Some Good News for Canada’s Arts and Culture Sector Announced in 2006 Federal Budget

CCA Bul­letin 23/06

For imme­di­ate release
Ottawa, May 2, 2006

The Cana­dian Con­fer­ence of the Arts (CCA) is encour­aged by the announce­ment of new monies for the Canada Coun­cil for the Arts con­tained in the 2006 Fed­eral Bud­get unveiled today by the Hon. Jim Fla­herty, Min­is­ter of Finance.

This announce­ment comes on the heels of months of sus­tained advo­cacy by mem­bers of the country’s arts and cul­tural sec­tor, who were seek­ing a dou­bling of the Canada Council’s annual bud­get.  Though the fig­ure of $50 mil­lion over the next two fis­cal years falls well short of the tar­get, it is nev­er­the­less a wel­come development.

The CCA sees this as the first step on the part of a new gov­ern­ment that is try­ing to be atten­tive to the sector’s long-standing call for sta­ble, increased, multi-year pub­lic fund­ing for arts and cul­ture. Now our work begins to ensure this the $50 mil­lion is secured as per­ma­nent, sus­tained fund­ing and to make the advo­cacy case for sig­nif­i­cant increases in the very near future.

Bud­get Plan 2006, which is enti­tled “Focus­ing on Pri­or­i­ties”, men­tions the increase to the Canada Coun­cil at the bot­tom of page 123 in the sec­tion “Build­ing a Bet­ter Canada: Fam­i­lies and Com­mu­ni­ties”.  The plan also calls for the elim­i­na­tion of cap­i­tal gains tax on cer­tain dona­tions to char­i­ties in order to facil­i­tate Cana­di­ans’ char­i­ta­ble giv­ing, which is spelled out on page 120 through 122.

Unfor­tu­nately, what today’s fed­eral bud­get does NOT con­tain is any news related to the CCA’s other cur­rent advo­cacy pri­or­i­ties.  For instance, there is no men­tion of a new fed­eral muse­ums pol­icy, nor is there an announce­ment regard­ing addi­tional monies to the Cana­dian Broad­cast­ing Cor­po­ra­tion (CBC), par­tic­u­larly for its regional pro­gram­ming plan.

It also appears Canada ‘s inter­na­tional pol­icy is focused mainly on increased mil­i­tary and defence spend­ing for the moment, though there is a new $320 mil­lion com­mit­ment to com­bat var­i­ous dis­eases and sharp changes in com­modi­ties mar­kets in low income coun­tries.  Regret­tably, an announce­ment last Novem­ber to allo­cate addi­tional monies to the cul­tural pro­grams housed at the Depart­ment of For­eign Affairs did not re-materialize.  In CCA’s pre-budget sub­mis­sion “Set­ting The Stage” we also called on the fed­eral gov­ern­ment to deter­mine the needs for increased fund­ing for the var­i­ous port­fo­lio agen­cies of the Depart­ment of Cana­dian Her­itage; this rec­om­men­da­tion also went unheeded.

Addi­tion­ally, CCA’s var­i­ous 2006 bud­get appeals in the area of tax­a­tion and tax cred­its went unad­dressed, for the time being, though we reported in CCA Bul­letin 21/06 that Min­is­ter Fla­herty has at least opened the door to hav­ing future dis­cus­sions with the CCA on these issues.  We were ask­ing the Gov­ern­ment of Canada to rein­state income aver­ag­ing for self-employed Cana­di­ans whose income fluc­tu­ates dras­ti­cally from year-to-year, as artists and cul­tural work­ers com­prise the fastest-growing sec­tor of the country’s 21 st Cen­tury post-industrial labour force, and for the gov­ern­ment to imple­ment a tax­a­tion exemp­tion on artists’ income, includ­ing copy­right income.  Last, the CCA had encour­aged the gov­ern­ment to expand its planned tax credit of $500 for par­ents of young Cana­di­ans under the age of 16 who enroll their chil­dren in pro­grams pro­mot­ing phys­i­cal activ­i­ties, to also include a tax credit to cover chil­dren par­tic­i­pat­ing in arts and cul­tural activities.

Canada’s artists and cul­tural work­ers earned an aver­age of $23,500 in 2001 and should there­fore ben­e­fit in one way or another from the var­i­ous tax relief mea­sures con­tained in the 2006 bud­get. It is too soon to assess the poten­tial impact of these pro­pos­als, which include: changes to the per­sonal income tax rate, as well as tax cred­its for trades people’s tool expenses and schol­ar­ship and bur­sary income, among other measures.

How­ever, the basic law of physics — “for every action, there is an equal and oppo­site reaction” — cer­tainly applies here, as any reduc­tions in tax rates decreases over­all fed­eral gov­ern­ment rev­enue.  This in turn means there is less money in the sys­tem to draw from for the pur­poses of pub­lic fund­ing, thus it is not sur­pris­ing that the gov­ern­ment also expressed its resolve to review its expen­di­ture man­age­ment sys­tem.  The Pres­i­dent of the Trea­sury Board, the Hon. John Baird, will be iden­ti­fy­ing areas for sav­ings of $1 bil­lion in spend­ing for fis­cal years 2006-07 and 2007-08.  We can expect to hear more details about these planned reduc­tions some­time in the fall.  The CCA will mon­i­tor any devel­op­ments related to this exer­cise in order to ascer­tain its full impact on the pro­grams and port­fo­lio agen­cies that facil­i­tate fed­eral invest­ment in the arts and cul­tural sector.