This week’s federal budget projects the net cost of new government spending to be nearly $39 billion over the next six years — and much of it favours Millennial and Generation Z voters.
The 400-page budget, entitled Fairness for Every Generation, seeks to improve the lives of younger Canadians, especially parents struggling to raise children among rocketing costs of living.
“Canadians of my generation and older Canadians have a desire to see younger Canadians succeed and have the opportunities we enjoyed,” Deputy Prime Minister and Finance Minister Chrystia Freeland told reporters at a press conference.
“And for too many young Canadians, that is too hard.”
Many of these younger voters have said they plan to support Pierre Poilievre’s Conservatives in the next federal election. The Liberal government has put these voters front-and-centre in the 2024 budget.
“Budget 2024 takes action to ensure Canada’s social safety net works for every generation, especially Millennials and Gen Z,” the budget says.
Canada’ current deficit is projected to be $40 billion or 1.4 per cent of GDP. The budget projects that the deficit will shrink to $20 billion in 2028-2029.
Education, health
Federal ministers have spent much of the past few weeks crisscrossing the country delivering announcements about new funding for housing. The 2024 budget repeats those housing commitments. It also reiterates commitments to expand $10-a-day child care and create national dental care, pharmacare and a national school food strategy.
The budget includes other measures to improve children’s education, now and in the future.
The government is proposing to automatically enrol eligible children, who do not have a Registered Education Savings Plan set up for them by the time they are four, in the Canada Learning Bond. The bond, introduced in 2004, provides up to $2,000 for future education for children from low-income families.
Under this proposed plan, beginning in 2028-2029, all eligible children born in 2024 or later would have a Registered Education Savings Plan opened for them automatically and the bond would be deposited into these accounts.
Starting in 2028-2029, the budget says that caregivers of eligible children born before 2024 can request that the government open a Registered Education Savings Plan for their children and automatically deposit the Canada Learning Bond. The budget estimates this will mean 130,000 more children will receive the Canada Learning Bond.
The budget earmarks $67.5 million over three years for various mentoring and student support services, particularly for Indigenous youth or youth from low-income families.
And it proposes to spend $50 million over five years for a Youth Mental Health Fund to increase youths’ access to mental health care.
Caregiving
The 2024 budget includes announcements aimed at older generations. This includes beginning consultations on a national caregiving strategy.
Half of Canadians are projected to become caregivers to sick or disabled relatives or friends, Canadian Affairs previously reported. These caregivers often struggle to find support for themselves and the people they care for.
“This announcement puts the national spotlight on care issues and is a tremendous step forward for all of us who care about care,” the Canadian Centre for Caregiving Excellence, a research and advocacy group, said in a statement released after the budget.
The budget also indicates Ottawa wants to improve long-term care. The government plans to introduce new legislation, the Safe Long Term Care Act, to support new, national long-term care standards.
Long-term care varies greatly across Canada and standards for long-term care are voluntary. Long-term care is a provincial and territorial responsibility, the budget notes, and says this proposed legislation would encourage provinces and territories to adopt best practices in long-term care. The budget does not say when this bill will be introduced.
The government also announced plans to fund the Canada Disability Benefit, first promised in 2020. The government is commiting $6.1 billion over six years to the benefit, which they say will help reduce poverty among disabled Canadians between the ages of 18 and 64.
The law to create the benefit has not yet been declared in-force, and regulations that detail who will be eligible or the amount that people with disabilities will receive have not been completed.
The benefit is slated to start in July 2025 and will be restricted to those eligible for the Disability Tax Credit. The most any person could receive is $2,400 a year, or $200 a month, the budget says.
The Green Party, who have been vocal in its support of the benefit, swiftly panned this plan. In a statement, Mike Morrice, MP for Kitchener Centre in Ontario, said the benefit is not “going to lift people with disabilities out of legislated poverty.”
Capital tax gains
The 2024 budget says the government plans to fund these programs in part by increasing the amount of tax paid on capital gains that top $250,000.
Capital gains are the profit from selling assets such as stocks or investment properties. The sale of a principal residence is tax-exempt. Currently, Canadians pay tax on half their annual capital gains. The “inclusion rate” is to remain the same for annual capital gains under $250,000.
However, the “inclusion rate” will rise to 67 per cent for annual capital gains above $250,000. This measure is expected to raise $19.4 billion over four years.
In her speech to the House of Commons, Freeland said that fewer than one per cent of Canadians will pay more tax as a result of this change, while everyone else will benefit.
Democracy succeeds when it provides a good life for the middle class, Freeland said.
“When liberal democracy fails to deliver on that most fundamental social contract, we should not be surprised if the middle class loses faith in democracy itself.”
Tax policy, the finance minister said, “belongs to all of us — because it is how we decide what kind of country we want to live in and what kind of country we want to build.”
Consumers
The 2024 budget addresses the burdens digital technology places on Canadians’ professional and personal lives.
The budget proposes $3.6 million over five years for the government to change the Canada Labour Code to require employers in federally regulated industries, such as banking and telecommunications, to have policies limiting work-related communication outside of work hours.
The budget also indicates plans to change the Telecommunications Act to stop phone and internent companies from charging customers extra fees for switching carriers. Companies will also be required to create a self-serve option, so customers can switch plans on their own instead of waiting to talk to staff.
The budget says the federal government plans to work with provinces and territories to encourage them to help people easily buy tickets to concerts or sporting events. This includes helping people get timely refunds when events are cancelled and cracking down on practices that drive up ticket prices, including bot technology that buys and resells tickets. As Canadian Affairs has reported, B.C., Alberta and Ontario already have legislation banning these bots.
The budget also contains several measures to make banking easier. This includes making sure banks can charge no more than $10 if a customer has insufficient funds in their account to make a scheduled payment or cover a cheque.
‘Plead for forgiveness’
Paul Kershaw, founder and lead researcher at Generation Squeeze, a think tank at the University of British Columbia that focuses on generational fairness, says the budget could be a game changer because the government acknowledges younger Canadians are facing greater economic hardships than previous generations.
Investments in child care and a school lunch program are important, he says. But the government’s greatest expenditures remain focused on seniors, he says.
The budget projects that Old Age Security payments will increase to $100 billion in 2028-29 from the current $70 billion. Spending on child care and early learning will rise to $7.7 billion from $4.5 billion over the same time.
“This budget opens the conversation” about how different generations are treated by the federal government, he said. But more needs to be done. Older generations “are going to have to plead for forgiveness from Millennials and Gen Z for a while longer,” he said.
The Conservatives decried the 2024 budget, lamenting in a statement that Prime Minister Justin Trudeau has not balanced the budget.
“This is not a government that gives people everything they want,” the Conservatives’ statement says. “It’s a government that takes everything they have.”
The party reiterated its call for Canadians to have an election.
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