Our fiscally responsible plan for fairness

May 12, 2015

With all due respect to National Post columnist John Ivison, his argument (“Conservatives say Liberals miscalculated cost of Trudeau tax plan by $1 billion”) is dead wrong. Conservatives convinced Mr. Ivison that we failed to account for hundreds of millions of dollars in tax revenue, in our commitment to replace the unfair Universal Child Care Benefit (UCCB).

Firstly, Mr. Ivison claims that the government’s numbers show the UCCB costs $18 billion per year. If this were the case, many people would be interested in seeing such numbers. The UCCB pays nowhere near that amount. When we built our plan for fairness, we assumed it would cost almost $8 billion annually, minus the recouped taxes. We booked $7 billion annually.

Here’s how we got there.

When the Conservatives announced the enhanced UCCB benefit last fall, they indicated that it would include $4.96 billion in cheques in 2016-2017. They also said it would generate $570 million in tax revenue for the government, leaving a net cost of $4.4 billion. This is the exact number we used in our model.

We did the same thing with the pre-existing child benefit, which was created in 2006. We used the Conservatives’ own estimate of $2.88 billion in cheques for the same time period, and subtracted $300 million in taxes.

Despite Mr. Ivison’s conjecture, the numbers are not wrong, and neither are we.

Interestingly, this unfortunate misunderstanding does make the point that Justin Trudeau’s plan for a bigger, simpler, tax-free monthly benefit is just the kind of fairness Canadians deserve.

Mr. Ivison lastly suggests that because a plan has $2 billion in new investment it is somehow underfunded. This completely ignores that the government itself is claiming surpluses in the years ahead, not to mention the different choices a Liberal government would make.

For one, we would not waste over $750 million on partisan advertising as the Conservatives have, nor would we double the tax free savings limit for wealthy Canadians. Our platform will of course be fully costed, and Liberals will provide Canadians with a plan that finally restores fiscal responsibility to government.

Hon. John McCallum, P.C., M.P.

Get the details