawa aims to shrink that to $45.4 billion in 2010-11 and return to surplus in 2015-16.

Most of the provinces expect to have deficits of their own in the 2010-11 fiscal year.

Ontario, the country's most populous province, has the biggest shortfall at an estimated $18.7 billion this year. The Ontario government officially plans to balance its books by 2017-18 but could reach that goal sooner if the economy delivers solid growth, Ontario Finance Minister Dwight Duncan told Reuters earlier this month.

On Sunday, Ontario and five other provinces urged Flaherty to keep a small enhancement to the Canada Pension Plan on the table as part of a package of ways to improve the retirement system, an issue that has jumped to the fore.

However, Flaherty has said that is unlikely to happen until a review of the system scheduled for 2012. Meanwhile, there is no consensus among the governments on what moves to make.

Economic uncertainty is also making him wary, he said.

"Several of us are concerned ... that right now is probably not a good time to impose any more burdens on employers in Canada because the economic recovery is fragile," he said. "We want to continue to create jobs in Canada."

Ottawa has proposed a new retirement savings plan for the self-employed and small-business employers that would be run by the private sector.

CTV.ca CTV Two CTV News CTV News Channel BNN - Business News Network CP24