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A daily look inside Canadian politics and power. | | | | |  | | By Nick Taylor-Vaisey, Andy Blatchford, Sue Allan and Zi-Ann Lum | Send tips | Subscribe here | Follow Politico Canada WELCOME TO OTTAWA PLAYBOOK. I'm your host, Nick Taylor-Vaisey with Andy Blatchford, Sue Allan and Zi-Ann Lum. We all spent several hours in a room with a book prepared by a Liberal government that has a new lease on life after inking a three-year deal with the opposition New Democrats. They tabled it on a Thursday and then skipped town into a two-week break from the House. Here's what we learned.
|  | DRIVING THE DAY | | The Liberals spent too much. The Liberals spent just enough. The Liberals didn't spend enough. That was Thursday's Budget Day non-consensus in Ottawa. Conservatives will never give a living Liberal — except for JEAN CHRÉTIEN and PAUL MARTIN — credit for fiscal responsibility. New Democrats will never applaud what a Liberal is willing to invest in a transformative social program. That's just how it goes. This much is true: CHRYSTIA FREELAND talks a big game about prudence, but she offers no path to a balanced budget and tens of billions in new spending over five years. JUSTIN TRUDEAU insists constantly that Liberals "have" our "backs," but still national pharmacare legislation won't come until 2023 — with an actual program that'll subsidize drugs to follow, sometime down the road, maybe just before an election, maybe not. — Freeland's Index, Part Deux: You be the judge of the Trudeau-Freeland fiscal bona fides. Playbook presents some of the key metrics for you to decide: 78 billion: Planned new spending over five years in the 2021 Liberal platform. 31.2 billion: Planned new spending over five years in Budget 2022. 36.1 billion: The windfall, in dollars, of higher revenues and lower expenses the government didn't anticipate last December — i.e. unexpected cash for federal coffers. 2.2. billion: Planned new spending, in dollars, in 2021-22 — a modest total that stunned many analysts in the budget lockup. 49.2 percent: Budget 2021's projected debt-to-GDP ratio for 2025-26. 42.8 percent: Budget 2022's projected debt-to-GDP ratio for 2025-26. 15 percent: The "dividend" that banks and insurance companies who raked in pandemic profits will have to pay on income over C$1 billion. 5.3 billion: Five-year cost of dental care for families with household incomes of less than $90,000 over five years. (In 2022, 12-year-olds are eligible. In 2023, 18-year-olds are eligible. The program will be fully implemented by 2025.) 1.6 billion: The average annual increase to defense spending. That funding jolt fell far short of what many observers expected — and seemed out of step with Freeland's rhetoric in the budget speech: "Putin’s invasion of Ukraine has also reminded us that our own peaceful democracy — like all the democracies of the world — depends ultimately on the defense of hard power. The world’s dictators should never mistake our civility for pacifism. We know that freedom does not come for free, and that peace is guaranteed only by our readiness to fight for it."
| | ALSO FOR YOUR RADAR | | FIVE THINGS YOU NEED TO KNOW — The POLITICO Canada team read the entire budget document so you don't have to. We came up with five takeaways: — Uncertainty is certain: The budget devotes pages to war and its potential spillovers. “The Canadian economy is less exposed to the economic fallout than other regions (e.g. Europe),” the document says. “On the other hand,” it adds, there’s a long list of vulnerabilities: sanctions, disrupted global trade, tighter financial conditions and additional pressure on supply chains. — Affordability is everything: A suite of housing measures take top billing in the government’s budget, reflecting Canadians’ anxieties about the cost of living. They include new programs to support more rent-to-own projects; a new multi-generational home renovation tax credit to help families build secondary suites; and a promise to increase housing stock by doubling the rate of new builds over the next decade. — It's time to let good times roll, for now: A boost to commodity prices, driven in large part by Russia’s war, has helped the resource-rich country’s bottom line. But Freeland’s budget warns that the steep climb in prices risks hurting households and further disrupting the global trade of goods and services. — Covid is in the rearview, probably: “We bent but we did not break,” Freeland told MPs as she tabled her budget documents in the House. Note the past tense. The finance minister’s speech and her 280-page budget mostly treat Covid-19 like something Canada is done with. — Climate policy is economic policy: A senior government official used Canada’s rich critical mineral deposits as an example for how natural resources can be harnessed to fuel an economy recovering from the pandemic. The official, who was not authorized to speak publicly on the matter, said a subset of Canada’s critical minerals sector is currently valued up to C$340 billion. “The question is are we going to emerge from it a poorer country or a more prosperous country,” they said. 'SMALL POTATOES' — Freeland's budget promised a C$8 billion boost to defense spending and a policy review meant to reflect tumultuous times on the global stage. But POLITICO's ANDY BLATCHFORD found experts in the lockup scratching their heads. Last month, Defense Minister ANITA ANAND told CBC’s Power & Politics she was personally bringing forward “aggressive options” for additional spending. She said they included a scenario in which Canada would exceed NATO’s 2 percent target. — DAVID PERRY, president of the Canadian Global Affairs Institute, said the Trudeau government had been setting out “pretty significant expectations” for defense spending ahead of the budget. “Given where we are with Ukraine, with language like that from the finance minister, it falls flat,” Perry said. “I certainly don't think that anything in the budget today is going to do anything to address the concerns of Canadian allies or people that think that we haven't been committed enough. Because C$8 billion in its totality is relatively small potatoes." “We’re great on rhetoric, but I'm not seeing any substance,” ROBERT HUEBERT , a University of Calgary defense expert, told POLITICO. “With inflation brought into consideration, I doubt that we moved a number at all on our (1.36 percent). ... We talk the talk, but I don't see much action.” More bits and bytes from the budget: — Cheaper beer: NDP MP RICHARD CANNINGSwas pushing an industry-backed private member's bill that would take the tax off low-alcohol beer. Freeland preempted that effort in the budget, wiping away the excise duty on wobbly pops to match similar rules for low-alcohol wine and spirits. Total cost to the treasury: C$9 million over five years. Cannings, for his part, took a victory lap. — You hearing this, Pierre? The budget acknowledges digital assets and cryptocurrencies are at play in the global economy. The government says the federal finance department will launch a legislative review on the digitalization of money with a focus off the top on cryptocurrencies and stablecoins.
| | CONSERVATIVE CORNER | | BUDGET SPIN — A buffet of Tories lashed out at the tax-and-spend Liberal-NDP coalition of doom. Over to you, righteously rhetorical right: — Candice Bergen: “This is not a responsible budget — this is an NDP budget. It is a budget funded by Canadians suffering from inflation. Canadians need a break and they didn’t get one from the NDP-Liberal budget today." — Pierre Poilievre: “This budget had one job — reverse the taxes and deficits that have ballooned inflation to a 30-year high. Instead, Trudeau turbo-charged JustInflation. When your house is on fire, you don’t douse it in gasoline. — Jean Charest: "The Liberals talk a big game about sustainability, yet they offer none when it comes to our economy. There is no fiscal discipline here. Instead, there is only a guarantee of crippling debt and out-of-control inflation." — Roman Baber: "Trudeau’s misguided ideology resulted in record spending, borrowing and printing, which caused the highest rate of inflation in a generation. We need to bring back adult supervision to Ottawa." FYI: Baber is in British Columbia this weekend, the same province where Poilievre is rallying tonight and LESLYN LEWIS is headed after she wraps up an Alberta swing.
| | MEDIA ROOM | | — ALTHIA RAJ, CBC At Issue: "This is clearly a signal that Minister Freeland wants to send that she’s focused on long-term growth, that she’s part of the Martin-Chrétien [legacy on fiscal restraint]. She wants to associate herself with that part of the party, and frankly, I don’t think anybody would have said that about her until this point." — JOHN IVISON, National Post: “Just when it seemed that this Liberal government was lost to pragmatism and common sense, it shows it still has the power to surprise.” — MURAD HEMMADI, The Logic: Ottawa bets on a new federal agency and a new ‘growth fund’ to try and bridge Canada’s innovation deficit. — HEATHER SCOFFIELD, The Star: “The old pandemic mantra of “we’ve got your back” has become a focus on something far less sexy: retooling how the Canadian economy works so that we can weather several incoming storms hitting us all at once.” — TERENCE CORCORAN, Financial Post: “Canada has been roaring backward since 2020, and Budget 2022 keeps economic and fiscal policy on the same track.” — ANJA KARADEGLIJA, National Post: $15B: The cost of the Liberal-NDP pact in the federal budget 2022. — ARMINE YALNIZYAN, Twitter: "I've been in the budget lockup all day. Fried. Partly being with people again. Mostly because I see this budget as a missed opportunity."
| | PAPER TRAIL | | NO VAX, NO PAY — Less than 1 percent of Canada’s more than 245,000 federal public servants have been put on unpaid leave for being unvaccinated against Covid-19. Conservative MP GARNETT GENUIS submitted a 531-word multi-part written question on Feb. 17 prodding the government to disclose how many public servants have been placed on unpaid leave — and how many have received exemptions. The government returned a response this week with the following numbers: 1,382 employees (core public administration and the RCMP) have been placed on unpaid leave related to the vaccination policy as of Feb. 1, 2022. 3,623 requests have been filed for accommodation as of Feb. 7, 2022. “Requests relate to accommodation on the basis of a medical contraindication, religion or another prohibited ground of discrimination as defined under the Canadian Human Rights Act,” read the government’s response, returned by Treasury Board Parliamentary Secretary GREG FERGUS. — Of those accommodation requests: 1,155 were related to a medical contraindication; 2,037 were for religious reasons; 431 were filed for “other prohibited grounds of discrimination.” — How those accommodation requests fared: 250 were implemented for medical reasons, 315 on religious grounds and 26 on “other grounds.”
| | TODAY'S HIGHLIGHTS | | 8:30 a.m. Statistics Canada will release the Labour Force Survey for March. 9 a.m. (Mountain): Alberta's United Conservatives hold an AGM that launches a review of Premier JASON KENNEY's leadership of the party. 6 p.m. (Pacific): Poilievre holds a rally at the Coast Hotel in Prince George, B.C.
| | PERSPECTIVES | | FAREWELL, QUEEN'S PARK — Former Ontario premier KATHLEEN WYNNE made her final speech Thursday at the legislature in downtown Toronto. The Star's ROBERT BENZIE has a collection of quotable quotes from the five-term MPP's last hurrah. This one stuck out to us: “I’m under no illusion that I have made the best decisions at every turn in the past 19 years. I know that I have made mistakes. I know I have failed sometimes to shine that light. And I have been quick to judge my opponents.” “You only have to look at my social media feeds to gauge just how many people see me as deeply flawed. But here’s the thing — we all are. That’s the point. We are all here trying to find the best way forward.”
| | PROZONE | | For POLITICO Pro s, our policy newsletter: The download on Budget 2022. From POLITICO Canada's ZI-ANN LUM details on the federal government's $2.6B CCUS tax credit. In other headlines for Pros:
— Meta removes cyber espionage, hacking accounts from Russia, Belarus and Iran.
— U.S. Treasury Department issues new sanctions against Russian crypto, targeting ransomware gangs.
— Canada approves controversial offshore oil and gas project.
— Space Force goes all in on commercial tech. But how much is too much?
| | PLAYBOOKERS | | Birthdays: HBD to Sen. PAT DUNCAN, former Cabinet minister STEVEN BLANEY, MPP TED ARNOTT, MNAs DAVID BIRNBAUM and DANIELLE ST-AMAND, SHELLEY MARTEL. Saturday birthdays: Former ambassador JOHN MCCALLUM, retired senator TOM MCINNIS, former Cabinet minister PETER PENASHUE, former Nova Scotia Premier IAIN RANKIN. Sunday birthdays: Current Nova Scotia Premier TIM HOUSTON and Sen. PAMELA WALLIN. Media mentions: IAN YOUNG is going to be CP's new B.C. bureau chief … LEX HARVEY is starting as a politics reporter at the Star next week. Photojournalist AMBER BRACKEN has won the World Press Photo of the Year for a photograph of a memorial on Tk’emlups te Secwepemc land just outside Kamloops, British Columbia. The Globe’s MARSHA LEDERMAN spoke to the photographer about her work in an interview you can read here. Spotted at the Met's post-budget party: Everybody. But to be specific: PMO ringleader KATIE TELFORD … PMO senior adviser JEREMY BROADHURST … Freeland chief of staff LESLIE CHURCH … Freeland budget-whisperer TYLER MEREDITH … Trade Minister MARY NG … Justice Minister DAVID LAMETTI … Immigration Minister SEAN FRASER … Liberal MPs ARIELLA KAYABAGA, SORAYA MARTINEZ FERRADA. ADAM VAN KOEVERDEN, VALERIE BRADFORD and JAIME BATTISTE … NDP national director ANNE MCGRATH … NDP MP HEATHER MCPHERSON. Hill +Knowlton account director ERIC DILLANE, who eschewed a suit for skinny jeans … Crestview VP ASHTON ARSENAULT … Sandstone founder KEVIN BOSCH … The Business Council senior VP ROBERT ASSELIN … McMillan Vantage's JONATHAN KALLES, ASHLEY CSANADY, RICHARD MAHONEY and ANUSHKA KURIAN (in conversation with Telford, for the record) … StrategyCorp VP ANDREW STEELE … Earnscliffe senior consultant ANTON SESTRITSYN … CTV anchor EVAN SOLOMON holding court ... The Logic's MURAD HEMMADI ... JOSH DADJO , parliamentary affairs adviser to Sen. ROSEMARY MOODIE.
| | HOUSE BUSINESS | | Here’s what’s on the roster so far. Keep up to the latest House committee schedules here. 1 p.m. Justice Minister DAVID LAMETTI will appear at the House justice committee to discuss Bill C-5, An Act to amend the Criminal Code and the Controlled Drugs and Substances Act. 1 p.m. The House industry committee will hear from department officials, the National Research Council of Canada and other experts as it studies Canada’s capacity to manufacture its own Covid-19 vaccines. 1 p.m. The House operations and estimates committee will hear from retired vice-admiral MARK NORMAN as it studies Canada’s shipbuilding strategy. 1 p.m. The House committee on Indigenous affairs continues to hear from housing experts. 1 p.m. The House status of women committee is scheduled to meet for “committee business” and will receive drafting instructions for its report on intimate partner and domestic violence. Check out POLITICO Pro’s calendar for additional committee activity, events and more.
| | PALATE CLEANSER | | LEAFING IT ALL ON THE COURSE — Much of the sporting public's attention in the States is on TIGER WOODS' return to the Masters golf tournament in Augusta, Ga. But Ottawa Playbook golf correspondent TYLER WEYANT reminds us three Canadians are in good position to play well on the weekend. They're all from Ontario. Listowel's COREY CONNERS shot a solid 2-under par to find himself in the top 10, three behind the leader. Hamilton's MACKENZIE HUGHES shot a respectable +1, six shots off the lead. (And he managed to get a good bounce off a tree on an errant 15th hole shot.) And MIKE WEIR of Brights Grove, the 2003 champion and your Playbook host's hero at the time, posted a score of +2, good enough for a tie for 43rd. When to catch them today: Conners is scheduled to tee off at 8:55 a.m. EDT, Weir at 11:18 a.m., and Hughes at 12:35 p.m.
| | TRIVIA | | Thursday's answer: In 1957, PAUL MARTIN Sr . said: “Government must not live in the past. ... Every day there are new needs to be met. If inflation is to be fought, unemployment countered and something done, and soon, to get Canadian prosperity back into its stride, the government must begin to plan ahead — not timidly, not tentatively — but boldly, imaginatively and courageously.” As finance minister, PAUL MARTIN repeated those words at the close of his 1995 budget speech. Props to ROBERT MCDOUGALL. Friday’s question: What sitting senator worked for ERIK NIELSEN when he was deputy PM? “If it had anything to do with the Yukon, it came to my desk, regardless of the fact that he was the deputy prime minister …” Send your answers to ottawaplaybook@politico.com Have a petition you want signed? A cause you’re promoting? Seeking to increase brand awareness amongst this key audience? Share your message with our influential readers to foster engagement and drive action. Contact Alejandra Waase to find out how: awaase@politico.com. Playbook wouldn’t happen without Luiza Ch. Savage, John Yearwood and editor Sue Allan. With thanks today to Tyler Weyant.
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