- Member of Parliament
- Member of Parliament
- Conservative
- Chatham-Kent—Leamington
- Ontario
- Voting Attendance: 65%
- Expenses Last Quarter: $153,134.70
- Government Page
Madam Speaker, it is a pleasure this morning to continue to put some thoughts on the record regarding the fall economic statement implementation act.
Seven years ago, the current government inherited a balanced budget and a robust economy, but instead of maintaining balance or even paying down some debt, let us consider that for a moment, perhaps to prepare for the unknown, such as a pandemic or an unexpected war, it immediately began to add more spending, took the government finances back into a deficit and again started to add to the debt.
Then came the COVID–19 pandemic, which required additional spending. We supported those early programs. However, of the half a trillion dollars, yes, $500 billion, of added debt by the current government, $200 billion was not pandemic-related.
Program spending by the current government is now 30% above prepandemic levels. We now have structural deficits presently embedded in our finances, and of course the more that the government spends, the more things cost.
When the current government came to power seven years ago, it promised transparency. Do members remember “sunny ways”? This is what its own Parliamentary Budget Officer had to say on the transparency of the fall economic statement:
In this year’s FES, the Government identified $14.2 billion in new measures without providing specific details on this spending....
This lack of transparency presents challenges for parliamentarians and the public in scrutinizing the Government’s spending plans, particularly given the magnitude of measures, $14.2 billion—the largest amount announced without specific details since the 2016 [FES].
On top of all the other spending already outlined, the $20 billion, the current government is now asking the House for a $14.2 billion blank cheque. Are these sunny ways? Hardly. We will not be supporting this.
In my remaining time, I want to spend some time on one issue that is not addressed in the fall economic statement.
Last week, I had a series of eight meetings with my own constituents. The primary issue I heard from them was the rising cost of living, particularly the costs of food, fuel and housing. Those are the main things I heard, and in particular, food. Last month, as we are all now aware, there were 1.5 million visits to food banks, that in the country of Canada, a country that is considered a breadbasket.
The FES missed an opportunity to address an issue that has the potential to lower food costs, namely the status of the implementation of a grocery code of conduct.
First, we have heard much in statements in the media today about two seemingly contradictory statements, record grocery retailer profits and the counter-argument from industry that retailer margins have not changed in percentage terms through the pandemic. Both statements can be true, as retail volumes have increased during the pandemic as consumers have shopped more retail versus the food service that supplies the restaurant trade and institutional trade.
Second, the carbon tax, along with other issues, that is applied to the delivery of farm inputs and outputs, and to transportation all up and down the food chain, has increased costs for suppliers. Retailers maintaining their margins in percentage terms are applying this margin to a higher cost of goods from suppliers and to higher volumes generated by the change in market from consumers.
However, there is an opportunity for us to accomplish many goals if we get it right. What do I mean by getting it right? We can increase profits for food manufacturers and processors because of fair trading practices, and we can reduce the administration costs in attempting to comply with the many “rules” applied by retailers in an updated code of conduct. We can reduce administration costs for retailers in all these programs that are allegedly used as profit centres, but most importantly we can reduce consumer food costs.
Right now, shelf listing fees, fines for short or late deliveries and a host of other administrative exercises are adding costs that eventually the consumer pays. The U.K., Ireland and Australia have all gone down this road of a grocery code of conduct. Retailers were afraid that imposing a code would lead to a reduction in the number of retailers with gross sales meeting the threshold for application of the code. The U.K., since fixing its original voluntary attempts, has seen more retailers. It started with 10 and now has 14 retailers meeting the threshold dollar value, so the code has not driven consolidation there.
In conclusion, an appropriately structured code results in lower consumer prices and fairer trading practices within the value chain. In addition, it allows 10,000 independent grocers, who are so crucial for rural parts of our country, to be treated on par with the big five that control 85% of the grocery retailer trade.
The fall economic statement missed an opportunity to advance this issue for Canadians. Instead, the statement adds more government spending, which would only lead to higher inflation over time and the hurting of our most vulnerable citizens. With that I will conclude, and I look forward to questions.
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Madam Speaker, it is always a pleasure to rise in this chamber and bring the voices of the constituents of Chatham-Kent—Leamington to this place, and it is an honour to speak to Bill C-32, the fall economic statement implementation act.
The Conservative Party had two asks going into the fall economic statement process. One was to stop the tax increases and have no new taxes, which includes cancelling all of the planned tax hikes and the tripling of the carbon tax. The other was to stop the spending and have no new spending, and ensure that any new spending by ministers or ministries is offset by equivalent savings found elsewhere. We need to cut the wasteful spending and stop the inflationary deficits that drive up the cost of living. Of course, none of our demands were met in the fall economic statement, and for that reason, the Conservatives, me included, will not be supporting it. I know that is a shock to the members opposite.
The cost of government spending is the main driver of the increasing cost of living. As stated by a colleague in an earlier speech this week, Canadians now have to make tough decisions. Why? It is because the government did not make tough decisions.
Of course, the pandemic required extra spending. The Conservatives knew that and supported the early programs. However, $200 billion of it, almost half of the $500 billion of added debt, was not pandemic-related. Program spending by the government is now 30% above prepandemic levels. It is amazing.
Last week I was in my riding and hosted a series of coffee meetings over two days to hear from constituents. I was just talking about the rising cost of living, and that is exactly what I heard from my constituents. Over and over again, the rising costs of everything, particularly food, fuel and housing, were highlighted. Last month it was reported that there was 11.4% food inflation. This month the rising cost of food is reported as being 10.7%. That is what Canadians are facing when they make a trip to the grocery store.
While rising inflation is causing pain for Canadian families in their everyday lives, it has boosted the tax revenues of the government. One would think there would have been an opportunity in the fall economic statement to bring some fiscal responsibility to budgeting.
I am not an economist, but let me share some thoughts from some respected voices on the fall economic statement. I will begin with Douglas Porter and others from BMO Capital Markets, who stated:
Less than half of this year’s revenue windfall will make it through to an improved bottom line. Moreover, the double-whammy of slower (or no) growth and rising interest rates will limit flexibility into 2023.... [T]he boost to government finances from higher inflation is temporary. Eventually, costs do catch up to the run-up in prices, and revenues get crimped by the economic slowdown. Accordingly, after a nice run of better-than-expected fiscal outcomes, Ottawa’s finances are expected to turn more challenging next year.
Will the government look ahead and plan accordingly? Obviously from prepandemic times we know that it did not.
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Mr. Speaker, you might rule me out of order, because I wish to ask a question on the fall economic statement. Finally, I did hear a comment at the end of the speech that listed a few topics broadly that were listed.
In an earlier exchange with the member for Calgary Shepard, he asked a question of the previous member. One of those things the hon. member across the way did not list was the $14.2-billion blank cheque. I have yet to hear what that is about. How is that not incendiary spending, as identified by the Parliamentary Budget Officer? I would like to know whether that is a measured response, which a previous speaker so described.
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Mr. Speaker, I appreciated my hon. colleague's speech, and I appreciated that I heard, twice, his use of the phrase “rein in spending”.
Earlier in this debate, I asked our colleague, the member for Ottawa Centre what the government's plan was going forward and whether it was more of a series of one-off payments in response to inflation. I am encouraged to hear the beginnings of a plan through the phrase of “rein in spending”.
Where would my hon. colleague envision this reining in of spending occurring?
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Madam Speaker, it is always a privilege to rise in the chamber and speak on behalf of the residents of Chatham-Kent—Leamington and, indeed, on behalf of agriculture across Canada.
I am also pleased to speak to my colleague from Huron—Bruce's private member's bill, Bill C-234, which affects so many constituents, including our own family farm.
The bill seeks to amend the Greenhouse Gas Pollution Pricing Act by adding natural gas and propane to the list of qualifying farm fuels, and that is for the purposes of both grain drying and heating and cooling farm buildings.
I did have the opportunity to speak to this bill's predecessor, Bill C-206, in the previous Parliament where it was passed, only to die in the other place when the Prime Minister called the unnecessary election.
Our farmers are the first environmentalists and our farmers are great competitors. They can hold their own against anyone, but not with one arm tied behind their back. They cannot continue to be first-rate environmentalists when they are hamstrung by policies that their competitors do not face.
Before getting into the specifics of this bill, I wish to remark on four different framing points that will outline where I am going.
One, as I just stated, as individuals, farmers are environmentalists by nature and by necessity. The drive to leave the land in a better condition than when they found it is innate to every farmer that I know. Farmers are environmentalists by necessity. It is the condition of their land, the condition of their flocks and of their herd that supplies the farm family with a return on their labour, on their investments and on their inputs, so it is in their own self-interest to leave the vehicle of their own prosperity in better condition for the next generation.
Two, collectively, agriculture has a strong record of reducing its environmental footprint, be it through the adoption of low till or no till; be it through the refinement of working through nutrients, such as through the lens of the 4Rs, putting the right nutrient at the right place at the right time with the right amount; be it through more intensive use of cover cropping or rotational grazing. Farmers have largely done all of this without regulation and without additional taxation or without an additional government-imposed price signal. I will come back to that point in a moment.
Three, agriculture has a strong record of innovation, of adopting new technologies, such as the use of GPS technology on the farm, the use of variable rate technology in seeding and in crop protection products, robotics in our dairy sector, and climate controls and automation in our greenhouse sector. Believe me, as soon as a viable commercial alternative to fossil fuels is available in rural Canada, farmers will adopt it and quickly, without the stick or a price signal embedded in a tax. That leads me to my final framing point.
Four, by and large, farmers are price takers. They cannot effectively pass along cost-input increases to their buyers.
Let these four points set the stage for my remarks on Bill C-234. When we initially debated its predecessor, Bill C-206, the harvest from hell in 2019 had just occurred in western Canada. That really demonstrated the need for this carbon tax exemption. It was a particularly wet fall where, with frost and rainfall, et cetera, interrupting the harvest, the use of natural gas and propane was required to put the grain into a storable condition.
Farming in Ontario and in eastern Canada requires the use of grain dryers each and every year, particularly for grain corn, but also for soybeans, wheat, canola, oats, et cetera.
When we studied Bill C-206 in the previous Parliament at committee, we did look at alternatives to fossil fuels. In many parts of our economy, electrification is a potential alternative, but given the obvious nature of agriculture being situated in rural Canada and the lack of our grid capacity, this is simply a non-starter.
We also looked at a second option, and that was the use of crop residues as a fuel source. That means gathering them after harvest and then burning them in heaters. While there are some prototypes being trialed, they are simply not available at scale.
Even more problematic with this approach, crop residues are incorporated into the soil or are left on the surface, and they become organic matter for our soils. They sequester carbon and they increase soil organic matter levels, which help both with crop production and our climate goals.
The voluntary adoption of reduced or eliminated tillage provided improvements in soil moisture retention, a reduction of soil erosion and, of course, an increase in carbon sequestration, all without the imposition of a tax. This is something that was not acknowledged in the Greenhouse Gas Pollution Pricing Act.
It does not make sense to apply a tax to reverse the environmental improvements that the farmers put in place voluntarily. However, the question remains, does it make any sense at all to apply such a tax on fossil fuels to increase the agricultural community's focus on reducing the use of fossil fuels? The answer to that is no, for several reasons.
There simply are not commercially viable, scalable alternatives to using natural gas and propane available today, but because there are not viable alternatives, the demand for fuel tends to remain unaffected by price. That makes these additional fuel charges simply an additional tax and an inefficient policy to lower carbon emissions. This very fact was confirmed by the Parliamentary Budget Officer.
The recent budget, which has been alluded to in other speeches here this evening, did put some more funds into the agricultural clean technology fund to upgrade present drying systems to a higher efficiency, but these funds only have the potential to update 500 of the 50,000 grain dryers across Canada. That is 1% of them.
Also, as opposed to granting an exemption from paying the carbon tax, they have proposed in Bill C-8 a rebate program to maintain, in their words, a “price signal” to the farm community to change their ways even though there are no viable alternatives.
I explored with several of my constituents the impact of these two approaches. My riding is a large rectangle and in the northeastern corner, Ron and Francine Verhelle farm with their family. This past year, they needed 89,670 litres of propane to dry their almost 7,000 tonnes of corn. They paid over $5,550 in carbon tax. If the 2022 conditions on their farm are the same, they are anticipating that cost to go up to almost $7,000 this year. Under the Liberal plan, the eligible farm costs on their farm would have to be over $3.2 million using the planned $1.73 per thousand in eligible farm expenses in order for that rebate to recoup their carbon tax cost. Farm input costs are definitely skyrocketing, but fortunately they will not be that high or no farmer will be in business this coming year.
Paul Tiessen and his family farm just down the road from my home farm. They are a third generation grain farm and their total natural gas bill for 2021 to dry 107,000 bushels, or just over 2,900 tonnes, of corn this past year was $10,010, of which almost $2,500 was a carbon tax. Under the Liberal proposal that would have been in place for 2021 rebating back $1.47 per thousand in expenses, they would only get a fraction of their carbon tax cost returns from this past crop.
My final point is simply to call for basic fairness in the marketplace. Our Canadian grain competes directly with American grain. It is priced off of the Chicago Board of Trade. No customer of grain will pay more for Canadian grain because it incurs a carbon tax, not if they can source it from the Americans.
The Greenhouse Gas Pollution Pricing Act did exempt gasoline and diesel fuel on the farm for this very reason and Bill C-234 is looking to correct the oversight regarding natural gas and propane for grain drying and barn heating and cooling.
Surely if the government cannot control its spending ways, it does not have to use farmers' bank accounts as a cashflow mechanism to finance its own spending. Making farmers pay this carbon tax in the fall and then having them file their taxes the following spring to apply for a rebate, all that does is return a portion of their costs plus now incurring all the administrative costs on the farm and the administrative burden on government to manage this program.
In fact, this past budget estimated that cost for the government alone to be $30 million. What does that do? All that does is serve to increase the size of government and not add any additional value to our climate goals.
In conclusion, I would again urge all members of the House to support passing a bill that removes the potential of being at cross purposes for lower greenhouse gas emissions. Please support the removal of a tax where the users have absolutely no viable options and please support basic inherent market fairness.
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- Apr/26/22 10:32:07 a.m.
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Madam Speaker, early in my colleague's comments he referenced the robust economy that Canada was experiencing just prior to the pandemic, and later on he referenced that the budget was getting the debt and the deficit under control. I am wondering if he could comment on the wisdom of having the government add $112 billion to this country's debt prepandemic, and then how this budget gets our present debt under control, in the context of the Parliamentary Budget Officer's comments saying that stimulus funding was not required and the budget does not account for all of the other measures that have been promised but do not appear in the budget.
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- Feb/4/22 10:59:03 a.m.
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- Re: Bill C-8
Mr. Speaker, that is actually not what I said. What I said is that we need less spending broadly. I supported measures for rapid tests, particularly if it had come much sooner. Targeted spending at preventative measures would have lessened the need for gross spending in response. I cited two areas, rapid tests and investments in health care. That would have prevented much of the spending in response and the resulting inflation that Canadians are now experiencing.
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- Feb/4/22 10:49:36 a.m.
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- Re: Bill C-8
Mr. Speaker, I am pleased to be speaking for the first time at length in this 44th Parliament representing the citizens of Chatham-Kent—Leamington.
Before I go on to make some comments on this specific legislation, I want to congratulate two of those citizens, my parents, as today is their 61st wedding anniversary.
With respect to Bill C-8, it should come to no one's surprise that I will be opposing this legislation and these additional spending measures. Why? It is because they are adding more fuel to the inflationary fires. The recent report by the Parliamentary Budget Officer states that more stimulus spending will only stoke these inflationary fires, resulting in an inflation tax. Asked at the finance committee if government deficits contribute to inflation, the PBO stated very clearly that, yes, they can.
How much money are we talking about? Another $71.2 billion in spending is referenced in the economic and fiscal update, and since the beginning of this pandemic, the government has introduced $176 billion in new spending that is unrelated to responding to the pandemic. Our interest-bearing debt is approaching $1.4 trillion.
I will borrow some descriptions my colleague from Edmonton West used yesterday when he outlined what that means. We understand what $1 million looks like. It is a one and six zeroes, but $1.4 trillion is $140 million millions. Folks should think about that. Yesterday during question period, the finance minister stated that 8 out of 10 dollars spent as a COVID response have come from the federal government, even if they have been delivered provincially, so the accountability for this spending lies with the government.
Let me mention two areas where Canadians would have been better served by a government being more proactive, which would have lessened the need to be so reactive to pandemic effects. The first is securing rapid tests. Conservatives supported the sourcing of rapid tests well before we had vaccines, almost two years ago now. Late in this pandemic, the government seems to have seen the light and now wants more rapid tests. After five waves of infection and the economic carnage that lockdowns bring, we are now finally seeing an effort being made.
The second is ICU capacity. Lockdowns have been invoked by provincial governments largely in response to the fear that critical care capacity will be overwhelmed during peak infection periods. It is not that often that my colleagues agree with opposition colleagues in this chamber, but on the point of increased health transfers, we do agree. In particular, while in some places we lack bricks and mortar in our health care system, we primarily lack doctors, nurses and nurse practitioners. It is the critical care capacity deliverers that we need so many more of.
While this is of course a provincial responsibility, in my federal role I have been closely monitoring the local health care capacity in my riding at Erie Shores hospital in Leamington and at Chatham-Kent hospital, especially because of the overlap of providing this care to our citizens combined with care for the guest worker community of the agricultural sector in my riding. I could spend 10 minutes just talking about the experience there in the last two years.
I did not realize that Canada only has one-third of the health care capacity of our neighbour to the south. I did not know that until we got into this pandemic. That is why such a low percentage of people who are critically affected by COVID so quickly overwhelm our health care capacity. These are the two areas where, especially early on in this pandemic, it would have been far better to respond proactively.
However, the cumulative effect of government spending in areas responding to, rather than preventing, the economic damage of COVID have led to a very predictable outcome: inflation. This form of taxation, and that is what inflation is, affects so many areas of our lives. It affects those particularly who can least afford it more than those with assets who can actually benefit from it.
Let me touch on just two areas. The first is housing and the crisis in housing inflation. The injection of so many printed dollars into our economy has exacerbated the rise in the cost of housing. While in Chatham-Kent—Leamington the average costs are not as high as national averages, the rate of increase, particularly on the lower end of the spectrum, is even higher. With the interest rate now below the rate of inflation, because it is rising, this provides a further incentive to bid up prices.
We have not yet seen the end of this inflationary housing bubble. The end is not written. The Bank of Canada has signalled that interest rates will rise. How many people will face an even greater pressure on their personal finances when it comes to renewing their home mortgage? The main solution of course lies in the basic laws of supply and demand. We need more houses built, not more taxes, and not more spending, which only drive the inflationary cycle.
Second is food inflation. Anyone who eats or, more specifically, buys groceries understands the rising cost of food in Canada. Prior to having the honour of standing in this place today, I actively farmed and produced food for most of my adult life. I also had the opportunity to be involved with the business of representing food producers at negotiation tables and in industry circles.
I understand that the broad inflation is not the primary driver of the cost of raw product of food prices in Canada. Weather events, geopolitical tensions and other trade issues impact the cyclical nature of these markets more than broad inflation, but, and this is a big but, I am speaking of raw food pricing. What the Canadian consumer experiences at the grocery aisle is only minimally impacted by the price of what a farmer receives. In most food stuffs, the percentage cost represented by the raw component is very small. The labelling, packaging, transportation, processing and preparing are cost components that dwarf the raw component, and of course, these are all cost drivers that are affected by inflation.
In conclusion, what would it take to get us out of this mess? First, the government needs to reorient its approach. It is encouraging to hear from our health care leaders, and in particular I want to point out Ontario's Chief Medical Officer, Dr. Kieran Moore, who support our need to learn to live and work with COVID. We need to move from a pandemic state of COVID to an endemic state. The vast majority of Canadians have done what we have asked of them. They got vaccinated and observed public health measures.
We have the tools, the vaccines and the rapid tests, or we should have the rapid tests. Now we need to learn to live with COVID, and we need to open up.
Second, we need to rein in government spending. We need to tamp down inflation, and we need to blunt the trend of rising interest rates, which inevitably result from inflation. It appears that the government's tax-and-spend approach, which resulted in inflation, is almost intentional. This is its way of inflating its way out of massive debt.
Lower taxes, less spending, leading to lower inflation and more economic growth is the only way out for all Canadians.
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