OTTAWA — Treasury Board President Stockwell Day says the government will not cut benefits to the public service.
The minister told a House of Commons committee there will be a discussion around pensions with union leaders, but generally benefits will not be affected.
Day says he doesn’t want to cut benefits because “members have paid for these benefits.”
But he left open the possibility that the public service would be made smaller through attrition.
In beginning his testimony, Day said the government can balance the budget in five years without counting on extraordinary growth in the Canadian economy, or tax increases.
The minister who is being called “Dr. No” because of his assignment to control spending says only a minor part of deficit cutting will depend on economic growth.
He told a Commons committee that 40 per cent — or $19 billion — of this year’s $53.8-billion shortfall will simply disappear when Ottawa ends stimulus next spring.
He says another 37 per cent will be chopped from freezing departmental budgets next fiscal year.
The remainder will come from a combination of growth and savings from the long-standing program review process, which from now on will be pocketed rather than re-allocated.
The minister illustrated the process by taking three large gulps from a glass of water, after which the glass was empty.
“The key for is balancing the budget ... but we are going to balance the budget without reducing transfers to the provinces for health and education,” he said.
“Not only will we bring down the deficit, but the debt as well.”
Day says departmental budgets will be frozen unless an “extraordinary situation” arises requiring additional funding.