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CAUT Bulletin Archives

March 1997

Alternative Budget Sparks National Debate

For the past three years a coalition of labour and social action groups has proposed an alternative budget to that of the Liberals. The coalition thought it could only be credible if it worked on a complete budget with differing assumptions from the federal government. Otherwise opposition to the government’s project seems self-interested, fragmented and lacking a national vision.

This year the alternative budget began to receive considerably more media attention than in the past, culminating in a major discussion on the CBC national news. The coalition also realized it would not have credibility unless it addressed the debt issue, and it made its calculations on the assumption that it too could balance the budget by the year 2000.

Essentially the coalition argues that the most sensible economic policy is for the federal government to launch a series of programs to encourage job creation so that there will be a greater number of Canadians paying taxes. The alternative budget would also be funded by reforms in the tax system and a reduction in interest rates over the medium term.

The alternative budget forsees a frontal attack on poverty by increasing rather than decreasing support for such social programs as income support, child welfare, a national drug plan and the like.

The plan also targets social investments. It rejects the concept of the Canada Health and Social Transfer (CHST), "... the policy values underlying it, and the cuts to social programs which motivate it."

In the area of higher education the alternative budget would introduce a post-secondary education fund and would restore and enhance the federal government’s contribution to the financing of higher education. It would restore transfers to the provinces to their 1995/96 level of $2.1 billion and then index by the three-year moving average of GDP, which will be 4.3 per cent for 1998/99.

A new Higher Education Act would define the federal government’s role in this field and would require provinces to adhere to the principles of public education, accessibility, comprehensiveness and the transferability of credits. The act would not apply to Quebec, with which separate negotiations would take place, based on these principles.

An Advisory Council on PSE would also be established. The long term goal would be to replace the Canada Student Loan Program with a National Grants Plan. In the meantime, a more limited and targetted grants program would be created along the lines suggested by the coalition of higher education groups in Ottawa for single parents and for needy first year students.

The funding for First Nations’ education would be maintained and increased by 10 per cent in each of the next two years. The Emergency Employment Investment Program would provide significant funding for research at post-secondary institutions and for infrastructure.

CAUT has given support to the coalition, particularly in the area of higher education. It does seem to be the only coherent opposition in Ottawa, and the only organization generating ideas for a national debate.

The work on the alternative budget is coordinated between the Canadian Centre for Policy Alternatives in Ottawa and Cho!ces: A Coalition for Social Justice in Manitoba.

The Canadian Centre for Policy Alternatives can be reached through its web site at or by e-mail at or by fax at (613) 233 1458. Cho!ces can be reached by fax at (204) 957 1508.