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Surplus hits $13.2 billion

[PoliticsWatch updated 6:05 p.m. September 25, 2006]

OTTAWA  — The federal government announced Monday that it posted a $13.2 billion surplus for the 2005-2006 fiscal year.  
  
The surplus was estimated to be $8 billion, but Finance Minister Jim Flaherty said strong revenue growth and lower program expenses made the surplus larger than forecasted. 
 
The $13.2 billion will be put towards Canada's national debt, which will lower it to a total of $481.5 billion. 

The finance department said that Canada's debt to GDP ratio is the lowest it has been since 1982. 
 
While in opposition the Conservatives were often critical of the Liberals for low-balling fiscal forecasts and then posting larger surpluses. 

During a CBC Town Hall meeting during the election campaign, Prime Minister Stephen Harper criticized the Liberal practice of running large surpluses. 

"What I've specifically advocated for in this election are two things," he said. "First of all, that the federal government give more of its enormous and growing surpluses back to not just lower levels of government, but also to the ordinary people who paid for these surpluses in the first place through overtaxation."

At a press conference in Ottawa on Monday, Flaherty said that this could be the final fiscal year where the federal government posts a large surplus. 

"Yes, probably unless there is some tremendous surprise," Flaherty said.

Flaherty and Treasury Board President John Baird also announced $1 billion in program cuts and other savings. 

Baird said the cuts in programs will only result in 300 job losses in the federal public service, which should be offset by general staff attrition. 

Some of the highlights include

> The government estimates it has saved $46.7 million by having a federal cabinet of just 25 ministers. 

> The end of the softwood lumber dispute will save the federal government $14.9 million in legal costs. 

> The government is cutting the medical marijuana research program at a savings of $4 million a year. 

> The elimination of funding for the Centre for Research and Information on Canada will save the government $6.5 million a year. 

> The elimination of funding for the Canadian Policy Research Networks will save the government $3 million a year. 

> The federal court challenges program's elimination will save $5.6 million a year. 

> The elimination of the First Nations and Inuit Tobacco Control Strategy will save $10.8 million a year.  

:  Related Links

> Finance Department list of spending cuts

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