Standard & Poor’s Ratings Services said that the new federal government’s priorities, as outlined in Tuesday’s throne speech, are not expected to negatively affect Canada’s sovereign creditworthiness.

“Although there are some indications that the new government will reduce the federal authority’s fiscal flexibility to deal with unforeseen events, Standard & Poor’s does not expect serious erosion of Canadian fiscal discipline under the Harper government,” said S&P credit analyst Nikola Swann.

“This reflects our analysis not only of the Conservative leadership, but also our expectation of continued parliamentary and broader public pressure to preserve the hard-won gains of the past 15 years, which have resulted in eight consecutive years of federal budget surpluses and a general government budgetary balance (all levels of government included), which has been the strongest of the G7 nations for the past four years,” he added.

The relatively brief throne speech focused on the priorities emphasized by Conservative leader and now Prime Minister Stephen Harper during the election campaign, S&P noted.

“The speech also implied that some concessions have already been made to endorse elements of opposition parties’ platforms, such as encouraging the creation of new child day care spaces, in addition to the Conservative plan of providing direct financial support to parents,” it said. “Moreover, it has been reported that the new government is considering abandoning a campaign plan to reverse income tax cuts to low-income earners that were originally intended to help pay for the Conservative plan of reducing the Goods and Services Tax.

“Although some of these concessions to the Conservatives’ minority position in the House of Commons, combined with key campaign promises, are expected to reduce the federal government’s fiscal flexibility to deal with unforeseen events, Standard & Poor’s expects Canada’s general government budgetary balance to remain the strongest of the G7 sovereigns in both this year and next,” S&P concluded.