Conservatives from the Quebec riding of Beauce have come up with a plan to gut social programs, and they want their party to get behind the idea at the policy convention.
After the government balances its budget, set for 2015-2016, they want to freeze spending at $300 billion in today's dollars through 2020-21.
Let’s put this radical idea in perspective. Freezing total federal government spending in nominal dollars wouldn’t allow spending to grow in line with inflation – let’s put it at 2% each year to be aligned with the inflation target of the Bank of Canada. The plan also fails to take into account population growth – about 1% per year.
This means there would have to be additional spending cuts amounting to 3% per year. That’s $9-billion in cuts, year after year, for four years. This is roughly equivalent to eliminating the federal government support for medicare through the Canada Health Transfer. But because some spending would increase at a faster rate than zero, this would mean deep, deep cuts in other areas of federal spending. Which ones?