Challenges Ahead for the Canadian Government in 2014

January 1, 2014 Updated: January 8, 2014

News Analysis

OTTAWA—The year that passed has been both exciting and difficult for the Stephen Harper’s Conservative government, making the year ahead likely definitive in terms of the party’s fortunes in the 2015 general election.

The government is facing a credibility crisis that has hit it in polling numbers harder than anything before, though a relatively successful economic performance has preserved the Tories’ most critical claim on power.

And despite the challenges facing the Conservatives, the NDP hasn’t seen its own fortunes rise as a result.

Instead it was the third-ranked Liberals, benefitting from the popularity of their newly minted leader Justin Trudeau, who have seen the biggest turn in public approval. 

That has been buoyed almost entirely by Trudeau’s appeal: neither policy ideas nor a significant change to the party structure can be credited for the Liberal resurgence. (Trudeau is, however, promising open nomination for all ridings in the next election).

And that makes Trudeau as much a liability as an asset. A major controversy or a few more questionable comments—like his apparent admiration for China’s murderous dictatorship—could reverse the party’s improved standing in polls.

That’s a problem for any party, but both the Conservatives and NDP have more experienced leaders and fleshed-out platforms to shore up their leaders’ credibility.

But for the Conservatives, that credibility has been shaken hard for the first time since Harper took the helm of the new party. 

Connections between the Prime Minister’s Office (PMO) and the ongoing Senate expense scandal can be blamed for a fall in the polls that has become significant in recent weeks. 

Cracks Appearing

But other controversies are more longstanding, including the government’s determination to push resource development at what critics say is the expense of the environment and scientific evaluation.

And Harper’s once-lauded control over his caucus has also shown cracks as Conservative MPs begin to challenge party policies and the authority of caucus leaders like Government House Leader Peter Van Loan.

Those internal fractures remain small at the moment, and no Tory MP is voicing anything but support for Harper’s leadership. But even before Edmonton-St. Albert MP Brent Rathgeber quit the party over its lost commitment to government transparency, backbench MPs were already chafing against restrictive controls on caucus. 

There is no indication the PMO will be loosening its grip on caucus in the next year, which could mean Tory backbenchers could be convinced to speak more boldly on their own priorities. 

The Conservatives have remained firm on basic economic policies, including keeping federal taxes at their lowest levels in 50 years, and have made a point of touting their economic performance at every opportunity. 

There are some challenges on the economic front—including questions over an investment deal with China and unknown details of Canada’s free trade deal with the European Union—but the Tories can count their fiscal performance as a strength. 

Critics may question whether particularly low corporate taxes have translated into the economic benefit promised, especially as many companies sit on hoards of cash in the face of an uncertain global economy, but no one has managed to displace the Conservative’s credibility on the economy.

Recently the government has also moved forward on a consumer agenda that was once the populist purview of the NDP. If it proves successful, broad economic policies on trade and taxes will be buttressed by success on kitchen table issues like cable packages and cellphone contracts.

Showdown with Unions

One of the biggest challenges the government could face is what looks to be a brewing showdown with organized labour. The Conservatives are in the midst of an austerity program that has it looking for ways to make the public service more efficient while trimming its workforce. 

While that effort isn’t controversial on its own, the government has paired it with broader measures aimed squarely at limiting the power and influence of unions in general.

Public opinion could be on the government’s side if sharp words come to major protests or job action because unions are largely concentrated in the public sector. That means private sector workers aren’t entirely supportive of tax dollars going to government workers with better benefits than their own.

But those sympathies could change if critics of the government can frame the debate more in terms of record high executive salaries and bonuses, or a widening gap between the average wage earner and Canada’s wealthiest companies and individuals.

The biggest challenge for the government is the biggest challenge for every government around the world—a shaky global economy. While the global outlook looks marginally more stable for 2014, for Canada high public and private debt, a lack of private sector investment, and political gridlock in the U.S. Congress are unsettling. 

That economic uncertainty might help the government justify its zealous support for resource development and tough-guy stance toward unions. 

On the other hand, as the economy becomes less of an issue, other matters become more important to Canadians. If the Conservatives can’t ride on their economic credentials, concerns over governance, the environment, or social programs like healthcare could become harder to deal with. On those fronts, opposition parties might have better traction.