Budget 2012

[Remius]

......so whats happening to my pension now?

Your severance will stop growing sometime next year.  You'll be paying more into it thus less take home pay, and likely work 5 years more than you anticipated. 

 

[Edward Campbell]

Here, reproduced under the fair Dealing provisions of the Copyright Act from the Globe and Mail, ia one commentator's opinion the budget:

My emphasis added
http://www.theglobeandmail.com/news/politics/john-ibbitson/pm-delivers-his-vision-less-government-for-all/article2386614/

PM delivers his vision: Less government for all

JOHN IBBITSON

OTTAWA— From Friday's Globe and Mail
Published Thursday, Mar. 29, 2012

Stephen Harper is diminishing the federal government for a generation, not simply to eliminate the deficit, but to reshape Canadian politics.

He expects us to take more responsibility for our retirement; he expects environmentalists to get out of the way of the resource economy; he is shrinking what government does and how often it does it. He is forcing everyone from the CBC to the military to the regional development agencies to absorb cuts.

No longer fettered by minority parliaments or an economic crisis, Mr. Harper is giving us a government he thinks we deserve: less intrusive, less responsive, less expensive, less reliable, less, less, less.

Once we get used to this new reality, the Prime Minister believes, we will come to expect it. Whenever another political party comes to power, it will be able to tinker on the margins only. That’s why this is not simply a budget. This is transformation.

Do not be misled by those who say the Conservatives are cutting program spending by “only” $5.2-billion, or that a mere 19,200 jobs will be lost in the public service. Look around the country and the world. Try to find another government not on the brink of calamity that is eliminating its deficit without raising taxes by making itself seriously and permanently smaller.

Those who believe that Mr. Harper has long harboured a secret radical agenda are both wrong and right. Wrong because this budget continues to increase payments to the provinces. Health care, education, welfare – all these and more Ottawa continues to fund through provincial transfers.

But right because Mr. Harper has always had a certain idea of government at the federal level. It should avoid national programs. It should live within limited means. It should protect the border and keep the streets safe. It should encourage growth through low taxes and the fewest regulations possible. And that’s about all it should do.

Which is why this government aims to curtail – sorry, “streamline”– environmental reviews and bring down the hammer on environmental groups that it believes abuse their charitable status through political activism.

A government that frets about the safety and security of seniors is asking the next generation to wait till 67 to begin receiving Old Age Security.

A government that insists the budget can be balanced without corroding the services government provides plans to increase program spending by about 2 per cent annually, which inflation will eat up, all the way out to 2017.

This is not a progressive agenda for government. This is not the Canada of those who promote equity or social justice. This is how a genuinely conservative government governs.

Finance Minister Jim Flaherty, perhaps wary of the true import of his budget, himself played down its impact. Each department promises to absorb its losses through “operational efficiencies,” “reducing overhead costs,” and other feats of magic.

Nonsense. These departments will have to cut programs and trim services. Those who are being asked to do more with less will, in fact, do less with less.

Museums will increase admission fees, courts become more crowded. There are bound to be fewer inspections and less oversight. There will be less money for regional development or overseas aid. Embassies will get smaller; parks will close earlier.

The government insists much of this won’t happen, that smarter flowcharts or better software will make everything right.

Put it this way. Either you believe, as the budget promises, that VIA Rail will “pursue productivity improvements such as augmenting the performance of heating, ventilation and air-conditioning systems on board trains,” or you believe passenger cars will be colder in winter and hotter in summer.

What are we offered in exchange? A lot. In three years at the most, more likely two, possibly even one, the budget will be balanced, a feat virtually unequalled in the developed world.

Taxes will stay low, giving each individual more freedom and each business a better shot at making money, which will create jobs and improve living standards. The Conservatives mean it when they say a strong economy is their first priority.

That priority explains the decision to make Ottawa more interventionist on one front: scaling back tax credits for research and development while increasing direct grants. Experience suggests this can be a mug’s game, but the current system isn’t spurring innovation, and that’s bad for the economy, so Mr. Flaherty is resolved to try something else.

As for the Conservatives’ other great priority, building and maintaining the defence establishment, the military is being asked to cut back, even as the Conservatives promise to continue plans for new ships and planes. That will be a circle not easily squared.

Mr. Harper is gambling that this budget will become an ethos. He believes voters – at least, middle-class voters living in suburbs, who matter the most on election day – will come to prefer a minimalist federal government. They may call on provincial politicians to build more hospitals and hire more teachers and fix the roads, but all they’ll ask of Ottawa is that it mind the store.

When another party does finally come to power, it will discover that minding the store is all it can afford to do without raising taxes, which the public will resist.

That’s why this budget is so transformative. It takes a giant step toward Stephen Harper’s vision of Canada’s future.

It makes Canada a more conservative nation.

Broadly, I approve of this budget, including the cuts to defence spending - being a civilian, albeit retired from the CF, I am not bound by DND's embargo on commentary - I think some cuts could have been deeper; I hope some, like those to the CBC and regional development, will become annual events. I do not believe that the cuts to the defence budget are going to hurt much - we have discussed elsewhere why and how to cut some of the "bloat" in DND; we do not all agree on how to cut but most of us, serving and retired, junior and senior, are fairly satisfied that DND, the whole place, beginning with HQs in Ottawa, can do more better with less. Maybe DND will need another cut to, finally, provoke the senior management and military leadership to examine their basic organization. I understand that some of you are going to have to work longer and harder to retire and you will not get the same benefits I enjoy. I will not apologize for my "good" pension - it was part of the terms of service under which I agreed to serve more than a half century ago, some things were better than you have, post this budget, some worse.

 

[matthew1786]

http://www.canada.com/mobile/iphone/story.html?id=6380737

A good listed summary of today's budget reveal. Check out #17 down the list for a summary on CF affected pension contributions. I believe right now it is 60/40 and now it will transform to 50/50.

Also, although the internal details have not yet been revealed, how do you think this will effect those applying into the CF now under the 2012-2013 fiscal year?

 

[dogger1936]

Your severance will stop growing sometime next year.  You'll be paying more into it thus less take home pay, and likely work 5 years more than you anticipated.

Thank you Mr. Harper!!

 

[Journeyman]

It's always hard to tell online, but I suspect that you meant that sarcastically.

I say the same thing, but sincerely.


But then, I guess I'm just looking at the larger puzzle rather than one small piece.

 

[dogger1936]

It's always hard to tell online, but I suspect that you meant that sarcastically.

I say the same thing, but sincerely.


But then, I guess I'm just looking at the larger puzzle rather than one small piece.

Whats not to love about losing severance pay and having to pay 50% for the same pension?

 

[PuckChaser]

Quickie look says Federal spending will increase by $13 Billion over 3 years.

Only in Ottawa would that be considered an austerity budget.

Correction, only for the Liberals and NDP would $13 Billion net increase in spending is considered austerity. Look what the Liberals and NDP did to Ontario.

 

[Journeyman]

Again, bigger picture -- what's not to love about being one of only two G7 countries to have a balanced budget by 2016? A stable budget, forecasting a surplus by 2015-16 is power.

I suspect that this will do more for Canada's voice in the world than whether we get F-35s or Super Hornets....whether our Army adopts any 'Royal' affectations and pips & crowns....or whether we ever get submarines that spend less time above water than our helicopters. But that's the budget, writ large, not any opinion on defence spending!

While you're looking closer to home, in the form of severance pay, my domestic vision says this will be better for my kids down the road.

:dunno:  Just sayin'

 

[dogger1936]

Again, bigger picture -- what's not to love about being one of only two G7 countries to have a balanced budget by 2016? A stable budget, forecasting a surplus by 2015-16 is power.

I suspect that this will do more for Canada's voice in the world than whether we get F-35s or Super Hornets....whether our Army adopts any 'Royal' affectations and pips & crowns....or whether we ever get submarines that spend less time above water than our helicopters. But that's the budget, writ large, not any opinion on defence spending!

While you're looking closer to home, in the form of severance pay, my domestic vision says this will be better for my kids down the road.

:dunno:  Just sayin'

Put yourself in the shoes of a Cpl with 4 years in. It's great for us on the end of the spectrum IRT career's. I'm sure he'll living in the PMQ's with a family of three loving the fact he's making X less dollars. I bet every payday he'll be thanking his lucky stars we have a good domestic vision.

 

[dogger1936]

Whats 17% of a Cpl pay anyway...cleared maybe 200 bucks or so? I'm sure they won't miss that.

 

[Journeyman]

Well, we've both laid out our points of view -- I guess we'll have to see how it all plays out.

 

[Fishbone Jones]

Does this thing mean I can serve to 65? That's what it sounded like to me :

 

[Journeyman]

Does this thing mean I can serve to 65? That's what it sounded like to me :

I somehow pictured you as accepting that you were one of us destined to leave this lash-up feet first in a box. 

 

[Allen]

7 years with no new equipment?

I don't think this is what's happening.

The article words it badly, but they're carving out $3.5b of the capital spending which would have occurred over the next 7 years and delaying it - the budget isn't clear for how long - it could be less or more than 7 years.

From the budget plan:

In order to ensure that funding for major capital equipment procurements is available when it is needed, the Government is adjusting the National Defence funding profile to move $3.54 billion over seven years into the future period in which purchases will be made.

http://www.budget.gc.ca/2012/plan/chap5-eng.html

This table shows that the $3.5b is spread out over the 7-yr period. The amount for the last 2 years are not shown, but it would be about $0.6b:

Updating defence capital funding
billions of dollars

2011–2012    0.4
2012–2013    0.5
2013–2014    1.3
2014–2015    0.7
2015–2016    0.3
2016–2017    0.1

http://www.budget.gc.ca/2012/plan/chap6-eng.html

It's not great, but postponing $3.5b on a 7-yr capital expenditure of over $30b is not going to bring equipment and infrastructure spending to a halt.

If certain journalists are to be believed, one of the programs to be delayed is the CCV.

Moderator edit: content

 

[Fishbone Jones]

I somehow pictured you as accepting that you were one of us destined to leave this lash-up feet first in a box. 

You're right! I'm just not ready to climb into the box yet ;D

 

[Edward Campbell]

Here is a right wing view of the budget, reproduced under the Fair Dealing provisions of the Copyright Act from the National Post:

My emphasis added
http://fullcomment.nationalpost.com/2012/03/29/andrew-coyne-on-budget-2012-this-is-the-terminus-of-tory-radicalism/

Andrew Coyne on Budget 2012: This is the terminus of Tory radicalism

Andrew Coyne

Mar 29, 2012


OTTAWA — So now we know. If the matter was ever in any doubt, it is no longer.

You fiscal conservatives who hung on all this time, while the Harper Conservatives ran up spending to levels no previous government had ever dreamt of — you who stood by the party through the years of minority government while it discarded every principle it had ever held and every commitment it had ever made — you who swallowed all of this in the belief that, one day, the Conservatives would win their long-sought majority, and all your compromises would prove to have been worthwhile: you, ladies and gentlemen, have been had.


Understand: this is as good as it gets. This was the legacy budget, the vision statement, the one where the Conservatives, with the assurance of four years in power, finally stopped pretending to be what they were not, and showed us what they were. After all, it had to be. If they were ever going to do anything of any consequence, they had to do it early, to give themselves time to recover from any political damage.

They had to do it now, while the opposition parties were still getting up to speed. This was their one shot — anything later would run into preparations for the next election.

This, then, is the summit of Conservative ambition, the terminus of Tory radicalism: a budget that commits the government to do everything it had ever done, only at fractionally less cost. And I do mean fractionally. Indeed, the budget is at pains at several points to spell out just how marginal the changes it proposes really are.

The $5-billion to be cut out of departmental budgets, it boasts, is “less than 2.0 per cent” of program spending. To be sure, adjust for inflation and population growth, take into account previously announced savings, and this implies a 12% reduction in real spending per capita by fiscal 2017.

But a 12% reduction from what? From the all-time, never-before-seen, not-even-close record the Tories set in 2010, when they jacked up spending by $37-billion in a single year. Be under no illusion about this: the five years of “austerity” on which we are now embarked will be, after inflation, adjusting for population growth, the five biggest spending years in the history of the country — other than the last three.

All that the Tories are proposing to do is to roll back some of the increased spending that they themselves introduced. The public service from which the Tories pledge to trim 19,000 employees is the same one to which they added more than 30,000.

But there will be no real change in the size and role of government. In the years to come, as in all previous, there will be the same hundreds of pages in the Public Accounts listing all the thousands and thousands of businesses, interest groups, activist organizations and the like on the receiving end of federal handouts — and that’s only the ones over $100,000. The Finance department, likewise, will issue the same list of “tax expenditures” it does every year: tens of billions of dollars worth of special tax breaks for favoured interests that distort investment decisions and reward the lobbyists.

The regional development slush funds will carry on more or less as before, the Crown corporations — Via Rail, the CBC, all the gang — will eat up nearly as much public subsidy as ever.

Look. It’s not a disaster. We are not going to go bankrupt. We are in nothing like the same fiscal straits as we were in 1995, as the government points out — indeed, barring an economic downturn the deficit could be as good as gone by next year. So if fiscal necessity were the only impetus, the government would have little reason to cut spending more than it has. If, on the other hand, you start by asking what government should and should not be doing, then we are no further ahead after this budget than we were before.

Given the opportunity to do more, it did less.

Two points of context should be added, however. First, it would not be fair to look at this budget in isolation. Indeed, thin as it is, it makes a point of dwelling on some of the government’s broader economic initiatives, some of which are quite significant: the many free trade treaties it has signed or is negotiating; the deep cuts in corporate tax rates; the modest opening of the telecommunications industry to foreign investment; the promised streamlining of regulation; and so on. Add it up, and the overall tilt of policy is towards freer markets and fewer barriers to capital formation.

And second, the budget makes some important progress towards the longer-term objective of reining in the costs of programs for the elderly. There had been much speculation before the budget of whether the age of eligibility for Old Age Security would be raised, gradually, from 65 to 67, or whether workers would be given the option of retiring later in exchange for higher benefits. In fact, the budget does both. No figures are attached, but the savings — OAS is the single most expensive program in the federal budget — are potentially enormous.

The other potential sleeper: a proposal to require public employees to pay more of the cost of their own pensions, eventually to match employer contributions 50/50, as workers in the private sector typically do. Again, no figures are attached, but again, the savings over time are likely to run into the tens of billions.

So we are at least headed in the right direction: that’s progress, I suppose. If an opportunity for reform has been missed in the short run, the longer-term picture is a little brighter. Hallelujah! Incrementalism at last!

National Post

I am not quite as pessimistic as Coyne; I believe there is some room in Harper's heart for further cuts to regional economic development programmes - maybe even cutting entire agencies - and the CBC in 2013, but, essentially he is right: the Conservatives will go easier and easier until, IF they get a majority in 2015, the 2016 budget.

 

[Fishbone Jones]

I don't mind the slow and steady approach. There's no great 'ah ha ' moments, but the problems are identified and being dealt with.

I don't think any one group was, really, untouched in all this. There are some ways forward, project timelines for example, that really needed a head shake anyway.

Coyne's probably just pissed (seems to be anyway), that this budget held no minefields for anyone (of consequense) and that there is really nothing to stab the CPC in the eye about.

Simple, boring fiscal management. It's what we need, what we elected the CPC to do............and what we got.

Coyne, and the rest, are just pissed that there's no story here. They, now, have to start working for a living and go out and find something to write about for a change. No two week free ride bitchng about the budget.

 

[Edward Campbell]

I don't mind the slow and steady approach. There's no great 'ah ha ' moments, but the problems are identified and being dealt with.

I don't think any one group was, really, untouched in all this. There are some ways forward, project timelines for example, that really needed a head shake anyway.

Coyne's probably just pissed (seems to be anyway), that this budget held no minefields for anyone (of consequense) and that there is really nothing to stab the CPC in the eye about.

Simple, boring fiscal management. It's what we need, what we elected the CPC to do............and what we got.

Coyne, and the rest, are just pissed that there's no story here. They, now, have to start working for a living and go out and find something to write about for a change. No two week free ride bitchng about the budget.

I think you are pretty close to the mark; this is a Stephen Harper budget, not a conservative one. Both the left and right 'wings' of the political spectrum will be annoyed but, barring some unforeseen catastrophe or a huge political scandal, the centre, where elections are won in Canada, should be happy enough by 2015 to re-elect Harper et al.

 

[The Bread Guy]

I am not quite as pessimistic as Coyne; I believe there is some room in Harper's heart for further cuts to regional economic development programmes - maybe even cutting entire agencies - and the CBC in 2013, but, essentially he is right: the Conservatives will go easier and easier until, IF they get a majority in 2015, the 2016 budget.

Maybe I'm shortsighted, but I think all ruling parties get a lot of local, over-the-heads-of-the-big-media-outlets press via such programs ("Government of Canada investment to support economic development in the Atikokan region", "Senator Duffy Announces Support for COWS Inc. to Expand Production Facility in North River", "Harper Government and Town of Swan River Turn Sod on Recreation Infrastructure Project", etc.), making them attractive to keep even by this government.

 

[Edward Campbell]

Maybe I'm shortsighted, but I think all ruling parties get a lot of local, over-the-heads-of-the-big-media-outlets press via such programs ("Government of Canada investment to support economic development in the Atikokan region", "Senator Duffy Announces Support for COWS Inc. to Expand Production Facility in North River", "Harper Government and Town of Swan River Turn Sod on Recreation Infrastructure Project", etc.), making them attractive to keep even by this government.

There's no doubt, regional development programmes, are political goldmines; but they are, also, social and economic rubbish pits and they do nothing  for anyone ... except to garner votes from the muddle headed. So, you're right, my desire to see the end of them represents, yet again, the triumph of hope over experience.