I beg to differ. The decentralizing of government allows for more money in provincial hands, where matters are negotiated closer to home.
The majority of new spending was in this fiscal imbalance fix.
http://en.wikipedia.org/wiki/2007_canadian_budget
This allows the provinces to have more money, and will allow for some very good provincial budgets if treated properly. In the future, my rational is that the federal government will lower taxes so the complications and inefficiency of only returning the money where it came from will be prevented.
I have been hearing that this is a short sighted budget. Because of this important measure however, I believe otherwise.