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Speech from the Throne: Ambitious but Vague

There is a lot for progressives to like in the Speech from the Throne – promises of major new federal investments in child care, health care, including pharmacare, green jobs, affordable housing, training, the future of first nations, and so on. But experience tells us that we should wait until the next budget before breaking out the bubbly.

Liberal governments are very good at promises, and they seem to have heeded calls to be bold. But we have seen many of these promises many times, not least the promise to build a national early learning and child care program which dates back to the election of the Chretien government back in 1992, almost thirty years ago.

The Speech, as expected, outlines an immediate response to the pandemic which is very far from being over. One can argue that it seems to respond positively to immediate needs, while also noting that is taking far too much time to deal with the crisis in long term care homes which killed thousands of seniors last Spring.

We are now going into a second wave with little further clarity about what will replace the CERB income support program for many families still dealing with high unemployment and short hours. It looks as though some workers will not get into a revamped Employment Insurance program, and that benefits will be cut from the CERB level of $2000 per month. 

The pivot to building back better, to fixing the long-standing cracks in our social and income support programs revealed by the pandemic, is very much present in the speech. It outlines a broad reform agenda. But it says almost nothing about financing.

It is quite appropriate to run large deficits to deal with the health, social and employment impacts of the crisis and to fund new investments to replace lost jobs. But we cannot build a strong social safety net for the long term without a long term plan to raise the needed revenues.

Here the Speech disappoints. There is a reference to the need to “tax extreme wealth inequality” but that turns out to mean only fairer taxation of stock options (promised by the Liberals back in the election of 2016), rather than a wealth tax or closing down tax loopholes for the top 1% such as the low tax rate on capital gains.

Similarly, there is a call for limiting corporate tax avoidance, but this applies only to the digital giants (as promised before) and the government is talking about further cutting corporate tax rates as part of the job creation strategy.

And the social agenda cannot really be described as bold and comprehensive.  

Pharmacare is mentioned, but very much subject to finding willing provinces. The future of post secondary education is not mentioned. There is nothing on long-term income support reform. The call for a national early learning and child care program is there, but with few specifics and certainly no firm financial commitment.

Those who have called for a green jobs agenda led by the federal government will find some encouraging words, including commitments to building retrofits programs and production of zero emission vehicles.

The government is also making a commitment to greater equality for women in the job market, including through a new task force. And the speech addresses the need for programs to promote greater equality for racialized Canadians.

With only a minority government, the Liberals have tacked left. To what extent that turn translates into action will be revealed in the next  budget.

Andrew Jackson is the former Chief Economist of the Canadian Labour Congress and the Senior Policy Advisor to the Broadbent Institute.