Seven Economic and Fiscal Update highlights for Canada’s social impact sector

In normal times, Finance Minister Minister Chrystia Freeland would have presented Canada’s Economic and Fiscal Update, a snapshot of the country’s coffers, in the House of Commons.

Instead, Freeland tabled the 96-page Update from isolation after two of her staffers tested positive for COVID-19 — a reminder of the virus’s persistence nearly two years into the global pandemic. The Update promised tepid single-digit GDP growth, a growing debt-to-GDP rating, and tens of billions of dollars in additional spending. 

But with an expected Omicron wave, the Update cautioned Canadians of the fact COVID recovery is still a long way off. 

“As Omicron has reminded us, COVID-19 threatens us still,” reads Freeland’s introduction to the Economic and Fiscal Update. “As 2021 draws to a close, finishing the fight against COVID-19 remains our most important national project.” 

And it may very well delay some of the Liberal government’s plans for 2021. CBC News was told by a senior government official that several major commitments, including new housing supports and climate change initiatives, will be on ice until next spring’s budget as the Canadian government adopts an “omicron-centric” focus. 

Still, there are some highlights for those interested in social policy and the social impact sector. Everything from COVID-19 related ventilation upgrades to First Nations reserve schools to billions in funding for resettling 40,000 Afghan refugees and their families are on the table. Future of Good combed through the Update to find the most important numbers for social impact organizations to consider in the coming months:

Compensation for past abuses against Indigenous children and ‘long-term reform’: $40 billion. 

The day before Freeland tabled the Economic and Fiscal Update, a statement from Indigenous Services Canada promised the economic snapshot would include $40 billion in compensation, a major announcement at a time when First Nations are still negotiating a child welfare agreement with the Canadian government (and as the Canadian government continues to appeal a Canadian Human Rights Tribunal ruling that would force the government to compensate children individually for past abuses). 

“Although negotiations are still ongoing,” the Update says, “the government has provisioned $40 billion to respond to the order of the Canadian Human Rights Tribunal, compensate for harms by the First Nations Child and Family Services Program and for delays or denials in needed children’s services, and support long-term program reforms to make sure communities have the support they need to keep families together.”

Nearly all of this $40 billion appears to be earmarked for addressing past harms and discrimination, according to the Update’s budget tables. What remains unclear, given the Update’s wording, is whether the $40 billion could cover other Liberal promises: mental health strategies for Indigenous children, drug and addiction services, or other programs designed to address the intergenerational trauma faced by so many Indigenous people as a result of the abuses they faced in care. 

High as the price may be, the First Nations Child and Family Caring Society pointed out that it would have been much lower than $40 billion if the Canadian government had acted sooner. “The price tag is so high today because the Government of Canada did not implement available solutions to address the serious harms to First Nations children and families, despite knowing about the problems for decades,” the Society said in a statement on Dec. 13, a day before the Update. 

Climate disaster recovery efforts in British Columbia: $5 billion

British Columbia’s devastating November floods are believed to have caused over $450 million in insurable damages alone, according to the Insurance Bureau of Canada. As part of its contribution to its disaster assistance arrangements, the Canadian government is offering $5 billion to help B.C. recover from the flood, “as well as other costs related to the recent natural disasters in British Columbia.” 

As with the Indigenous child welfare promise above, it isn’t clear exactly what the $5 billion will pay for, although B.C is currently suffering major damage to its highways, railways, and pipelines. Eligible expenses for the Canadian government to cover under the Disaster Financial Assistance Arrangements, according to Public Safety Canada’s website, include everything from repairing infrastructure like roads and bridges to the costs of evacuation operations, and replacing personal property. Non-profits and charities are also heavily involved in both humanitarian and recovery efforts in B.C.

The impact of 2021’s climate disasters on B.C. will clearly be long-lasting for B.C. residents looking to buy food and other essentials. “The impacts of this extreme weather are expected to weigh on Canada’s recovery in the fourth quarter of 2021 and could lead to a further increase in prices, particularly in British Columbia,” the Update reads. “While some trade links have fully reopened, others remain closed or at partial capacity, and permanent repairs could take several months in some cases.” 

COVID-19 therapeutics and rapid tests: $3.7 billion

Canadian public health experts have demanded better access to antigen tests, commonly known as rapid tests, for Canadians as a way to screen for COVID-19 outside of clinics or testing facilities. As Omicron threatens to overwhelm Canada’s testing capabilities, the need for quick testing is greater than ever. The Update contains $1.7 billion in promised spending to help provinces and territories buy rapid testing supplies. 

The government says a greater supply of rapid testing kits, along with $2 billion in spending on COVID-19 therapeutics to treat the virus, will help Canadians most susceptible to COVID-19 in the first place: elders over the age of 60, people with chronic medical conditions, low-income Canadians, and members of visible minority groups. “Increased rapid testing in schools and workplaces also indirectly supports parents and caregivers who would be affected by school closures in the event of further transmission of known or suspected cases,” the Update says. 

That said, some Canadian provinces are already sitting on millions of antigen tests. While Alberta and Nova Scotia have recently promised to distribute free kits to their residents, Ontario is only offering them to students free-of-charge. Simply offering money for more rapid testing kits may not necessarily provide more kits in the hands of Canadians who actually need them. 

Resettling costs for 40,000 vulnerable Afghans and their families: $1.37 billion

After scathing criticism of Canada’s disorganization in the face of the Taliban takeover of Afghanistan in August 2021, the federal government promised to resettle 40,000 vulnerable Afghans and their families. The Update gave Canadians an estimate of the cost — $1.3 billion over the next 6 years, with another $66 million to follow. 

“Many of these individuals will be women, children, religious and ethic minorities fleeing the Taliban, or people who supported Canada and our allies over the past two decades,” the Update says. These refugees would be coming to Canada through a series of special immigration, humanitarian, and family reunification programs. 

Some Canadian NGOs continue to provide humanitarian aid in Afghanistan, especially in the face of the country’s ongoing drought and consolidation by the Taliban government. However, the situation is only likely to get worse. Development funding by the World Bank and other major multinational grantmakers has slowed to a trickle due to concerns about humanitarian funding falling into the hands of the Taliban. 

One-time payments for Guaranteed Income Supplement recipients who had their payments clawed back after qualifying for CERB: $742.4 million

Essential as the Canada Emergency Response Benefit (CERB) was for millions of Canadians, it had one major flaw: recipients who already drew on other benefits to make ends meet saw clawbacks from their bank accounts. People who earn the Guaranteed Income Supplement are low-income seniors whose income, if single, is lower than $19,248 a year. In the Update, the Canadian government promised to pay out $742.4 million to rectify the clawbacks.

It isn’t clear how much Canadians who had Guaranteed Income Supplement payments clawed back will receive in these one-time payments. Regardless, they may be welcome news for low-income Canadians who depend on benefit income.

IMF Poverty Reduction and Growth Trust: $107 million

Canada is promising to contribute at least $107 million between 2021 and 2027 to the International Monetary Fund’s (IMF) Poverty Reduction and Growth Trust, a fund to provide financing to low-income countries around the world. Reforms enacted by the IMF’s executive board in July 2021 include eliminating limits on access to funds for the poorest countries in need of COVID-19 pandemic relief. 

In a statement in July, the IMF admitted “the volume of pandemic-linked lending — already provided or expected to be provided in the next few years — far exceeds what has been anticipated or previously recorded, creating a sizable shortfall in the necessary resources.” 

According to a Government of Canada statement from October 2021, Prime Minister Justin Trudeau promised $982 million in Canadian contributions to the Poverty Reduction and Growth Trust, nearly ten times more than the contributions promised in the Update over the next six years. 

Canada Performing Arts Workers Resilience Fund: $60 million

Performing artists and all of the trades associated with live shows, from carpenters to sound designers, have been among the hardest-hit sectors by COVID-19 public health restrictions. Not only have repeated lockdowns deprived them of an audience, but the amount of time required to take a show from concept to curtain means many Canadian production companies have been unable to put on performances even when restrictions were relaxed. 

The Update proposes a $60 million program to start a Canada Performing Arts Workers Resilience Fund, through Canadian Heritage, to “fund new or enhanced sector-led and delivered initiatives that improve the economic, career, and personal circumstances of individual Canadian workers in the live performance sector.” 

At least 200 million COVID vaccine doses to COVAX by the end of 2022: Unknown

Trudeau also announced on the first day of the G20 Summit in October 2020 that Canada would be contributing, through either procurement or financial support, a minimum of 200 million vaccine doses to COVAX by the end of 2022. According to the Update, this would make Canada “one of the most generous donors” to the international vaccine-sharing agreement. 

However, leaders in the Global South, particularly South Africa and India, have accused Canada of stifling vaccine production efforts by refusing to support the Trade Related Aspects of Intellectual Property Rights (TRIPS) waiver to temporarily limit corporate intellectual property rights on vaccines, thereby allowing countries to manufacture their own COVID doses. 

The exact price of these vaccines will depend on the going rate for doses at the time of purchase, as well as whether any of the procured supply comes from Canada itself. Canada signed contracts with seven different vaccine makers to produce more than 400 million doses. 

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