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Budget 2003 - Budget Plan - Table of Contents - Previous - Next - Chapter 6
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2002-2003 | 2003-2004 | 2004-2005 | |
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(millions of dollars) |
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New Defence funding | 270 | 800 | 800 |
Contingency | 125 | 200 | |
Total | 395 | 1,000 | 800 |
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In the aftermath of September 11, 2001, the Government took action to protect Canadians by strengthening Canada’s domestic security capabilities and contributing to the international coalition against terrorism. It provided substantial ongoing funding for these measures, enabling Canada’s military and associated agencies to respond more effectively to the ongoing challenges of military interoperability, intelligence and the protection of Canadian citizens and the country’s infrastructure.
In 2001 the Government provided $7.7 billion over five years to enhance the personal and economic security of Canadians. Of this amount, $4.3 billion was targeted for increased intelligence and policing, better screening of entrants to Canada, enhanced emergency preparedness and support for the military; $2.2 billion was targeted for greater air security; and $1.2 billion was allocated for initiatives aimed at strengthening border security, facilitating the flow of goods and people and improving border infrastructure. Among other things, this funding has enabled the Government to:
In 2001 the Government also set aside a Security Contingency Reserve of $345 million over five years to allow the Government to respond to future security needs that could not be anticipated at the time of the budget. This allowed the Government subsequently to provide funding for the procurement of smallpox vaccine and related medical supplies, address gaps in Canada’s marine security in light of the events of September 11, and administer visa requirements.
Budget 2003 provides an additional $50 million for 2003–04 and $25 million for 2004–05 to the Security Contingency Reserve to help the Government to respond to unforeseen future security needs. The Government of Canada will continue to work closely with the U.S. to enhance border security in the interests of protecting Canadians and maintaining and strengthening key economic links.
Recognizing the security needs of air travellers in Canada after the events of September 11, 2001, the Government provided $2.2 billion through 2006–07 to make the air transportation system even safer and more secure in accordance with rigorous new Transport Canada national standards. As part of the new approach to air travel security, the Canadian Air Transport Security Authority (CATSA) was created to consolidate the delivery of a number of key aviation security services under a single federal authority at 89 airports across Canada.
In April 2002 CATSA assumed responsibility for the delivery of certain aviation security services, including pre-boarding screening of passengers and baggage; the acquisition, deployment and operation of explosives detection systems; financial support for enhanced policing at Canadian airports; and working with the Royal Canadian Mounted Police to provide on-board officers for domestic and international flights. In November 2002 the Government announced new aviation security enhancements. CATSA was given responsibility for the implementation of an enhanced restricted area pass system for Canadian airports and for the screening of non-passengers entering restricted areas at airports.
To fund these initiatives, the Air Travellers Security Charge was introduced, to be paid by air travellers effective April 1, 2002. The charge was established at a level sufficient to fund the expected $2.2 billion of expenditures for the enhanced air travel security system through 2006–07. The Government also committed to review the charge this year and, over time, to ensure revenue remains in line with planned expenditures.
On the basis of this year’s review, in particular taking into account an updated forecast for air passenger traffic and the Government’s change to full accrual accounting, the level of the charge for air travel in Canada will be reduced from $12 to $7 for one-way travel and from $24 to $14 for round-trip travel, effective March 1, 2003. This reduction is consistent with the objective of funding the enhanced air travel security system on a sustainable basis. Annex 3 provides further details about the review and how the new rate was determined.
The Government has implemented a number of new initiatives to enhance Canada’s marine security. It has increased the requirement for advance notice by vessels entering Canadian waters; developed new procedures for boarding ships that present a threat before they arrive at Canadian ports; and, in cooperation with the United States, enhanced security-screening procedures for ships entering the Great Lakes/St. Lawrence Seaway System.
In January 2003 the Government of Canada announced funding of up to $172.5 million for projects that will further increase Canada’s marine security. These projects, funded from the Security Contingency Reserve, include measures to protect our marine infrastructure, increase the surveillance of maritime traffic in Canadian waters, and improve our capability to respond to emergency situations.
Canada has the longest coastline in the world and the Canadian Coast Guard has a vital role in ensuring marine safety. For more than 500 years the oceans have made an important contribution to Canada’s economy. Even today a significant percentage of Canada’s international trade is carried by ship. The country’s rivers, lakes and coastlines further benefit the nation’s economy by offering recreational opportunities for millions of Canadians.
To ensure the ability of the Canadian Coast Guard to provide necessary marine safety services, Budget 2003 allocates $94.6 million over the next two years for major repairs for its fleet and shore-based infrastructure and for capital replacement purchases for that infrastructure.
International trade is critical to Canada’s economic performance and standard of living. A key element in achieving success in global markets lies in an innovative, responsive and productive domestic economy, capable of exporting products second to none in the world. Just as important is a strategy of energetically engaging in key export markets to promote international recognition of Canadian products and to foster wider understanding of Canada’s global advantage.
In December 2001 Canada and the U.S. began implementing a 30-point plan, known as the Smart Border Action Plan, to enhance the security of the shared border while facilitating the legitimate flow of people and goods. Among the more important measures that Canada has adopted in the context of the Plan are pre-approved programs for low-risk commercial traffic and travellers, commitments to streamline driver participation in smart card programs, the creation of joint-targeting teams at five marine ports to examine in-transit containers, the deployment of border enforcement teams, and commitments to manage the flow of refugee claimants. While more work remains, substantial progress has been made in a number of areas, and border agencies from both countries are continuing to work toward full implementation and expansion of the Plan.
To ensure the smooth flow of goods and people between Canada and the U.S., a number of important steps were taken last year to implement the $600-million Border Infrastructure Fund. In August the Government outlined the main features of the Fund. In September $150 million from the Fund was committed to address immediate border infrastructure needs in Windsor, the single most important trade crossing between Canada and the United States. In partnership with the Province of Ontario, this investment will result in $300 million towards improved border infrastructure at Windsor. Efforts to carry through on the Government’s border infrastructure commitment will continue in future years.
With the U.S. accounting for 87 per cent of Canada’s total exports of goods, and nearly $2 billion in trade crossing the Canada–U.S. border daily, further ongoing efforts are required to promote and advance Canada’s trade and economic interests in the U.S., especially in new areas of opportunity.
Budget 2003 commits $11 million in new funding over the next two years to bolster Canada’s ability to actively engage at local and regional levels across the U.S. through the establishment of additional regional offices and an increased consular presence in strategic locations such as the U.S. southwest. This includes the creation of new satellite offices that will focus on specific sectors or issues, and stronger, targeted trade and economic advocacy initiatives. The Department of Foreign Affairs and International Trade, Agriculture and Agri-Food Canada and Industry Canada are working in partnership on this initiative and providing additional resources.
Canada’s responsibility to help the world’s poor is deeply rooted in Canadian values. At the International Conference on Financing for Development, held in Monterrey, Mexico, in March 2002, the Prime Minister pledged to increase international assistance by 8 per cent a year. The Speech from the Throne committed to double assistance by 2010. At least half of that increase will be earmarked for Africa as part of Canada’s support for the New Partnership for Africa’s Development and the G8 Africa Action Plan adopted at the June 2002 Kananaskis G8 Summit.
The Government will implement these commitments immediately. The International Assistance Envelope will be increased by 8 per cent, or $353 million, in the current fiscal year, and by 8 per cent annually in each of the next two fiscal years consistent with the Government’s commitment to double the assistance budget by 2010. These Canadian international assistance initiatives build upon substantial increases announced in recent years. This budget will provide an additional $1.4 billion for the International Assistance Envelope this year and the next two fiscal years.
These additional resources will complete the financing of the $500-million Canada Fund for Africa, which the Government announced in 2001, and will substantially increase funds to support Canada’s long-term commitment to promote sustainable development in Africa and around the world. The increases to international assistance will also allow Canada to:
At last year’s G8 Summit the Prime Minister announced that Canada would take an important step to reduce poverty in the world’s poorest countries by eliminating tariffs and quotas on most of their exports to Canada, with the exception of certain agricultural products. This initiative came into effect on January 1, 2003.
Recent Initiatives to Enhance
International Cooperation
Canadians understand that doing their share to foster a secure, prosperous and more equitable global society is both morally responsible and central to Canada’s interests. This commitment has led the Government to increase the International Assistance Envelope by nearly 24 per cent since 1998. These increases in international assistance recognize the need for developed and developing countries to work together to ensure adequate assistance is provided to countries able to use it most effectively. The United Nations’ International Conference on Financing for Development in March 2002 was a milestone in the evolution of this partnership. Countries agreed on a "development compact" linking additional aid to commitments by developing countries to transparency, good governance, respect for human rights and the rule of law. The need for a development compact was also a key theme of the Kananaskis G8 Summit, where G8 leaders unanimously endorsed the New Partnership for Africa’s Development. Support for Debt Reduction Through the Canadian Debt Initiative announced in December 2000, Canada has instituted a moratorium on debt service payments from 11 reforming heavily indebted poor countries (HIPCs) able to use debt relief savings productively. In 2001 this moratorium freed up about $75 million per year in debt payments for other uses. Participating HIPC nations owe Canada a combined $700 million. Once eligible countries complete the HIPC process, their remaining Canadian debts are forgiven. In 2002, for example, Canada cancelled all debts owed by Bolivia ($10.2 million) and Tanzania ($83.6 million). This year’s $75-million contribution to the World Bank-administered HIPC Trust Fund brings Canada’s total contribution to multilateral HIPC efforts, involving both the International Monetary Fund and World Bank, to over $315 million. |
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Last Updated: 2003-02-18 |
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