Since its tabling last month, Canada’s leading economists have lauded Economic Action Plan 2012’s prudent outlook and Canada’s strong economic performance.
Minister Flaherty regularly consults private sector economists directly on their views on the outlook for the Canadian economy. The economic forecast presented in Economic Action Plan 2012 was based on a survey conducted in early March 2012 and includes the views of 14 independent, private sector economists.
The average of independent, private sector economic forecasts has been used as the basis for fiscal planning since 1994 and introduces an element of independence into the fiscal forecast. This practice has been supported by international organizations such as the IMF.
Here are what Canada’s leading economists have said about Economic Action Plan 2012:
Patricia Croft, economist:
“(Budget 2012’s) initiatives in the job front and addressing the demographic challenge … in both regards I’d have to give the budget probably an ‘A’ … in a global context, I think Canada is in a fabulous position.” (CBC News – March 29, 2012)
Avery Shenfeld, CIBC World Markets chief economist:
“(Budget 2012) makes sense in a world economy that is still not what we would like it to be … Relative to what anybody else is doing, we still come out with flying colours.” (Toronto Star – March 30, 2012)
Tina Kremmidas, Canadian Chamber of Commerce chief economist:
“Overall, the federal government’s relatively favourable fiscal position, compared to other G7 countries, should be well received by markets, as will the plan to eliminate deficits largely on the back of spending restraint … the government has incorporated additional prudence into the budget plan. The Canadian Chamber praises this cautious approach as it will provide the government with greater flexibility … (Budget 2012) creates a solid foundation on which to build.” (Press Release – March 30, 2012)
Craig Alexander, TD Economics chief economist:
“(Budget 2012) was quite a prudent budget … the government provided support to the economy when it needed it. They boosted spending. They increased stimulus and now that we’re on the other side of the valley, it is time to rebalance.” (CTV News Channel – March 29, 2012)
Doug Porter, BMO Capital Markets deputy chief economist:
“Overall, (Budget 2012) increases our confidence that the government can achieve its medium-term target—new measures are mildly restrictive and achievable, there is a degree of prudence … (Budget 2012) fleshed out a reasonably detailed plan to rein in the deficit over the medium term … (the) carefully detailed the Strategic and Operating Review of spending, which looks for savings of more than $5 billion per year by mid-decade.” (BMO Capital Markets – March 29, 2012)
François Dupuis, Desjardins Economics chief economist:
“Better management of the government is front and centre … the government continues its reflection on the management of government and the effectiveness of existing programs based on the new economic realities … The economic and financial projections used in the 2012 budget are similar to our latest projections. In this context, the parameters used in developing the budget seem realistic … in the current context of a global crisis in public finances, it is clear that Canada is doing relatively well.” (Desjardins Economics – March 29, 2012)
Avery Shenfeld, CIBC World Markets chief economist and Warren Lovely, CIBC World Markets economist:
“Canada’s federal government remains the very picture of health, standing head and shoulders above many developed countries in terms of fiscal sustainability … the 2012 budget was as much about Canada’s longer term prospects.” (CIBC Economics – March 29, 2012)
Craig Wright, RBC Economics chief economist:
“(Budget 2012) projections are based on reasonable economic assumptions … The federal government has delivered on its promise of guiding the Canadian economy towards improved fiscal performance in what are generally difficult economic times globally. There is often the tendency to project improving fiscal conditions on vague initiatives for cost savings. To the federal government’s credit, it has gone to great lengths to identify specific areas of saving which provides greater reassurance of the improving fiscal situation being realized. These improving fiscal measures are in marked contrast to less stellar fiscal performance among numerous other industrialized economies.” (RBC Economics – March 29, 2012)
Pedro Antunes, Conference Board of Canada economist:
“(Budget 2012) has put the focus on facilitating long-term economic growth. The budget keeps the government’s deficit-elimination plan on track by bringing federal spending as a share of the economy back in line with historical levels … given the prudent economic outlook and conservative estimates … overall, the Conference Board’s economic outlook is more optimistic than the assumptions used in Budget 2012.” (Conference Board’s 2012 Federal Budget Analysis – March 29, 2012)
Craig Alexander, TD Economics chief economist:
“When combined, the various measures included in (Budget 2012) are aimed at improving productivity and boosting private sector growth … In addition to being fiscally prudent in the medium-term, the government is taking action to pursue fiscally sound policies for the long run.” (TD Economics – March 29, 2012)