Finance Committee on Nov. 9th, 2023

[The Chair, Liberal, Peter Fonseca]

We do not have unanimous consent.

For the witnesses' sake, we're going to have one round of questions before we get back to MP Bendayan's motion.

In this round, each party will have up to six minutes to ask our witnesses questions.

We are starting with MP Morantz for six minutes, please.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

On a point of order, Mr. Chair, I would like to bring Mr. Ste-Marie's motion to a vote.

[The Chair, Liberal, Peter Fonseca]

That's not possible. The member had asked for unanimous consent, not a vote.

We're back to our first round of questions and MP Morantz for six minutes, please.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Mr. Chair, I have to say this at the outset.

I don't know whether the Liberal members of this committee know this, but we have a housing crisis in this country. We're dealing with a very thoughtful study on the housing crisis. We have excellent witnesses here today on a very thoughtful study brought forward by Mr. Blaikie. It is highly disrespectful to these witnesses to abridge their ability to impart their wisdom to us on this issue for what is really a partisan motion put forward by the Liberals. It's designed to divide Canadians so they can try to distract Canadians from their abysmal record on the economy.

Having said that, I do have some questions for the witnesses. I want to start with Mr. Dicker.

I'm sorry that the Liberals are doing this to you, Mr. Dicker. I'll try to be as concise as I possibly can.

There was a very interesting editorial this morning in The Globe and Mail that was really damning in terms of the Liberal government's economic record and its management of the economy. One thing the editorial said was that “the Liberals have governed” while Canada's “GDP per capita has flatlined”—it actually uses the word “flatlined”—“and their policy choices are making the problem worse.”

Would you agree with that assessment from the Globe?

[Keith Dicker]

Thank you for the question.

I did not read the article, but the challenge for Canada's economy right now.... If you look at aggregate economic growth, it's sort of flattish or down a little bit. Once you make adjustments on a per capita basis.... That is the key. Per capita is how many people it takes to produce one extra unit of economic output, whatever that may be. The fact that it's increasingly taking more people to produce that same output means that economic growth is deteriorating.

Whether it's a good policy or not, what we looked at is that the probability—

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

I'm sorry to interrupt. I just have limited time, but I think I get the gist of your response there.

I want to ask Mr. Cooper a question about the same editorial. The Globe highlighted that the housing crisis is “the most prominent example” of failed Liberal policy choices.

Would you agree with that assessment?

[Michael Cooper]

I think it's the failed government choices for 30 years. Whoever was in power at any given time could take an equal amount of responsibility.

Having said that, on the per capita question, the issue is that people can't afford more now than they did six years ago and they don't feel good about it. Meanwhile, housing has gone up a lot.

I think that's really where the big issue is; it's more a focus on growth.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

On your point about the three decades, I do have to point out what the editorial said. The Globe said that our “prosperity problem” has accelerated “since the Liberals took power in 2015”.

Would that not be accurate to say?

[Michael Cooper]

The three decades was money for affordable housing. It's absolutely true that there's been no growth in the last six or seven years on a per capita basis.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

In fact, they went on to say—and this was just this morning—that Canada's “prosperity is in a steep decline”, with the GDP per capita “falling well below the average for advanced economies” in the OECD, and that “there is an increasing likelihood of an outright decline in living standards”.

[Michael Cooper]

I think that's right. To the extent that people have less money, they can afford less rent or they can buy houses for less money. That's kind of a tautology, but more money allows people to solve the housing problem.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

What makes it even worse, in my mind, is that since 2015 this government has actually doubled the national debt from $600 billion to $1.2 trillion. They call these expenditures “investments”. In my mind, normally an investment means that there will be a return on an investment, but the truth is that despite all that spending, we have economic growth that has flatlined, so it clearly hasn't worked.

I'm just wondering if you would agree that the only realistic assessment you could give the Liberals on the economy is that they've actually engaged in economic malpractice.

[Michael Cooper]

A lot less than the States....

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Well, somewhat, then... Would you agree?

[Michael Cooper]

It's been a tough time. The fiscal is bad.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

How much time do I have left, Mr. Chair?

[The Chair, Liberal, Peter Fonseca]

You have a minute and a half.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

You touched on accelerated capital cost allowance, which is something near and dear to my heart. I remember that, when I was a young lawyer, there was a program in Canada called the MURB program, multi-unit residential buildings, which I think you touched on, that allowed investors to deduct capital cost allowance from professional and personal income. It got hundreds of thousands of units built.

There are also other ideas. Mike Moffatt has written in his report about the idea of deferral of the capital gains tax when the money is invested in low-income housing or purpose-built rentals.

I wonder what you think of those kinds of adjustments to the Income Tax Act to incentivize new builds.

[Michael Cooper]

Accelerated depreciation means that people pay less tax up front by investing in housing, but they will pay it back when they sell the property, or they'll have less depreciation later, so it's just time shifting. The government will get the same amount of money. It's a very effective way of doing it. The other one I'm not as high on.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Thank you.

Mr. Chair, I'd like to move at this point that there be a second round of questioning of the witnesses after this round is finished.

[The Chair, Liberal, Peter Fonseca]

There is a move to ask for a second round of questioning.

I see hands up.

Go ahead, MP Blaikie.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Thank you very much.

Mr. Chair, I would be happy to support this motion if we knew we were going to get a vote on the other motion by the end of the meeting. If somebody could provide those assurances, I'm happy to hear more from our witnesses, have a brief debate and make a decision on the motion, whatever way that's going to go. However, if we can't come to some kind of reasonable compromise about being able to get to a vote, that makes it harder to find reasonable compromises elsewhere.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Blaikie, for that.

I have MP Chambers on this motion, and then PS Bendayan.

[Adam Chambers, Conservative, Simcoe North, ON]

I would hope that we can get to a vote on Ms. Bendayan's motion, but there may be amendments that I'd like committee members to consider, so I wouldn't want to prejudge the ability to get there.

[The Chair, Liberal, Peter Fonseca]

I have PS Bendayan, and then MP Blaikie.