The Canadian federal budget for fiscal year 1990–1991 was presented to the
House of Commons of Canada by finance minister
Michael Wilson on 20 February 1990. It was the second budget after the
1988 Canadian federal election.
Taxes
The 1990 budget did not introduce a major tax change, as income taxes were reformed in prior years and the
Goods and Service tax was scheduled for implementation on January 1, 1991.
Although not part of the 1990 budget, three major tax changes are implemented as of January 1, 1991:
* The individual surtax on high-income is increased to 5% of federal taxes in excess of $12,500 (instead of 3% of taxes owed over $15,000);
* The ''Large Corporation Tax'' introduced in April 1989 is increased to 0.2% of taxable capital over $10 million (instead of 0.175%);
* A new ''Refundable Goods and Services Tax Credit'' of $190 per adult replaces the ''Refundable Sales Tax Credit''.
Expenditures
Expenditure Control Plan
The 1990 budget sets out a control plan for expenditures and was predicted to yield $2.8 billion in savings in fiscal year 1990-91 and $3.3 billion in fiscal year 1991-92. This control plan complements the expenditure reductions of December 1989. Most government transfers to individuals, including old age pensions, child allowances, veterans' benefits and unemployment insurance, were not included.
5%-growth
Some programs were constrained to a 5%-annual growth until 1992:
* Science and Technology (National Research Council, Canada's space program, Scholarships...);
* Department of Indian Affairs and Northern Development;
* ''
Canada Assistance Plan
The Canada Assistance Plan (CAP) (french: Régime d'assistance publique du Canada) was a financing program created in 1966 by the Pearson government. The CAP consisted of a cost-sharing arrangement between the federal government and provinces, te ...
'' (CAP, a cost-sharing program consisting of transfers to province for social assistance programs);
* Defence spending;
* Foreign aid
Programs frozen until 1992
Some programs are frozen altogether:
* ''
Established Programs Financing
The Established Programs Financing (EPF) (french: Financement des programmes établis) was a financing program created by the 20th Canadian Ministry, Trudeau government in 1977, to finance the provinces of Canada, provincially-run healthcare in Ca ...
'' (EPF, transfers to provinces for health and post-secondary education);
* Funding to the
CBC for acquisition of capital equipment. Previously-announced increases are cancelled;
*
Telefilm Canada
Telefilm Canada is a Crown corporation reporting to Canada's federal government through the Minister of Canadian Heritage. Headquartered in Montreal, Telefilm provides services to the Canadian audiovisual industry with four regional offices in ...
;
*
Export Development Corporation;
*
Marine Atlantic
Marine Atlantic Inc. (french: Marine Atlantique) is an independent Canadian federal Crown corporation which is mandated to operate ferry services between the provinces of Newfoundland and Labrador and Nova Scotia.
Marine Atlantic's corporate he ...
(ferry services in Atlantic Canada).
Budget cuts
* Secretary of State and Multiculturalism and Citizenship;
*
National Health and Welfare;
* Social Housing (through the
Canada Mortgage and Housing Corporation
Canada Mortgage and Housing Corporation (CMHC) (french: Société canadienne d'hypothèques et de logement) (SCHL) is Canada's national housing agency, and state-owned mortgage insurer. It was originally established after World War II, to help re ...
).
Programs Eliminated
* Incentives for exploration of natural resources provided by the ''Canadian Exploration Incentives Program'' (CEIP) are eliminated after February 19, 1990. The CEIP was introduced in 1988 to help resource companies raise capital following the
market crash of 1987.
* The OSLO Project of development of oil sands in Northeastern Alberta;
* The
Polar 8 Project.
Reactions
Opposition
Herb Gray
Herbert Eser Gray (May 25, 1931 – April 21, 2014) was a Canadian lawyer who became a prominent federal politician. He was a Liberal member of parliament for the Windsor area over the course of four decades, from 1962 to 2002, making Gray o ...
, interim leader of the
Official Opposition, rejected many features of the budget, notably the cuts to transfers to provinces and capping of research and science budget.
Paul Martin
Paul Edgar Philippe Martin (born August 28, 1938), also known as Paul Martin Jr., is a Canadian lawyer and politician who served as the 21st prime minister of Canada and the leader of the Liberal Party of Canada from 2003 to 2006.
The son o ...
, Liberal MP and candidate to the leadership of the
Liberal Party
The Liberal Party is any of many political parties around the world. The meaning of ''liberal'' varies around the world, ranging from liberal conservatism on the right to social liberalism on the left.
__TOC__ Active liberal parties
This is a li ...
, also rejected the budget as a symbol of the Conservatives' mismanagement of the economy.
Audrey McLaughlin
Audrey Marlene McLaughlin (née Brown; born November 8, 1936) is a Canadian politician and former leader of the New Democratic Party from 1989 to 1995. She was the first female leader of a political party with representation in the House of Co ...
, leader of the
New Democratic Party held that the budget would not help students or homeless people and decried the lack of environmental measures, despite prior ambitious declarations made by the Prime Minister
Brian Mulroney and the
Minister of Environment Lucien Bouchard
Lucien Bouchard (; born December 22, 1938) is a Canadian lawyer, diplomat and retired politician.
Minister for two years in the Mulroney cabinet, Bouchard then led the emerging Bloc Québécois and became Leader of the Opposition in the Ho ...
.
Provinces
The budget is characterized by
Gérard D. Levesque
Gérard D. Levesque (May 2, 1926 – November 17, 1993) was a longtime Quebec politician and Cabinet minister, who twice served as interim leader of the Quebec Liberal Party.
Levesque was first elected to what is now called the Quebec Na ...
, Quebec's finance minister, as a smokescreen and an unfair budget. He particularly criticizes the cuts to
EPF as a tentative to download the federal deficit onto the provinces and the abolition of the ''Canadian Exploration Incentives Program'' that benefited mine exploration in Quebec rural areas (and especially
Abitibi). The minister warns that the federal budget will likely lead tax increases for Quebec taxpayers to offset the downfall in revenues.
External links
Budget SpeechBudget PlanBudget in Brief
References
{{Canada federal budget
Canadian budgets
1990 in Canadian law
1990 government budgets
1990 in Canadian politics