Finance Minister Jim Flaherty delivered the Federal Budget on Thursday. The seventh budget since Stephen Harper took office, this year’s 500-page budget document promises to trim $5.2 billion in annual federal spending. Among some of the key points delivered on March 29:

  • The government will stop producing the penny. “We will eliminate the penny. Pennies take up too much space on our dressers at home. They take up far too much time for small businesses trying to grow and create jobs. It costs taxpayers a penny-and-a-half every time we make one. We will, therefore, stop making them,” said Flaherty.
  • Raise the age of eligibility for old age security and the guaranteed income supplement to gradually move to 67 from 65, beginning in 2023. “The Old Age Security program was designed for a much different demographic future than Canada faces today. In the 1970s there were seven workers for every one person over the age of 65. In 20 years there will be only two. In 1970 life expectancy was age 69 for men and 76 for women. Today it is 79 for men and 83 for women. At the same time, Canada’s birth rate is falling,” Flaherty said.
  • Eligible Canadians will be able to defer old age security for a maximum of five years, beginning in 2013, in exchange for higher benefits.
  • 19,200 federal public sector positions (4.8 percent of the federal workforce) to be eliminated in the next three years
  • Nearly $130 million in fees will be returned to nearly 300,000 would-be Canadian immigrants to eliminate backlog in skilled-worker applications
  • A cap on annual increases to employment insurance premiums will be in place until operating budget is balanced
  • Canadian Coast Guard to get $5.2 billion over the next ten years to renew boats and helicopters
  • $1.1 billion in research and development over five years, plus $500 million to encourage private-sector venture capital investments
  • Over two years, $482 million will be put into the employment insurance system, including incentive programs for accepting work
  • Duty-free cross-border shopping limits to increase to $200 for 24-hour trips and $800 for trips of 48 hours or more
  • CBC funding to be cut by 10 percent over three years. An annual $60 million programming top-up will be rolled into base funding
  • The Governor General will begin to pay income taxes, starting in 2013
  • Canada will continue with the International Space Station mission through 2020
  • First Nations reserves will receive $275 million over three years for schools and education and  $330.8 million over two years to improve water systems and water quality

Canada’s full 2012 Budget can be read online.

What’s your reaction to the budget? Share your thoughts by leaving a comment below.

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