Federal budget short on innovation or social value

It seems what’s old is new again in Budget 2017, presented to the House of Commons.budget shortfalls

The big federal budget deficits of the 1970s and ’80s? They seem to have taken up permanent residency again in Canada. Federal finances will be in the red for the foreseeable future while annual spending jumps from $315 billion last year to $330 billion this year—largely because of interest paid on government debt.budget shortfalls

The innovation agenda that will help the middle class? Well, there’s not much that’s innovative about it. It assumes that government is the primary agent of delivering change and social stability for the middle class—the same philosophy that’s guided most federal spending for decades.budget shortfalls

Some simple examples make the budget shortfalls case.

The federal government has committed $7 billion over 10 years to fund daycare spaces in Canada. These won’t be home-based, neighbourhood daycare spaces. They’ll be the institutional kind, which is the kind parents favour the least.

What’s more, daycare funding isn’t even about making sure low-income parents are able to work. A report published by the Advisory Council on Economic Growth on Feb. 6 explains that one government goal is to get parents (mostly mothers) of young children into the workforce in order to increase the gross domestic product. It’s as though the government only defines parents’ value as measured through economics. The funding puts the government in the driver’s seat with one childcare option heavily favoured.

Or take the almost $1 billion committed toward creating high-tech “superclusters.” Again, government is driving the bus. In fact, Cardus work and economics program director Brian Dijkema makes a rather wry observation about big government funding for economic growth.

“There’s a sense in which their desire to form superclusters sounds like old attempts to grow clusters of cucumbers in Newfoundland,” he said.

Yes, government tried to fund cucumber production in Newfoundland in the late 1980s. The result? According to the CBC, cucumbers did grow in the province, but at a cost to taxpayers of $27.50 each. At the time, you could buy an out-of-province cucumber in a grocery store for 50 cents.

Government funding to spur new industries is neither innovative nor new.

It’s worth noting that this same government-first mentality comes through in another way through Budget 2017. The booklet has 11 references to “social infrastructure.”

What does the government mean by that? According to the budget document, social infrastructure is made up of “affordable housing, high-quality, affordable child care, and cultural infrastructure like community centres, museums, parks and arenas.” In other words, this type of infrastructure is almost all government-owned in one way or another.

Unfortunately, that’s a complete misunderstanding and misuse of the term. Canada’s social infrastructure is actually comprised of the business and labour groups, volunteer associations, cultural institutions, families, faith communities, and educational institutions that exist apart from government and make up our civil society.

A truly innovative approach to helping the middle class wouldn’t start with government. It would not be based on a centrally prescribed vision.

No, renewal of social infrastructure—or architecture—would instead create the conditions in which all of society could thrive.

There is, however, very little that would create bottom-up social flourishing of that sort in the budget document tabled in the House of Commons last week.

— Ray Pennings is executive vice-president of public policy think-tank Cardus.



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