Finance Minister Bill Morneau speaks during a press conference following meetings with provincial and territorial finance ministers in Ottawa on Tuesday, Dec. 17, 2019. The political war-of-words around the national economy took another turn on Sunday’s political talk shows as the federal finance minister warned Conservatives to stop warning of a looming recession. THE CANADIAN PRESS/Sean Kilpatrick

Finance Minister Bill Morneau speaks during a press conference following meetings with provincial and territorial finance ministers in Ottawa on Tuesday, Dec. 17, 2019. The political war-of-words around the national economy took another turn on Sunday’s political talk shows as the federal finance minister warned Conservatives to stop warning of a looming recession. THE CANADIAN PRESS/Sean Kilpatrick

Morneau takes shot at Tories over recession talk in wake of fiscal update

The Liberals’ election platform projected four years of deficits of more than $20 billion

The political war-of-words around the national economy took another turn on Sunday’s political talk shows as the federal finance minister warned Conservatives to cease claims of a looming recession.

Finance Minister Bill Morneau also suggested in separate broadcast interviews that the country’s economic track will have a bearing on how the Liberals steer their government’s budget in the coming years.

On CTV’s Question Period, Morneau warned his Conservative critics to avoid the “irresponsible” claims when private sector economists project growth, which the fiscal update estimated at 1.7 per cent this year and 1.6 per cent in 2020.

The projections would make Canada’s the second-fastest-growing economy among G7 countries, behind only the United States.

“I think it’s a little bit irresponsible of the Conservatives to be making people more anxious,” Morneau said in the CTV interview.

Conservatives claim the conditions are ripe for a “made-in-Canada” recession, fuelled by the Liberals’ spending policies, as the party’s finance critic, Pierre Poilievre, claimed last Monday in the wake of the fiscal update.

“I’m not saying there is (a recession), but if we head to a recession, it will be a made-in-Canada recession,” Poilievre told reporters at the time.

The technical definition of a recession is two consecutive quarters of economic contraction, but the scope of the declines makes a difference between adorning the label to the downturn of 2008 or the split to do so for the two quarters of declines measured in 2015.

READ MORE: Liberals’ fiscal update shows billions more in deficits this year and next

On Sunday, Morneau said the government wants to ensure continued growth, particularly after disappointing jobs numbers from November revealed the economy shed some 71,000 jobs.

“We need to play our hand cautiously, but I see the economy as strong and I see it as growing,” Morneau said on Question Period.

Morneau’s fiscal updates released Monday showed the Liberals’ projected deficit of $19.8 billion for this fiscal year will now be $26.6 billion, and next year it will be $28.1 billion before accounting for the Liberals’ election promises.

The Finance Department said the deeper deficit is largely driven by changes to how employee pensions and benefits are calculated — a hit that grows when interest rates are low, but could drop sharply when interest rates rise.

The Liberals’ election platform projected four years of deficits of more than $20 billion, including almost $27.4 billion in 2020-21.

Experts and the parliamentary budget officer suggested the government’s fiscal wiggle room had suddenly narrowed considerably, particularly if the economy slows down.

The budget officer suggested in its review of the fiscal update that the Liberals have run deficits between $18 billion and $28 billion, which may act as an “implicit fiscal anchor” for Morneau. The finance minister didn’t say how deep a federal deficit he would be comfortable seeing.

“The hypotheticals about what might or might not happen in the future are very dependent on where we go in the economy,” Morneau said on Global’s The West Block.

“We expect strong growth that will allow us to continue to make these investments.”

Morneau said in the interview that the Liberals planned to focus on maintaining the country’s triple-A credit rating, keeping that “fiscal firepower” as Trudeau has asked and making sure the national debt declines as a percentage of the overall economy.

He also said the Liberals would continue spending on things that matter to Canadians.

The Canadian Press


Like us on Facebook and follow us on Twitter.

Just Posted

Fraser Health registered nurse Kai Kayibadi draws a dose of the Pfizer COVID-19 vaccine into a syringe at a walk-up vaccination clinic at Bear Creek Park, in Surrey, B.C., on Monday, May 17, 2021. To reduce long lines and wait times the first 1,000 Surrey residents to arrive at the neighbourhood clinic on both Monday and Tuesday will receive wristbands and a same-day appointment. The effort is in addition to the provincial vaccination plan which is now open for bookings to anyone who is 18 years and older. THE CANADIAN PRESS/Darryl Dyck
69 new cases of COVID-19 reported in Interior Health

The province, in total, recorded 411 new cases showing a downtrend of new infections

Council has allocated funding in the 2021 budget to upgrade and restore this part of the Gartrell Trail named after Summerland pioneers Fred and Mary Gartrell. (John Arendt - Summerland Review)
COLUMN: Providing answers about Summerland’s Gartrell Trail

This 225-square-metre strip of land lies between the existing Gartrell Trail and the high water mark

WorkSafe BC is out in the Interior making sure wineries, cideries and breweries are adhering to COVID-19 safety protocols. (File photo)
WorkSafe visiting Interior wineries, cideries and breweries ahead of tourist tasting season

40 field inspections and 35 consultations are expected over next few weeks

B.C. RCMP released these two photos of Erick Fryer (left) and Carlo Fryer (right). The two brothers from Kamloops were found dead near a remote road in Naramata May 10, 2021. (RCMP photo)
Slain Kamloops brothers found near Penticton not likely connected to recent B.C. gang wars: RCMP

Police confirm the bodies found near Naramata as Erick Fryer, 29, and Carlo Fryer, 31

Send your letter to the editor via email to news@summerlandreview.com. Please included your first and last name, address, and phone number.
LETTER: Summerland’s lakeshore land should be protected

There is an opportunity to restore this important lakeshore habitat for fish and wildlife

A prowling coyote proved no match for a stray black cat who chased it out of a Port Moody parking lot Friday, May 14. (Twitter/Screen grab)
VIDEO: Little but fierce: Cat spotted chasing off coyote by Port Moody police

The black cat is seen jumping out from under a parked car and running the wild animal out of a vacant lot

A forest of dance-protesters outside the BC Legislature on April 11. These participants were doing the Dance for the Ancient Forest in support of the Fairy Creek blockade and against old-growth logging. (Zoë Ducklow/News Staff)
Arrests begin at Fairy Creek blockade on Vancouver Island

Five protesters arrested as RCMP begin to enforce injunction

A thunderstorm pictured in Fraser Valley in 2021. (Black Press Media/Jaimie Grafstrom)
Wildfire concerns sparked after 320+ lightning strikes blasted B.C. yesterday

Approximately one-quarter of the province is currently listed as being at moderate risk of fire

Coldstream Fire Department was quick to arrive and knock down a fire Sunday, May 16, in a Matner Lane orchard just up the hill from the firehall on Aberdeen Road. (Jennifer Smith - Morning Star)
Coldstream fire crews quick to knock down blaze

Fire broke out just before 2:30 p.m. on Matner Lane, which is just up the hill from the firehall on Aberdeen Road

Several RCMP cruisers stationed out front of Kelowna’s Global Fitness following a shooting on the morning of Monday, March 29. The shooting was later revealed to be gang-related. (Michael Rodriguez/Capital News)
B.C.’s top gangs are operating in Kelowna: RCMP

‘We have all of the major gangs in Kelowna,’ said Supt. Kara Triance

Crews battled a grass fire behind the Tolko mill along the railway tracks off Otter Lake Cross Road in Spallumcheen Monday, April 26. (Caitlin Clow - Morning Star file)
Reports of man lighting Vernon fires with blowtorch

Grassfires sparked near train tracks, behind bottle depot

Kelowna RCMP precinct. (Michael Rodriguez/Capital News file)
Kelowna RCMP promotion process tainted with bias: federal judge

An officer was passed over for a promotion in 2015

A restaurant server on White Rock’s Marine Drive serves customers on a roadside patio. Indoor dining and recreational travel bans have been in effect since late March in B.C. (Peace Arch News)
B.C.’s COVID-19 infection rate falls to 411 cases Tuesday

360 people in hospital, up slightly, two more deaths

The Banff National Park entrance is shown in Banff, Alta., Tuesday, March 24, 2020. THE CANADIAN PRESS/Jeff McIntosh
Minister asks Canadians to camp carefully in national parks as season starts

Kitchen shelters in Banff National Park closed, trails on Vancouver Island will only be one-way

Most Read