Source: The Canadian Press

The C.D. Howe Institute is urging Finance Minister Jim Flaherty to get tough in his upcoming budget.

The Toronto-based think-tank says Flaherty should bring in tough measures that would eliminate the deficit a year earlier than currently planned.

And the only way to do that is to get serious about cutting spending, it says.

The think-tank suggests strongly that Ottawa should not be financing non-productive projects such as sports arenas and adds that it needs to rein growth in the public service.

The institute said the public service should be trimmed by two per cent each year for the next four years, that public-sector wage increases need to be restrained and that government employees should be made to pay a greater share of their relatively lucrative pensions.

Flaherty said earlier this week that Canadians should expect no major new spending when he tables his budget in March, but has also indicated in the past that any cuts would not be draconian.