‘As big as the census’: Page on move to restore parliamentary borrowing approval
In former Parliamentary Budget Officer Kevin Page’s opinion, it’s a reversal as significant as the reinstatement of the long-form census — but it hasn’t received a fraction of the attention.
In fact, most Canadians probably didn’t know it even needed to be reversed.
On Wednesday, Finance Minister Bill Morneau introduced Bill C-15, a budget implementation bill that repeals one line of the Financial Administration Act and will, when brought into force, effectively reestablish the requirement for Parliament to approve government borrowing.
It follows through on platform and budget (p.209) commitments that, perhaps understandably, got overshadowed.
Section 43.1 of the Financial Administration Act, as it’s currently written under the headline “Power to borrow”, states: “The Governor in Council may authorize the Minister to borrow money on behalf of Her Majesty in right of Canada.”
Put simply, it allows cabinet to authorize unlimited borrowing in financial markets without parliamentary approval.
This wasn’t always the case, however — Section 43.1 was added in the Conservatives’ first omnibus budget bill in 2007 and went pretty well unnoticed at the time — something Page thinks may have happened because a long streak of budget surpluses desensitized Canadians to debt.
Writing in iPolitics in June 2013, Scott Clark and Peter DeVries — former senior department of finance officials — labelled the move the late finance minister “Jim Flaherty’s blank cheque.”
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