This presentation looks at both economic trends as well as government taxation and spending. The presentation is design to look both economic conditions as well as the health of Federal Government when it comes to taxation and spending.

1. Fiscal Monitor –Financial
Performance for Canada –
3Q16 – September 2016
BY: PAUL YOUNG, CPA, CGA
DATE: DECEMBER 11, 2016

2. Description
• This presentation looks at both economic trends as well as
government taxation and spending. The presentation is design to
look both economic conditions as well as the health of Federal
Government when it comes to taxation and spending.

3. Agenda
• Economic trends
• Wages
• Employment
• GDP by industry
• GDP by expenditure
• Government
• Taxation
• Spending
• Deficits

4. Economic Trends

5. GDP Growth
Source - Scotiabank
Commentary:
• Canada will trail United Kingdom,
Mexico and United States in economic
growth.
• Neither Mexico nor the United States
have carbon taxation
• Mexico has become the 2nd largest
trading block with the United States
• World-Wide growth is predicting to be
slow for the next decade
• Carbon taxation will mean lower
growth. Carbon Taxation will impact 1st
and 3rd economies in Canada
• United States is moving to low tax and
low regulation environment.

6. Wages / Canada
• What is Stagnation?
• Stagnation is a prolonged period of little or
no growth with wages
• What determine salary increases
• Rating systems
• Union contracts
• Market value
Comments:
• Middleclass us under pressure around the
world
• UK, Canada and USA have had similar
economic growth
• Wages tend to be tied to economic growth
Source: Investopedia, Stats Canada and CNN

7. Employment / Canada
Source – Stats Canada and CIBC
Comment:
• There has been shift for close to
four decades from full-time to part-
time jobs (Job quality)
• Goods producing sector struggling
due to low commodity prices
• Canada needs to better align
education/skills with job opening
• New carbon taxation and/or hikes
to CPP will no create jobs, but could
impact both wages and jobs
• Canada needs to reduced the red
tape to get projects off the ground.
Canada depends on FDI
• Canada needs to continue to sign
fair and equitable FIPA and Trade
Deals

8. GDP Growth
Source: Scotiabank, Cheatsheet.com,
Investopedia and Stats Canada
What does GDP Growth mean?
The gross domestic product (GDP) is one of the
primary indicators used to gauge the health of a
country's economy. It represents the total dollar value
of all goods and services produced over a specific
time period; you can think of it as the size of the
economy.
How Do Millennials spend money:
• Millennials spent an average of $26,000 a year on
discretionary purchases, such as eating out and travel.
This is $6,000 less per year than the average consumer.
• Millennials tend to use cash, a debit card and checks for
half of their monthly spending and charge just 30% of
their purchases.
• Millennials love their coffee. The only category where
millennials spent more money than Generation X and
baby boomers is on coffee and fast food.

9. GDP by Expenditure
Source: Stats Canada and http://www.environicsanalytics.ca/
• Part-time jobs do not have benefits
• Most millennials are doing jobs not necessarily
related to their field of studies
• Many millennials still live at home due to
housing costs and student debt
• Household spending drives the economy

10. Housing
Source – Scotiabank, BMO, CMHC and RBC
Comments:
• You need earn
over 100K+ to be
able to afford a
home
• Condos can be
cheaper, but
come with costs,
i.e. maintenance
fees
• Apartment rent
can vary from
$850 to $1,200 a
month

11. Canada – Finances Update

12. Fiscal Monitor – What it is
• The Fiscal Monitor provides an overview of monthly and year-to-
date financial results for the Government of Canada. It is prepared
in accordance with the same accounting policies used in the
annual audited financial statements of the Government of
Canada. Summary financial results reported in The Fiscal
Monitor are based on financial transactions recorded in the
Accounts of Canada, maintained by the Receiver General for
Canada.
Source – Government of Canada

13. Summary – Revenue and
Expenses
Comments:
Taxation:
• Corporate profits rise 3Q16 after fourth straight
quarter declines
• Goods producing sector continues to lose jobs in
2016
• Temporary work has taken over in 2016
Expenses:
• Major transfers to persons were up $3.2 billion, or
7.9 per cent. Elderly benefits increased by $1.2
billion, or 5.3 per cent, reflecting growth in the
elderly population and changes in consumer prices,
to which benefits are fully indexed
• Transfer payments increased by $1.6 billion, or 10.6
per cent, reflecting increases across several
departments, including the accrual of liabilities for
disaster assistance, claims expenses and increased
funding of new and existing programs. ◦
• Other direct program expenses increased by $2.5
billion, or 6.7 per cent, due in large part to an
increase in pension and other employee and
veteran future benefit expenses based on the
Government's latest actuarial valuations, as well as
an increase in operating expenses of Crown
corporations.Source – Government of Canada

14. Program Expenses
Comment:
• Canadian Forces deploy to the
Ukraine and more peacekeeping
roles (Africa)
• Global Affairs look light due to fact
that Canada is looking at bringing
in more immigrants as well as
opening more offices
• First Nations have complained
that not all the funding promised
has arrived to the various bands.
• Innovation reflects money spend
on SDTC as well as other initiatives
in automotive
• Infrastructure money has not
flowed to provinces and
municipalities
• Trudeau continues give money to
countries around the world

15. Other Sources
• Job Quality - http://www.slideshare.net/paulyoungcga/job-
quality-canada-2015-analyis-and-commentary
• Middle class – http://www.slideshare.net/paulyoungcga/middle-
class-analysis-and-commentary-canada
• Wealthiest - http://www.slideshare.net/paulyoungcga/top-1-
wealthiest-income-earners-canada-2013-and-2014-analysis-and-
comments
• Carbon Tax - http://www.slideshare.net/paulyoungcga/carbon-
pricing-or-carbon-tax-impact-on-consumers-december-2016