Finance Minister John Manley launched a defence of his first budget to the Canadian Club and Empire Club in Toronto Thursday.

Manley took the need to balance the desires of Bay Street and Main Street in a budget as the primary theme of his address. He called his budget a series of investments, rather than spending decisions. “We invested money, yours and mine, in the priorities that Canadians identified. And above all, we only commited the money we reliably believe we will have, no deficits, no unrealistic forecasts, no throwing caution to the winds. Just wise investments in the highest priorities, responding to the interests of Canadians in building a society and economy that will succeed for all of us.”

While there were really no new tax cuts or debt-reduction efforts in the budget, Manley noted that Ottawa has chosen to encourage the savings, investments and expanded capital pools that will make Canada even more of a magnet for growth. “If we want to spur savings, it makes sense to raise RRSP limits. If we want to strengthen the financial base for small businesses, it makes sense to raise the income ceiling for the small business tax rate, which we’ve now taken to $300,000.”

“If we want to create jobs, then it makes sense to reduce EI premiums and to restructure how we set those premiums. If we want to support growth in our regions, it makes sense to reduce resource sector income taxation rates. And if we want to build jobs and attract investment in businesses of all sizes, it makes sense to eliminate the federal capital tax,” he said.

Manley explained his government’s approach to social spending in the budget. “Traditionally, social spending has been seen as a simple and simplistic question of left vs. right, Bay Street vs. Main Street. Some people are still very clearly stuck there,” he said.

Manley said that the federal government is aiming to make investments that will make for a stronger society and a stronger economy. “Because in the long run, Bay Street can only be as healthy as Main Street is, in every sense.”

He also defended the lack of specific investments for cities, and he talked up the government’s initiatives to promote more accountability in its spending. “And from the feedback since Tuesday, I have seen that Bay Street and Main Street are in total agreement on the need to look to better use of existing spending before we put new dollars to work.”

“Yes, the world is an uncertain place today. Yes, our country faces challenges of many kinds. No, the business cycle has not been banished from our world. But now we are in a position to talk about opportunities in a way we have not been for many years. We are in a position to make intelligent choices that enable all Canadians, not just some, to thrive in this new world of opportunities and challenges,” he concluded.