Quebec Finance Minister Eric Girard plans additional spending totaling over $22 billion from 2021-2022 to 2026-2027, including $3.2 billion in “immediate relief” for the 6.4 million Quebecers who are severely or not hit hard by the rising cost of living. Here are the highlights of Quebec’s 2022-2023 budget.
$500 Immediate Assistance for “Inflation Protection”
Less than seven months before the election, Eric Girard is providing a $500 refundable tax credit to adults with an income of $100,000 or less to “better protect themselves from the effects of frenetic inflation.”
People earning between $100,000 and $105,000 will receive a lower amount, which will be determined based on income.
The refundable tax credit will be available without distinction to students, employees, final resort financial aid recipients and retirees, provided they file a 2021 income tax return. Depending on the situation, it increases or decreases the tax refund. expected payment.
The $500 Immediate Assistance is in addition to the $200 or $275 exceptional living wage benefit that was given to 3.3 million low- and middle-income people last fall.
The cost of living will rise by 4.7% in 2022 in Quebec — not the 2.9% Mr Girard predicted last November. Inflation has been exacerbated by a strong global economic recovery from the pandemic and Russia’s invasion of Ukraine, the finance minister said on Tuesday.
For access to “quality and affordable housing”
The Government of Quebec is providing $347 million to build 1,000 new affordable housing units over the next five years and to complete the already announced 3,500 new units.
The Lego government will also lend a helping hand to 2,200 hard-pressed tenants, including abused women and the homeless, through monthly “rent surcharges.”
Unexpected Support for Public Organizations
This year, Quebec is allocating another $149 million to community organizations, which, according to Eric Girard, are “the cornerstone of Quebec’s social safety net.” These amounts are intended to finance not only specific projects, but also the activities of organizations.
The government pays special attention to organizations fighting sexual and domestic violence (+18.8 million) and organizations helping young people in difficult situations (+5 million).
The fourth budget, signed by Minister Girard, improves Quebec’s core portfolios – health (+6.3%, excluding measures taken after the arrival of COVID-19 in Quebec), education (+5.4%), higher education. education (+13.1%) — in 2022-2023
Amounts for the restoration of the health network
Quebec is allocating $5.2 billion over five years to a plan to “rebuild” the health network, developed by Minister Christian Dube.
The government, which advocates “local”, “decentralized, humane and efficient” management of the health care network, is counting on decentralized scheduling, eliminating abuse of overtime, and increasing the number of full-time employees. in a hospital setting and improving work-family balance.
The government is providing $27.3 million in 2022-2023 ($183.3 million over five years), among other things, to facilitate “access to a health worker within 36 hours.”
The government is also increasing the refundable Senior Home Maintenance Tax Credit by one percentage point per year, from 35% in 2021 to 40% in 2026.
Together we weathered the storm. As we look at the finish line of the mandate entrusted to us by Quebecers, we can be satisfied with the soundness of our finances, the vigor of our economy, and the substantial sums we have put back into the pockets of Quebecers.
Extended Student Financial Aid
Quebec is responding to expected tuition increases by significantly expanding access to student financial aid. The government plans to invest $342 million over five years in various loan and scholarship programs.
The expenditure portfolio of the Ministry of Higher Education will increase by 13% next year. By 2027, the government will spend $634 million to increase the number of CEGEP and university alumni.
A return to balanced budgets is expected in 2027-2028.
Quebec will return to a balanced budget in 2027-2028 without “increasing the tax burden” on Quebecers, while ensuring “adequate funding for the state’s core missions” and filling the Generations Fund, Eric Girard confirmed on Tuesday, after announcing new spending of nearly 22.3 billion over six years.
To achieve this, he is counting on faster economic growth and, as a result, growth in government revenues, as well as a possible increase in federal transfers to health care.
In addition, the gross debt weight will increase to 43.1% of GDP as of March 31, 2022.
Eric Girard is promising to set next year “a new debt reduction target spanning the next 10 or 15 years” if by then voters – and Prime Minister François Legault – have regained their confidence in him.
Investment in economic recovery
Quebec is committing $4.2 billion to help rebuild an economy that has been hit hard over the past two years.
To combat labor shortages, specifically, the government is counting on business productivity growth: more than half of the amount allocated for recovery (2.2 billion) will be directed over the next five years to research and development, to the digital shift, to new technologies. Part of the recovery funds (1.5 billion) will be directed to the development of the regions, including 627 million to stimulate the agri-food sector.
Gross domestic product (GDP) of Quebec will grow not by 3.3%, but by 2.7% in 2022, the Ministry of Finance now estimates, forced to revise its economic growth forecasts downward due to the Omicron option (-1.4%) . then the Russian invasion of Ukraine (-0.2%).
After a recorded decline of 5.5% in 2020 due to the COVID-19 pandemic, real GDP grew by 6.3% in 2021.
Green shift contingencies
Thanks to windfall revenues from the carbon market, the minister is adding $1 billion to strengthen the fight against climate change over the next five years.
A total of $7.6 billion will be directed primarily to greenhouse gas (GHG) reduction activities, starting with transport and industry.
Dawson College excluded from PQI
The Dawson Anglophone CEGEP expansion project in downtown Montreal has been excluded from the Quebec Infrastructure Plan (PQI). QIP 2022-2032 includes projects totaling $142.5 billion.
Envelope of the Ministry of Education in PQI is inflated, this is 200 million.
Eric Girard is trying to solve the dilapidated school buildings caused by the COVID-19 pandemic and the air circulation problems seen in some schools. So it’s freeing up an additional $267 million over five years to help “maintain classroom water and air quality.”
Tax cuts on the horizon?
Mr Girard said the government still has a “long-term” goal of cutting taxes when there is a budget surplus. “Before we can reduce the tax burden, we must be able to see a surplus,” he said.
The Minister of Finance was not too lazy to point out that, without taking into account the planned contributions to the Generations Fund, the balance of the budget “in accounting terms” will be achieved in 2023-2024. Prime Minister François Legault recently signaled that he would wait until the next election campaign to clarify his intentions for tax cuts.
And four budgets
Eric Girard signed his fourth and final budget for the Quebec legislature.
On August 15, the Department of the Treasury will release a campaign report that should allow all political parties (and Quebecers) to be informed about Quebec’s finances before the election campaign begins.
With Ulysse Bergeron, François Carabine, Clemence Pavic, Isabelle Porter, Alexandre Robillard and Marie-Michel Siui