Trudeau's government reveals big spending on housing programs, impacting budget

Posted on November 24, 2023   |  

Prime Minister Justin Trudeau's government is allocating significant funds for housing and business support, contributing to a rise in Canada's budget deficit due to increased borrowing costs and economic slowdown.

The newly proposed tax and spending measures are expected to cost C$20.8 billion ($15.2 billion) over 6 years.

The government's economic statement lacks a specific timeline for achieving a balanced budget. 

It forecasts a slower decline in Canada's debt-to-GDP ratio, with an anticipated increase to 42.7% next fiscal year before a decline to 39.1% by 2028-29.

Trudeau and Finance Minister Chrystia Freeland are facing challenges in the polls, with the Conservative Party criticizing the government on housing, the cost of living, and perceived overspending, alleging it contributes to inflation.

The government is prioritizing housing initiatives. Key measures include providing C$15 billion for low-cost loans for apartment construction, a C$1 billion investment for non-profit housing, eliminating taxes on new rental housing, and repurposing federal lands for housing.