Trudeau has long list of 'top priorities' for economic ministers

Finance Minister Bill Morneau is being asked by his boss to help phase out fossil fuel subsidies, work with the provinces to boost the Canada Pension Plan, and reshape the country's tax and benefits system for families.

Those are just some of the 27 "top priorities," outlined in Morneau's mandate letter from his boss, Prime Minister Justin Trudeau.

A lot of responsibility for a rookie MP — albeit one who is a seasoned veteran in financial circles.

Also, none of the items on the long list should come as a surprise to Morneau, or any of his cabinet colleagues, as they are drawn from the campaign promises made by the Liberals in the recent election.

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Some items can be dispatched relatively quickly, including repealing the Federal Balanced Budget Act, — the law passed just months ago by the former Conservative government after it tabled its first balanced budget in six years.

The Liberals acknowledged in the early days of their campaign that to accomplish their ambitious infrastructure spending plan will require running three "modest," budget deficits.Trudeau defined modest as "no more than $10 billion."

The first listed priority for Morneau is, "balancing the budget by 2019/20 and continuing to reduce the federal debt-to-GDP ratio throughout our mandate."

The second part of that top priority — to reduce the federal debt-to-GDP ratio every year — may be trickier to accomplish. Recent fiscal forecasts, including this week's by the Parliamentary Budget Office, point to an ever-slowing economy.

With GDP forecast to grow by a modest two per cent for 2016, the government could run a deficit of up to nearly $40 billion and still likely see the debt-to-GDP ratio shrink, but the numbers are getting tighter.

Another ambitious undertaking will be to fulfil the Liberal promise to increase retirement payments from the Canada Pension Plan — a move that requires boosting payments into the system, as well as the co-operation of the provinces.

"Meet with your provincial and territorial colleagues at your earliest convenience," Trudeau's instructions to his finance minister include, "to begin a process to enhance the Canada Pension Plan."

Trudeau set out no timeline as to when he would like his minister to accomplish this task.

Quick tax cuts

On the other hand, a middle-class tax cut will be among the first orders of business when Parliament opens with the new government in early December. Reducing the federal income tax bracket for those making between about $45,000 to $89,000 to 20.5 per cent from 22 per cent could be passed rapidly.

It's not clear as to when the government will fully unveil other promised measures, including the Canada Child Benefit, a new family allowance system meant to combine and replace the money families with young children receive now through the Universal Child Care Benefit (UCCB), as well as the Canada Child Tax Benefit and National Child Benefit Supplement.

Implementing the change is tasked to the Minister of Families, Children, and Social Development Jean-Yves Duclos — another rookie MP.

He will also undertake an overhaul of Old Age Security, which will see the guaranteed income supplement boosted by 10 per cent, the age of eligibility for OAS rolled back to 65 from 67, and the creation of a new Seniors Price Index (SPI).

Help for seniors

During the election campaign, the Liberals cited a Statistics Canada study showing that goods typically purchased by seniors rise in price faster than the benchmark Consumer Price Index — therefore future increases to OAS and GIS will be pegged to the new SPI rather than the CPI.

While Morneau is stick-handling other changes to taxes, including eliminating income splitting for families, raising taxes for those making more than $200,000 a year, and rolling back deposit limits for tax-free savings accounts, the minister of national revenue has been asked to implement measures that are likely to be more popular.

Diane Lebouthillier, also newly elected to the House of Commons, will oversee changes to the Canada Revenue Agency.Those will include fulfilling a promise to "proactively contact Canadians who are entitled to, but are not receiving, tax benefits," and to have the CRA offer to help low income Canadians with straightforward taxes to fill out their forms.

Lebouthillier has also been handed the task of undoing a controversial move by the previous government.

She will oversee a review of the tax laws governing the political activities of charities. The previous Conservative government launched audits of charities and revoked a number of organizations' charitable status because it deemed they spent too much of their resources and time on activities that were of a political nature.

"Allow charities to do their work on behalf of Canadians free from political harassment," Trudeau instructs the newly-minted revenue minister.

In his letter to Lebouthillier, the prime minister asks her to keep in mind that "charities make an important contribution to public debate and public policy."

Old deals - new government

The new government also inherits a basket of trade deals.

Although the negotiations for the trade deal with Europe formally ended more than a year ago, the deal has yet to be formally ratified on either side of the Atlantic.

Trudeau seems ready to proceed with it as is, though, and has directed a number of his ministers to "develop strategies to implement," the trade deal — including support those in agriculture and the auto sector that are likely to be hurt by this deal, as well as "compensation for incremental cost increases for public drug plans arising from (the trade deal with Europe)."

When it comes to the Trans-Pacific Partnership, a deal concluded only two weeks before the election, Trudeau seems to be keeping his options open — asking a number of ministers simply to "consult on Canada's potential participation in the (TPP)."