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Tax cuts will do nothing for health care, public services, poverty reduction

OTTAWA – The Liberal government’s Economic and Fiscal Update is a crude pre-election mini-budget that promises to put tax cuts ahead of Canadians’ priorities like protecting public health care, said Paul Moist, national president of the Canadian Union of Public Employees (CUPE).

What Canadians really care about is protecting health care, improving public services and reducing poverty, but none of these priorities appear in the update,” Moist said.

Finance Minister Ralph Goodale is using the bogeyman of productivity as an excuse to provide billions in tax cuts to corporations and individuals, but these are just pre-election promises that ignore Canadians’ most important priority – protecting public health care,” Moist said.

Moist noted that tax cuts don’t work at increasing productivity.

The federal Liberals brought in $100 billion in corporate and personal income tax cuts in their 2000 Budget,” Moist said. “Since then, corporate profit and executive incomes soared, but our investment rate and productivity growth plummeted. Why do they think that more of the same will work?”

Federal government program spending is expected to be only about 12 per cent of Canada’s GDP for the next five years. This is much lower than its average it has been for most of the last 50 years.

Investments in public services are crucial for increasing productivity and have been shown to be much more effective than tax cuts at boosting the economy and increasing productivity. To fully protect public services, the federal government must stop privatization by increasing accountability on the spending of public funds.

Moist noted that the federal government missed the opportunity to take concrete steps to protect public health care, such as stopping the funding of private care and stopping doctors from working in both the private and public realms.

They could have guaranteed access to all necessary services, pledged to stop buying for-profit care for federal employees like the RCMP and announced federal public funding for hospital financing,” Moist said. “These are simple steps but the federal government took none of them in this pre-election ploy.”



Paul Moist, National President, cell (613) 558-2873; Claude Généreux, National Secretary-Treasurer, (porte-parole francophone) cell (514) 884-5074; David Robbins, CUPE Communications, cell (613) 878-1431