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Federal budget to announce $7-billion in savings on outsourcing and travel, source says

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Finance Minister Chrystia Freeland, right, tries on new shoes in Ottawa on Monday. Ms. Freeland has clearly signalled the federal budget’s main elements in recent remarks.Sean Kilpatrick/The Canadian Press

Finance Minister Chrystia Freeland’s 2023 budget will announce plans to save about $7-billion over five years through cuts to federal travel and reduced outsourcing, with a particular focus on using fewer management consultants, according to a senior government official.

The Globe is not identifying the official, because they were not authorized to be named when discussing the contents of the budget. The savings represent one side of what will be a challenging political balancing act for the government as it presents this year’s spending plan on Tuesday.

Ms. Freeland’s budget will aim to show that the government is focused on fiscal responsibility after posting massive deficits during the pandemic. At the same time, the plan will promote billions in increased spending in areas such as dental care, direct support for low-income Canadians, and a major package of new programs to boost the clean economy.

The government’s decision to cut back on outsourcing follows a series of reports by The Globe and Mail that highlighted how federal spending in this area – officially called professional and special services – has spiked under the Liberals, from $8.4-billion in 2015-16 to an estimated $21.4-billion this current fiscal year.

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Parliamentary Budget Officer Yves Giroux recently reported that while federal spending on management consultants is only 5 per cent of that total, it is a category that has grown by 95 per cent under the Trudeau government.

Mr. Giroux has questioned why spending on outsourcing has increased while the size of the federal public service has jumped by 28 per cent since 2017.

The government operations committee is currently engaged in three separate studies of the growth in federal outsourcing, including one on management consulting firms such as McKinsey & Co. and another on the ArriveCan app, which is on pace to cost over $54-million and was built through extensive use of outside contractors.

The savings on outsourcing and travel will be worth about $7-billion over five years and $1.7-billion for each year after that, the official said. The plan is meant to show that Ottawa will exceed last year’s target of finding $6-billion in internal savings over five years.

Another item that will be in the budget, according to the official, is an announcement that the government will move ahead with reforms to the alternative minimum tax. The AMT, which is intended to prevent excessive use of deductions by providing an alternative way for wealthy taxpayers to calculate their obligations, has been in place since 1986. The 2021 Liberal campaign platform and 2022 fall economic statement both said it needs to be updated to ensure wealthy people can’t excessively lower their overall tax bills.

The budget will also announce a clean technology manufacturing tax credit worth more than $3-billion over five years.

Companies will be able to use the 30-per-cent tax credit to offset the cost of equipment for mining and processing critical minerals, which are in high demand as the global economy seeks to expand the use of renewable energy and electric vehicles.

The budget will also include an extension of the six-month increase to the GST rebate, which temporarily doubled the amount sent to recipients starting in the fall. The GST rebate is a payment targeted toward lower-income Canadians. It is meant to help offset the costs of paying sales taxes.

The government plans to promote the extension as a “grocery rebate,” even though many grocery items are exempt from sales tax. There will be no obligation on recipients to spend the money on groceries.

NDP Leader Jagmeet Singh, who is seeking support for lower-income Canadians in Tuesday’s budget, responded to the grocery-themed rebate plan after it was reported Monday by CBC News.

“It looks like one of the things we’ve asked for is going to be there,” he told reporters on Parliament Hill. “We still want to see confirmation of the dental-care expansion to include seniors, people living with disabilities, and kids 18 and under. We really want this budget to save money for people.”

In public comments over the past few weeks, Ms. Freeland, who is also Deputy Prime Minister, has clearly signalled the budget’s main elements.

The government will “invest aggressively” in various clean-energy programs, partly to compete with massive new tax breaks and other incentives that were announced last year in the United States through the Inflation Reduction Act and other policies. The budget will also lay out a detailed spending plan for increased health transfers to the provinces and territories, which were announced in February.

A third category of spending will be under the heading of affordability measures, partly in response to cost-of-living pressures driven by inflation. This will include the extension of the GST credit increase and an expanded dental-care plan, as called for by the NDP, which is supporting the minority Liberal government in exchange for action on a list of policy priorities.

Lana Payne, president of Unifor, which represents thousands of Canadian autoworkers, met with Prime Minister Justin Trudeau last week just ahead of the budget. She said in an interview that U.S. policies to encourage the manufacturing and purchasing of electric vehicles and other emission-reducing measures are a “game changer” that require a strong Canadian response.

“We are in a very important moment in time, I think, economically speaking,” she said. “We can’t lose track of things right now. Because we’ve had a decade or two in which we haven’t been doing that well in terms of attracting new manufacturing investment to Canada.”

Canadian Chamber of Commerce president Perrin Beatty said he hopes to see a budget with one clear theme.

“The thing that we believe the government needs to focus on is growth. Everything flows from that,” he said. “How do we create the conditions for private-sector-led economic growth in Canada? And that doesn’t mean bringing in massive new spending programs.”

On the tax front, outside experts are not expecting major changes on Tuesday. The government has already signalled that Canadians can expect more detail on tax changes that had been previously announced, but had not yet been launched or fully explained.

These include a proposed 2-per-cent tax on share buybacks for public companies, and the updated alternative minimum tax for high-net-worth individuals.

Last year’s budget said the minimum tax change is aimed at an “unfair” situation in which thousands of wealthy Canadians pay little to no personal income tax each year because of tax credits and deductions.

Brian Ernewein, a former Finance Department assistant deputy minister for tax legislation who is now a senior adviser with KPMG, said he’ll be watching to see if the proposal indirectly limits access to the capital gains exemption for some people.

Currently in Canada, only 50 per cent of a capital gain – such as the profit on a stock sale or an investment property – is taxable. There has long been a policy debate over whether that inclusion rate should be increased. Mr. Ernewein said a minimum tax could have an impact.

“There’s at least some reason I would think for speculating that effectively, maybe not directly, but effectively, they might be changing the tax burden on capital gains through the minimum tax,” he said.

While governments frequently signal a budget’s contents in advance, tax changes are generally closely guarded, given their potential to move markets.

Bruce Ball, vice-president of taxation with the Chartered Professional Accountants of Canada, said he is not expecting major changes to personal or corporate tax rates.

He does, however, expect to see a fair number of smaller tax announcements.

“The government does have a lot of unfinished business, things that they’ve talked about before,” he said, pointing to a promised reform of business tax incentives for scientific research and experimental development as an example.

 

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Trump's claims on crime rates clash with police data – NBC News

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Surging crime levels, out-of-control Democratic cities and “migrant crime.”

Former President Donald Trump regularly cites all three at his campaign rallies, in news releases and on Truth Social, often saying President Joe Biden and Democrats are to blame.

But the crime picture Trump paints contrasts sharply with years of police and government data at both the local and national levels.

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FBI statistics released this year suggested a steep drop in crime across the country last year. It’s a similar story across major cities, with violent crime down year over year in Chicago, New York and Washington, D.C.

NBC News analyzed crime data to evaluate Trump’s assertions about the topic.

U.S. and big city crime rates

Trump’s campaign often refers to crime levels, regularly pointing the finger at Biden.

“On Joe Biden’s watch, violent crime has skyrocketed in virtually every American city,” the campaign said in a news release published this month on its site.

Trump himself has made similar remarks.

“Four years ago, I told you that if crooked Joe Biden got to the White House, our borders would be abolished, our middle class would be decimated and our communities would be plagued by bloodshed, chaos and violent crime,” Trump said in a speech last month at the Conservative Political Action Conference. “We were right about everything.”

Government figures don’t support that characterization.

Reported violent crime dropped 6% across the board when comparing the last three months of 2022 to the same period in 2023, the FBI reported.

The reported drops were especially pronounced in the big cities that Trump often assails, many of which have Democratic mayors. Violent crime dropped by 11% in cities with populations of 1 million or more, according to FBI data, while murders dropped by 20%, rape was down 16%, and aggravated assault fell by 11%.

Reached for comment, the Trump campaign pointed to other reports indicating that certain types of crimes increased in specific cities.

At the national level, the reported rate of violent crime in 2022, the most recent full year with comprehensive FBI data, was 380.7 offenses per 100,000 people. That’s lower than the overall reported violent crime rate from 2020 — the last full year Trump was in office — when the figure was at 398.5.

The lowest reported violent crime rate of Trump’s presidency was in 2019, when the metric was at 380.8 — in line with the 2022 rate.

The FBI said it will release more comprehensive 2023 crime data in October, just before the election.

The Trump campaign, reached for comment, cited certain categories of violent crime, such as motor vehicle theft, as having increased during the Biden administration, according to FBI figures.

“Joe Biden is trying to convince Americans not to believe their own eyes,” campaign press secretary Karoline Leavitt said in a statement, adding that “Democrats have turned great American cities into cesspools of bloodshed and crime.”

New York City crime

Trump, who was born and raised in New York but now lives in Florida, often rails against what he portrays as an increasing crime rate in his former hometown.

Those references to soaring violence have only increased as he faces criminal charges in New York accusing him of falsifying business records related to hush money payments to adult film star Stormy Daniels. Trump, who has pleaded not guilty in that case, must also post a $175 million bond to prevent state Attorney General Letitia James from collecting the judgment from a New York civil fraud case.

“I did nothing wrong, and New York should never be put in a position like this again,” Trump posted on Truth Social about the civil judgment in all capital letters. “Businesses are fleeing, violent crime is flourishing, and it is very important that this be resolved in its totality as soon as possible.”

In a separate post, he claimed that “murders & violent crime hit unimaginable records” in the city.

However, major crimes in New York City are down this year by 2.3%, according to police department data comparing year-to-date figures to the same period in 2023.

Those figures for last year were also far below the highs from recent decades. In 1990, more than 527,000 major crimes were reported, compared to more than 126,000 last year, according to New York police data — a drop of more than 75%.

In 2001, more than 162,000 major crimes were reported in New York. The figure dropped by more than 20% over the next two decades.

At the same time, New York City data indicates that the number of major crimes increased in the past few years, though reported violent crimes like murder and rape were down last year from previous years.

‘Migrant crime’

Trump’s dehumanizing language about migrants has become a mainstay of his political speeches since he first sought office in 2015.

In a news release this month, his campaign said the “border Crisis has created a tragic surge in violent crime against innocent American citizens at the hands of some of the world’s most violent criminals.”

Trump has also focused his energy on high-profile cases such as the death of Laken Riley, who was killed in Georgia while jogging. The suspect is a Venezuelan citizen who entered the U.S. illegally in 2022.

“Every day, innocent citizens are being killed, stabbed, shot, raped and murdered because of Biden migrant crime,” Trump said in a video posted to his campaign’s X account last week.

However, there is no evidence of a migrant-driven crime wave in the U.S., according to local police department data.

Crime reports have decreased in several major cities targeted by Texas’ Operation Lone Star, a program backed by Republican Gov. Greg Abbott that flies or buses migrants from the state to Democratic-run cities across the U.S.

Several of those cities — New York, Chicago, Washington and Philadelphia — have had decreases in year-to-date reported crime totals compared to the same period last year.


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Federal government promising a 'renters' bill of rights' in upcoming budget – CBC.ca

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Prime Minister Justin Trudeau announced that his government will introduce new measures — including a new “bill of rights” — that he says will help protect those who rent their homes as part of the upcoming budget.

Trudeau said the new measures are specifically geared toward younger people, who are renting more than previous generations.

“It’s about changing the rules of the game in a way that meets young people where they are,” he said on Wednesday.

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Ottawa will work with provinces and territories to develop a “renters’ bill of rights” that would introduce a national standard lease agreement and implement requirements for landlords to disclose an apartment’s pricing history to allow tenants to negotiate their rent.

The new measures will also include a $15-million fund for provincial legal aid organizations that help tenants fight against “renovictions” and landlord abuse.

The Liberals are also proposing to change federal rules so that making rental payments on time will count toward someone’s credit scores, something Trudeau said is meant to help renters looking to one day buy a house.

“If you look at someone who pays a $2,000 [per month] mortgage, they’re getting recognition and credit for that from their bank as part of their credit score,” the prime minister said.

“But if you’re paying $2,000 a month on rent, you get no kudos.”

Typically the government doesn’t discuss what is in an annual budget until it is introduced in the House of Commons. But the announcement was made weeks prior to the release of the Liberals’ next budget, which is slated to drop on April 16.

Releasing tidbits from the budget ahead of time is part of a new communications strategy for the Liberals, sources told CBC News. Trudeau and his ministers are expected to make a number of similar announcements in the run-up to the budget, the sources said.

WATCH | Trudeau says new measures aim to help tenants: 

Liberals promise ‘renters’ bill of rights’ to fight housing crisis

5 hours ago

Duration 2:07

The Liberals are looking to create a ‘renters’ bill of rights’ to help deal with Canada’s housing crisis. Justin Trudeau says the plan is geared toward younger people suffering from a rising cost of living. The Conservatives call the measures meaningless.

Before revealing the planned rental measures on Wednesday, Trudeau took a moment to plug the April 16 fiscal plan, saying that the budget will be about “fairness.”

“For Canada to succeed, we need everyone to succeed,” he said.

Finance Minister Chrystia Freeland joined Trudeau for his announcement and hinted about further announcements ahead of budget day.

“Over the coming days and in the April budget, we are going to launch a no-holds-barred plan to wrestle down the cost of owning and renting a home,” she said.

Wednesday’s announcements came on the same day that the Canada Mortgage and Housing Corporation released a report that found a surge in new apartment construction drove housing start increases in several major Canadian cities last year.

But the report also cautions that demand continues to outweigh supply.

The opposition Conservatives, who have enjoyed a healthy lead in recent polls, have made housing — and other cost-of-living issues — a key point of attack against the governing Liberals.

Following his announcement, Trudeau was asked whether he thinks he bears any responsibility for people feeling left behind in the current economy and whether the new measures would be enough to convince younger people to support him in the next election.

In response, Trudeau suggested that a recent rise in the cost of living is not unique to Canada.

“Young people who are key to our present, and obviously key to our future, are seeing a system that is stacked against them. That’s true in Canada but also true elsewhere around the world,” he said. “What we’re focused on now is making sure that young people can see their success in the economy.”

Opposition parties criticize Liberal announcement

Scott Aitchison, the Conservative housing critic, said Wednesday’s announcement was Liberal posturing that won’t get results.

“Today’s photo op is just another set of meaningless measures that won’t result in building the homes Canadians need,” he said in a statement.

NDP housing critic Jenny Kwan criticized the announcement for not going far enough.

“The Liberals are so out of touch with what Canadian renters are experiencing that they keep offering half-measures instead of a real action,” Kwan said in a statement.

The NDP is calling on the government to invest more in affordable housing while temporarily preventing for-profit firms from buying designated affordable-housing spaces.

WATCH | Liberal government promises better protections for renters in upcoming budget: 

Liberal government promises better protections for renters in upcoming budget

9 hours ago

Duration 11:39

The Liberal government unveiled three new proposals Wednesday to better protect renters in Canada. Power & Politics speaks to Marci Ien, minister of women, gender equality and youth, about the proposed protections.

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‘Hillary was right’: Lifelong GOP voter on why he is leaving party – CNN

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‘Hillary was right’: Lifelong GOP voter on why he is leaving party

Texas Trey, a lifelong Republican voter, speaks with CNN’s Laura Coates about why he plans to leave the party before the 2024 election.


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– Source:
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