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Martin's Liberals freeze spending, hiring
By Leo Valiquette, Ottawa Business Journal Staff
Tue, Dec 16, 2003 2:00 PM EST
A cash crunch in the federal budget led new Finance Minister Ralph Goodale to announce a partial spending freeze on Tuesday, with new government hiring among his targets.
Following a cabinet meeting, a statement issued to the media declared that every nickel and dime spent at the federal level will be under the microscope as part of a sweeping review of all expenditures.
"In contrast to previous reviews, all government spending will go under the microscope. There will be no exceptions," read the statement.
However, the new Liberal government of Paul Martin will try and hold to a commitment to transfer an extra $2 billion to the provincial governments for health care. That promise was made only a few months ago by Goodale's predecessor, John Manley.
"We have taken immediate steps to find savings in the current fiscal year. We will take every step possible to ensure that we are able to provide the $2 billion health transfer to the provinces and territories without going into deficit," Goodale said in the statement.
Spending on all major capital projects will be frozen, as well federal staffing levels.
The announcement comes after new Prime Minister Paul Martin and his cabinet of 39 ministers was sworn in last Friday at a ceremony at Rideau Hall.
Goodale warned after the ceremony that the cost of responding to this year's economic shocks, such as SARS and the mad cow scare, had drained federal coffers.
Between April and November the federal government was forced to increase spending by 6.2 per cent while revenues gained by only 0.2 per cent.
Goodale said there was little wiggle room left without straying into deficit spending, something the Liberal's have vowed not to do.
Goodale also said last week that the economy has not rebounded as quickly as he would like, forcing the government to take a "very disciplined approach" to spending.
Time will tell what impact a hiring freeze will have on a government town like Ottawa. For the past year and a half, public service hiring has emerged as a bright spot of the local labour market. However, government hiring has slowed down in recent months, according to the latest data from Statistics Canada.
On the year to date, employment in Ottawa-Gatineau has increased by about 4.5 per cent, or 26,000 jobs, thanks in part to strong federal hiring.
By Leo Valiquette, Ottawa Business Journal Staff
Tue, Dec 16, 2003 2:00 PM EST
A cash crunch in the federal budget led new Finance Minister Ralph Goodale to announce a partial spending freeze on Tuesday, with new government hiring among his targets.
Following a cabinet meeting, a statement issued to the media declared that every nickel and dime spent at the federal level will be under the microscope as part of a sweeping review of all expenditures.
"In contrast to previous reviews, all government spending will go under the microscope. There will be no exceptions," read the statement.
However, the new Liberal government of Paul Martin will try and hold to a commitment to transfer an extra $2 billion to the provincial governments for health care. That promise was made only a few months ago by Goodale's predecessor, John Manley.
"We have taken immediate steps to find savings in the current fiscal year. We will take every step possible to ensure that we are able to provide the $2 billion health transfer to the provinces and territories without going into deficit," Goodale said in the statement.
Spending on all major capital projects will be frozen, as well federal staffing levels.
The announcement comes after new Prime Minister Paul Martin and his cabinet of 39 ministers was sworn in last Friday at a ceremony at Rideau Hall.
Goodale warned after the ceremony that the cost of responding to this year's economic shocks, such as SARS and the mad cow scare, had drained federal coffers.
Between April and November the federal government was forced to increase spending by 6.2 per cent while revenues gained by only 0.2 per cent.
Goodale said there was little wiggle room left without straying into deficit spending, something the Liberal's have vowed not to do.
Goodale also said last week that the economy has not rebounded as quickly as he would like, forcing the government to take a "very disciplined approach" to spending.
Time will tell what impact a hiring freeze will have on a government town like Ottawa. For the past year and a half, public service hiring has emerged as a bright spot of the local labour market. However, government hiring has slowed down in recent months, according to the latest data from Statistics Canada.
On the year to date, employment in Ottawa-Gatineau has increased by about 4.5 per cent, or 26,000 jobs, thanks in part to strong federal hiring.
