Financial relief on the way for low-income Albertans, those with student debt

Low-income Albertans and those with student debt are set to receive support from today’s federal fiscal update.

But while Ottawa’s deficit is declining – actually benefitting from inflation – the government is offering little in terms of new spending.

It’s hard enough for most students to afford an education in Alberta, and large tuition hikes aren’t making it any easier.

“Some professors are still choosing to do online, so it almost seems like we’re paying more for less help,” said University of Calgary student Sydney Geboers.

“Lots of people rely on bursaries and scholarships and everything like that in order to even get to secondary,” said fellow U of C student Mason Dyrkach.

But financial relief is now on the way.

“This is monumental news and a monumental investment for students across Canada,” said Christian Fotang, chair of the Canadian Alliance of Student Associations.

Ottawa is eliminating interest payments on all federal student loans and making the Canada Worker’s Benefit a quarterly payment.

“Knowing that employment for post-secondary graduates is the lowest in the first year, this means when they’re graduating, they’ll be able to grow their careers and join the workforce,” Fotang said.

Canada’s forecasted deficit now sits at $36.4 billion this year, but a possible recession could increase that to $49 billion.

That’s still lower than projected, but inflation remains high at 6.9 per cent and the central bank has raised its rate to 3.75 per cent to compensate.

“What we’ve been doing throughout is to strike a balance between necessary compassion and support for Canadians and fiscal responsibility,” said Chrystia Freeland, deputy prime minister and minister of finance.

Affordability measures for low-income Canadians total slightly more than $6 billion, and clean-energy investments aim to improve affordability and labour shortages.

The Calgary Chamber is encouraged, but says more can still be done to support small businesses.

“We would have liked to have seen some sort of relief addressed in terms of higher energy costs or helping them offset higher labour costs because that’s certainly something that small businesses are very concerned about,” said Deborah Yedlin, Calgary Chamber president and CEO.

Other plans include a new two per cent tax on share buybacks for large corporations, as a way of encouraging companies to invest in their domestic operations and workers.

“So we’re seeing the deficit shrink quite a bit and the biggest driver of that is the tax of corporate profits,” said Trevor Tombe, research fellow at the School of Public Policy.

For now, those profits are slowing down and a recession could loom, but the government insists it has a plan.

“A plan that supports Canadians and builds an economy that works for everyone,” Prime Minister Justin Trudeau said.

Some of the bigger supports announced Thursday include a doubling of the GST credit as well as relief in credit card fees.

There will also be increases to dental benefits as well as housing.

For now, the government says it is being prudent in uncertain times and reining in spending in case things get worse, but it does forecast a surplus of $4.5 billion by the year 2028.