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In Canada, federal budgets are presented annually by the
Government of Canada The government of Canada (french: gouvernement du Canada) is the body responsible for the federal administration of Canada. A constitutional monarchy, the Crown is the corporation sole, assuming distinct roles: the executive, as the ''Crown-in- ...
to identify planned government spending and expected government revenue, and to forecast economic conditions for the upcoming year. They are usually released in February or March, before the start of the
fiscal year A fiscal year (or financial year, or sometimes budget year) is used in government accounting, which varies between countries, and for budget purposes. It is also used for financial reporting by businesses and other organizations. Laws in many ju ...
. All the Canadian provinces also present budgets. Since provincial finances depend on funds from the federal government, they are usually released after the federal budget.


Budget process

The budget is announced in the
House of Commons The House of Commons is the name for the elected lower house of the bicameral parliaments of the United Kingdom and Canada. In both of these countries, the Commons holds much more legislative power than the nominally upper house of parliament. ...
by the
Minister of Finance A finance minister is an executive or cabinet position in charge of one or more of government finances, economic policy and financial regulation. A finance minister's portfolio has a large variety of names around the world, such as "treasury", ...
, who traditionally wears new shoes while doing so. The Budget is then voted on by the House of Commons. Budgets are a
confidence Confidence is a state of being clear-headed either that a hypothesis or prediction is correct or that a chosen course of action is the best or most effective. Confidence comes from a Latin word 'fidere' which means "to trust"; therefore, having ...
measure, and if the House votes against it the government can fall, as happened to
Prime Minister A prime minister, premier or chief of cabinet is the head of the cabinet and the leader of the ministers in the executive branch of government, often in a parliamentary or semi-presidential system. Under those systems, a prime minister is n ...
Joe Clark Charles Joseph Clark (born June 5, 1939) is a Canadian statesman, businessman, writer, and politician who served as the 16th prime minister of Canada from 1979 to 1980. Despite his relative inexperience, Clark rose quickly in federal polit ...
's government in 1980. The governing party strictly enforces
party discipline Party discipline is a system of political norms, rules and subsequent respective consequences for deviance that are designed to ensure the relative cohesion of members of the respective party group. In political parties specifically (often refe ...
, usually expelling from the party caucus any government
Member of Parliament A member of parliament (MP) is the representative in parliament of the people who live in their electoral district. In many countries with bicameral parliaments, this term refers only to members of the lower house since upper house members ofte ...
(MP) who votes against the budget. Opposition parties almost always vote against the budget. In cases of
minority government A minority government, minority cabinet, minority administration, or a minority parliament is a government and cabinet formed in a parliamentary system when a political party or coalition of parties does not have a majority of overall seats in ...
, the government has normally had to include major concessions to one of the smaller parties to ensure passage of the budget. Historically the
official opposition Parliamentary opposition is a form of political opposition to a designated government, particularly in a Westminster-based parliamentary system. This article uses the term ''government'' as it is used in Parliamentary systems, i.e. meaning ''th ...
used to prepare a complete alternative budget and present this alternative to the Canadian people along with the main budget. In recent years, opposition parties are more likely to pick only certain aspects to criticize. The Reform Party revived this practice for a time, however. A complete alternative budget is today produced each year by the
Canadian Centre for Policy Alternatives The Canadian Centre for Policy Alternatives (CCPA) is an independent think tank in Canada. It has been described as "left leaning". The CCPA concentrates on economic policy, international trade, environmental justice and social policy. It is es ...
, a non-partisan think-tank. Traditionally, the budget process was immensely secretive with little consultation. Under Prime Minister
Louis St. Laurent Louis Stephen St. Laurent (''Saint-Laurent'' or ''St-Laurent'' in French, baptized Louis-Étienne St-Laurent; February 1, 1882 – July 25, 1973) was a Canadian lawyer and politician who served as the 12th prime minister of Canada from 19 ...
, the Finance Minister famously would type the entire budget himself so that no secretary could read it. This secrecy was felt to be needed for inside information could enable individuals to profit from upcoming government decisions. The secrecy also had a large political component, as it would help undermine the response by the opposition. Under Prime Minister
Jean Chrétien Joseph Jacques Jean Chrétien (; born January 11, 1934) is a Canadian lawyer and politician who served as the 20th prime minister of Canada from 1993 to 2003. Born and raised in Shawinigan Falls, Quebec, Chrétien is a law graduate from Uni ...
and his Finance Minister
Paul Martin Paul Edgar Philippe Martin (born August 28, 1938), also known as Paul Martin Jr., is a Canadian lawyer and politician who served as the 21st prime minister of Canada and the leader of the Liberal Party of Canada from 2003 to 2006. The son of ...
, this changed considerably. Most of the budget would be released well before its announcement, especially any major changes so as to get feedback from the populace and the market. The process of creating the budget is a complex one which begins within the working ranks for the Federal Government. Each year, the various departments that make up the Government (for example, Health, Transportation, Foreign Affairs, National Defence, Industry, CRA, etc.) submit what are called 'The Main Estimates' to The Treasury Board Secretariat. These documents identify the planned expenditure of each department, linking these proposed expenses to programs, to objectives and ultimately to the priorities of the current ruling Government. The Treasury Board Secretariat combines these budget estimates and compiles an initial proposed budget. From there, the Cabinet and Prime Minister's Office adjust the budget based on a series of economic, social and political factors. In reality, decisions are usually made with the primary intent of re-election and so often include advantages for key regions and lobby groups. Following the budget, Parliament (the Canadian Parliament) will pass an Appropriation Act (called the 'Interim Supply') which will allow individual departments to spend 3/12th of their annual budget. (The Government of Canada Fiscal Year runs from April 1 to March 31.) This partial authority enables Parliament to spend more time in examining the Estimates documents. In June, Parliament appropriates the full supply.


Summary of budgets


See also

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Taxation in Canada Taxation in Canada is a prerogative shared between the federal government and the various provincial and territorial legislatures. Legislation Under the ''Constitution Act, 1867'', taxation powers are vested in the Parliament of Canada under s. ...
*
Canadian public debt Canadian public debt, or general government debt, is the liabilities of the government sector. Government ''gross debt'' consists of liabilities that are a financial claim that requires payment of interest and/or principal in future. They con ...
International: *
Government budget by country A government is the system or group of people governing an organized community, generally a state. In the case of its broad associative definition, government normally consists of legislature, executive, and judiciary. Government is a ...


Notes and references


Notes


References

{{National government budgets
Budget A budget is a calculation play, usually but not always financial, for a defined period, often one year or a month. A budget may include anticipated sales volumes and revenues, resource quantities including time, costs and expenses, environment ...