Canadians' Views on Eliminating the Federal Deficit

While Canadians are optimistic about their own personal economic situations, over one-half feel the federal government has caused too much pain and are skeptical that the federal government may spend excessively leading to another deficit situation. Canadians want the debt reduced before reducing taxes or spending on programs. And when it comes to cutting taxes, Canadians would prefer the GST to be cut before personal income taxes. As well, a majority oppose spending on new national projects. These findings emerged from a Globe and Mail/National Angus Reid Poll conducted among a representative cross-section of 1,515 Canadian adults between October 23rd and 28th, 1997.

Highlights

Following the Federal Minister of Finance's recent economic statement announcing that the national deficit will likely be eliminated next year, the majority (66%) of Canadians agree that the Liberals are doing a good job of managing the national economy. As well, the majority (65%) are optimistic that their own personal economic situations will improve as a result of eliminating the deficit. However, over one-half (55%) feel that the federal government caused too much pain for Canadians with deep cuts to reduce the deficit, and one-half (50%) are skeptical that the federal government may spend excessively and "get us back into a deficit situation again".

Further, while one-third (34%) of Canadians directly acknowledge that the federal Liberal Party's economic policies are responsible for the elimination of the deficit, almost one-half (49%) indicate that the elimination of the deficit stems from a general improvement in the overall economy. One in ten (10%) Canadians feel that deficit elimination results from a combination of both federal Liberal economic policies and an improvement in the economy.

Also, given a choice of three possible tax cuts the government could make over the next couple of years, just over one-half (51%) of Canadians would prefer the GST to be cut compared to under four in ten (37%) opting for reduced personal income taxes. One in ten (10%) Canadians would prefer the government to cut employment insurance premiums paid by employees and their employers.

As well, the majority (56%) of Canadians do not feel that the federal government should launch new national to help improve the quality of life for Canadians because "it will likely result in a lot of money being spent with little being accomplished". Just over four in ten (41%) feel that the federal government should focus on launching new national projects "to help improve the quality of life for Canadians; these projects could include programs to provide jobs for young people or reduce child poverty" now that it has some money available.

Finally, when given a choice of allocating any future federal budget surplus money, the plurality (47%) of Canadians feel that the federal government should focus on reducing the accumulated debt, compared to over one-third (37%) who would prefer reduced taxes. The least preferred choice, selected by just over one in ten Canadians (13%), is to spend more on government programs.

Good Economic Management and Personal Benefits

Thinking of past and future implications of eliminating the federal deficit, two-thirds (66%) of Canadians agree that the Liberals are doing a good job of managing the national economy. Just under one-third (32%) of Canadians disagree and two percent (2%) are undecided. (Table 1)

• Federal Liberal supporters (90%), Ontarians (78%), the university-educated (73%) and the most affluent (72% among those with annual household incomes of $60,000 or more) are disproportionately more likely to feel that the Liberals have managed the national economy well.
• On the other hand, Bloc Quйbйcois supporters (59%), federal NDP supporters (50%), residents of Quebec (46%) and Alberta (39%), as well as the least affluent (40% among those with annual household incomes of less than $30,000) and the least educated (39% among those without a highschool education) are predominantly more likely to disagree that the Liberals have performed well in managing the national economy.

Further, Canadians are optimistic about their personal economic situations given the impending deficit elimination. The majority (65%) agree that, "at the end of the day, I will personally be better off because the federal government has eliminated the deficit", compared to just under one-third (32%) who disagree. Three percent (3%) are undecided.

• Canadians more likely to feel positive about their personal future economic situations given the upcoming elimination of the deficit tend to be federal Liberal (74%) and Progressive Conservative (72%) supporters, the most affluent (73% among those with annual household incomes of $60,000) and residents of Ontario (69%).
• Conversely, those more likely to disagree that they believe they will be "better off" because the federal deficit will have eliminated the deficit include federal NDP supporters (47%), British Columbians (38%), Atlantic Canadians (38%) and the least affluent (38% among those with annual household incomes of less than $30,000).

Painful cuts and skepticism over future spending

Although the majority (66%) of Canadians feels that the federal government has done a good job managing the national economy, it has not been without noted anxiety as over one-half (55%) believe that the federal government "caused too much pain for Canadians by cutting too deeply to reduce the deficit". Conversely, over four in ten (44%) disagree and one percent (1%) are undecided. (Table 2)

• Federal NDP (79%) and Bloc Quйbйcois (68%) supporters, the least educated (65%), the least affluent (66% among those with annual household incomes of less than $30,000), as well as those residing in Atlantic Canada (74%), Quebec (67%) and Saskatchewan/Manitoba (64%) are disproportionately more likely to feel that the federal government caused too much pain by cutting too deeply.
• Canadians more likely to disagree with this statement include Reform (57%) and federal Liberal (53%) supporters, residents of British Columbia (54%) and Alberta (54%), the most affluent (56% among those with annual household incomes of $60,000 or more) and the university educated (52%).
• One-half (50%) of Canadians are skeptical about the federal government's spending intentions now that the deficit has been almost eliminated, indicating that they are "afraid the Liberals may start spending excessively and get us back into a deficit situation again". In comparison, just under one-half (47%) of Canadians disagree with this statement and three percent (3%) are undecided. (Table 2)
• Canadians supporting federal opposition parties such as Reform (71%), Bloc Quйbйcois (68%) and Progressive Conservative (64%) tend to be more likely to be apprehensive about the federal government's spending intentions now that the deficit has almost been eliminated. Regionally, Albertans (61%) and Atlantic Canadians (56%) are more likely than those in other regions to indicate skepticism over this issue.
• Federal Liberal (65%) and NDP (56%) supporters, Ontarians (56%) and the university educated (58%) are more likely to disagree that the Liberals may spend excessively given the upcoming elimination of the deficit.

Assigning credit for deficit reduction

While one-third (34%) of Canadians acknowledge that the federal Liberal Party's economic policies are responsible for the elimination of the deficit, almost one-half (49%) indicate that the elimination of the deficit stems from a general improvement in the overall economy. Further, one in ten (10%) Canadians feel that it is a combination of both federal Liberal economic policies and an improvement in the overall economy that has lead to the elimination of the deficit. Six percent (6%) of respondents are undecided. (Table 3)

• Those more likely to feel that the elimination of the deficit is due to an improvement in the overall economy tend to be supporters of federal opposition parties such as Reform (62%), Bloc Quйbйcois (60%) and Progressive Conservative (57%) supporters. As well, Albertans (65%) and British Columbians (56%) are more likely to share this view.
• Those more likely to directly place responsibility for the elimination of the deficit on the economic policies of the federal Liberal government include federal Liberal supporters (44%) and Atlantic Canadians (40%).

Tax cut preferences

Given a choice of three possible tax cuts the government could make over the next couple of years, the majority (51%) of Canadians would prefer the GST to be cut compared to under four in ten (37%) opting for reduced personal income taxes. Further, one in ten (10%) Canadians would prefer the government to cut employment insurance premiums paid by employees and their employers. Two percent (2%) are undecided. (Table 4)

• Federal NDP supporters (69%), Atlantic Canadians (60%), the least affluent (58% among those with annual household incomes of less than $30,000) and females (57%, versus 44% of males) tend to be more likely to prefer cutting the GST.
• Reform (50%) and Bloc Quйbйcois (43%) supporters, residents of Alberta (48%) and Saskatchewan/Manitoba (46%) and the most affluent (43% among those with annual household incomes of $60,000 or more) are predominantly more likely to support cutting personal income taxes.
• Support for cutting employment insurance premiums is consistent across socio-demographic variables.

Launching new national projects

The majority (56%) of Canadians do not feel that the federal government should launch new national projects (i.e. programs to provide jobs for young people or to reduce child poverty) because "it will likely result in a lot of money being spent with little being accomplished". Conversely, just over four in ten (41%) Canadians feel that the federal government should focus on launching such new national projects now that it has some money available. Three percent (3%) are undecided. (Table 5)

• Those more likely to be opposed to launching new national projects are Reform (76%) and Bloc Quйbйcois (61%) supporters, Western Canadians (64% among British Columbians, 68% among Albertans and 64% among residents of Saskatchwan/ Manitoba).
• On the other hand, Canadians more likely to feel that the federal government should launch new national projects tend to be federal NDP (51%) and Liberal (50%) supporters, younger Canadians aged 18 to 34 (47%) and those without a highschool education (47%).

Preferred Budget Surplus Priorities

When given a choice of allocating any future federal budget surplus money, the plurality (47%) of Canadians feel that the federal government should focus on reducing the accumulated debt, compared to over one-third (37%) who would prefer reduced taxes. The least preferred choice, selected by just over one in ten Canadians (13%), is to spend more on government programs. Two percent (2%) of Canadians feel that any future budget surplus money should be allocated to all three areas (i.e. reducing the debt, cutting taxes and spending on programs) and a further one percent (1%) are undecided. (Table 6)

Canadians' views on this issue are consistent across socio-demographic variables, with the exception of the following regional differences:

• Reform supporters (57%), residents of Alberta (57%) and British Columbia (56%) are predominantly more likely to feel that the federal government should focus on reducing the debt given a budget surplus state. Conversely, residents of Atlantic Canada (34%), Quebec (41%) and Saskatchwan/ Manitoba (42%) are less likely than those in other Canadian regions to indicate this choice of budget allocation.
• Cutting taxes is more likely to be the preferred choice by Bloc Quйbйcois supporters (43%), residents of Quebec (44%), Atlantic Canada (43%) and Saskatchwan/Manitoba (43%). Albertans (29%) are least likely of all regions to feel that the federal government should reduce taxes in a budget surplus situation.
• As well, federal NDP supporters (27%) and Atlantic Canadians (22%) are more likely than those in other regions to feel that the federal government should spend more on government programs given any future budget surplus money.

This National Angus Reid Poll was conducted by telephone between October 23rd and 28th, 1997 among a random and representative cross-section of 1,515 Canadian adults.

These data were statistically weighted to ensure the sample's regional and age/sex composition reflects that of the actual Canadian population according to the 1991 and 1996 Census data.

With a national sample of 1,515, one can say with 95 percent certainty that the results are within ±2.5 percentage points of what they would have been had the entire adult Canadian population been polled. The margin of error will be larger within regions and for other sub-groupings of the survey population.

For more information on this news release, please contact:

John Wright
Senior Vice-President
Angus Reid Group
(416) 324-2900

Dr. Darrell Bricker
Senior Vice-President
Angus Reid Group
(613) 241-5802

Christian Bourque
Directeur de recherche Affaires Publiques
Angus Reid Group
(514) 877-5550