Those expecting a Christmas present from the Finance Minister will be disappointed. Less optimistic than expected for 2024, Eric Girard unpacked specific and cautious investments on Tuesday, particularly for housing affordability.
“We are not in a recession, but certainly in an excessively difficult period that could be described as stagnation,” Minister Girard said at a press conference.
“The next six months will be very difficult,” he warned.
Altogether, the additional investments planned in its economic upgrade amount to 4.3 billion dollars.
For the average Quebecer, the indexation of the personal income tax system at 5.08%, as of January 1, will represent $282 more for the entire year 2024.
Including the indexation of social assistance benefits to the same level, this measure, provided automatically based on inflation, adds up to $2 billion.
Specifically, the maximum amount of the family allowance will increase by $141, that of the solidarity deduction by $59. For the basic welfare benefit, it will be an additional $37 per month.
Housing crisis
As already announced, Quebec will match federal spending ($900 million) to improve access to housing, which overall will ensure that $1.8 billion will be invested to build 8,000 new housing units social and affordable in five years, including 500 for the homeless.
Food banks, which urgently requested $18 million, will eventually receive $20.8 million to see them through the year.
Downward forecasts
The prolonged rise in interest rates and the persistence of inflation have led Minister Girard to revise down his economic growth forecasts for 2024, from 1.4% to 0.7%.
Despite this, the Finance Minister maintains the goal of returning to budget balance in 2027-2028.
To achieve this, however, it will have to draw $1 billion from its contingency reserve. The projected deficit remains at $4 billion for 2023-2024.
Away from the demand of the cities
Analyzing the breakdown of the sum of 1,800 million over five years announced by Minister Girard for adaptation to climate change, we see that the planned investments are still far from the 2,000 million requested by the municipalities.
In fact, only $260.6 million in new money is actually earmarked “to support initiatives” in this area. To arrive at the $1.8 billion figure, Mr. Girard includes $696 million related to wildfires, including $400 million already spent for those that occurred over the summer.
Last June, Prime Minister François Legault and his Minister of Municipal Affairs, Andrée Laforest, indicated that municipalities had room for maneuver to invest in adaptation to climate change. Mr. Legault has particularly highlighted the remuneration of municipal officials, which is 35% higher than that of Quebec state officials.
