No major cuts in budget; $2.9B deficit projected

Daniel Proussalidis, National Bureau

, Last Updated: 7:14 PM ET

OTTAWA -- The feds aren't ready to kick the habit of spending more money than taxpayers give them, but Finance Minister Jim Flaherty says they're getting closer.

"It's been a long road back from the Great Recession to a balanced budget," Flaherty said. "We're not quite there yet, but we're almost there."

Flaherty introduced his tenth budget Tuesday, projecting a deficit of $2.9 billion for this year -- down from the $55.6-billion hole the Conservatives dug in 2009.

The finance minister expects the feds will "easily" post a $6.4-billion surplus in 2015, just in time for the next federal election.

Donald Carson with Chartered Professional Accountants Canada gives the budget "a solid silver" medal.

"We do applaud the government for maintaining a course toward eliminating the deficit," Carson said.

NDP Leader Thomas Mulcair isn't impressed.

"They're trying to set it up in such a way that they'll be able to announce the balanced budget irrespective of whether or not the numbers actually work," he said. "This is all about lining themselves up for the 2015 election."

Flaherty's budget projects $9.1 billion in savings over six years.

Most of that will come through tough upcoming negotiations on civil servants' salaries and by making retired civil servants pay more for the health-care benefits.

Others savings will come through a two-year freeze on federal departments' operating budgets and punting $3.1 billion meant for new fighter jets, ships or other military equipment until 2016 when the purchases will likely happen.

The Canadian Taxpayers Federation (CTF) says this is the first Conservative budget that actually reduces government spending year-over-year.

"They're gradually undoing some of the mistakes they made with that huge surge in spending in '09, and we're happy to see it," CTF federal director Gregory Thomas said.

Liberal Leader Justin Trudeau panned the budget for not responding to middle class concerns, unmoved by new consumer and job creation measures.

One of the most high-profile measures is a commitment to give the Competition Bureau the power to crack down on retailers who can't justify why they sell goods in Canada for more than what they charge in the U.S.

Details are scarce, but David Wilkes with the Retail Council of Canada says he still likes the idea.

"We welcome the initiative, which will lower costs for independent retailers in Canada," said Wilkes.


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