Budget 2023 means progress on green jobs but missed opportunities on health care, tax fairness

White man and Asian woman sitting at a table reviewing bills. not looking happy

March 29 2023

The 2023 federal budget included some measures to help ensure that jobs created by the transition to a green economy will provide decent wages, but opportunities to fix our public health care system and to introduce real tax fairness were missed. Instead, the federal government relied on Band-Aid solutions that won’t meet the long-term needs of Canadians. 

Budget announcements on health care inadequate

The federal government has acknowledged that the universal public health care system is floundering. Unfortunately, the additional funding and initiatives in the budget aren’t enough to address the structural issues related to labour shortages of health care workers and the impacts of the pandemic.

What we wanted was a clear and unequivocal commitment to strengthening and expanding public health care. Instead, the door has been opened to an unprecedented expansion of privatization.

The budget promises an additional $195.8 billion over 10 years in federal health transfers, including $46.2 billion in new funding. This is significant and welcome, but there is little to force provinces and territories to ensure these funds are used to improve public health care.

Already some provinces are expanding private health care delivery under the false claim that this will improve access. Instead, this increase in privatization will undermine our public health care system. It will also draw health care workers into the private system, further exacerbating the labour shortages and the crisis in public health care.

Dental care plan a step forward, but nowhere near what it could have been

The other major development in health care is the investment in dental care. Budget 2023 promises $13 billion over 5 years to implement the Canadian Dental Care Plan. Uninsured families with income below $90,000 a year will be able to access this plan. There will be no co-pays for those with family income below $70,000.

The missed opportunity here, as with the other health care investments outlined above, is that this is not being delivered in a public system. Instead, the dental care plan is being run as a benefit through Health Canada so it won’t be subject to any of the restrictions under the Canada Health Act.

While the dental care plan will have a significant impact on those who do not currently have access to dental care, delivering this care through private dental clinics inherently includes all of the failings of private health care.

Fair-wage requirements for some green investment credits

Budget 2023 included credits to support investment in clean electricity, clean technology manufacturing, and clean hydrogen. Included also were improvements to expand the credit for investments in carbon capture, utilization and storage. What is new is that 2 of these credits — clean technology and clean hydrogen — include fair-wage requirements and a requirement for hiring apprentices.

Equally on the bright side is that publicly owned electricity services will be eligible for assistance through the clean electricity credit. It would have been better if only publicly owned utilities had been eligible, but given the federal government’s past decisions, this is a step forward.

Increase capped on excise duties on beer and other alcoholic beverages

One measure that will help protect Canadian jobs is the cap on the increase in excise duties on beer and other alcoholic beverages. Without that cap, duties would have increased by 6.3% on April 1, 2023. The federal budget places a one-year cap of 2.0% on excise duty increases.

The National Union and its Components representing brewery workers had written to the federal government expressing concern about the impact a 6.3% increase in excise duties would have.

Services almost certain to suffer if proposed cuts go ahead

It’s fantasitical thinking that the proposal in the federal budget to cut spending by departments and agencies by 3% with no impact on services for Canadians. No one should expect to see this happen.

The federal government should know better. They’re spending billions fixing problems caused by previous spending cuts. Problems like delays in processing Old Age Security and EI and long lineups at airport security.

Now, with the proposal to cut spending by 3.0%, the federal government is going to create a whole new set of problems. Pretending that it’s possible to cut spending without affecting the services Canadians receive may help the government politically, but it won’t help Canadians trying to access public services they rely on.

Affordable housing crisis ignored

Data from the Canadian Mortgage and Housing Corp (CMHC) and Statistics Canada confirm that foreign investment in housing is a small part of the problem. The CMHC found that roughly 2.4% of Toronto condos and 2.3% of Vancouver condos were owned by overseas investors. The highest concentration of foreign-owned condos was 6.9% in Montreal.

Restricting foreign investment in housing is politically easy, but the overwhelming majority of those investing in residential properties live in Canada. Encouraging the construction of more housing units won’t do much good if the units are too expensive, or if they aren’t the sizes people need.

The number of affordable housing units promised is not enough to make up for the years of underfunding. And until provincial governments step up and reform property taxes to target speculators and renovictions there’s nothing to stop speculators from buying up even more privately owned affordable properties.

Tax fairness promises fall short — again

Both Liberal and Conservative ministers of finance have a history of promising tax fairness, but doing relatively little. Unfortunately, this budget continued that tradition.

While there was a positive step to increase rate of the Alternative Minimum Tax from 15% to 20.5% (a tax intended to make it harder for the wealthy to completely dodge taxes), important measures that are essential to genuine tax fairness were missing from the budget. These include increasing the federal corporate income tax rate, so that corporations that have seen their profits shoot up pay their share.