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Harper signals continuation of economic policies despite new faces in cabinet

General Angela Calla 19 May

Julian Beltrame, The Canadian Press

OTTAWA – Stephen Harper has kept one economic lynch pin, promoted two others, and brought in an untried new face — but his Conservative government’s message and policies remain the same.

The top economic minister, Jim Flaherty at Finance, was brought back to cabinet Wednesday in order to re-introduce the March 22 budget the opposition parties rejected.

Another, Tony Clement, leaves the industry portfolio where he learned to say no to Australia’s BHP Billiton in its attempt to buy Potash Corp, and moves upstairs to Treasury Board — where he will need to find $4 billion in annual savings by saying nyet to the public service.

Replacing Clement at Industry is former natural resources minister Christian Paradis, who now inherits the task of freeing up Canada’s telecom industry to foreign competition.

And Harper added a brand new player, British Columbia MP Ed Fast, to continue the job of negotiating free trade arrangements with the European Union and India, both already well on their way.

“Although a number of changes have been necessary and desirable, the new ministry is fundamentally about stability and continuity,” Harper told reporters after emerging from the swearing-in ceremony at Rideau Hall.

“I’m confident that the team that was just sworn in … will hit the ground running.”

For Canada’s business community, it’s full-speed ahead with the previously established economic agenda, with possibly a few minor delays while new ministers get caught up.

That agenda includes continuing to reduce corporate taxes, controlling government spending, and expanding trading opportunities in the U.S. and globally.

“My group will feel it’s pretty much steady as she goes,” said John Manley, president of the Canadian Council of Chief Executives, representing the country’s largest companies.

Manley, a former Liberal industry minister, said the portfolio will be an especially steep learning curve for Paradis because of the complex files dealing with a new copyright law, rules on foreign takeovers and opening up the telecommunications industry to foreign competition.

“But I don’t think there’ll be a lot of surprises,” he added. “I think the Conservatives pretty much laid out their agenda in the election campaign and the expectation is now that they are elected, they will get to work on it.”

Flaherty is the safest of bets as far as his immediate intentions. He has said he intends to introduce his budget — likely on June 7 — with only minor tweaks and keep the government on a deficit-elimination track over the next four years.

That’s one year earlier than the March budget calculated, but officials say the earlier deadline can be achieved by including savings from a new Strategic and Operating review, which they claim will cut spending by $4 billion annually.

The task of finding those savings through staffing cutbacks or even elimination of low priority programs falls on Clement, who many expect will be known as Dr. No in Ottawa.

Although not regarded as an economic portfolio, the appointment of John Baird to Foreign Affairs may be the most critical to Canada’s economic well-being, said Perrin Beatty, head of the Canadian Chamber of Commerce.

Coincidentally, Beatty said Baird was hired as a junior adviser on his staff when he was foreign affairs minister in 1993.

“I expect he’ll have more time than I did,” Beatty said of his brief stint during the short-lived Kim Campbell government.

Beatty called Baird a quick study and, importantly, someone who has the ear of the prime minister.

“We need to make real progress on issues like energy and border management and this is someone who will be seen by the Americans and other countries as someone who has the respect of the prime minister,” he said.

Neither Beatty nor Manley said they knew Fast, the new trade minister, but expressed confidence that free trade talks with Europe and India would not be disrupted.