Canada column for Sunday, April 17/16
THE CANADIAN REPORT
(c) By Jim Fox
The Liberal government’s spending plans are already proving to be a boost for the Canadian economy.
The Bank of Canada kept its trend-setting interest rate unchanged at 0.5 percent while predicting economic growth as shown by the gross domestic product to rise by 1.7 percent this year, up 0.3 percent from an earlier prediction.The central bank noted this was due to Prime Minister Justin Trudeau’s government deciding to invest $25 billion in additional spending over the next two years for such things as infrastructure projects.
The spending was included in the recent federal budget that projected a deficit of $110 billion over five years while the previous Conservative government was reducing spending to avoid going into the red.
“The mix of policies that we have today is a more favorable one for economic growth than what we had before," bank Governor Stephen Poloz said.
Spending by the government is helping to counter lower oil prices affecting the Canadian economy’s commodity-abundant provinces.
The dollar dropped from a seven-month high topping 78 cents U.S. with news of the key interest rate remaining steady and lower oil and gold prices.
The Alberta government is looking at $58 billion in debt over three years as the oil-rich province is dragged down by low commodity prices.
Things are so bad that Finance Minister Joe Ceci said there is no expectation of balancing the books before 2024.
The budget includes two new tax credits worth $250 million and cutting the small business tax to 2 percent from 3 percent to encourage investment and capital spending.
Alberta will launch a carbon tax that will cost households about $500 a year by 2018 as gasoline rises by 4.5 cents a liter (17 cents a U.S. gallon) next January. There will also be increases in home heating bills, excluding electricity.
News in brief:
- Three senators have repaid expense claims that were called “unjustified.” Liberal senator Colin Kenny paid back about $31,400 in expenses for trips and overnight stays. Conservative senators Jean-Guy Dagenais and David Tkachuk returned almost $2,300 and $1,900, respectively. There are still 12 senators being investigated for claims totaling $622,000.
- Police in Hallandale Beach, Fla. are hopeful that a new type of genetic profiling will help them find the killers of David Pichosky, 72, and Rochelle Wise, 66, of Toronto. They were found asphyxiated inside their winter home in 2013. Police Chief Dwayne Flournoy said DNA evidence was found from two women believed responsible. DNA phenotyping has allowed them to develop a composite sketch of one of the two women who stole a diamond ring from the home, he said.
Facts and figures:
Canada’s dollar returns 77.61 cents U.S. while the U.S. dollar is worth $1.288 in Canadian funds, before bank exchange fees.
The Bank of Canada’s key interest rate is steady at 0.5 percent while the prime-lending rate is 2.7 percent.
Markets are higher, with the Toronto Stock Exchange index at 13,627 points and the TSX Venture index 627 points.
The average price for gas nationally is higher at $1.012 cents a liter or $3.84 (Canadian) for a U.S. gallon.
Lotto 6/49: (April 13) 10, 14, 23, 41, 42 and 47; bonus 1. (April 9) 12, 29, 34, 44, 47 and 49; bonus 37. Lotto Max: (April 8) 9, 12, 13, 14, 28, 39 and 41; bonus 38.
- Senator Jacques Demers is showing improvement daily at McGill University Health Center in Montreal, doctors say. Demers, 71, coached the National Hockey League’s Montreal Canadiens to the 1993 Stanley Cup victory. “Every day he is brighter and looking better,” said neurologist Dr. Angela Genge. He also coached the Tampa Bay Lightning, Quebec Nordiques, St. Louis Blues and the Detroit Red Wings.
- The New Brunswick government is offering free tuition beginning in the fall for full-time university and college students in households earning less than $60,000 a year. “This is the beginning. We’re going to be looking for other ways to try and help ensure that university is accessible and affordable,” Premier Brian Gallant said. About one student in four will qualify for the financial aid.
Jim Fox can be reached at email@example.com