Parliamentary Budget Officer Criticizes Federal Spending On Pandemic Measures

A new report from the Parliamentary Budget Officer (PBO) criticizes the Liberal government’s ongoing spending to shore-up the economy during the COVID-19 pandemic.

The Liberals had promised up to $100 billion in economic stimulus, subject to a series of spending checks to determine whether the economy had sufficiently recovered from the pandemic.

The PBO’s new report says those benchmarks, mostly tied to the labour market, have now been met, and called on the stimulus to be wound down before the current fiscal year ends on March 31.

The report added that the rationale for the planned stimulus of up to $100 billion no longer exists unless the government has changed the policy yardsticks.

Canada’s labour market ended 2021 having surged past pre-pandemic levels, while other economic indicators suggest the economy may be hitting capacity. Statistics Canada reported this week that Canada’s annual rate of inflation in December hit a 30-year high.

Since the start of the pandemic, the PBO estimates that the federal government has spent or planned to spend $541.9 billion in stimulus measures, about one-third of which ($176.6 billion) is not related to the pandemic.