sheesh am i in the wrong country....

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Vancouver Sun, Page A04, 22-Aug-2005

Federal surplus predicted to climb by billions

By Eric Beauchesne

 

OTTAWA -- The federal government is -- and will continue -- racking up fatter

than forecast budget surpluses that will climb back above the $10-billion mark

next fiscal year, says an economic think-tank.

 

The surplus this fiscal year will rise to $9.5 billion from an estimated $6.8

billion last year, and then surge even further to $11.3 billion in 2006-07, the

Canadian Centre for Policy Alternatives says in a new forecast prepared for the

House of Commons finance committee.

 

The rebound in federal surpluses is despite an additional $4.6 billion in social

spending this year and next which the minority Liberal government agreed to in

order to obtain NDP support and avoid being defeated before the budget was

passed.

 

The surpluses are in excess of the $2 billion a year required to meet the

conditions for that agreement with the NDP to be implemented. They are also a

lot higher than forecast in the budget, which didn't include the $4.6 billion in

extra spending, but still projected surpluses of $3 billion in the last fiscal

year, $4 billion this year and $5 billion next year, says the think-tank.

 

Other economists speculated that last year's surplus could be as high as $8

billion when the final figures are in this fall.

 

" The federal government has a long track record of low-balling its surplus

estimates and announcing surprise year-end surpluses. We believe that the budget

has significantly underestimated corporate income tax revenues, " notes the

report, adding that personal income tax revenues will also be slightly higher.

Program expenditures will also be less than forecast by the budget, despite the

additional social spending. So too will debt charges, reflecting the declining

debt, which will more than offset the impact of what are expected to be modest

increases in interest rates, says the report.

 

A federal government strategist said last week that revealing another fat

surplus, at a time when consumers are being hit with record gasoline prices,

will add to pressure on the government to offer further quick tax relief,

possibly in a fall budget.

 

The Canadian Centre for Policy Alternatives, however, has long advocated using

the surpluses -- which now automatically go towards debt reduction -- to boost

social spending.

 

 

a blinding flash

hotter than the sun

dead bodies lie across the path

the radiation colors the air

finishing one by one