Canadians Prefer Staying the Course on Federal Fiscal Management and Deficit Reduction over Spending

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According to Senior Vice-President Doug Anderson, “Over the past thirty years, Canadians have learned a lot about the difficult choices necessary in managing the country's finances. Most Canadians today are clearly willing and able to make forced choices that may require sacrificing in one area to make progress in another. Within a public opinion environment that accepts there are consequences to fiscal choices, governments may experience greater latitude to chart a fiscal course – particularly, if that course is one that demonstrates consideration of the various options available and their consequences.”

 

 

Most Canadians continue to feel the government is doing at least a fair job of managing government finances. Nationally, 60% feel the government is doing a very good job (5%), a good job (16%) or a fair job (39%) of managing government finances. One-in-three (33%) feel the government is doing a poor job (20%) or very poor job (13%) of managing government finances.

  • Men are more likely to feel the government is doing at least a good job of managing finances.
  • Atlantic Canadians are most critical on this measure.
     

Almost half are aware the budget will be presented on February 11th. Nationally, 47% are aware the federal budget is being presented next week, while 52% are unaware.

Health care has joined economic issues as the top priorities for the budget. Overall, 18% feel the top priority should be health care, while 16% cite jobs and unemployment, 14% government spending, and 8% education. Other priorities cited include; the economy (7%), seniors’ issues (7%), environment (5%), social programs and services (5%), taxes (4%), and government leadership (4%).

A majority of Canadians believe the deficit should be eliminated before any increased spending can occur. Nationally, 57% of respondents hold this view, while 34% say it’s okay to increase spending even though there’s still a deficit.

  • The sense the deficit should be eliminated before increased spending can occur is higher in Quebec than it is in British Columbia.

This study included an investigation into the kinds of choices Canadians would like to see made on federal revenues and the resulting choices for spending and tackling the deficit.

Respondents were first asked whether they would prefer to see the federal government increase its revenues, decrease them or maintain them at the current level.

Depending on their choice for changes in federal revenue levels, respondents were then forced to choose from among three options that would result from that change in revenue.

If a respondent wanted government revenue to shrink, they were asked whether they preferred this be addressed by spending cuts, a deficit increase or a mix of both.
 

If a respondent wanted government revenue to grow, they were asked whether they preferred this increased revenue go to increased spending, deficit reduction or a mix of both.

If a respondent wanted government revenues to remain stable, they were asked whether they preferred to increase spending and therefore increase the deficit, decrease spending and therefore decrease the deficit or keep spending levels and the deficit as they stand.

A majority say their preference is that government keeps its revenues stable. Overall, 51% express this view, while 21% prefers that government decrease its revenues, while a further 21% prefers government increase its revenues.
 

  • Residents of Manitoba and Saskatchewan are more likely than those in Atlantic Canada, Quebec and BC to prefer government keeps its revenues at the level they’re at now.
  • Those in Quebec are more likely than those in Ontario, Manitoba and Saskatchewan, and BC to prefer government decrease its revenues.
  • Men are more likely than women to prefer government increase its revenues.
     

On the subsequent forced choices, those who wanted reduced revenues had the greatest difficulty in making the resulting forced choice between reduced spending or an increased deficit. The level of non-response among this group was higher than among those who prefer revenue stability or revenue growth.

When removing those who could not make choices that addressed both revenue preference as well as spending/deficit preference, we are left with the following segments:

  • Revenue Shrinkers: 20% who prefer revenues be reduced
  • Revenue Stable: 55% who prefer revenues stay the same
  • Revenue Growers: 24% who prefer revenues be increased
     

By adding in the choices on spending and deficit reduction, the data reveal a spectrum that shows how Canadians would like to see federal fiscal management pursued.

The majority of Canadians (55%) are Revenue Stable, and looking at their subsequent choices, it is clear there is no strong appetite among this group to request a spending increase:
 

  • Among 30% of Canadians, the single most commonly preferred approach is to have stable revenues and reduced spending and thus a reduction in the deficit;
  • Another 21% of Canadians want stable revenues and no change in spending or deficit levels; and
  • 4% prefer spending be increased with a corresponding increase in the deficit.


The roughly one-in-four (24%) who prefer revenue is increased (aka “Revenue Growers”), are divided as follows when factoring preferences on spending and the deficit:

  • 17% of Canadians want revenue growth and would like to see the increased revenue divided with some going to increased spending and some to decreasing the deficit;
  • 4% of Canadians prefer increasing revenue and using it exclusively to increase spending; and
  • 3% of Canadians prefer increasing revenue and using it exclusively to reduce the deficit.
     

Finally, the one-in-five (20%) who prefer the government reduce its revenues (aka “Revenue Shrinkers”) can be broken out as follows:

  • 9% of Canadians prefer decreasing revenue and want it addressed with a mix of spending cuts and an increased deficit;
  • 8% of Canadians prefer decreasing revenue and addressing this exclusively by decreasing spending; and
  • 3% of Canadians prefer decreasing revenue and addressing this exclusively by increasing the deficit.
     

Between spending and the deficit, Canadians feel deficit reduction is more important, but it seems that deficit reduction is not important enough to many to call for increased revenue to address it.

The most commonly approved approach to managing the country’s finances is to keep revenue levels as they are and reduce spending in order to achieve deficit reductions. Additionally, the second most commonly approved approach is to keep revenues, expenditures and the deficit the same.

In fact, of all the combinations of options, more than twice as many Canadians end up choosing approaches that reduces spending (47%) or reduces the deficit (59%) than choose an approach that would increase spending (25%).

Interestingly, while partisanship plays some role, there is still far more agreement than disagreement across party lines. While there are still more NDP and Liberals who are inclined to accept deficit increases or revenue increases in order to increase government spending, the proportions are not dramatically different from Conservative supporters. Likewise, deficit reduction is clearly not a financial objective that is exclusively a Conservative preference.

Additionally, when looking at just those (one-in-five Canadians) who have no declared partisan leaning right now, they are the least likely to want revenue increased. Like the partisan Canadians, they skew towards revenue stability, but are a little more likely to want revenue reductions.

Data was collected using computer assisted telephone interviewing (CATI) via the Harris/Decima teleVox omnibus. Overall, 1,008 completes were collected nationally between January 30 and February 3, 2014. The sample consists of 80% landline and 20% cell phone respondents, with quotas by gender (50/50 split) and by region. The data is weighted in tabulation to replicate actual population distribution by age and gender within region according to the 2011 Census data. This survey is considered accurate to a margin of plus or minus 3.1 per cent, 19 times out of 20.