March 25, 2021 – Québec government update on the COVID-19 pandemic
Here is an update on recent decisions and actions by the provincial government in connection with the COVID-19 pandemic.
Provincial budget: record deficit and balance to be restored in seven years
Minister of Finance Éric Girard unveiled the first Québec government budget in the context of “the global pandemic, a health crisis that has affected the whole world and caused an unparalleled situation,” economically, socially and in terms of health.
The Québec government has spent colossal sums over the last year, creating a $15 billion deficit, in order to deal with challenges around health and education and to provide support to people who have lost their jobs and to affected businesses.
Restoring Québec’s public finances will have to take seven years rather than the five stipulated under the Balanced Budget Act in order to avoid reducing services or slowing down economic recovery, said Minister Girard.
The ratio of net debt to gross domestic product (GDP) has reached 45%.
Three lines of action: health, education and the economy
The Québec government has identified three lines of action, namely, health, education and the economy, to help the population get through the pandemic and to restore the economy.
Minister Girard announced a $10.3 billion investment over the next five years to strengthen the health system, including $2.9 billion this year.
For education, the government has added $1.5 billion over the next five years to support academic success, student retention and completion of higher education, facilitate occupational and social integration and promote sports and leisure.
In order to stimulate business investment, Québec is offering $4 billion in new initiatives to accelerate economic growth and Québec’s transition to the new economy.
Return to normal in 2022
To enable the Québec economy to return to its prepandemic pace of development, the Québec government will increase and accelerate its investments in public infrastructure. Some $4.5 billion is being added to the $130.5 billion already planned for Québec’s 2021-2031 infrastructure plan. Moreover, almost 60% of investments under this plan will be disbursed in the next five years.
The government also plans to complete the extension of the Québec sales tax (QST) to all goods from abroad, including online purchases. This measure is designed to promote the competitiveness of Québec businesses and will bring in $1.8 billion in additional revenues over the next five years.
These actions should restore the economy to its prepandemic level by 2022.
Strengthening the health system
To strengthen the health system, overcome the health crisis and improve healthcare and services for Quebecers, the government will spend $10.3 billion to enhance the services offered to the population, support healthcare workers, improve healthcare and services to seniors and gradually transform the residential and long-term care centres (CHSLDs) into seniors’ homes. Efforts will also be made to improve homecare.
Protecting vulnerable people
An additional $1 billion over five years has been allocated to better respond to the needs and well-being of vulnerable people.
This will contribute to accelerating the completion of 5,000 social housing units over five years, offer more educational childcare services, prevent and better protect women victims of violence and promote the funding of community organizations and access to their services.
Supporting economic growth
Minister of Finance Éric Girard has allocated an additional $4 billion to accelerate economic growth and the transition to the new economy.
These investments will be used to support businesses affected by the pandemic, increase productivity and stimulate investment as well as support innovation and workforce requalification and integration into the labour market.
Supporting the next generation
For youth, who have been particularly hard hit by the pandemic, especially educationally, the government is injecting $1.5 billion over five years to support academic success and student retention and completion of higher education, to facilitate the occupational and social integration of young people and to promote sports.