Canada 18-K/A Annual report (foreign governments) (amended)

Exhibit C-4

Ottawa, May 13, 2005

2005-035

Minister of Finance Outlines Fiscal Impact of Recent Government of Canada Initiatives

Minister of Finance Ralph Goodale today released an accounting of the fiscal impact of all Government of Canada initiatives announced since the budget was tabled on February 23, 2005. These total $9 billion over five years.

“There is no doubt that we remain on track to achieve balanced budgets or better each and every year and to reduce the federal debt as a share of the economy to 25 per cent by 2014–15, as indicated in the last budget,” said Minister Goodale. “This commitment is backed by $28.5 billion in contingency reserves and economic prudence over the next five years.”

The initiatives announced in recent weeks, some of which overlap and some of which were funded in Budget 2005, are as follows:

• $4.5 billion over the next two years related to initiatives in Bill C-48 for post-secondary education and training, affordable housing, the environment and foreign aid.

• $5.7 billion for a number of shared initiatives with the Province of Ontario over the next five years. Some of these initiatives are covered by Bill C-48 or by funds set aside in Budget 2005.

• $350 million in lower airport rents until 2009–10. Over the lifespan of the rental agreements (most of which have remaining terms of about 50 years), Canadian airports will pay $8 billion less.

• $618 million over the next five years for other initiatives outlined in the table below.

The total cost of the above measures is $11.2 billion. However, $2.2 billion of this amount was funded in Budget 2005 or represents the overlap between Bill C-48 and the Ontario agreement. As a result, the net fiscal cost of these measures is $9.0 billion.

Measures outlined in Bill C-48 will be funded from any budgetary surplus that exceeds $2 billion in this fiscal year and the next. Other new spending commitments will be funded through the use of economic prudence, where appropriate, as well as the reallocation from existing programs, or increased revenues should they materialize.

The table below provides a detailed breakdown of the fiscal impact of these measures over the next five years.

In releasing this information, Mr. Goodale said, “It is important that Canadians have an accurate understanding of the impact of recent decisions on the financial position of the Government of Canada.”

                                                                                
For further information, media may contact:

Pat Breton	David Gamble
Press Secretary	Public Affairs and Operations Division
Office of the Minister of Finance	(613) 996-8080
(613) 996-7861

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Initiatives Announced Since the 2005 Budget

	2005-06			2006-07			2007-08			2008-09			2009-10			Total
							($ millions)
Bill C-48
Post-Secondary Education and Training		750			750												1,500
Affordable Housing		800			800												1,600
Environment and Energy Efficiency for Low-Income Housing		450			450												900
Foreign Aid		250			250												500
Total		2,250			2,250												4,500
Canada-Ontario Agreement
Higher Education		200			200			350			400			400			1,550
Housing and Infrastructure		150			150			100			100			100			600
Cities		149			149												298
Labour Market Development Agreement and Immigration		80			300			400			560			634			1,974
Climate Change					40			140			158			200			538
Corporate Tax and Meat Inspection		10			80			350			250			100			790
Total		589			919			1,340			1,468			1,434			5,750
Airport Rents Reduction					48			72			97			132			349
Other
Wage Earner Protection Program		32			32			32			32			32			160
Canadian Museum for Human Rights		10			10			10			20			20			70
Prince Rupert Port Upgrade		10			20												30
Global Centre for Pluralism		30															30
International Fishing Governance		6			7			7									20
Quebec City 400th Anniversary Celebrations		11			34			45			19						110
Measures to Aid Darfur		120			78												198
Total		219			181			94			71			52			618
Total		3,058			3,399			1,506			1,636			1,618			11,217
Less
Funding Included in 2005 Budget		(130	)		(171	)		(231	)		(277	)		(348	)		(1,157	)
Overlap With Bill C-48*		(499	)		(499	)		—			—			—			(998	)
Total		(629	)		(670	)		(231	)		(277	)		(348	)		(2,155	)
Net Fiscal Cost of New Initiatives**		2,429			2,728			1,275			1,359			1,270			9,062

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*	Measures for post-secondary education, housing and cities.
**	Funding for agricultural sector of $1 billion and for mountain pine beetle of $100 million (funded in the 2005 budget) accounted for in 2004-05.
Note: The financial support for C Series commercial aircraft program of up to $350 million was provided for in the 2005 budget.

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