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Finance Minister Oliver solicits NDP, Grit ideas for ‘low-cost’ spending plan

As he prepares his first budget as federal Finance Minister, Joe Oliver is repeating the practice of writing to opposition leaders to request suggestions. However, a string of recent government announcements – including tax cuts for families and small businesses – combined with falling oil prices, mean there is virtually no surplus left to spend in the coming fiscal year.

Fred Lum/The Globe and Mail

Finance Minister Joe Oliver is asking opposition leaders to propose ideas for the 2015 budget, but only if they are "low-cost" or have no cost at all.

As he prepares his first budget as federal Finance Minister, Mr. Oliver is repeating the practice of writing to opposition leaders to request suggestions. However, a string of recent government announcements – including tax cuts for families and small businesses – combined with falling oil prices, mean there is virtually no surplus left to spend in the coming fiscal year.

As a result, Mr. Oliver is framing the 2015 budget in the same terms as his predecessor Jim Flaherty framed previous budgets during years of spending restraint.

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"I will not entertain 'laundry lists' of new spending or subsidy programs from the opposition," Mr. Oliver writes in identical letters to NDP Leader Thomas Mulcair and Liberal Leader Justin Trudeau.

"I invite you to contribute low-cost or cost-neutral proposals that will help to create jobs and grow the economy. Additionally, I continue to welcome suggestions to eliminate ineffective spending in government," Mr. Oliver wrote.

Ottawa had been anticipating a $6.9-billion surplus for 2015-16 after making adjustments for lower-than-expected revenues related to lower oil prices, but the government's $5-billion tax-cut package and $300-million in infrastructure spending have reduced the size of next year's projected surplus to $1.6-billion.

Economists say that surplus could shrink further – or even become a deficit – should oil prices remain at current low levels or drop further. Another factor weighing on Ottawa's bottom line is the cost of Canada's military mission in Iraq. The government has not provided an estimate on the cost of the mission.

Members of the House of Commons finance committee are currently working on a report based on weeks of testimony related to prebudget hearings. The Conservatives hold a majority on the committee and the final report tends to give an indication of the government's budget priorities. The opposition parties generally issue dissenting reports outlining their proposals for the budget, which is normally tabled in February or March.

NDP finance critic Nathan Cullen said the reason why there is no money for new initiatives is because of the high-cost measures recently announced by the Conservatives.

Opposition MPs have been critical of the policy merits of the government's move to allow families with children to split their income for tax purposes. The opposition has also criticized Mr. Oliver for approving a small-business tax break related to employment insurance premiums without conducting an internal analysis as to whether the move would create jobs.

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"He should probably take some of his own advice," Mr. Cullen said. "Certainly there's new money for their pet projects that are shown to be ineffective and ideological. That's a choice that they're making."

Liberal finance critic Scott Brison described Mr. Oliver's letter as patronizing.

"On one hand, he's telling opposition there'll be no reckless spending. On the other hand, he's engaging in reckless spending," he said. "I find it a little rich."

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