Legault promises $500 cheques to help Quebecers cope with inflation in pre-election budget

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Premier François Legault’s government in Quebec said all adults who earn less than $100,000 a year will get a one-time payment of $500 to help households cope with surging inflation.

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The promise was the highlight of the province’s annual budget on March 22. Finance Minister Eric Girard said the province will record a deficit of $7.4 billion in the fiscal year that ends at the end of the month, better than previous year’s shortfall of $9.2 billion, but short of his target of narrowing the deficit to $5.3 million.

Girard was on track to meet his budget goals, but his government, which will be seeking re-election this fall, opted to use increased revenue to respond to cries for relief from the biggest shock to the cost of living in more than three decades. The consumer price index (CPI) rose 5.7 per cent in February from a year earlier, and the war in Ukraine has only added to price pressures.

The average price of gasoline in Quebec stands at a record $1.79 per litre, and experts think prices could climb as high as $2 per litre.

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“The budget that I am presenting today is indeed within a context of great uncertainty,” Girard said in a speech to the legislature. “We do not know how the pandemic may evolve, inflation is high at the start of the year and the central banks are tightening their monetary policy. Added to this is the tense geopolitical context, marked by the invasion of Ukraine by Russia.”

With the budget, Legault made good on a promise to hand out cheques to help Quebecers cope with inflation and rising gas prices, despite push back from opposition parties that, instead, suggested freezing electricity rates or removing the provincial gas tax.

Girard estimated that 6.4 million Quebecers will receive the $500 cheques, at a total cost of about $3.2 billion.

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On the whole, Quebec’s economy is looking up. The province’s gross domestic product increased 6.3 per cent in 2021, compared with a 5.5-per-cent decline in 2020. Girard predicted growth of 2.7 per cent this year and two per cent in 2023.

Quebecers came out in droves as health restrictions were eased, releasing pent-up demand. But the lockdowns may not be over just yet. As the omicron variant threatens another wave, the government has pledged $8.9 billion to strengthen Quebec’s health care infrastructure.

It was Girard’s fourth budget since the Coalition Avenir Quebec was elected in 2018, and will likely be the last budget released before the provincial election, scheduled for Oct. 3.

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