The 2000 Economic Statement and
Budget Update
A Renewed Debt Repayment Plan
October 18, 2000
Thanks to the commitment and dedication of
hard-working Canadians, Canada has entered a new era of strong economic growth
and budget surpluses.
Just as Canadians pay down their credit cards
when times are good – so must governments.
Reducing the public debt burden is one of the
most important steps we can take as a government to ensure a brighter future for
our children. We owe it to them.
In 1998 – having eliminated the deficit - we
announced a Debt Repayment Plan, based on continued unswerving fiscal
discipline, prudent economic forecasts and an annual $3 billion Contingency
Reserve - any unused portion of which would be used to pay down the debt.
The goal of our plan was to put our debt-to-GDP
ratio – once among the highest in the G-7 – on a permanent downward track.
And it has worked.
In 1999-2000, the debt-to-GDP ratio fell to 58.9%
-- down from a post-war peak of 71.2% in 1995-96.
A few weeks ago, we announced a $12.3 billion pay
down of the national debt in 1999-2000- the largest in Canadian history –
bringing our total debt reduction over the past three years to $18.7 billion.
The 2000 Economic Statement and Budget Update
adds an important new dimension to the Debt Repayment Plan.
In addition to the $ 3 billion Contingency
Reserve, from now on, we will also announce each fall whether fiscal and
economic circumstances will allow us to pay extra against the debt
This fiscal year, the government is committed to
paying off at least $10 billion of the public debt.
With a renewed Debt Repayment Plan and the
continued vigour of the Canadian economy, our debt-to-GDP ratio will continue on
its permanent downward track.
By 2005-06, we estimate it will have fallen to
40%.
|