Transitioning from the Pandemic: Towards a More Balanced Fiscal Policy

  • James K. Stewart (Jason), Executive in Residence, Global Risk Institute
  • Hugh O’Reilly, Executive in Residence, Global Risk Institute
  • Erik Brown, Research Analyst, Global Risk Institute
Computer generated image of coronavirus.


As Canada’s COVID-19 vaccination rates achieve critical thresholds in mid 2021, fundamental changes in fiscal policy are recommended to boost the Canadian economy’s supply side and make governments’ demand-side support more effective. A more balanced fiscal policy would help achieve greater economic resilience and robustness, and foster more broadly-based growth and sustainable prosperity. A fiscal pivot is also timely given the economic risks and health uncertainties of the Delta variant in H2, 2021.

This paper builds upon the methodology and frameworks of Stewart & O’Reilly’s 2020 and our 2021 Long-Term Thinking in Extraordinary Times GRI articles. It assesses fiscal policy-making needs with a three-phase lens reflecting successes, challenges and risks from the pandemic, while focusing upon the needs of the transition and sustainability phases. Effective fiscal policy requires consideration of the potential impacts of key known unknowns, and preservation of the flexibility to respond to unknown unknowns in 2021 and 2022.