Quebec budget | Six things to know

A few months before the general election, Finance Minister Eric Girard presented the latest budget for his mandate. Faced with rising inflation and to counter its effects, he sent a check for $500 to nearly 6.4 million Quebecers. Here are six things to know about the red ink budget as the return to a balanced budget holds for 2027-2028.

Published at 16:13

Hugo Pilon Laros

Hugo Pilon Laros
Press

Cost of living: Minister Girard’s check

This is the most striking measure in the budget. Finance Minister Eric Girard says the inflation rate is expected to be 4.65% throughout 2022 and he is concerned about the economic impact on households. In this context, the government is providing a lump sum of $500 to all Quebecers whose annual income was $100,000 or less in the past year. This check will be in the form of a refundable tax credit, payable automatically on 2021 tax return filing. The measure represents a cost of $3.2 billion and affects 6.4 million people. Prisoners and people who moved outside Quebec before 1uh last January will not be eligible.

This check, sent months before the election, is not an election check, Quebec defends. The Minister of Finance explains in his budget that “part of the increase in the cost of living is offset by the indexation of personal income tax by 2.64% in 2022. [Mais] inflation forecast for 2022 is 4.65%. […] The lump sum helps Quebecers bridge that gap. »

“Refundament” of the healthcare system: money ahead of the plan

Health Minister Christian Dube has vowed to “rebuild” the healthcare system hit by the COVID-19 pandemic. His finance colleague Eric Girard is now determining the amounts he will have to make. Quebec is investing $8.9 billion over five years, including “$5.2 billion to restore health and social services and $3.7 billion to improve community care and services.” Of this package, $1.3 billion is budgeted for 2022-2023. The remaining investments are divided into 2026-2027.

The “recovery” plan of Minister Dube, which will soon be submitted for consideration, will be deployed along four axes. The government wants to improve access to data, modernize information technology (while the network tries to share patient health data between institutions), focus on human resources in the face of labor shortages, and maintain the quality of infrastructure.

On this last point, “The Quebec Infrastructure Plan 2022-2032 (PQI) provides for an investment of $22.8 billion in the health and social services sector”, while “the proportion of investments intended to maintain the current state of the infrastructure is 47% of the total investment.” [ces investissements]and new infrastructures to support development account for 53%.”

Education: The Priority of Perseverance

With school sanitation rolled out and classrooms closed during the COVID-19 outbreaks, school persistence has become a priority again. The government is making an additional $1.6 billion investment over five years — $275 million for fiscal year 2022-2023 — to keep young people (and teachers) in schools, support the tutoring program, and refurbish schools, while some of the they show a high level of deterioration. .

For university students, the government is allocating 1.2 billion over five years (246.7 million in 2022-2023) to improve access to study and graduation. The Student Financial Aid program, which takes into account parental or spouse income, will also be reviewed in the context of “some students seeing their financial aid drop significantly.”

“In order to provide financial assistance to more students to continue their studies, from 2022-2023 the government wishes to raise the threshold against which parental or spouse income is considered from $55,000 to $75,000 for parents living together, from $50,000 to $65,000 dollars per parent or sponsor and between $48,000 and $63,000 per spouse,” the budget states.

Economy and housing: focus on productivity

The Lego government is returning to its oft-repeated goal of closing the wealth gap between Quebec and Ontario. “This gap, as measured by GDP per capita, widened from 16.4% in 2018 to 13.6% in 2022. And we have a goal to reduce it to 10% by 2026 and eliminate it completely by 2036,” the Minister of Finance wrote. Eric Girard in a budget speech.

To achieve this, Quebec claims that “increasing productivity is the main lever for increasing the wealth of Quebec.” Therefore, Mr. Girard plans to invest $4.2 billion over six years to “improve the productivity of the economy, increase the integration of immigrants into employment, support regional economic development and support recovery.”

“In principle, 20% of the wealth gain needed to close the gap in living standards with Ontario should be made up by increasing the number of workers and the employment rate of the labor force, and 80% by increasing productivity. says the budget.

To help families and workers find housing in a context sometimes referred to as a housing crisis, the Lego government is investing $634 million over six years to “complete nearly 3,500 AccèsLogis housing units, build 1,000 additional Quebec affordable housing units.” Housing Program, Rent Supplementation and Assistance to Municipalities”.

Environment and Society: Another $1 Billion in Green Economy Plan

The government itself admitted that the environment was a weak point in its last election campaign. Months before the general election, he announces that he is adding $1 billion towards his Green Economy Plan 2030, which will total “$7.6 billion over five years to fight climate change.”

Of this amount, “$5.8 billion is planned to reduce GHG emissions, including $3.5 billion for the transport sector ($717 million in 2022-2023), $1.3 billion for the industrial sector (197, $1 million in 2022-2023); and $758 million for the construction sector ($85.2 million in 2022-2023).” Quebec is also expanding the Roulez vert program, which “allows for discounts on the purchase of several types of electric vehicles, as well as on the purchase and installation of charging stations at home, at work and in apartment buildings.

For community organizations, some of which have been in high demand since the start of the pandemic, Quebec plans to invest $1.1 billion over five years to roll out the Government Action Plan for Community Action 2022-2027. The government believes that this amount “will provide an unprecedented increase in financial support for organizations” and “will give them the means to improve their services and strengthen their activities through the recruitment of staff.”

Portrait of finance: rising costs

In 2022-2023, the main tasks of the government will be accompanied by a steady increase in spending. In healthcare and social services, they will reach 6.3% growth, in education – 5.4% (in higher education – 13.1%).

“The fiscal balance in terms of government accounts shows a $3.0 billion deficit in 2022-2023 and a surplus in 2023-2024. Subject to requirements Balanced Budget Law“The fiscal balance shows a deficit of $6.5 billion in 2022-2023 and a structural deficit of $2.8 billion in 2026-2027,” the budget reads.

The government still expects a return to balanced budgets by 2027-2028. “Thanks to the strong economic recovery, the gross debt burden will reach 43.1% of GDP as of March 31, 2022, below the target of 45% set in Debt Reduction and Generation Fund Act. This is 6.1 percentage points better than the budget forecast for March 2021. In 2022-2023, Quebec plans a reserve for economic risks and stimulus measures of $2.5 billion in 2022-2023.

Quebec Infrastructure Development Plan (PQI) 2022-2032 increased by $7.5 billion. “Over the past four years, PQI has increased annually from $100.4 billion in March 2018 to $142.5 billion in March 2022,” the budget reads.

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