OTTAWA — Canada’s first parliamentary budget watchdog says there are ways for the federal government to impose some discipline on its upcoming spending plans to keep the deficit from spiralling out of control.
Kevin Page makes the argument in a paper today that the government should move away from spending to stimulate the economy as conditions improve following the shock of COVID-19.
To guide decision-making, Page proposes a series of measures the Liberals can use to focus planned spending while also keeping federal finances healthy.
They include setting a range for federal debt as a percentage of the overall economy over a 10-year period and yearly limits for spending increases.
He also suggests the government prepare a policy response just in case economic conditions worsen, or improve beyond expectations.
Page says the Liberals shouldn’t abandon some form of spending restraints because of COVID-19, despite what the government says.