OTTAWA — Federal spending on financial supports during the height of the global pandemic in Canada greatly outpaced that of other developed countries, enough to actually raise household incomes at a time when the economy was in free fall.
A new report by the Organization for Economic Co-Operation and Development (OECD) shows that household incomes in Canada increased by 11 per cent in the second quarter of 2020, while incomes in other developed nations including the U.K., France and Germany decreased. The boost came despite a more than 10 per cent contraction in the Canadian economy over the same period, shortly after strict lockdowns were introduced across the country.
The figures underscore the immense scale of the Liberal government’s emergency aid spending, prompting economists to contemplate what level of fiscal response is necessary to cushion the Canadian public against economic fallout.
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