VANCOUVER (Reuters) - Canada’s economic growth this year will be weaker than anticipated, but there will be growth and the federal budget will be balanced in the 2015-16 fiscal year, Canadian Prime Minister Stephen Harper said on Tuesday.
Harper said his Conservative government, which faces an election in October, is not considering an economic stimulus package even though a drop in oil prices has caused job losses and a decline in federal revenues.
“Embarking on a major stimulus program when the economy is growing, and driving us back into deficit, makes absolutely no long-term economic sense whatsoever,” Harper said.
He said the government will put a fair amount of money into the economy this year even with a balanced budget, including tax cuts, benefit increases and infrastructure spending.
Harper, speaking in Vancouver, also said that while he had some concern about household indebtedness, data suggests most borrowers and lenders are in good shape.
“While I don’t want to say that a problem doesn’t exist, because we are concerned about some households and urge those households to be cautious, particularly because interest rates can rise over time, the big macro economic data suggests that both borrowers and lenders in Canada are in good financial shape,” Harper said.
He declined to comment on the trial of suspended Senator Mike Duffy, which began in Ottawa on Tuesday, beyond his previous statements that he had no knowledge of illegal payments. Harper said he will not be called as a witness.
Duffy, once a high flier in the Conservative Party, faces 31 charges in a case that could damage Harper’s chances of winning reelection in October. All the charges relate to Duffy’s actions after Harper appointed him to the Senate, the upper chamber of Parliament, in late 2008.
With additional reporting by Randall Palmer in Ottawa, writing by Andrea Hopkins; Editing by Chizu Nomiyama; and Peter Galloway