SoVote

Context: House Hansard - 83 - Jun/7/22

Mr. Mark Gerretsen

Jun/7/22 3:47:00 p.m.
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Mr. Speaker, I ask for a recorded vote.

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Recorded
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Hon. Jonathan Wilkinson

Jun/7/22 3:47:00 p.m.
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Re: Bill C-19

moved that the bill be concurred in.

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The Speaker

Jun/7/22 3:59:33 p.m.
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Re: Bill C-19

I declare the motion carried. When shall the bill be read a third time? At the next sitting of the House? Some hon. members: Agreed.

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Mr. Francis Drouin (Parliamentary Secretary to the Minister of Agriculture and Agri-Food, Lib.)

Jun/7/22 4:00:13 p.m.
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Mr. Speaker, today we are debating an opposition motion that is supposed to offer solutions to address the impact of inflation. I want to point out to my hon. colleagues that what they are asking for is that the House call on the government to provide immediate assistance. They therefore believe that providing immediate assistance to address the housing problem is to immediately launch a national public inquiry into money laundering. How is that going to provide immediate assistance to Canadians looking for housing? I do not understand how a national public inquiry into money laundering is going to provide immediate assistance to Canadians. It does not make sense. I cannot believe that anyone even took the time to write this motion. I see no reason whatsoever to support this motion. I will not be able to support it because it makes no sense. Today we are talking about inflation, and I know that two Conservative members have switched sides. Two Conservative MPs, on the day the Conservatives presented a motion to come to solutions to fight inflation, decided to jump camp to a specific member of Parliament running for the highest office. His solution to fight inflation is to fire the Governor of the Bank of Canada. I do not see how that is going to help, but that was the big policy idea that this particular member of Parliament came up with. He also suggested that we opt out of inflation by joining the big cryptocurrency movement. I am not sure if my hon. colleagues on the other side of the House actually watch cryptocurrencies. Let us take Terra Luna, for instance. In April, it was worth $135.

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The Speaker

Jun/7/22 4:02:48 p.m.
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I will interrupt for a moment. We are trying to hear the parliamentary secretary, and while it is nice to hear everybody getting along and talking, maybe members can keep the tone down a bit so that those who want to hear what the parliamentary secretary has to say will have that option. Those members who want to hear each other can maybe just whisper to each other. The hon. parliamentary secretary can continue.

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Mr. Francis Drouin

Jun/7/22 4:03:11 p.m.
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Mr. Speaker, just to make sure my colleagues heard me properly, I note that on the day the Conservatives are proposing a motion to fight inflation, with solutions that have no immediate impact on Canadians, two members of Parliament have decided to jump ship to support the member for Carleton, who came up with two policy ideas. Those two grandiose ideas are to fire the Governor of the Bank of Canada and opt out of inflation by investing in cryptocurrency. With respect to cryptocurrency, I am sure the Conservatives have been following the trajectory of Terra Luna. Terra Luna, about a month and a half ago, was worth $135 on the market. Today it is worth barely a penny. It is worth $0.0003. I have not checked out the latest number, but it is not even worth a Canadian penny, and we do not even have pennies. I do not see how this motion would help Canadians fight inflation. We have put some solutions forward. Obviously, the Canada child benefit is helping families. It is geared toward the cost of inflation, so that is a potential solution. I represent a big farming community. We have talked about how we can help farmers lower their costs, and fertilizer is certainly in debate. I do not necessarily support simply giving a direct exemption to companies that have decided to continue to do deals with Russia and Belarus, because other companies have changed their supply chains and have made the decision not to continue doing business with them. If I were advocating for a potential solution, it would be to provide aid to farmers directly, as opposed to giving it to companies that continue to do deals with Russian and Belarusian companies. Many companies signed contracts with farmers last summer, telling them they would pay a certain price. Some of those companies are now telling them that even though they signed a contract, they are going to charge them extra fees. When an individual and a company sign a contract in Canada, they are creating a bond of trust. It is a binding contract. I am fortunate that in my riding this is not happening, but I have heard many, many stories like this in other parts of the country. Companies are not honouring the contracts, and I would hope that they continue honouring them. It is a binding agreement they have signed with farmers and they owe it to our farmers to honour those contracts. I do not support this motion because it does not include any solutions that will help Canadians immediately.

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Mrs. Cheryl Gallant (Renfrew—Nipissing—Pembroke, CPC)

Jun/7/22 4:06:38 p.m.
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Madam Speaker, the finance minister did not even know that Canada depends on Russia for its fertilizer when the tariffs were decreed. Food has become scarce and more expensive. Carbon taxes on fuel and phasing out the oil sands, our source of fuel, have driven up food prices even higher. Why is the government intentionally driving up the cost of food? Is it just incompetent?

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Mr. Francis Drouin

Jun/7/22 4:07:14 p.m.
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Madam Speaker, the government is not intentionally increasing the price of food. Everyone is concerned with the price of food around the world. I would invite the hon. member to come to the agriculture committee on Thursday and hear from the agriculture minister from Ukraine, who will explain what the issue is. When Russia is bombing grain terminals, the Government of Canada is not intentionally raising the price of food. Ukraine is a major contributor on wheat, corn and canola. Canada can play a major role on canola because we have amazing growers out west who grow canola. We can increase the role— An hon. member: It is not “can play”. We do play. Mr. Francis Drouin: Yes, we do, Madam Speaker. We export 40% of our canola, and we will continue to do so. We have always supported our farmers in Canada.

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The Assistant Deputy Speaker (Mrs. Carol Hughes)

Jun/7/22 4:08:03 p.m.
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I just want to remind members that when somebody has the floor, others should not be trying to have conversations or yelling out other things. Questions and comments, the hon. member for Port Moody—Coquitlam.

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Ms. Bonita Zarrillo (Port Moody—Coquitlam, NDP)

Jun/7/22 4:08:18 p.m.
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Madam Speaker, if the Liberal and Conservative governments would have had courage in the past, and if taxation was fair in this country, we would not be in the mess we are in right now. We would already have pharmacare, affordable child care and affordable housing in this country. Will the Liberals tax the outsized profits from big box and grocery retail?

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Mr. Francis Drouin

Jun/7/22 4:08:52 p.m.
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Madam Speaker, if we want to create government programs we need to generate revenues. That is a simple fact. Government does not own any dollars. It needs to generate revenues. One way to generate revenues is to unleash the power of entrepreneurship, which is a great idea, and we have great entrepreneurs. Farmers are playing a huge role in this country. However, we simply cannot create money. Money does not grow on trees. We need to generate wealth, and to do so, we need to ensure our entrepreneurs and private sector are healthy. I believe the economy has been growing. Obviously, we are concerned about inflation, but the solutions provided by the current opposition is not something that is realistic and will not provide any immediate relief.

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Mr. Damien Kurek (Battle River—Crowfoot, CPC)

Jun/7/22 4:09:42 p.m.
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Madam Speaker, the member is right that money does not grow on trees. In Canada, we do not even use paper. We use a polymer that based off oil, so there is a very fitting analogy there that oil does produce prosperity in this country. The member keeps talking about how somehow giving Canadians a break at the pumps will not actually help. We have a very clear and present example, and economists agree, of how definitively the tax cut offered by the Province of Alberta has led to two things. One, it has led to savings for Canadians at the pumps, and two, it has reduced inflation in the province of Alberta by a significant amount. When a proposal is brought forward that would actually help, and there is proof of it, why will they not support it?

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Mr. Francis Drouin

Jun/7/22 4:10:40 p.m.
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Madam Speaker, as my good Liberal friends Lowell Green and Rob Snow have reminded me, there is always one taxpayer in this country, and he knows the gas tax helps municipalities pay for the costs of operations. I would argue we should be using those dollars to help municipalities pay off some of the operational costs that gas pressures are creating on their own budgets. If they do not have that help, they will need to increase their taxes in return. He knows, because he was part of that government, that they were transferring that gas tax to help municipalities. We have continued that program and we believe in it, but cutting the GST will not help consumers at the pump.

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Hon. John McKay (Scarborough—Guildwood, Lib.)

Jun/7/22 4:11:54 p.m.
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Madam Speaker, I find the motion actually pretty easy to vote against. Whoever wrote the motion has been quite brilliant at describing the issue, but not nearly so brilliant at describing the solution. You might be interested in knowing, Madam Speaker, that I do all the family shopping. I also do the gas purchases and I buy materials for the house. I remember buying two-by-fours during COVID and I had to go to three stores to try to just get one two-by-four and the cost was 100% more than I paid in years previous. I agree with the description of high inflation for everyone, that gas is more expensive and that the cost of food is up. I have experienced that personally. What the hon. members from the Conservative Party do not seem to realize is that the supply chains were pretty badly messed up during COVID. Some were out because the countries were locked down. Some were not able to produce the products they had previously. Take for instance, microchips. We could not get any microchips for anything, including a car. Again, within my experience we live in a neighbourhood where we bought a couple of cars and for a considerable period of time there were no cars on the car lot. In fact, we could buy a used car for what we paid a year or two previously for a new car. Just a simple thing like microchips has in and of itself driven up the cost of living quite dramatically. Add to that the great resignation. People simply do not want to do the jobs that they were doing pre-COVID and that in turn has driven up the cost of labour. I took note in the Report on Business Magazine last weekend that the Royal Bank of Canada has just given a 3% increase across the board to all of its staff because it knows it has difficulty recruiting and retaining staff. We have had representations from Irving, which is building our warships. Its biggest challenge is, again, recruiting and retaining staff, even with substantive increases in salary. Add to that the Putin war, which took supply chains that were really badly messed up by COVID and only made them more difficult. Sanctions do mean something. They mean that certain products that we are used to purchasing simply cannot be purchased any longer from the Russian-based sources. Add to that the fact that Canada is about 2% of the world's economy. We are in effect inflation takers as opposed to inflation makers. Even for products that we have in substantive quantities such as oil and gas, wheat and various other mineral products, we do not actually get to set the prices. The prices get set by places other than Canada. As I say, we are price-takers, not price makers. We are inflation takers. We are not inflation makers. On a point of information, as much as the Conservative Party would wish to pin the inflation upon the Prime Minister, I would suggest respectfully that it is a bridge too far even for them. What is the Conservative solution? The Conservative solution is a reduced consumption tax, and if we do that on the GST and the tax on carbon, everything will be resolved. That is possibly the worst idea ever. Any economist in Canada will say, with the notable exception of Stephen Harper, that if we want to generate government revenues we should be taxing consumption and we should be reducing the tax on labour. Income tax is a tax on labour. Consumption tax is a tax on consumption. In effect, it is taxing the person who works hard and reducing the taxes on the person who plays hard. If we reduce the consumption tax, it is practically a guarantee that large oil and gas companies and other companies as well will backfill with price increases, and I would expect that our Conservative friends would have recognized that before drafting this motion. The consumer gets no relief. The government revenues are drained. Rich companies get richer, and the working person gets increased income tax. Hardly what one would describe as a brilliant solution. Finally, there is carbon pricing. The most effective way to reduce carbon consumption, short of turning down the thermostat or reducing unnecessary travel, is to apply a tax to it. If, in fact, the tax is collected and applied as it should be, then, in the end, the lower-income families will actually receive rebates in the mail. In Ontario, that means $745, and in Alberta, it means something in the order of just over a thousand bucks. There are those who say they cannot adjust. For some that is actually true. For others it is simply a lifestyle choice. However, if we are going to be serious about carbon reduction, then we have to apply this sort of tax, which has repeatedly demonstrated to be the most effective way to reduce carbon consumption. Given that inflation is real, given that we are just 2% of the world's economy, given that we are a trading nation and highly dependent upon external trade, given that the Putin war will not end any time soon and given that inflation is well beyond the Bank of Canada target, what is a relatively small but prosperous economy to do? We will start with some of our strengths. We have a relatively low debt-to-GDP ratio, possibly the best in the G7. It is the same thing with jobs, as we have had 115% job recovery in the post-COVID era. We have a number of products that the rest of the world wants. There are, frankly, more jobs available here than there are people to fill them. Something about over a million positions are begging for people. Again, we have heard that from various employers who are looking for people to fill positions and simply cannot find them, so we are in a relatively strong position. Then there are some direct relief measures. The Canada child benefit in my riding is worth over $100 million per year. That is a significant relief to those constituents of mine who have children. The $10-a-day child care plan, which is just being rolled out in Ontario, will help a lot of people and it will make a significant difference in terms of the choices that those who wish to take advantage of the program have. In some instances, particularly during the earlier part of this government, we were able to reduce the tax margin for those with lower incomes and apply relief to those who actually needed it the most. However, we should recognize that the Bank of Canada is the main player here. It has control over monetary policy. The Bank of Canada's monetary policy is independent from government, as it should be. It is possibly the worst idea in the world to have the government control monetary policy because government interests and central bank interests are not always lined up. As an example of that, I might point to Turkey, where the government of the day has taken over monetary policy. That has led to something in the order of 70% inflation. The central bank has renewed its 2% target. We need to recognize that interest rates are going to rise and possibly even dramatically rise. Our strong monetary policy is our most effective weapon. We have a relatively decent fiscal position. We do not need to yield to the siren song of reduced consumption taxes.

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Mr. Adam Chambers (Simcoe North, CPC)

Jun/7/22 4:21:21 p.m.
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Madam Speaker, it is a great honour to ask my hon. colleague a question. He has given so many years to this place in the service of his community. In the United States, the President as well as the Secretary of the Treasury, Ms. Yellen, have actually taken responsibility for underestimating inflation. Why is it that no one in the government, cabinet or the executive branch, has acknowledged that they underestimated inflation and they were behind the curve? Can they not just say that it is a lot higher than they thought and there are some immediate things that they can do to fix it?

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Hon. John McKay

Jun/7/22 4:22:09 p.m.
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Madam Speaker, I appreciate that question from the hon. member, because in a speech I made about a year ago, or sometime around then, I flagged that particular issue. In fact, from my own grocery shopping, I recognized that inflation was here. I actually sat down with the PBO at one point and said, “I don't understand why we are not more alarmed about inflation.” People from the Office of the PBO had an explanation that I frankly could not understand, but that said, they were still very helpful in trying to explain it to me. The Bank of Canada had described inflation at that time as “transitory”. I think it recognized that it was on its way but did not recognize that it was possibly going to be more long-standing than it had previously anticipated, and if there is an issue to be had there, I think that is a legitimate point.

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Mr. Luc Thériault (Montcalm, BQ)

Jun/7/22 4:23:18 p.m.
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Madam Speaker, I listened carefully to my colleague across the way. Basically, he is saying what we are also thinking, which is that the opposition motion is a bogus solution for real problems. I understood that he was objecting to one aspect of the motion, which would be to temporarily stop charging the GST on gas and fuel, since it is unclear whether that money would go to consumers. However, would my colleague agree that the surplus the government is currently reaping from higher gas prices could be used to provide relief to those hit hardest by inflation? These include low-income earners, seniors, agricultural workers, taxi drivers, truck drivers, and so on. Support programs could be put in place for these people.

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Hon. John McKay

Jun/7/22 4:24:23 p.m.
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Madam Speaker, in saying “a false solution to a real problem”, the hon. member described it better than I did, and I think he is right. With respect to the revenues, yes, inflation has that effect of giving the revenues a temporary boost, but it is a temporary boost, because once we get the revenues in, the bills start arriving as well, so the costs of running a government are actually going to be much greater because there is necessarily going to be wage inflation, which is essentially what government is. As to spending the revenues that are coming in, I would not go for that kind of an idea immediately. There have been various relief elements, particularly for seniors, that have been distributed over the last couple of years.

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Ms. Bonita Zarrillo (Port Moody—Coquitlam, NDP)

Jun/7/22 4:25:18 p.m.
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Madam Speaker, I can tell the hon. member that seniors, single moms and persons with disabilities do not need a lecture from this government on inflation. What they need is food on the table for their families this summer. My question is this: Will the Liberal government finally start taxing outsized profits so that we can share some of this prosperity with the community?

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Hon. John McKay

Jun/7/22 4:25:48 p.m.
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Madam Speaker, I am shocked. The federal government is already taxing those who are making excess profits. There is an excess profits tax built right into the system, so I am not quite sure what the hon. member is driving at, but those companies that are making extraordinary incomes will receive an excess profits tax allocation when they file their returns.

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