The Federal Government released its budget yesterday, and Bow River Member of Parliament Martin Shields is not impressed. With a forecasted 40 billion dollar deficit, Shields calls it an "inflation-fueling budget" that will further contribute to Canadian debt and rising inflation.

The Government of Canada's website highlights several ways they believe the budget will make life more affordable for Canadians, including but not limited to:

  • The new Grocery Rebate, which "delivers targeted inflation relief for 11 million low and modest-income Canadians and families who need it most."
  • Launching the new Tax-Free First Home Savings Account
  • Increasing the Canada Student Grants and raising the interest-free Canada Student Loan limit.

Shields believes these programs won't be effective in lowering inflation and helping Canadians, as he says the root issues of government overspending and several cost-raising policies need to be addressed.

"They give on one hand and take it away on the other, so they're saying they're providing these benefits, but yet on the other hand, they're increasing the cost. And then you have the debt, the interest we're paying on the debt that adds to that," he said.

While inflation and rising costs are worldwide issues and there are several factors that the Federal Government can't control, like the Russia-Ukraine war for example, Shields said there are steps the government could have taken to lower inflation, and failing to take these steps is one of the budget's big failures.

"Their continued spending, this increase in spending, that's about $4200 per family that it's going to cost in increased cost that they're talking about in this budget. That's a huge tax cost to our families, so they're making decisions not to pay as you go, but to spend more. The other thing that they could do which they control is the carbon tax."

Regarding the carbon tax, which will be increasing to 14 cents per litre from the previous 11 cents per litre mark, Shields believes this could create a ripple effect that would make inflation and rising costs worse.

"Anything to do with agriculture, whether it's the machinery, the fuel, whatever you're doing, the carbon tax is going to go up. The ripple effect goes all the way back into all parts of the economy and eventually to the food and grocery stores. That creates inflation."

As for government spending, Shields said the Federal Government since 2015 has nearly doubled debt, going from around 628 billion dollars to around 1.1 trillion as of December 2022. He added this increases the amount of interest we pay on debt, thus further fueling inflation.

"You can't qualify for a mortgage because the interest rate has been driven up. And two, if you're going to renew it, you're going to be paying more. So the money that comes out of your pocket is more. We want people in Canada, the people that are working, the people are doing the right things, to have their paycheck increased, not lessened."

One of the big focuses of the budget was green energy incentives and tax breaks to promote renewable energy in Canada, including a refundable tax credit equal to 30% of the cost of investment in new machinery and equipment, among other measures.

"Our made-in-Canada plan is underpinned by a new federal toolkit for investing in the clean economy: a set of clear and predictable investment tax credits, low-cost strategic financing, and targeted investments and programming, where necessary, to respond to the unique needs of sectors or projects of national economic significance," the government website says.

Shields says hydrogen energy will definitely be an energy source in the future and is not against green energy like wind and solar, but says the Federal Government needs to support oil and gas stronger than they have. With hydrogen and other energy sources several years away, and some renewable energy being unreliable at times according to Shields, he says we still need oil and gas and it needs to be a budget priority.

"There's going to be alternatives developed, hydrogen is one of them and it's great for Wheatland County, but in the meantime, natural gas should be promoted. Ten years ago, there was 16 LNG (Liquefied Natural Gas) projects on the board for Canada, we will only get one done here at Prince Rupert here in about two to three years. Only one. Australia has developed a number of them in the same time frame. We have missed out on the resource sector, providing more great jobs, more money for our industries, as well as supplying to the rest of the world who is now burning up more coal because they can't get liquefied natural gas."

Shields concluded by saying Canada's economy is slowing down, and he believes there needs to be more policies in place to keep businesses in Canada rather than going to the USA to incentivize investment and job growth in our country.

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