Of course.
Evidence of meeting #86 for Finance in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was question.
A video is available from Parliament.
Evidence of meeting #86 for Finance in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was question.
A video is available from Parliament.
12:15 p.m.
Senior Director, Federal-Provincial Relations, Department of Finance
Of course.
12:15 p.m.
Liberal
The Chair Liberal Peter Fonseca
Thank you, Ms. Kennedy and Mr. Ste-Marie.
MP Blaikie, the floor is yours for two and a half minutes.
12:15 p.m.
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Thank you very much.
I just wanted to come back to division 8. I'm frankly surprised that there aren't any coordinating amendments, given that Bill C-46 was tabled well prior to Bill C-47.
I'm wondering what the decision-making process was around not including coordinating amendments, in the event that Bill C-46 passes expeditiously.
12:15 p.m.
Director General, Federal-Provincial Relations and Social Policy Branch, Department of Finance
That's a very good question.
The government decided to table a bill expeditiously for those two things that are in Bill C-46. Then, as you know, it included the very same provisions in Bill C-47. The government will have to determine, based on which one passes first, how it will adjust how each one will take effect. If Bill C-46 does get royal assent before Bill C-47, then Bill C-47 will need to be adjusted accordingly to reflect that.
12:15 p.m.
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
When the same measure is being included in two pieces of legislation, is there normally a review process in the department to try and capture that and ensure there's some coordination included in the bills when they're tabled or is it normal that we would do this retroactively?
12:15 p.m.
Director General, Federal-Provincial Relations and Social Policy Branch, Department of Finance
This is interesting in the sense that it's not the first time I've seen measures that have been tabled in a separate bill then forwarded into a budget implementation bill. In the past, the government just didn't move that separate bill forward through the House to seek royal assent.
What's happened here is that there's been an agreement—as I understand—to expedite the passage of Bill C-46. I think that may not have been part of the thinking or what was contemplated at the time.
It's a bit not in my realm to determine exactly how the government will proceed. The government will have an intention, I think, to come back to this committee with a plan forward as to how to address and coordinate the two bills.
12:15 p.m.
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Has this been flagged as a learning in the department for when this kind of situation arises in the future, that it may behoove government to include coordinating amendments in their budget implementation act?
12:15 p.m.
Director General, Federal-Provincial Relations and Social Policy Branch, Department of Finance
Yes, I think this is a note that we'll take back, for certain.
12:15 p.m.
Liberal
The Chair Liberal Peter Fonseca
Thank you, MP Blaikie.
Now we go to MP Chambers for five minutes, please.
12:15 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
Thank you, Chair.
I do have some additional questions on the Bank of Canada. As we're waiting for our official to arrive, I'll ask a general question.
Mr. Countryman, you're designated as the tribute, if you've watched The Hunger Games. I don't know if you get that reference.
What are the additional operational costs in terms of people that the government will incur for the provisions we have in front of us?
12:15 p.m.
Director General, Federal-Provincial Relations and Social Policy Branch, Department of Finance
On that, I'm afraid I don't have an answer for you.
12:15 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
That's fair enough. I was expecting that answer because we asked last year and we have never gotten an answer.
That is why, Mr. Chair and Mr. Clerk, I have asked that Treasury Board officials be included as part of the pre-budget study. The Parliamentary Budget Officer and the Auditor General have raised concerns about people planning processes across government. Every year that a budget is tabled, it is asked what the impact is on people. We don't actually have an answer. We don't have anyone come to committee from the Treasury Board who's capable of answering that question. That's the reason I'm asking for those officials to appear.
Ms. Wong, thank you for your earlier discussions with my colleagues.
I understand the accounting, but what I'm actually interested in is a very simple issue of cash.
Where does the Bank of Canada get the money to satisfy the losses it's incurred? Does it just create additional settlement balances and put those in the accounts of the banks to whom they owe the funds?
12:20 p.m.
Director, Crown Corporations and Currency, Department of Finance
Thank you for the question.
During normal times, the Bank of Canada makes a profit by seigniorage from printing money. Currently, the Bank of Canada is suffering losses due to settlement GBPP activities conducted during the pandemic.
Currently, the seigniorage that the Bank of Canada makes is not sufficient to cover the losses it's incurring. Going forward, the intent of the measures—
12:20 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
I know the intent of the measure. I'm just curious as to....
They don't have enough money to pay for the balance that they owe the financial institution. Is that correct? They're actually running a loss. They've run out of money, right? Where does the money come from that they pay to whom they owe the debt? That's my question. It's more of a technical question; I'm just curious.
12:20 p.m.
Director, Crown Corporations and Currency, Department of Finance
I'm sorry. I do not have the information on that, but I will get it for you.
12:20 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
Do they create additional money and put it in the bank? Is it like a digital settlement balance, where they just kind of chalk it up and erase it with an eraser and put in...? I'm just curious as to where the money actually comes from in order to cover that shortfall.
12:20 p.m.
An hon member
The taxpayer.
12:20 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
Ultimately, it ends up being borne by the taxpayer, indeed. Also, when you consolidate it all goes to the taxpayer.
If one is analyzing what the impact of interest rates are on the government deficit, would you agree that you have to include the net actuarial losses and not just look at the cost of borrowing for government?
12:20 p.m.
Director, Crown Corporations and Currency, Department of Finance
The impact does have an impact on cash flows. Therefore, the government would have higher interest payments.
12:20 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
Correct. The government has higher interest payments, almost double what they were a couple of years ago—from $23 billion to $43 billion next year. That does not include the net actuarial losses that the bank is incurring as a result of higher interest rates. Is that a fair interpretation?
12:20 p.m.
Director, Crown Corporations and Currency, Department of Finance
I'm afraid I do not have that answer.
12:20 p.m.
Conservative
Adam Chambers Conservative Simcoe North, ON
Okay. That's quite all right. It wasn't my intention to ask that very technical question, but it was brought up earlier.
Quickly, on the Canada innovation corporation, are there any protections or directions with respect to investments in rural Canada outside of central or metropolitan areas?
12:20 p.m.
Director General, Resource Policy Analysis, Department of Finance
Thanks for the question.
Within the legislation, there is no prescription of exactly where or for what funding will flow. In fact, it says that it will flow to all sectors and all regions, which really just provides the opportunity for the corporation to operate in all sectors and all regions with that intent. As programs are designed and further information flows out, there will be additional information in that respect.
12:20 p.m.
Conservative