Quebec budget will help citizens cope with soaring costs, Eric Girard says

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QUEBEC — The new provincial budget to be tabled Tuesday will offer direct help to Quebecers to struggle to manage the soaring cost of living, Finance Minister Eric Girard said Monday.

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But the rapid economic rebound Quebec has experienced following the COVID-19 pandemic is also allowing him to scale back the projected deficit number.

Girard said Quebec’s structural deficit, the long-term one that does not include one-time spending for particular events such as the pandemic, will be under $3 billion, which is about half of what he projected in the 2021-2022 budget he tabled last March.

That budget pegged the structural deficit at between $5.5 and $7 billion. The total deficit was supposed to be $15 billion.

“We do have measures to help people with the cost-of-living increase,” Girard told reporters at the traditional media event where the minister shows off his budget day new shoes — in this case New Balance running shoes.

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“We did it in the fall. We had a special amount. We’re looking to make another gesture tomorrow.”

In his November economic update, Girard doled out checks for 3.3 million low-income Quebecers to help them cope with inflation. A person living alone got up to $275, while couples got $400.

Over the last few weeks, the government has given numerous hints that the budget will cut fresh checks for many more people who are coping with the higher-than-anticipated inflation rate that has sent the cost of food, gas and housing soaring.

In his last budget, Girard forecast a three-per-cent inflation rate for 2022. The rate now is closing in on four per cent.

Girard would not say how many more people would be getting checks. That number will be known Tuesday, when the budget is tabled in the National Assembly around 4 pm

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“We are looking for a more general application,” a tight-lipped Girard said.

But Girard hinted his budget-writing was made easier by the “exceptional” economic performance of Quebec now that many pandemic restrictions are being lifted and citizens and businesses are starting to spend.

The unemployment level, for example, was pegged at 4.5 per cent in February, among the lowest in Canada. Ontario’s rate is 5.5 per cent.

All this helps Quebec stay on track with its plan to return to balanced books by 2027-2028, Girard said.

“The objective is for the return to balanced books to happen with the least possible effort,” Girard said. “In other words, that the transition be as smooth as possible.

“You have to remember we are living in uncertain times. We have a prudent financial framework. When we say 2027-2028, it is possible we reach a balanced situation a year or two before, but we have a high degree of uncertainty.

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“There is the pandemic, the invasion of Ukraine by Russia.”

He said at the start of any new year there is about a 10 per cent chance of a recession. Events in Ukraine mean that possibility is now hovering at about 20 per cent.

Girard rebuffed the idea that the budget will take on an electoral allure with boutique spending items to gain votes. It is the Coalition Avenir Québec government’s fourth and last budget before the October general election.

“I am at the service of Quebecers,” Girard said. “It’s an honour. I think people will be pleasantly surprised that we are prudent, that we’re dealing with the immediate needs. We’re also funding the principal missions of the state: health care, education, the economy, the environment.

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“We’re providing for the long term. We’re thinking beyond the election. With respect to fighting cost-of-living increases, I think the need is immediate.”

The inflation checks won’t be the last from the government. Last Thursday, Premier François Legault indicated Quebecers will be getting a second check somewhere down the line to pay anticipated hydro increases.

But the government has ruled out a suggestion from the Quebec Conservative Party, which said Quebec should stop collecting its share of taxes on gas at the pump. Legault said that move would only benefit big consumers and increase greenhouse gas emissions.

Besides revising the deficit numbers, Tuesday’s budget is expected to include other key spending decisions, including some idea of ​​how Quebec plans to pay for its planned reforms of the health-care system.

It also will include Quebec’s annual infrastructure spending plans. On Monday, Transport Minister François Bonnardel got the jump on the budget, announcing a total of $6.8 billion in infrastructure spending for the province.

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