Bill C-375

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First Reading

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	1st Session, 36th Parliament, 46-47 Elizabeth II, 1997-98
	The House of Commons of Canada
	BILL C-375
	Balanced Budget Act
	Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:
	Object
Object of the Act	1. The object of this Act is to prevent the government from incurring budgetary deficits as of the 1998-1999 financial year.
	Definitions
Definition	2. In this Act,
``deficit'' « déficit »	``deficit'' means the excess of expenses over revenues;
``expenses'' « dépenses »	``expenses'' means the expenses entered into the financial statements of the government in accordance with its accounting methods;
``gross debt'' « dette brute »	``gross debt'' means the total of all deficits incurred by the government;
``Minister'' « ministre »	``Minister'' means Minister of Finance;
``revenues'' « revenus »	``revenues'' means the revenues entered into the financial statements of the government in accordance with its accounting methods;
``surplus'' « surplus »	``surplus'' means the excess of revenues over expenses;
Prohibition against deficit	3. Subject to sections 5, 6 and 7, no deficit shall be incurred by the government as of the 1998-1999 financial year.
Exceptions to prohibition of section 3	4. Except where provided for in sections 5, 6 and 7, budgetary estimates introduced into the House of Commons shall be in accordance with section 3.
Deficit of less than three billion dollars	5. Where a deficit of less than three billion dollars is established for a financial year, the government shall produce a surplus during the following financial year equal to this deficit.
Deficit of more than three billion dollars	6. The government may incur a deficit for more than one financial year if it estimates at the time of a debate on the budget, a deficit of at least three billion dollars for the financial year of this budget or if it establishes a deficit of at least three billion dollars for any given year, but in either of these situations, the deficit may only result from one or more of the following circumstances:
	(a) a natural catastrophe having a major impact on revenues or expenses;
	(b) a major deterioration in economic conditions;
	(c) the involvement of Canada in a military conflict consequent to its international peacekeeping commitments.
Reabsorption of deficit within 6 years	7. (1) In the cases specifically covered by section 6, the government shall reabsorb completely, over a time period of a maximum of six years, the deficits incurred or estimated for this time period and for such purposes, the Minister shall at the time of the debate on the budget presented for the first financial year of this time period:
	(a) report to the House of Commons on the circumstances justifying the government's reliance on section 6;
	(b) present a financial plan providing for the reabsorption of the deficits during the time period in question;
	(c) provide for the reabsorption of at least 75% of the deficits during the first three financial years of the time period in question;
	(d) provide that at the end of the reabsorption plan, the level of the gross debt will be equal in nominal value to the level which prevailed before the first year of the reabsorption plan.
Maximum time period	(2) The maximum time period of six years referred to in this section shall commence at the start of the financial year that the deficit is established or estimated in accordance with section 6.
Report to the House of Commons	8. (1) The Minister shall report to the House of Commons at the time of the debate on the budget, on the status of any deficits which may have occurred, on the balance of the budget, on any deficits authorized by this Act and on any disparities relating to these matters, if applicable.
Report to the House of Commons	(2) The Minister shall report annually to the House of Commons on the impact, on the financial status of the government, of any changes to accounting methods in force for the 1998-1999 financial year.
Responsible Minister	9. The Minister is responsible for the application of this Act.
Coming into force	10. This Act comes into force on April 1, 1998.

Bill C-375

BILL C-375

Object

Definitions