$500 checks: an ineffective measure, say economists

Gurav Changar is a graduate student. He counts himself lucky to be one of the future beneficiaries of the province’s initiative.

I think it’s good cause I need that moneyhe says, adding that this sum will help him pay the rent and the groceries.

For Judge Cote, a father of four, the measure is also welcome, although the relief it will provide may be short-lived given rising costs.

It’s hard to keep paying the rent, in addition to food, bills and children’s fees. It definitely presents financial challenges.he explains.

A sober welcome in the academic world

The provincial government will spend $450 million to provide these $500 checks to 900,000 people in Saskatchewan.

For Moshe Lander, professor of economics at Concordia University, this type of measure does not eliminate inflation. By putting this surplus money in the pockets of taxpayers, it instead leads to a sudden increase in demand relative to supply.

It is a good political stunt, but a terrible economic measure. »

A quote from Moshe Lander, professor of economics at Concordia University

Professor in the Department of Economics, Justice and Politics at Mount Royal University, Lori Williams, notes for her part that these millions of dollars could have been invested in education or health.

The Government of Saskatchewan is specifically advocating for more federal funding in the health sector. Seeing the province distribute money in this way, Ottawa could be more reluctant to agree to this request, believes the professor.

Also, the Saskatchewan Minister of Finance, Donna Harpauer, invokes the volatility of incomes and resources in order to avoid investing these surpluses in the field of health.

It is precisely for this reason, Professor Lander thinks, that surpluses should not turn into cheques. He cites the example of Alberta.

In 2006, under the government of Ralph Klein, surpluses allowed the government to pay the sum of $400 to each Albertan. However, soon after, the situation changed and several years of deficits followed one another due to the fall in the price of hydrocarbons.

Saskatchewan should keep this example in mind, the professor thinks.

With information from Yasmine Ghana

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