The Government of Canada has released the 2024 Fall Economic Statement (FES), which outlines critical investments and policy measures to strengthen the economy, reduce disparities, and enhance social safety nets.
This statement reflects Canada’s commitment to fostering innovation, ensuring affordability, and safeguarding national security while maintaining a sustainable fiscal trajectory.
Below are the detailed insights, facts, and figures from this comprehensive announcement.
Economic Priorities and Investments
The 2024 Fall Economic Statement focuses on five primary areas: affordability, housing, innovation, national security, and economic sustainability.
Affordability and Social Support
To support Canadian families and reduce the cost of living, the government has introduced several measures:
- Child Care: Expansion of the $10-a-day child care program, saving families up to $14,300 per child annually, and boosting GDP by 1.1% in the long term.
- Dental Care and Prescription Medications: Enhanced coverage, including insulin and contraceptives, ensuring healthcare affordability for all Canadians.
- Social Safety Net: Strengthened support for marginalized communities, including investments in women’s rights, religious groups, and Black Canadians.
Housing Initiatives
With the ongoing housing crisis, the government plans to:
- Boost the construction of affordable homes by providing incentives and streamlining approvals.
- Increase investments in housing infrastructure to address supply shortages.
Investments in Innovation and Economic Growth
Canada is doubling down on its competitive edge in artificial intelligence (AI) and other high-tech sectors. Key measures include:
- R&D Investments: Significant funding to support research, innovation, and start-ups.
- Accelerated Investment Incentive: A five-year extension delivering $17.4 billion in tax incentives to stimulate business investment and job creation.
Job Market Overview
- Over the last year, 330,000 jobs have been created, averaging 27,000 jobs per month, demonstrating robust economic recovery post-pandemic.
- The unemployment rate remains at historically low levels, hovering around 5.7%.
National Security and Border Safety
To ensure the safety and security of Canadians, the government proposes:
- $1.3 billion investment in border security.
- Stricter bail and sentencing laws.
- Measures to combat gun violence by removing assault-style weapons from streets.
Fiscal Sustainability
The 2024 FES ensures fiscal responsibility while fostering growth. Key fiscal highlights include:
- The debt-to-GDP ratio is projected to decline from 41.9% in 2024-25 to 38.6% in 2029-30.
- The deficit is expected to remain below 1% of GDP by 2026-27 and beyond.
- Inflation has been successfully managed within the 1%-3% target range, hitting 2% in October 2024.
Interest Rate Updates
The Bank of Canada has reduced interest rates five times in 2024, bringing the policy rate from 5% to 3.25%, supporting economic activity and reducing borrowing costs.
Economic Growth and Employment
Canada’s economy has demonstrated remarkable resilience:
- The economy is now 7.3% larger than pre-COVID levels.
- Labour force participation, particularly from the national child care program, is contributing to higher family incomes and long-term GDP growth.
| Indicator | Value | Key Insight |
|---|---|---|
| Debt-to-GDP Ratio (2024-25) | 41.9% | Expected to decline to 38.6% by 2029-30. |
| Inflation (October 2024) | 2% | Within the Bank of Canada’s 1%-3% target range. |
| Policy Interest Rate | 3.25% | Reduced by 175 basis points in 2024. |
| Jobs Created (12 months) | 330,000 | Average of 27,000 jobs per month, higher than pre-pandemic levels. |
| Economic Growth | 7.3% larger than pre-COVID | Demonstrates strong recovery and expansion. |
| Child Care Savings | $14,300 per child/year | Boosts family incomes and affordability. |
Long-Term Impacts of the Statement
The initiatives announced in the 2024 Fall Economic Statement are expected to:
- Enhance affordability and reduce economic disparities.
- Strengthen Canada’s position as a global leader in innovation and AI.
- Create a safer and more secure environment for Canadians.
- Support sustained economic growth while maintaining fiscal discipline.
The 2024 Fall Economic Statement demonstrates the Government of Canada’s commitment to tackling pressing challenges like affordability, housing, and security while positioning the nation for sustained growth and innovation.
With targeted investments and a focus on inclusivity, the government aims to ensure that all Canadians benefit from economic prosperity.
What is the debt-to-GDP ratio projection in the 2024 Fall Economic Statement?
The debt-to-GDP ratio is projected to decline from 41.9% in 2024-25 to 38.6% by 2029-30.
How much will the Accelerated Investment Incentive contribute to the economy?
The incentive will deliver $17.4 billion in tax benefits over five years, encouraging business investments and job creation.
What are the key measures for affordability in the 2024 Fall Economic Statement?
Measures include $10-a-day child care, expanded dental and prescription coverage, and increased housing investments.
