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Alternative Federal Budget 2017 ISBN 978-1-77125-329-1 B A C HIGH STAKES,, CLEAR $ CHOICES Alternative Federal Budget 2017 ISBN 978-1-77125-329-1 This report is available free of charge at www. policyalternatives.ca. Printed copies may be or- dered through the CCPA National Office for $10. PleaSe make a doNatIoN... Help us to continue to offer our publications free online. With your support we can continue to produce high quality research — and make sure it gets into the hands of citizens, journalists, policy makers and progres- sive organizations. Visit www.policyalternatives.ca or call 613-563-1341 for more information. The CCPA is an independent policy research organ- ization. This report has been subjected to peer re- view and meets the research standards of the Centre. The opinions and recommendations in this report, and any errors, are those of the authors, and do not necessarily reflect the views of the funders of this report. 5 Introduction 10 Macroeconomic Policy 27 Taxation 35 Agriculture 40 Arts and Culture 46 Child Care 52 Defence 57 Employment Insurance 63 Environment and Climate Change 69 First Nations 74 Gender Equality 81 Health Care 88 Housing and Neighbourhoods 93 Immigration 99 Infrastructure and Cities 105 International Development 111 Post-Secondary Education 118 Poverty 125 Public Services 131 Sector Development Policy 137 Seniors and Retirement Security 143 Trade: International Trade and Investment 149 Water 155 Youth 161 Acknowledgements Introduction We are at a pivotal moment in Canadian High stakes politics. In 2015, a new Liberal government Canadians are giving a lot to the economy, was elected on a wave of public desire for but it is not giving back as much as it could. more: more empathy, more investment, more The median income in Canada was acknowledgement that we can and must $32,800 a year in 2014. Albertans did bet- do better for each other and especially for ter with $41,000 a year while in PEI the medi- the most vulnerable. Some positive steps an income was a low $25,200.1 Lower on the have been taken in this direction. But much spectrum, more than 1 million people in more needs to be done to address Canada’s Canada worked for minimum wage in 2015.2 persistent inequalities and to get the econ- At current rates, if they were lucky enough omy moving. to work 40 hours a week, a minimum-wage This would be a very bad time to re- worker would have brought home a low of treat into the rhetoric of fairness while fall- $22,152 a year in New Brunswick and as ing short on implementing the policies that much as $28,288 in Alberta.3 Miss one week would take us there. Better than nothing — or of work at $10.65/hour, however, and you better than Trump — is not good enough. are officially living below the poverty line. We must be clearheaded and unapologetic The average house price in Canada is in our vision for change or be ready to face closing in on half a million dollars — double the backlash from half-measures or broken that if you live in Vancouver.4 A loaf of fac- promises. More than ever Canadians need tory bread will put you out nearly $5 if you to see action on inequality, climate change, live in Nunavut.5 The cost of enlisting your poverty, and jobs. High Stakes, Clear Choices: Alternative Federal Budget 2017 5 two-year-old in child care in Toronto now sistently provides greater benefits to high- tops $16,000 a year.6 income earners.18 More than 4.5 million Canadians lived For example, over 90% of the benefit of below the poverty line in 2014, 991,000 of the capital gains tax break goes to the top them children.7 Poverty rates are higher for 10% of income earners; 87% of the benefit women, racialized people, and immigrants, goes to the top 1%.19 Over 10 years, federal and they skyrocket for people living with corporate tax rates have been cut by nearly disabilities, single mothers, and Aborigin- 50%, while those same corporations amassed al people. More than half of all First Nation over $500 billion in excess cash.20 children live in poverty.8 In 2016, the federal government took One in eight Canadians regularly experi- steps toward narrowing this income and ence food insecurity and more than 800,000 wealth gap. It made significant investments people visit a food bank each month.9 Near- in housing and clean water for First Na- ly 100 First Nation communities continue to tion communities, for example, and im- go without clean drinking water.10 plemented the Canada Child Benefit (CCB), More than a third of Inuit households which should reduce child poverty in Can- live in overcrowded or unsafe housing.11 ada by 14%. The government also introduced And 3.5 million Canadians lack basic drug a 10% increase to the Guaranteed Income coverage, leading many to simply go with- Supplement (GIS) top-up for poor single sen- out important prescription medication.12 iors, which we estimate will reduce poverty Canada is on track to miss its green- among seniors by 5%. house gas emissions target by a mile, leav- While these are positive measures, all of ing future generations to foot the bill of cli- them advocated in past Alternative Feder- mate change. al Budgets, they do not get us nearly close Canadian household debt exceeded the enough to the goal of more equally shared size of our economy (GDP) for the first time prosperity. last year. The average Canadian owes $21,348 Economists and financial institutions in consumer debt (not including mortgage around the world have recognized the detri- debt).13 Canada’s farmers are now carrying mental effects of inequality on social co- over $92 billion in total debt.14 Public stu- hesion, health, and tolerance for ever-higher dent debt in Canada had reached $28 bil- levels of poverty. This year’s AFB demon- lion at last count.15 strates that the money and tools are there On the other side of the divide, the two to transform Canada’s economy so that it is richest Canadians hold the same amount working for everyone. of wealth as the poorest 30% of the popu- lation.16 The 100 highest-earning CEOs in Clear choices Canada took home an average of $9.5 mil- lion each in 2015.17 And our tax system con- The AFB would establish a federal minimum wage of $15 an hour, indexed to inflation, so 6 Canadian Centre for Policy Alternatives that no full-time worker finds themselves liv- ous people living off reserve, people with ing in poverty at the end of a 40-hour week. physical disabilities, and seniors). By lowering the eligibility requirement for The AFB would increase access to pri- employment insurance, our plan would pro- mary health care and mental health care tect an additional 250,000 workers in pre- while introducing a national pharmacare carious, contract, and part-time jobs from program. This would allow more than 3.5 downturns in the economy. million Canadians to fill prescriptions that The AFB recognizes the diversity of Can- they would not otherwise be able to afford. ada’s workforce and would rebalance invest- The AFB would support struggling fam- ments across different sectors of the econ- ilies by providing access to affordable child omy. Young workers would receive support care and home care, and ensuring the people through the creation of paid internships and who provide those services are paid a living greater access to apprenticeships. wage. It would eliminate tuition for post- Investments in physical infrastructure secondary education and improve funding would be dramatically larger and immedi- for First Nations students. ately implemented. This money would be Parents would no longer need to trade more responsive to community needs and in their own financial security to provide for create jobs in predominantly male employ- their children’s education. New graduates ment sectors, while investments in care ser- would no longer enter the workforce with vices would create jobs in predominantly crippling debt. The 10,000 First Nations female employment sectors. students on waiting lists for post-second- Investments in Farm Credit Canada will ary education would be able to start school. allow a new generation of farmers to con- Some of the money for these commit- tinue without unmanageable debt loads. ments will come from ending the special The AFB would direct funds raised tax treatment Canada gives to domestic and through carbon taxes to low-income house- foreign corporations. For example, the AFB holds, and to training for those affected by would tax capital gains at the same rate as the shift to a greener economy. It would in- we tax employment income or profits, creat- vest in making existing industries more sus- ing an additional $10 billion in government tainable, and in supporting new industries, revenue. It would apply a 1% withholding creating green-collar jobs and ensuring a tax on Canadian assets held in tax havens, just transition for workers and their families. generating over $2 billion a year. The AFB would ensure the federal gov- The AFB would eliminate provisions ernment helps shoulder the burden of the in trade agreements that allow foreign in- rising cost of living by increasing investments vestors to sue the Canadian government for in basic necessities. It would build 10,000 lost business revenues that result from pub- new units of affordable housing each year, lic interest regulation and other democrat- with an additional 5,000 units for popula- ic decisions.
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