Freeland defends budget measures as premiers push back on federal involvement

Deputy Prime Minister and Finance Minister Chrystia Freeland says she thinks unhappy premiers will come around on measures in the federal budget that touch on provincial legislation, even as they push back.

At an event in Toronto on Sunday, Freeland — who presented the federal budget on Tuesday — said the national government needs to push ahead on such issues as housing and she was "extremely optimistic" premiers would choose to co-operate.

"Housing is a national challenge, and the federal government needs to be leading the charge," she said.

"My own experience has been when there are big issues that really matter to Canadians, after all the sound and the fury, people are prepared to roll up their sleeves and find a win-win outcome for Canadians."

Several premiers have pushed back against the federal government in recent months and again after the budget was released on the grounds that some measures touch on provincial jurisdiction.

WATCH | Why some premiers are pushing back:

Premiers lash out at Trudeau over budget

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Duration 2:00

This week’s federal budget has premiers lashing out at Prime Minister Justin Trudeau over a planned increase to capital gains taxes as well as what they say is overstepping on infrastructure and pharmacare.

In a letter released Friday by the Council of the Federation, which represents the leaders of all 13 provinces and territories, the premiers said Ottawa should have consulted them more ahead of the budget.

Individual premiers have shared more pointed critiques.

"It's a never-ending spending platform that we've seen now for the last 10 years," New Brunswick Premier Blaine Higgs said on CBC's Power & Politics on Friday.

"My initial thoughts about the federal budget are that they are overtaxing, overspending, overborrowing and over interfering in provincial affairs," Alberta Premier Danielle Smith said earlier this week.

Alberta has clashed with the government repeatedly over housing. Smith introduced legislation earlier this month that would require provincial oversight of deals made between municipalities and the federal government, including for future agreements around federal housing funds.

WATCH | Breaking down the politics of the budget:

At Issue | Federal budget buy-in and blowback

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At Issue this week: The Liberals work to sell their multibillion-dollar spending plan and capital gains tax hike. Pierre Poilievre tells Radio-Canada what he thinks of the federal budget. And another province pushes back on the carbon tax.

Freeland said on Sunday that, as an example, the federal child-care program negotiated through a series of deals with provinces and territories showed that co-operation was possible.

Capital gains tax changes criticized

The federal government has also faced some opposition on what was perhaps the most prominent measure revealed on budget day: changes to Canada's capital gains tax rules. The government has proposed raising the inclusion rate to 67 per cent on capital gains above $250,000 for individuals.

"The 21st-century winner-takes-all-economy is making those at the very top richer, while too many middle-class Canadians are struggling," Freeland said Sunday, adding the government was asking wealthy Canadians to pay their "fair share."

"We do need to ensure that we have some revenue coming in. This is a very limited way of ensuring that that occurs," Treasury Board President Anita Anand said in an interview on Rosemary Barton Live on Sunday.

WATCH | Treasury Board president defends budget measures:

Millennials, Gen Z, need government help ‘now more than ever’: treasury board president

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Treasury Board President Anita Anand joins CBC chief political correspondent Rosemary Barton to talk about the federal budget and its focus on young Canadians — as well as the criticism it's receiving.

Critics have raised concerns that the changes could result in reduced investment or capital flight.

"The big concern right now … is this going to have a detrimental impact to the progress we're trying to make in making Canada a hub for innovation," said Kirk Simpson, CEO of the tech company goConfirm, in a separate interview on Rosemary Barton Live.

"With productivity the way that it is, we want more capital, not less, flowing into business innovation," Simpson told CBC chief political correspondent Rosemary Barton.

Freeland said Sunday that the changes will affect very few Canadian individuals — the government estimates 0.13 per cent — and the revenue will go to pay for investments in areas like housing.