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“This means that senior management and the Minister of Finance were not informed of the overall impact on the government’s long-term fiscal position until well after they had approved the budget measures,” the report says.

The federal government did not conduct long-term fiscal projections of the impacts of multibillion-dollar major policy decisions such as reducing the GST to five per cent and offering a GST/HST credit to low-income earners, since it did not expect the costs relative to GDP to grow, nor did it examine the long-term fiscal implications of pension income-splitting.

Federal officials did, however, examine the long-term fiscal implications of other major measures examined by the auditor, including trimming the annual funding increases in health transfers to the provinces, and increasing the eligibility age for Old Age Security to 67 from 65.

The Conservative government has agreed to implement recommendations from the Auditor-General, including:

– Beginning with Budget 2013, the Finance Department will provide the Finance Minister with an assessment of the overall long-term fiscal implications of new budget measures before the budget is finalized; and

– The Finance Department will publish long-term fiscal analyses for the federal government on an annual basis, by 2013 at the latest.

The findings from the Auditor-General come as Parliamentary Budget Officer Kevin Page has been calling on the federal government to fully release information on the impacts of cuts announced in the 2012 budget. Page has said he’s willing to go to court to get the details of budget cuts from several major federal departments if they’re not released.

A recent report from the PBO concluded the Harper government’s reforms over the past year to the Canada Health Transfer and Old Age Security, along with its ongoing savings in operating spending, mean the federal government’s finances are sustainable over the long term.