A Liberal mini-budget that promised a bulky $39-billion in tax cuts and spending is a thinly veiled election platform and its proposals aren't good enough to keep the government in power, the opposition parties said after its release.
They see the government's plan to reduce Canadians' taxes, particularly a proposed $30-billion reduction in personal income taxes and proposing cutting the lowest income tax bracket to 15 per cent from 16 per cent that they have proposed, as nothing more than pre-election manoeuvring.
After Finance Minister Ralph Goodale presented Monday's economic update to the Commons finance committee, the Conservative Party's Monte Solberg said that the so-called update was in fact an election platform and asked what guarantee the federal government could provide that it would not erase the promised tax cuts if it is re-elected.
“If you are elected again as the government, you end up in a minority situation, what assurance do we have that you wouldn't bargain away those tax cuts again, bargain away a higher standard of living just to save the hide of the Liberal party?” Mr. Solberg asked, referring to a deal made last spring between the NDP and the Liberals in which the Liberals agreed to cut corporate taxes in exchange for New Democrat's support of the minority government in the House of Commons.
“As I've indicated to the committee, what's being discussed today is not a budget. It is in fact the update which lays out all of the relevant fiscal and economic information and the plan for growth and prosperity that in a responsible way and I have that responsibility as Minister of Finance,” Mr. Goodale responded.
But the Liberals may not have a chance to see that plan to fruition.
Their minority government is teetering on the edge of survival. On Monday, Prime Minister Paul Martin rejected a united opposition request to call an election for early January for a vote in February. He said he could not abide by a proposal put forward after the weekend by the NDP, Conservatives and Bloc Québécois that would force a February election, calling it ”untenable.” They say if Mr. Martin does not call one, they will bring about a no-confidence motion this week that will cause the government to topple and put a federal election campaign smack in the middle of Christmas.
Opposition Leader Stephen Harper said Monday the Prime Minister has lost ”the moral authority to run this country” and that neither he nor the other opposition parties would back down.
After the fiscal update was released Monday, the Tories and the Bloc Québécois also accused the Liberals of using the flurry of promises in the mini-budget to take attention away from Mr. Justice John Gomery's damning report on the sponsorship scandal.
Bloc finance committee member Yvan Loubier said the Liberals are using the mini-budget as ”an attempt to pull the wool over Canadians' eyes.”
The opposition also said it was that the Liberals had changed gears on what is normally a fiscal update that provides a short list of the government's plans to a document similar to a full-blown budget.
“While Mr. Goodale said that this isn't a budget ... it includes a number of personal income from tax reductions and corporate tax reductions. I've rarely seen such an economic update with so many budget measures. This smacks of a budget so why not call it what it is. Call a spade a spade.”
The NDP pointed out that the average economic update is about 100 pages and Monday's document weighed in at 227 pages.
Finance critic Judy Wasylycia-Leis argued that because Mr. Goodale has said the mini-budget has requires legislation and requires changes to the tax system it cannot be called a typical economic update.
“If it's not a budget it must be a Liberal election platform,” she said.
Mr. Goodale denied that is the case, saying it is simply the government's fiscal framework.
Interest groups also weighed in after Mr. Goodale released the document. The right-leaning National Citizens Coalition said the announced tax cuts today have more to do with politics than the nation's finances.
”Are the Liberals really sincere about cutting taxes, or are they merely trying to bribe voters before an election?” asks NCC vice president Gerry Nicholls.