- Member of Parliament
- Member of Parliament
- Conservative
- Simcoe North
- Ontario
- Voting Attendance: 68%
- Expenses Last Quarter: $121,028.17
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- Apr/19/23 5:21:36 p.m.
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Mr. Speaker, I do not know how I will top the remarks and wonderful intervention by the member for Calgary Confederation.
We are in trouble as a country. It is very serious. We are a country in decline, but listening to the government, it is as if Canadians have never had it so good. The Liberals say things like that we have the lowest net debt-to-GDP ratio in the developed world, or that we have the best growth in the G7. What they do not say is that our living standards are in serious decline. Our living standards have been in decline since the 1980s. In fact, in a research report released just yesterday, the Institute for Research and Public Policy highlights an urgent need. The report says, “In 1981, Canadians enjoyed a $3,000 higher per capita standard of living than the major Western economies (adjusted for inflation and currency fluctuations). Forty years later, Canada was $5,000 below that same average. If the trajectory continues, the gap will be nearly $18,000 by 2060.”
We care about per capita because that is how we measure standard of living. We often hear people talk about the economic pie, which can grow, but if people's slices still stay the same, they are not better off. The government is achieving economic growth solely on the basis of volume alone. What do I mean by that? We are growing the pie, but the size of everybody's piece of the pie is staying the same. Our population is growing. We are only growing demand. That is the only thing that is happening and will continue to happen.
Last year in the budget, the government was transparent about this issue. It highlighted a chart that showed Canada toward the bottom of the OECD in peer countries from GDP per capita growth. All of a sudden, this year, that chart disappeared. I wonder why. It is because the story is so awful.
I have to read a quote from 2015 for my colleagues:
The OECD has cut its 2015 GDP forecast for Canada to a dismal 1.5%. By way of excuse, the minister today claimed, “We are doing better than most developed countries.” That is simply not true. The OECD puts us behind Australia, Germany, Ireland, Israel, the Netherlands, South Korea, Sweden, the U.K., the U.S. and yes, even Spain.
This is no global problem, as the government likes to pretend to excuse its shoddy management. This is a made-in-Canada runway to recession.
The Deputy Prime Minister said that. Maybe the Deputy Prime Minister should go back to her 2015 self and take some lessons.
This is the context in which we have to think about this budget. It was not even one year ago when members on this side stood up and asked the government what it would do if inflation does not come down and we see economic uncertainty. What was the answer from the government? It was that these hon. members are “economically illiterate”. Guess what? Unfortunately, the worst is happening. Inflation is still high and unemployment is going to go up. We are walking into a recession because the government's spending is out of control.
The government's own projections state that unemployment is going to go up by 1.3%. That is 275,000 to 300,000 Canadians who, the government is projecting, will lose their jobs before the end of the year. I do not think they really care at all what inflation is in the U.K. or in the U.S., or that we somehow have a little bit better growth than some of our peer countries. We can argue about whether the causes of inflation are domestic or international. They are both, but more recently, really smart people are saying that we have too much demand in Canada. Our own central bank governor says that inflation is caused by too much domestic demand. Stephen Poloz recently said that the size of the deficit last year caused interest rates to go higher.
What does this mean for Canadian families? Derek Holt at Scotiabank suggests that one full percentage point of central bank increases is related to government overspending. What does that mean for the average Canadian? If the average mortgage is $360,000, they are paying $3,600 extra per year in interest because the government has been overspending and increasing demand, meaning interest rates have to go up to cool inflation. If someone happens to be a new homeowner or is trying to get an $800,000 mortgage, that is $8,000 extra a year they have to pay.
The bank is working very hard to bring inflation down, and we should be supporting it. Instead, the government is making its job harder. It is putting on additional taxes that have been determined to be inflationary.
We have had food inflation in double digits for more than a year, and the government has never bothered to even ask how the carbon tax affects food prices in Canada. Food has to be produced, and farmers are paying the carbon tax. One farmer in a nearby community showed me a bill with $13,000 in carbon tax alone in one month for natural gas. Also, the government thinks farmers have so much money that it put HST on top of the $13,000. It is absolutely incredible.
The Liberals are not willing to admit this massive problem. They can only stand up and point to few things, saying that we are so much better off than the rest of the world. The only thing they have done to help people over the last year has been the GST rebate to help low-income Canadians. There is one in the budget and one in the fall, and the Conservatives supported and support both of them. We would like to see that go forward.
All of this spending has consequences. We are spending almost as much, this year coming up, on interest on the debt as we are giving to the provinces to spend on health care. How incredible is that? Just a couple of years ago, when the Deputy Prime Minister was asked about interest rates increasing and how much that would cost, the response was, “These are investments in our future, and they will yield great dividends. In today's low interest rate environment, not only can we afford these investments, it would be short-sighted of us not to make them.”
The Liberals ignored inflation when it came and said it was transitory. Now they are ignoring economic uncertainty and a recession. They are calling it a shallow recession that is going to be short. Maybe they are also saying it is going to be transitory.
They were asked about economic uncertainty, and they called us economically illiterate. They said the debt-to-GDP ratio was going to keep declining, but they have broken that promise too. Now Canadians are paying the price for their prediction. The plan is not working, inflation is high, economic growth is slowing and the impacts on Canadians are real. I will give just a couple of examples of what is happening.
People are not getting great service in many circumstances. I heard from a young woman who is a PSW at a retirement home in Midland caring for our vulnerable. She is trying to get her PR card. She is also a nurse, but she cannot change jobs while she is waiting for her PR card. She has been waiting two years, which is an incredible injustice. We are preventing a young nurse from getting into the system.
Then there is Gary, a pilot who is retired. He builds planes. All he needs is his medical approved by the the transportation department so he could fly his plane and enjoy his retirement years. That is not happening either.
If members thought it was all doom and gloom, I want to end on a positive note. Last week I was in Ms. Thompson's grade 11 law class. Mr. McEcheran is a student of Lakehead who is observing that class and helping out. These students asked the most amazing questions. It gives me a lot of great hope for the future of the country. They asked about crime, homelessness and land conservation. I was very energized by this conversation. I think the country is in great hands when we have student leaders like them engaged in civics discussions.
I could not answer many of those questions and could not point to things in the budget to address their concerns. I hope next year we will have a better shot.
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- Mar/21/22 12:57:31 p.m.
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Madam Speaker, I am pleased to answer this question again. We look at the federal budget from 2017 and it talks about how much revenue was gained from the tax increase on the wealthiest Canadians. It was one-third of what the government projected, so it received far less revenue than it thought it would because people left.
If we increase taxes on large businesses that can easily shift profits and operations overseas, we will find that they will leave this country and we will have less investment.
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- Mar/21/22 12:55:32 p.m.
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Madam Speaker, to clarify, while I find some portions of the NDP motion acceptable, I do not think we can support the motion in its entirety as it is currently written. I do not believe that growing the size of government is going to address the cost-of-living crisis.
My submission would be that we need to let consumers take these excess profits from companies in the form of lower prices. In fact, with respect to public transfers and what we would do with money should we have an excess amount of revenue, and by the way government revenues are increasing substantially during inflation, absolutely, we should be giving no-strings-attached additional money to provinces for health care transfers and other social programs.
I think the provinces well understand how to best use that money to support their own jurisdictions. I would support my hon. colleague with that suggestion.
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- Mar/21/22 12:53:45 p.m.
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Madam Speaker, I would like to thank the hon. member for his question, which allows me to point back to his own government's data. In 2016, we raised the top marginal rate on the highest income earners in Canada. What happened? The government told us that we were going to get about $3 billion in extra taxes. What did we get? We received less than $1 billion, which is a third of what we were expecting to get. In fact, we had a record number of tax filers leave the country after that was introduced.
I refer the hon. member back to his own government's statistics on this matter.
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- Mar/21/22 12:42:48 p.m.
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Madam Speaker, it is a pleasure to speak to this motion put forward by my colleagues and the member for Burnaby South.
Before I begin, I would like to mention I am splitting my time with the hon. member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup.
I was very encouraged when I heard about this motion today and that we were going to talk about a public beneficial ownership registry, which is badly needed in this country. However, upon closer inspection, I see parts of this motion that make it difficult for me to support it. I would like to outline a few of those areas, but I would first like to return to the important measure of the public beneficial ownership registry.
The motion reads that a “proposed...surtax on banks and insurance companies...be expanded to profitable big oil companies and big-box stores” and “to re-invest the billions of dollars recouped from these measures to help...with the cost-of-living crisis”.
First, industry-specific tax policy that targets particular industries is generally a very poor idea. Instead, the government should set the tax rate it wants to apply to companies of all industries appropriately.
Second, tax hikes typically bring in less government revenue than was expected when they were proposed. We recall that in 2016 the newly elected government increased the top marginal tax rate on the wealthiest Canadians, but government revenues were about one-third of what were projected because wealthy Canadians fled Canada with their assets and declared their income in other countries.
Third, industry-specific tax policy will decrease investment in these industries at a time when capital flows and investments in this country are at record lows. Capital flows freely across borders and in particular within the financial services sector. It would be very easy for companies to relocate operations or shift profits outside of Canada.
Additional taxes imposed on these industries will have to come from somewhere. Corporations could reduce dividends that often go to retirees and pension plans across Canada, and many Canadians have investments in these companies. Companies will cut back on hiring plans, perhaps putting jobs at risk. They will potentially cut back on social services and community social responsibility programs that have invested hundreds of millions of dollars into communities right across this country. The money will have to come from somewhere.
I have to ask the question: Why does the NDP believe that giving the government more money will solve the affordability crisis? If we want to talk about affordability, I propose that the best thing we could do is have an honest conversation about how to increase competition, which will lower prices for Canadian consumers. We should be talking about increasing competition across all major sectors of this country that have been protected for too long, such as financial services, airlines and other federally regulated industries, including telecom.
Just a few months ago, one of the large financial institutions in the United States reduced its ATM and overdraft fees. I believe this is a reflection of a much more intense competition in the market, whereby companies that keep prices high on consumers are punished, and quite rightly so. Oligopolies have less incentive to lower prices for consumers in times of inflation and have an easier ability to raise their prices. Therefore, the answer is not for government to take away those profits, but for consumers to take away those profits through lower prices. We can do that through a radical reshaping of competition policy across these key sectors. For too long we have shielded and protected these industries from true competition. The result has been increased prices for consumers. As we approach the next Bank Act review, I believe all options should be on the table to figure out how we can increase competition and keep prices low for consumers. This includes discussing the widely held rule of allowing foreign competition in our key industries, significantly reducing the regulatory burden and allowing for easier adoption of financial technologies to vastly reduce the cost of serving customers.
Having businesses that have to compete and give better deals to consumer is the most efficient way to ensure we tackle the cost of living crisis. Growing the size of government revenues is not the path to success.
There was discussion in the motion about wealth inequality. It is hard to discuss wealth inequality without acknowledging where some of the responsibility lies. The Bank of Canada has pursued radical, artificial low-interest rate policies for more than a decade. It has caused asset price inflation. Those who own assets like homes have seen significant increases in wealth. In fact, the Bank of Canada is not alone. Most central banks across the developed world have all contributed to significantly worsening wealth inequality.
We also know that the decision by our central bank to ignore inflationary pressures that started one year ago was a deliberate policy choice by the Bank of Canada that risked doing harm to society's most vulnerable. Less than one year ago, the Governor of the Bank of Canada said in a speech:
Inequality has long been a concern of the Bank of Canada. Our focus on inflation control has always recognized that inflation is particularly tough for poorer Canadians and for those on fixed incomes because they are most affected when the purchasing power of cash declines. Years of low and stable inflation haven’t made us complacent about the potential threat these groups face. We also know that the most vulnerable employees are hit the hardest by the boom and bust economic cycles that come with high and variable inflation. Keeping inflation low, stable and predictable promotes a stronger and more stable economy, with greater opportunities for everyone.
I am wondering where the central bank is today. For over one year, we have ignored the risk of higher inflation. Who benefits in times of inflation? The federal government has seen record revenue increases because it taxes nominal GDP. The oil price increases have also inflated the government's revenues and the federal government's response is that gas prices have not gone up high enough, so it wants to increase them even more, by almost 3¢ a litre, which would increase government revenues commensurately.
I would like to turn to the public beneficial registry, the part of the opposition motion I wholeheartedly support. As I previously mentioned, I was very pleased to hear this motion would include the public beneficial registry. There is widespread support for this move from all parties in the House. The motion would have a far greater chance of passing had it been restricted to the public beneficial registry. I became interested in money laundering and white-collar crime when I worked for the previous minister of finance Jim Flaherty on his cause to implement a national securities regulatory framework in Canada, in part to make it easier for authorities to secure convictions against white-collar criminals.
If we were just to review conviction statistics, we would assume that Canada has very little, if any, white-collar crime. Our prosecution and conviction rates are not nearly what they should be. We have some bright lights, of course. FINTRAC is lauded as a world leader in terms of identifying suspicious transactions, but somewhere in between the 13 federal agencies responsible for money laundering, we fail to live up to acceptable standards when it comes to prosecutions and convictions. Our system is broken and experts are saying the public beneficial registry is needed. Transparency International and Publish What You Pay have been doing lots of work where the government, quite frankly, has been negligent.
Indeed, the government has committed to bringing forth this registry but not until 2025. With events like Ukraine and a focus on financial sanctions, it is even more important to speed up implementation well before 2025. We all know where we want to go and we must do it sooner. The challenge is that the longer we wait to take this step, it puts subsequent steps later and delays other actions we can take, including unexplained wealth inquiries, which could allow authorities to investigate suspicious new-found wealth, and other badly needed measures.
The public beneficial ownership registry is non-partisan. It is unfortunate that we could not have just focused on that issue today, but I recognize the motion put forward does not focus on that one issue.
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