[Update at 11:30 AM: New appointments—Oliver and Rickford—are now official. According to CBC: “Prime Minister Stephen Harper was at Rideau Hall for the swearing-in, for which no press release was issued.”]
The best federal finance minister since the Liberals’ Paul Martin has resigned. Jim Flaherty, who has served as finance minister since he was elected to the federal riding of Whitby-Oshawa in 2006, resigned his cabinet post on Tuesday.
Flaherty’s term as Canada’s chief financial officer has not been an unambiguous success, however. In Oct. 2006, Flaherty imposed a tax on distributions from income trusts, wiping out more than $20-billion in stock-market value overnight—much of which was owned by ordinary middle-class Canadians.
The move might have been good tax policy, but it came only months following his Conservative Party’s 2006 election campaign promise to avoid ending favourable tax treatment of income trusts, thereby encouraging thousands of ordinary Canadians to invest retirement and other saving funds in such stocks. The callous turnabout ruined the retirement plans of thousands who could ill afford the loss.
Nothing has shaken my faith in the Conservative Party of Canada more than that bait-and-switch election tactic. It is dishonourable that a political party—during and election campaign—would specifically tell its supporters that it’s safe to own a popular investment vehicle, and less than a year later tax away the financial benefits provided by the vehicle. This was a shameful episode and really was unforgivable for the real damage it did to financially vulnerable seniors.
Notwithstanding his broken promise on income trusts, Mr. Flaherty piloted Canada through what PM Harper characterized as our “most challenging economic times since the Great Depression and gaining the country a solid global reputation for economic management.” Here’s a quote from Bloomberg Businessweek.com:
World leaders have noticed Canada’s economic record in recent years. President Barack Obama once said the U.S. should take note of Canada’s banking system, and Britain’s Treasury chief said Britain looked to emulate the Ottawa way on cutting deficits.”
Prime Minister Stephen Harper, apparently, intends to announce Flaherty’s replacement on Wednesday. News reports citing unnamed sources say it’ll be Natural Resource Minister Joe Oliver. He’ll be a good choice for he’s likely to provide continuity and stability—just what the financial community would look for.
Oliver, aged 73, does have some Bay Street cred for he is a former investment banker at Merrill Lynch, he once served as executive director of the Ontario Securities Commission and is a former president and chief executive officer of the Investment Dealers Association of Canada.
He has earned an MBA from the Harvard Graduate School of Business and a Bachelor of Arts and Bachelor of Civil Law at McGill University. He is also, reportedly, fluently bilingual.
Lucky Joe, he’s set to inherit a balanced budget. Here’s hoping he’ll keep it that way and, perhaps, pay down part of the national debt.
My money had been on Foreign Affairs Minister John Baird or Jason Kenney, Minister of Employment and Social Development and Minister for Multiculturalism. But the timing might not have been right for either man since they are both pretty busy with critical files these days.
According to CBC News, “Kenora, Ont. MP Greg Rickford is replacing Oliver in the natural resources portfolio. Rickford was minister of state for science and technology, and in the past was parliamentary secretary to the minister of aboriginal affairs.”
We’ll await the PM’s official announcement later today.