Exclusive: Canadian PM Trudeau says C$30 billion budget gap figure not hard limit

Thu May 19, 2016 10:03pm EDT
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By Andrea Hopkins and David Ljunggren

OTTAWA (Reuters) - Canadian Prime Minister Justin Trudeau suggested on Thursday that a C$30 billion ($21 billion) budget deficit was not a hard limit as the government's focus should be on spurring economic growth.

In a wide-ranging interview, Trudeau, 44, also said he wanted Britain to stay in the European Union and attributed his role a day earlier in an unusual physical fracas in Parliament partly to being in a high stress job.

On the budget deficit, Trudeau said he was not obsessed with a "perfect number" and instead vowed to increase economic growth.

"Yes, we need to be fiscally disciplined, we need to be responsible, but we need to be investing in the right kinds of things at the same time, so the arbitrary picking a number and trying to stick with it is exactly what I campaigned against in the last campaign," Trudeau said.

"It's not an obsession with the perfect number, it's an obsession with the perfect, or the right, path to grow the economy in ways that help in the short term but lead us on the path towards prosperity in the medium and long term."

Canadian economic growth is tepid and massive wildfires spreading across the energy heartland will cut federal tax revenues and cost Ottawa billions to cover much of the damages.

Trudeau campaigned on a proposed C$10 billion annual deficit but the ruling Liberals later said the economy needed a bigger jump start given the downturn. In March, the government unveiled a budget with a shortfall of just under C$30 billion.

"What Trudeau learned from ballooning out the deficit the first time was that voters don't care. Canadian voters are prioritizing growth and Trudeau plans to deliver that at any cost," said Adam Button, currency analyst at ForexLive in Montreal.   Continued...

Canada's Prime Minister Justin Trudeau poses following an interview with Reuters in his office on Parliament Hill in Ottawa, Ontario, Canada, May 19, 2016. REUTERS/Chris Wattie