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Canada Seeks C$1.7 Bln in Savings From Spending Cuts

May 3 (Bloomberg) -- Stockwell Day, head of Canada’s treasury board, said the government is seeking to save C$1.7 billion ($1.68 billion) from reviews of government spending.

Day said the results of the reviews will be seen in next year’s budget. He said the government is looking at C$35 billion in spending by 13 departments and agencies, including Industry Canada and Day’s Treasury Board.

The review may help the government lower its deficit after it implemented a two-year stimulus program aimed at lifting the economy out of recession. Finance Minister Jim Flaherty projected a record deficit of C$53.8 billion in the fiscal year that ended March 31, and C$49.2 billion in the current year.

Day told reporters in Ottawa that Canada was alone among the Group of 20 countries in restoring budget balance by “maintaining a policy to not raise taxes and to look at reducing expenses.” He also said the savings will be permanent and won’t come from cutting transfers to people or provinces.

Canada’s economic growth, which is ahead of Flaherty’s budget projections, may help reduce the deficit by C$34 billion over the next five year, Toronto-Dominion Bank said last week.

To contact the reporter on this story: Alexandre Deslongchamps in Ottawa at adeslongcham@bloomberg.net.

To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net; David Scanlan at dscanlan@bloomberg.net.

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