Tories say platform costing shows deficit elimination in 10 years, without cuts

The Conservative party released the costing for its election platform on Wednesday, just hours before Erin O'Toole was to take part in the first of two official leaders' debates.

The party said the costing demonstrates that a Conservative government could eliminate the deficit within 10 years without cutting programs or services, as O'Toole has promised.

But the costing, based on the parliamentary budget officer's election platform costing baseline, actually covers only five years.

And it doesn't count as cuts Conservative promises to scrap some Liberal programs, such as the $30-billion national child-care plan. It refers to those as budget "reallocations" since the Conservatives would replace the Liberal programs with alternative programs of their own.

The costing document was released just two hours before the French-language leaders' debate amid mounting criticism from Liberal Leader Justin Trudeau over O'Toole's failure to produce detailed costing of his plan. Trudeau has accused O'Toole of "magically" hoping to eliminate the federal deficit.

The Conservatives rolled out their platform on Aug. 16 -- the second day of the election campaign. The Liberals released their platform, with costing, on Sept. 1, the day before the French-language debate organized by Quebec network TVA. The NDP released a platform-style list of promises before the campaign began, but has not yet published its cost estimates.

According to the document, O'Toole's platform promises would add $30 billion to this fiscal year's forecasted budget deficit of $138.2 billion. The deficit would then fall substantially each year thereafter, to $24.7 billion in 2025-26.

The Conservatives said that shows they'd be well on the way to balancing the books by the end of the decade.

Moreover, they said that's based on the PBO's more cautious economic growth estimates, which Conservatives believe would actually be more robust once O'Toole's recovery plan was implemented.

"Even without the additional growth that will result from the plan, no cuts are needed because Conservatives will run a disciplined government that limits the growth of future spending," the party says in the costing document.

The Liberal government has inked five-year deals with eight provinces and two territories to fund increased child-care spaces and reduce child-care fees to an average of $10 per day by 2026.

That includes a deal to transfer $6 billion to Quebec, which already offers $8.50-per-day child care, to increase the number of spaces available.

During a background briefing on the costing document held on condition of anonymity, Conservative officials said Wednesday that an O'Toole government would honour the funding deals with provinces for the first year.

But after that, the Liberal child-care plan would be replaced by the Conservatives' promise to convert the existing child-care expense deduction into a refundable tax credit that would cover up to 75 per cent of child-care costs for low-income families.

The costing document suggests that means almost $27 billion of the $30 billion allocated by the Liberal government to help provinces improve access to child care over the next five years would be scrapped, replaced by a tax credit which would cost almost the same amount but go directly to parents.

As for Quebec's $6-billion share, officials would not say precisely how much of that the province would get to keep. They said there'd be money on the table for a deal, which O'Toole would sit down with Premier Francois Legault to discuss.

The Liberals said the document makes clear that the Conservatives would make "a massive 80 per cent cut to our Canada-wide child-care system."

"They would replace it with a tax credit -- and only 6,600 families out of 1.5 million families across the country would receive the full value of it," the Liberal party said in a statement.

The document also shows a Conservative government would scrap some $2-billion worth of Liberal "natural climate solutions" and replace them with $1.5 billion-worth of their own.

O'Toole has made much of his promise to boost unconditional health transfers to the provinces by $60 billion over 10 years, by guaranteeing a six per cent increase in the transfer each year.

However, the costing document shows that under the existing formula for the Canada Health Transfer, which is based on economic growth, the annual payments would already increase by almost six per cent for the next two to three years.

Officials said the Conservative plan would guarantee that would continue over the long term, whereas the current formula guarantees a minimum of just three per cent annual increases.

The bulk of O'Toole's promised $60-billion boost to health transfers would come in the latter half of the decade and would be dependent on the Conservatives winning re-election.

"Despite Mr. O'Toole's grand promises, he will only invest $5.1 billion over four years (in health care)," the Liberal party said.

"Our plan invests nearly five times more to strengthen our public universal health-care system."

This report by The Canadian Press was first published Sept. 8, 2021.