On March 28, the Minister of Finance, Eric Girard, spoke before the Chamber to present the 2022-2023 budget recently tabled by the Government of Quebec.
In part, he reviewed measures to fight inflation and the optimistic outlook for the health of the Quebec economy and the province’s public finances.
Strong numbers for the Quebec economy
Minister Girard focused on the robustness of the Quebec economy, pointing out that it is outperforming the economies of its neighbours.
“Quebec’s economic recovery in 2021 was more robust than observed in Canada. The current levels of activity exceed those of before the pandemic.” – Eric Girard, Minister of Finance
This recovery is accompanied by encouraging signals about the management of public finances, with a balanced budget objective set for 2027-2028.
“We have healthy management of public finances, with a gradual reduction in the structural deficit. Our next budget will set a new debt reduction target for the next 10 or 15 years.”
Despite this, the Minister emphasized the significant inflationary pressure, brought about, he believes, by three major factors.
“There are three key factors to inflation: the synchronized recovery of the global economy, the effects of the fifth wave on labour, and the increase in the price of raw materials because of the war in Ukraine.”
Key measures to tackle economic challenges
Eric Girard detailed the logic behind the most talked-about measure of the budget: a one-time payment of $500 to 6.4 million Quebecers to address the increase in the cost of living.
“The idea of the $500 is to bridge the gap between the indexing of income and the real hike in prices. We have chosen to trust Quebecers.”
Despite constant progress, the economy continues to face a productivity challenge. To catch up to Ontario wealth levels in the medium term, the Minister focused on productivity growth through innovation.
“Our budget includes $2.2 billion to increase the productivity of the Quebec economy. One of the priority avenues is support for innovation and research through the 2022-2027 Québec Research and Innovation Strategy, which we will deploy.”
In conclusion, the Minister reiterated that the government’s priority was to help Quebecers deal with the increase in the cost of living as part of the healthy management of public finances. He also indicated that a new budget exercise will be conducted in the summer before the provincial election on October 3, 2022.