The quiet cuts - Macleans.ca

The quiet cuts

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The Federal Tobacco Control Strategy is being cut, trade consulates will be closed, a coalition of organizations that deal with homelessness in Montreal won’t receive funding, neither will six groups studying women’s healthseafood inspection is being moved, regional development auditors are being eliminated, economists at Statistics Canada will have to compete for their jobs and StatsCan will start surveying less. David Pugliese wonders why Defence Research and Development Canada is being cut.

Kevin Page puts the short-term situation in perspective.

Ottawa’s ongoing planned restraint and 6.9 per cent cut in departmental spending will reduce its share of the economy from 7.3 per cent in 2010-11 to 5.5 per cent in 2016-17. That will have a direct impact on the economy, Page’s report stresses. It projects the spending restraints and cutbacks will reduce economic output by 0.3 per cent this year, climbing to 0.88 per cent in 2014.

Canada’s economy, subsequently, will grow by only 1.6 per cent in 2013, eight tenths of a point less than forecast by the Bank of Canada and the private sector consensus. On the jobs front, restraint will result in about 18,000 fewer jobs this year than had there been no restraint, climbing to 108,000 fewer jobs in 2015. Most of the losses are due to Ottawa’s actions — including a reduction of 43,000 stemming directly from March’s spending reductions — although provincial restraint is also a factor. Unemployment, currently at 7.2 per cent, will climb to 7.9 per cent in 2013, the report predicts.