The Liberal government's assault on the deficit will reduce program spending by 21 percent by 1998/99 and be accompanied by a reduction of almost 50,000 public employees. Rather than a frantic across-the-board slashing exercise, the cuts have been portrayed as a change in philosophy toward reducing the role of the federal government by devolving responsibilities to other sectors and applying private sector management techniques to those activities that remain. This year's edition focuses on life in Canada - from the perspective of specific government departments, the Liberal government and society as a whole - now that the federal budget cutting knife is being wielded in an unprecedented manner. Have the restraint measures been like a scalpel, surgically removing unnecessary fat from various government departments, or more like a chain saw cutting a wide swath through its core? Individual chapters analyze the impact of restraint on the departments of industry, environment, human resources development, treasury board, government services and public works, and defence.