Economic Statements

I’ve briefly talked about the Budget and economic statements in the tutorial on the legislative branch, but given that the federal finance minister, Joe Oliver, gave an update this afternoon, and other Canadian jurisdictions have or will be giving their own, I thought it would be a good idea to have a post to distinguish between the budget and economic statements.

First, it is important to note that  the Budget and the Economic statement are financial documents – that is, explanations of how the government collects and spends monies of the government treasury -and therefore critical to the function of government (the collection of funds and the distribution of those funds for programs and services consumed or used by citizens). Failure to pass any supply bills attached to the budget is deemed to result in the legislature losing confidence in the government and the government “falls”.

Traditionally, both Budgets and Economic Updates are delivered in the legislature, where they are also “tabled” or put into the official record of the Legislature or House of Commons proceedings. This is because as the chamber of the peoples elected representatives, MPPs/MLAs/MPs are responsible for scrutinizing or studying the financial accounts of the government and are required to question how the government collects and spends money. And traditionally, ministers of finance have upheld this practice and the principle of Parliamentary Supremacy, respecting the role of our elected representatives.

However, there have been instances where the Budget and Economic Updates have not been delivered in the legislature. Economic Updates more so then Budgets, but there have been instances such as in Ontario in 2003 when Janet Ecker, finance minister in Ernie Eves’ Cabinet delivered her Budget speech at Magna’s automotive training facility, in Brampton.

It has been more common recently for ministers of finance to deliver their Economic Updates in front of supportive crowds outside the legislature as Joe Oliver did today in Toronto rather than in the House of Commons in Ottawa.

So, what is so important about the tabling of the Economic Update? Well, it is part of the story of the governments finances known as the Financial Cycle.

Budget-Economic Statement

The economic statement is a progress report on Budget implementation and is therefore part of the annual Financial Cycle. Budgets are typically introduced in the Spring. Economic Statements, delivered in the Fall, provide updates on the economy, provides new direction, updates on new or existing government priorities and any other details the minister of finance deems important and any changes to the Budget [1]).

To read the 2014 Fall Economic Statement from the Canadian Ministry of Finance, please visit: http://www.budget.gc.ca/efp-peb/2014/pub/toc-tdm-eng.html .

Sources:
1 Ontario News. Ontario Budget Basics. https://www.ontario.ca/government/ontario-budget-basics (Accessed: November 12, 2014).

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