Canadian economic recovery from pandemic not likely to begin until mid-2021

Feds vow to spend $100 billion in stimulus funding once pandemic is in check

The Trudeau Government is proposing $100 billion in new spending to help employers and employees weather the COVID-19 winter despite deficit projections of $382 billion.

Finance Minister Chrsytia Freeland handed down the federal government’s fall economic update on Monday, outlining a stimulus plan that includes measures to fight climate change and begin the framework of a federal child-care system. It is expected the bulk of the federal spending outlined in this budget will not begin until the pandemic is under control, likely in the latter half of 2021.

“We know what we must do to get through the dark months ahead,” said Freeland. “And we know what we must do to bring our economy roaring back once this pandemic is beaten.”

Freeland announced the government’s wage subsidy program would be boosted to 75 percent of an employee’s wage until March of next year, while the feds plan to spend $2.6 billion on home energy retrofit grants, with $3 billion going towards the planting of two billion trees. More money is earmarked for long-term care homes to beef up protections against COVID-19. The Federal Government is also committing to provide a top-up of $1,200 to low- and middle-income parents of children under the age of six in the Canada Child Benefit.

“Canadians are doing their part. It’s only right that we, in this house, do ours,” concluded Freeland. “By ensuring the economy that comes after this pandemic is more innovative, inclusive, and resilient than the one that preceded it.”

The government will run a deficit of about $382 billion, but the update from the House of Commons warned that a resurgence of the virus could cause that number to grow closer to $400 billion.