Message For Canada – February 2009

An Economic Action Plan to Protect Jobs and Working Families

With a global recession raging, Canadians are concerned about the economy. The news is not all bad: unlike other countries, Canada has not nationalized or bailed out our banking sector. And thanks to our Government’s long-term policies of cutting taxes, paying down debt and investing in infrastructure, Canada is in a much stronger position than most other countries as we face this crisis.

But many communities are feeling the effects of the global recession, and Canadians want their elected officials to set partisanship aside and get to work.

Canada’s economic problems originated beyond our borders, but our Government is taking action to protect Canadians and create the conditions for future prosperity.

On January 27, Finance Minister Jim Flaherty introduced Canada’s Economic Action Plan. It’s a focused, multi-year plan that will provide almost $40 billion in stimulus, boost Canada’s GDP by an estimated 1.9 per cent, and create a net increase of 190,000 new jobs.

Part of our plan includes tax relief for hard-working Canadians. You work hard for the money you send to Ottawa; that’s why our first three budgets delivered nearly $200 billion in tax relief.

Canada’s Economic Action Plan goes even further by:

• Increasing the basic personal amount that all Canadians can earn without paying federal income tax;

• Raising the upper limit of the two lowest personal income tax brackets by 7.5 per cent so that Canadians can earn more at lower tax rates;

• Increasing the amount that low and middle-income families can earn before their federal child benefits are phased out;

• Investing $580 million to effectively double the tax relief provided by the Working Income Tax Benefit – real assistance to low-income Canadians; and

• Providing up to an additional $150 of annual tax savings for low and middle-income seniors through a $1,000 increase to the Age Credit Amount.

Many Canadians will use tax savings to make home improvements. Home renovations are smart investments, as they can improve the value of a property, and reduce both energy consumption and the long-term costs of ownership.

Canada’s Economic Action Plan will provide a boost to workers in the housing construction industry and assist working families by:

• Implementing a temporary Home Renovation Tax Credit that will provide up to $1,350 in tax relief, and reduce the cost of renovations for an estimated 4.6 million Canadian families;

• Providing an additional $300 million over two years to the ecoENERGY Retrofit program to support an estimated 200,000 additional home retrofits; and

• Assisting first-time home buyers by offering up to $750 in tax relief to help with the purchase of a first home, and by boosting the RRSP Home Buyers’ Plan withdrawal limit from $20,000 to $25,000.

Canada’s Economic Action Plan will boost construction in other ways. We will expand and accelerate federal investment in roads, bridges, tunnels, harbours, border crossings and other projects with almost $12 billion in new infrastructure stimulus over two years.

Investing in infrastructure is a win-win for Canada; it creates jobs for Canadians at a time when new jobs are needed, and it will provide the better roads and bridges, and the expanded broadband service and electronic health records that Canada will need in the years to come.

Investing in social housing is also a win-win for Canada. Canada’s Economic Action Plan will create jobs and improve the quality of life for low-income Canadians by providing a one-time federal investment of $1 billion over two years for renovations and energy retrofits for up to 200,000 social housing units on a 50-50 cost-shared basis with the provinces.

In that time, we will dedicate funds to construct and improve social housing for low-income seniors, persons with disabilities, First Nations and Northerners.

Constructing new social housing is just one way our Government is assisting vulnerable Canadians. Canada’s Economic Action Plan will help workers who have been hit by the global recession by:

• Increasing for two years all regular Employment Insurance (EI) benefit entitlements by five extra weeks and increasing the maximum benefit duration to 50 weeks from 45 weeks;

• Providing $500 million over two years to extend EI income benefits for Canadians participating in longer-term training, benefitting up to 10,000 workers;

• Extending work-sharing agreements by 14 weeks, to a maximum of 52 weeks, so more Canadians can continue working;

• Helping young Canadians find summer jobs by investing $55 million over two years;

• Supporting older workers and their families with an additional $60 million over three years for the Targeted Initiative for Older Workers;

• Extending the Wage Earner Protection Program to cover severance and termination pay owed to eligible workers impacted by employers’ bankruptcy;

• Consulting with Canadians and developing options to provide self-employed Canadians with access to EI maternity and parental benefits; and

• Boosting funding for training delivered through EI by $1 billion over two years.

Canada’s Economic Action Plan meets Canada’s short-term needs, while serving our long-term goals. It will help Canadians who are out of work, protect Canadian jobs and businesses, build our communities, and put more money into the hands of hard-working families.

It is a plan that will get Canada through the global recession. Canadians will emerge from this crisis a stronger and more united people.