2023 federal budget focuses on high cost of living, investing in public health care, green economy

Finance Minister Chrystia Freeland announced this year’s federal budget in the House of Commons Tuesday afternoon. It is focused on helping Canadians with the high cost of living, investing in public health care, and investing in the green economy.

Freeland delivered a budget that she says aims to promote economic growth without making inflation any worse. It’s a difficult balance as economists say deficits drive inflation up.

READ MORE: New Hamilton-Centre MPP Sarah Jama sworn in at Queen’s Park

Some of the most notable items include more than $46 billion in funding for provincial health systems, $13 billion to expand dental care coverage for lower-income Canadians, a 30 per cent tax credit for clean technology manufacturing, a 15 per cent tax credit for clean energy investments.

The federal government is promising more than $8 billion in new program spending this year alone, projecting the deficit to climb to more than $40 billion which is $10 billion more than was forecast in the fall economic statement. This is due to new spending and a worsening economy.

To help with the high cost of living, the feds are offering a grocery rebate for lower-income Canadians, as much as $467 a year for families with children, and $225 for seniors. The GST tax credit is expected to cost Ottawa $2.5 billion.

When it comes to the economy, inflation is expected to remain high but also continue to decline from its peak last June, returning to the level the Bank of Canada would like to see by the second quarter of next year.

READ MORE: Ontario minister defends covering fewer eye exams for seniors

The government is forecasting an economic slowdown, telling Canadians to expect a shallow recession this year. Real GDP growth in 2023 is expected to decline significantly.

The historically low unemployment rate is expected to climb this year from about 5 per cent now, to 6.3 per cent by the end of the year.

The government is no longer forecasting a return to surplus by 2027-28, instead, this budget predicts the deficit will be $14 billion by then.