44th Parl. 1st Sess.
October 5, 2022 02:00PM
Mr. Speaker, we are here to discuss Bill C‑253, an act to amend the Bank of Canada Act and to make consequential amendments to other acts, including the Auditor General Act. This bill seeks to ensure that the Auditor General of Canada and the auditor for the Bank of Canada have access to the Bank of Canada's operations.
Basically, as the member for Carleton and others have suggested, this means that the Auditor General could conduct an audit of the money spent during the pandemic, for example, which actually came from money printing by the Bank of Canada. Essentially, the idea is to examine and evaluate Canadian monetary policy through an audit by the Auditor General.
Since the Bloc Québécois will always respect Canadian institutions as long as Quebec is part of Canada, it should come as no surprise that we believe that the Bank of Canada should be totally independent.
In my speech, I would like to add some qualifications to the Conservative Party's comments and also recall the importance of the Bank of Canada's independence.
First, I would like to clarify some of the comments made by the member for Regina—Qu'Appelle, the sponsor of the bill. He said that the Bank of Canada is exempt from the Auditor General's oversight. I would like to qualify that. The Auditor General can review the bank's operations and records related to its roles as the government's fiscal agent, advisor on public debt management, and manager of the exchange fund account.
I will start by saying that the Auditor General has access to a study on the structure of the Bank of Canada, the review of audits, certain records and so on. It is not the Auditor General's role to assess the quality of a policy, let alone the quality of monetary policy. It is very important to make that clear.
Moreover, control measures are already in place for the Bank of Canada. I would like to list a few of them. Under the Bank of Canada Act, once a year, two independent firms are to audit the affairs of the bank simultaneously. The Minister of Finance has the authority to enlarge or extend the scope of the audit and to request special audits and reports.
The point is, the Bank of Canada already has an accountability process; it is accountable to the government. The Bank of Canada also reports to the committee, and it is up to the committee to determine whether certain monetary policies are appropriate.
I happened to be there when the Governor of the Bank of Canada appeared before the Standing Committee on Finance. Committees can call Bank of Canada governors and deputy governors to appear. They can review the bank's books and make recommendations in that respect. Committees can oversee internal and external audits. Lastly, they can review the adequacy of the bank's risk management, internal control and governance framework and its information communication.
Clearly, the Bank of Canada already has an accountability process.
The member for Regina—Qu'Appelle also suggested we should follow the example of our Commonwealth partners, such as the United Kingdom, Australia, and New Zealand.
Taking a look at what is done in some of those countries, we note that the auditor general of New Zealand can indeed audit the central bank. However, the AG's role is to ensure that the financial statements are accurate and free of any errors. It is explicitly stated in the constraints placed on the auditor general that he or she cannot comment on the efficiency of the central bank.
In Australia, the auditor general's objectives are to obtain reasonable assurances that the financial statements taken as a whole are free from significant anomalies, whether due to fraud or error, and to issue an auditor's report to confirm that.
Once again, in these countries, whose example we should supposedly follow, the auditor general has no mandate to audit monetary policy.
Things are a bit more complicated in the United Kingdom. We recognize that. The auditor general examines whether the Bank of England has a sufficiently ambitious strategy to develop appropriate efficient and cost-effective central services to help the bank deliver change and control costs.
Once again, there is agreement that the auditor general does not make findings about the strategic objectives of the central bank. Consequently, an audit of a monetary policy would not be acceptable in any of these Commonwealth countries. There is no mention of issuing an opinion or criticizing a monetary policy. In short, in these three countries, the auditor general can audit the administrative integrity of the central bank, but not the effectiveness of its monetary policy.
The Bloc Québécois does not oppose the idea of increasing accountability. On the contrary, it is something we frequently ask for and we are quite in favour of the idea of asking the central bank good questions especially at committee. However, the Bloc is opposed to this bill because it does not use the right means to attain its objective, which is to evaluate a monetary policy by having the Auditor General conduct an audit. That is not her function, nor is it the place for her to carry it out.
I would now like to focus on the importance of the central bank's independence. I would never venture an opinion on monetary policy even if I were an economist. It is a very complex exercise that must be very nuanced. That is also the case for the independence of central banks. I would remind members that a central bank uses monetary policy to help establish price levels, for example. It has an impact on the level of employment in an economy. The central bank has a major impact on our economy.
That said, the medium- and long-term stability objectives of a central bank are completely different from the objectives of a government that is elected for a maximum of four years. A government's objectives are short-term, in some cases more than others. Long-term stability is a different objective, and that is why a central bank must be completely independent from a government. The two have different objectives. One is aiming for long-term economic stability, while the other is likely to develop a budgetary policy that is shorter term.
For example, when a central bank increases its key policy interest rate, that will affect the economy about 18 to 24 months later. I would remind members that we have a minority government with a potential lifespan of two more years. Therefore, at no time would the two objectives coincide. Developing a budgetary policy is completely different from developing a monetary policy, and that is why the central bank must remain independent. Without that independence, a government might choose a short-term monetary policy that is to its advantage, but that is not optimal in the long term.
Central bank independence falls within a wide spectrum. There are as many degrees of central bank independence as there are central banks. However, I would like to talk about the good practices developed by the Organisation for Economic Co-operation and Development, which says, “Central banks hold considerable power in their countries' economies [as we know]. While their mandates vary, they generally aim to create the conditions for economic and financial stability. Their most important tools are monetary policies, which are decisions about the value of money. These include decisions about the amount of money in the economy and ways to keep inflation stable.”
We agree that the central bank plays a tremendous role in keeping inflation stable and we agree that inflation is too high at the moment. The central bank set out to keep inflation at 2% and it had and agreement with the government on that. However, we know that the causes of inflation are much more complex than a monetary policy. In this case, there is indeed a shortage of labour, materials and semi-conductors. There are global supply chain problems. No central bank has managed to truly address the problem of inflation.
In conclusion, I would like to cite my favourite economist, in other words my father. He says that a monetary policy is as complex as medicine. Economists are a bit like doctors. The difference is that doctors have seven billion patients to test a drug or new method on, while economists have just one economy.
The central bank may make mistakes. It is the role of committees to look at its mistakes and ask questions. It is not for the Auditor General to do that. Independent institutions make for a healthy democracy.
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Mr. Speaker, I am very happy to rise at any point in the House of Commons. It is such an honour to be here. Today, specifically, we are talking about the member for Regina—Qu'Appelle's private member's business, which is called the Bank of Canada accountability act.
I am a little confused about this bill, to be honest. I read it through and looked at the reality and cannot quite understand why the member would pick this particular pathway to express his concerns about the country.
I think of some of the private member's bills that I have tabled. I am really focused on things like the right to housing and making sure that seniors get their guaranteed income supplement, even if they get their taxes done a little late. For me, people really matter. I know that the member would argue that this is about accountability, because it intends to have the Auditor General audit the Bank of Canada. I will get to that a little, but when I look at the role of the Auditor General, there is some significant and important work that is done in the country by that role.
The first thing that it made me think about is that, earlier this year, the Auditor General of Canada presented a report called “Processing Disability Benefits for Veterans” and I found that report to be incredibly helpful. The purpose of this report by the AG was to measure if Veterans Affairs Canada, or VAC, as it is called, is taking steps to reduce the wait times for disability benefits. If anybody has been paying attention to the House, we have heard, for numerous years, that many veterans in the country are applying for their disability benefit and they are waiting far too long. It is having a profoundly negative impact on the veteran and on the people who love them most.
If we are going to look at how how we hold departments accountable, the Auditor General does important work. This is a perfect example of it. The report said that veterans are still waiting too long for their compensation and that veterans are still waiting to get the benefits that they need just to get through everyday life.
I hear this a lot. I hear this from veterans across the country, who contact my office and let me know that they are still waiting. I also get calls from the loved ones of veterans, who are worried because the veteran that they love and hold dear is struggling profoundly because they do not have those supports.
I think that this is an important conversation for the House, because it often feels like veterans serve this country and just get nothing back. The fact that they have to wait so long takes away from that commitment and sacrifice that they made, and the value of it to this country. That is something that I hope all parliamentarians are hearing from the veterans in their riding and that they are standing up for them in this place.
What the AG found was that the median waiting time was 39 weeks. Imagine that: Someone is a veteran, they served the country, they have a disability based on that service, and they are waiting around 39 weeks for a decision to be made. Their family is waiting. The people and their loved ones who are surrounding them are caring for them and they are not able to get the supports that they need to be better, to be stronger, to take the next step in their own evolution.
The other thing that the AG pointed out is that VAC's data is so poor that it does not allow the department to realize or understand if the initiatives that they are taking are actually making an impact. That concerns me greatly and I am really glad that the Auditor General was able to put that into a report.
We need to be looking at VAC and saying that it is time for it to figure out how to gather data so that we know that, when it does something, it is actually working. At the end of the day, it is the veteran who matters. It is the people who love that veteran who matter. We want to see those application processes speed up but if we are not collecting the right information, we cannot verify if that is the truth.
Finally, the AG pointed out that the department does not have a long-term strategy in terms of staffing. I just want to say how concerning that is.
We all know, because we have heard it from our communities, from businesses and small businesses, that people are just trying to figure out how to find enough staff to do the things they need. It is getting increasingly harder to find people, because we have a population of retirees who are leaving. We do not have enough immigration, because we had a couple of years during COVID where we could not have people coming into the country. Staffing is just becoming incredibly hard.
To find out that Veterans Affairs does not have a strategy on how it is going to make sure it has enough staff to serve the people who served this country is shocking, so I thank the AG for doing this work and for this report because it tells us important things. Most importantly, it keeps that department accountable, accountable to all Canadians, Canadians who want to know that the veterans who served this country are being served well on the other side.
The bill that we are looking at today, in my opinion, is simply not useful. The Bank of Canada already undergoes two external audits simultaneously by two separate firms. By the way, the Auditor General also has the authority to audit certain aspects of the Bank of Canada's affairs under the Financial Administration Act, so there is already a component that can be looked at.
My concern is that the Auditor General is being asked to do more and more without the resources to be able to do it, without having the resources to make sure that the incredible people who work in that department are paid properly, looked after and can take on this level of accountability. We know, funnily enough, that the Conservatives cut funding to the Auditor General, so I find it interesting that when they were in government they cut the funding, but when they are over here on the opposition side they are asking the Auditor General to do more work without any more resources.
I appreciate accountability. I will always fight for more accountability and transparency, but this bill does not promise that. It also asks an already overworked department to do things it does not have the capacity to do and that do not make any sense. Hopefully, we will see something that comes forward soon from this member that actually thinks about the needs of the people in this country.
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At the end of the day what I see are economic policies coming from the Conservative Party. Are they serious? Do we want to talk about contrast? Let us look at what the Conservatives are proposing for inflation. The Conservatives are criticizing the Bank of Canada. Do they not realize that for generations the Bank of Canada has been held accountable? There are different ways in which that is done. There are independent audits that are conducted and provided to the government. Do they not realize that there are reports? I will give them a tip. They can get copies of those reports to see what the Bank of Canada has been doing, to provide them assurances that they are independent private audits that are done every year on the Bank of Canada.
Why is this legislation necessary? If anything, the Conservative Party of Canada is doubling down on that bizarre idea of firing the Governor of the Bank of Canada. Does it not realize the consequence of the types of statements it is making? It actually hurts the Canadian economy. It plants seeds of doubt regarding confidence in the Bank of Canada, because technically it is recognized as the official opposition. It is supposed to be the party in waiting. Hopefully it will be many years, possibly decades, that it will be waiting in opposition, based on the types of things we hear coming from it.
Canadians need to be concerned about it. I can assure the members opposite that when I have the opportunity to talk about economic policy and issues, I do not hesitate to talk about some of the bizarre things that we hear coming from the Conservative Party of Canada. We need to establish and support the Bank of Canada as much as we can with respect to building that confidence.
Dealing with inflation, we just spent a couple of hours earlier this afternoon, and we are going to spend more hours this evening, talking about the issue of inflation. As a government, whether it is the Prime Minister or members from across this country, we are concerned about inflation. That is the reason we have legislation such as Bill C-30, which we were debating just an hour ago and which has fortunately passed. It took us a little while to convince the Conservatives to support it, but they did. Kudos to them.
In about an hour from now, we are going to be talking about Bill C-31, again to deal with inflation. The Conservatives still have not come onside with that one, which gives dental benefits to children under the age of 12. It also provides support for low-income renters. I would think they would want to support that too.
We could pass that and then we could maybe go on to Bill C-22 and talk about the disability legislation, which is again legislation that would make a difference and would help Canadians in every region of our country. Instead, the Conservatives are bringing forward bizarre bills like the one the member has brought here before us today, which reinforces statements that the current Conservative leader has put on the record with respect to the Bank of Canada and the lack of confidence they have in it.
Let us get behind good legislation and pass it, and maybe put a pass on this one.
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