Thank you, Mr. Chairman and members of the committee. It's a pleasure to be here to share with you our view of the budget.
I should say that I am very much the numbers guy at the Conference Board. We put together an economic forecast, and I'm the person behind that. We are looking at the policy implications and whether the budget's timing and issues are in accordance with our views. But we are also maybe bringing you some sense of what we feel the longer-term retributions or implications of the current spending program will be.
Let me start by saying that, certainly, we were very worried about the economic outlook for 2009 and even 2010. I think we were looking, even before the budget was out, for a number of the measures that were actually announced: a lot of infrastructure spending, some tax measures to get money into the hands of households, and other stimuli to try to get us out of this very important recession we are now facing. Budget 2009 did, very much, a lot of that. So we were quite pleased to see that a lot of the measures we had talked about were in there, and we generally gave the budget a passing grade. If we look at the economic impact of the budget itself, we're looking at a number somewhere in the range of between 1% and 1.3% of economic stimulus that we could add to the 2009 calendar year.
This is a huge spending program that is coming, if it can get out there quickly enough and at the right time. That brings me to just two issues.
I think the budget does a lot of things to try to get that stimulus out there quickly, which is very important in the current crisis. The issue, again, will be whether we can get as much stimulus as we expect into the economy as quickly as we can. It is very much a balancing act. If we do tax cuts, we tend to get the stimulus out very quickly, but the impact is less. If we do infrastructure spending, which we feel is a good way forward, the impact tends to be longer-term, and it's harder to get that money out there into the economy. There are a couple of issues there. When we look at the amount of infrastructure spending and include the provincial and municipal portions, we're looking at $15 billion in this year. We're not quite sure whether all of that amount will get out there.
Last, a little longer term, if we look at--certainly when we put our forecast together--a fairly robust recovery as we get to the outer years, we feel that the federal and provincial governments will have a tough time getting back into a balanced budget situation. We would suggest that we have to look carefully at what measures we are putting in place further down the road to assist in maintaining a balanced budget as we return to potential. At the federal level, it's doable. But when we look at provincial levels of government, which are going to be pushing their spending in terms of the infrastructure components they have to contribute to, we're a little more worried. We've been living very well, if you like, with very strong commodity prices in 2008. I think the situation has changed going forward, especially for the regions.
I'll leave it at that, on that note.
Thank you very much.