Bill C-2

An Act to provide further support in response to COVID-19

Part 1 amends the Income Tax Act and the Income Tax Regulations to extend subsidies under the Canada Emergency Wage Subsidy (CEWS), the Canada Emergency Rent Subsidy (CERS), and the Canada Recovery Hiring Program until May 7, 2022, as part of the response to the COVID-19 pandemic. Support under the CEWS and the CERS would be available to the tourism and hospitality sector and to the hardest-hit organizations that face significant revenue declines. Eligible entities under these rules would need to demonstrate a revenue decline over the course of 12 months of the pandemic, as well as a current-month revenue decline. In addition, organizations subject to a qualifying public health restriction would be eligible for support, if they have one or more locations subject to a public health restriction lasting for at least seven days that requires them to cease some or all of their activities. Part 1 also allows the government to extend the subsidies by regulation but no later than July 2, 2022.
Part 2 enacts the Canada Worker Lockdown Benefit Act to authorize the payment of the Canada worker lockdown benefit in regions where a lockdown is imposed for reasons related to COVID-19. It also makes consequential amendments to the Income Tax Act and the Income Tax Regulations .
Part 3 amends the Canada Recovery Benefits Act to, among other things,
(a) extend the period within which a person may be eligible for a Canada recovery sickness benefit or a Canada recovery caregiving benefit;
(b) increase the maximum number of weeks in respect of which a Canada recovery sickness benefit is payable to a person from four to six; and
(c) increase the maximum number of weeks in respect of which a Canada recovery caregiving benefit is payable to a person from 42 to 44.
It also makes a related amendment to the Canada Recovery Benefits Regulations .
Part 3.1 provides for the completion of a performance audit and tabling of a report by the Auditor General of Canada in respect of certain benefits.
Part 4 amends the Canada Labour Code to, among other things, create a regime that provides for a leave of absence related to COVID-19 under which an employee may take
(a) up to six weeks if they are unable to work because, among other things, they have contracted COVID-19, have underlying conditions that in the opinion of certain persons or entities would make them more susceptible to COVID-19 or have isolated themselves on the advice of certain persons or entities for reasons related to COVID-19; and
(b) up to 44 weeks if they are unable to work because, for certain reasons related to COVID-19, they must care for a child who is under the age of 12 or a family member who requires supervised care.
It also makes a related amendment to the Budget Implementation Act, 2021, No. 1 .

An Act to Provide Further Support in Response to COVID-19

[Darrell Samson, Liberal, Sackville—Preston—Chezzetcook, NS]

Madam Speaker, I want to thank my colleague as well for his work in the House since 2015. I can share with him that I have also, as the member of Parliament for Sackville—Preston—Chezzetcook, received many calls and notes from seniors faced with the challenge of the GIS, having lost income and supports they were due to receive throughout the pandemic. It is a situation we need to deal with. I believe last week our minister said that the government was looking at how it could resolve the issue, because we want to help seniors who have had challenges with respect to the pandemic and who need the support from the GIS. We also increased the GIS by 10% back in 2016 and have committed to more increases as we move forward. However, we absolutely have to rectify the situation the member has presented.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Madam Speaker, it is an honour to rise in the House in this 44th Parliament.

Early on in the pandemic, when the provinces first when into lockdown, a constituent reached out to me for help. She could not work because of public health lockdowns and she was worried about how she would take care of her children without an income.

When we introduced CERB and enhanced the Canada child benefit early on, it created a lifeline for her while she waited for her job to come back. At different times over these last 20 months, when cases surged and lockdowns returned, she used CERB and the CRB to keep food on the table and to provide for her kids.

We reconnected this month and I was glad to hear that she was in a much better position than she was in those early months. She had not needed government assistance for some time, but then she said something that stuck with me, “I hope your programs will still be here during the next lockdown.”

Canada is in a good place right now, but we all know that this may not be the last, and we have all seen the news of the omicron variant. Residents in my riding of Mississauga—Erin Mills are working day-to-day knowing that as long as this pandemic continues, as long as there are still those who are unvaccinated, another lockdown is always a possibility.

It is a privilege for me to lend my voice in support of Bill C-2, an act to provide further support in response to COVID-19. This legislation is an important next step in our government's fight against the virus.

Throughout the pandemic we have been nimble. We have adjusted and adapted our support programs to the evolving nature of this once-in-a-lifetime crisis. We always knew that to win the fight against COVID-19 and to protect Canadians through the worst impact of this economic crisis, we needed to adapt our programs to the conditions of the moment. We have done this to ensure that they remain effective in protecting Canadians and in supporting the strong recovery as Canadians pull together to win this fight.

When the COVID-19 crisis struck, our government immediately rolled out a comprehensive range of broad-based effective measures in response to the greatest economic shock that our country had suffered since the Great Depression. We were able to deliver the Canada emergency response benefit and the wage and rent subsidies rapidly, with unprecedented speed for a program of such a size and scale.

As our communities went into lockdown, over eight million Canadians had emergency income support, and hundreds of thousands of businesses received emergency subsidies. These support programs proved to be a lifeline for workers and businesses across the country. They helped pay the rent. They helped keep food on the table. They helped to protect millions of jobs and keep hundreds of thousands of Canadian businesses going through the darkest days of the pandemic. For thousands of families in my riding of Mississauga—Erin Mills, that support in the early days of the pandemic meant the difference between eating or paying rent.

However, these emergency measures were always designed to be temporary, to address the broad impact of the mass lockdowns that were necessary at that time.

Today, we are in a very different stage in the fight against COVID-19. Canadians have done their part by respecting public health measures, by getting vaccinated and by contributing to one of the most successful vaccination campaigns across the world.

As a result of their efforts, we are now turning the corner in this fight. Restrictions are now carefully being eased in our communities and at our borders. Many businesses are safely reopening. Jobs are being created and employment is now back to pre-pandemic levels.

Residents in Mississauga—Erin Mills understand that getting to this point required unprecedented government spending, not just in Canada but across the world. For example, the U.S., trillions of dollars were spent to provide supports to Americans during this pandemic. They supported this extraordinary spending during the darkest days of the pandemic because they knew that every dollar spent puts food on their neighbour's table and delivered masks and sanitizers to nursing homes, which saved lives. Every cent protected a family-owned business from closing down and the workers from losing their jobs. They understood that the cost of cutting corners, of nickel-and-diming Canadians in a time of crisis, could be paid with lives. It was the right thing to do. It was the smart thing to do, economically and socially. It allowed us to save lives and prevent the sort of lasting economic damage that could have come from mass business closures and job losses.

Today, Canadians understand that the situation has evolved, and we are in a much better position. Canada has one of the highest vaccination rates in the world. The economy is rebounding and we have blown past this Liberal government's goal of creating one million jobs. Therefore, the time has now come to adapt our income and business support measures to these improved circumstances, and Bill C-2 is precisely about that.

The legislation would effectively pivot us from the very broad-based supports that were appropriate at the height of lockdowns to more targeted measures that would provide help where it would still needed and create jobs and growth, while prudently managing government spending.

At the same time, Bill C-2 would move us forward on the understanding that while our recovery is strong, we are not out of the woods yet. Our recovery is uneven. The pandemic continues to affect economic activity, especially in certain sectors of the economy subject to ongoing and still necessary public health restrictions. That is why Bill C-2 contains measures that would snap into action immediately to support workers in the event of a new regional lockdown. This would include a new benefit, the Canada worker lockdown benefit, which would provide $300 a week to workers who are directly impacted by a public health lockdown imposed to curtail the spread of COVID.

This new benefit would be strictly available to workers whose work interruption would be a direct result of a government-imposed public health lockdown. It would be available to workers who are ineligible for employment insurance as well as those who are eligible for EI, as long as they are not paid benefits through the EI program during this same period.

The Canada worker lockdown benefit would be available until May 7, 2022, with retroactive application to October 24, 2021, should there be applicable lockdown situations, and it would be accessible for the entire duration of a government-imposed public health lockdown up until May 7, 2022.

This support, however, will be for those who are doing their part to protect their fellow Canadians and support the fight against COVID. This means that under Bill C-2, individuals whose loss of income or employment is due to their refusal to adhere to a vaccine mandate would not be able to access this benefit.

Bill C-2 also contains measures that would extend eligibility to both the Canada recovery sickness benefit and the Canada recovery caregiving benefit until May 7, 2022, and it would increase the maximum duration of each benefit by two additional weeks. That means that the caregiving benefit would be increased from 42 to 44 weeks, and the sickness benefit would be increased from 4 weeks to 6 weeks.

As we know, the Canada recovery caregiving benefit provides income support to employed and self-employed individuals who are unable to work because they must care for their child under 12 years of age or a family member who needs supervised care. It has delivered $3.74 billion to 486,910 Canadians.

The Canada recovery sickness benefit provides income supports to employed and self-employed individuals who are unable to work because they are sick, or they need to self-isolate due to COVID-19 or have an underlying health condition that puts them at greater risk of getting COVID. It has already delivered over $829 million of much-needed support to 758,670 Canadians.

The extension of these benefits is important, because we still need to protect ourselves, we need to grow and we need to ensure that those businesses that are suffering have the support from our government.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Madam Speaker, once again, it is good to be able to ask some very important questions. I heard the member reference a number of times the importance to get this work done, and I agree. Therefore, my question is very simple.

Does that member support the immediate reinstatement of committees, so the House can get to work for Canadians?

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Madam Speaker, I congratulate the member on his election to this Parliament.

Over the past year, I witnessed the opposition parties continuing to hinder the work and the supports that we as a Liberal government tried to hand out to Canadians.

[Damien Kurek, Conservative, Battle River—Crowfoot, AB]

Like an election.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Madam Speaker, I watched them filibuster for hours and hours in the House and also in committees. We know what Canadians want and we are very committed to getting that done.

[The Assistant Deputy Speaker, NDP, Carol Hughes]

I do want to remind the member for Battle River—Crowfoot that he had an opportunity to ask his question and he should be respectful when he is getting the answer. If he has any other questions and comments, then he can ask them the next time around.

The hon. member for Thérèse-De Blainville.

[Louise Chabot, Bloc, Thérèse-De Blainville, QC]

Madam Speaker, one question is being asked over and over about a problem that could have a constructive solution. Bill C-2 is all about such proposed measures as the reinstatement of the Canada recovery benefit and a weekly $300 benefit for workers not eligible for EI who find themselves in a lockdown.

How can we explain the different approach to the self-employed in the cultural sector, which, while not under lockdown, is practically dying because it is having so much trouble rebounding? These workers are not eligible for EI. Why have they been outright forgotten in Bill C-2?

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Madam Speaker, I congratulate the member on her election to the House in this 44th Parliament.

We have been quite nimble, as I mentioned in my speech. Absolutely we provided supports for individual Canadians and for small businesses, but also at the discretion of the regional recovery fund, which we instilled across the country to continue to provide that support for sectors that may not have fit in one way or another, to continue to have that hands-on approach to ensure that industries like the agriculture industry were able to sustain themselves as the country recovered economically.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Madam Speaker, as we have heard many times, a lot of seniors, including my father, receive the guaranteed income supplement and that is how they make ends meet. A lot of low-income seniors also got CERB because they lost their supplementary income. Now that member's government is clawing back their guaranteed income supplement.

Could the member inform the House what her government plans to do to ensure that those seniors have their full guaranteed income supplement and are able to make ends meet?

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Madam Speaker, the question of seniors is a very important one in the House and across our country. Our seniors committed their whole lives to ensuring we would do well, that our country would not only sustain itself but would also thrive. The onus is on us to provide that support.

Over the past year not only did we provide individual payments to seniors to help them see through COVID-19 and the impacts that it brought to their lives, but we also increased OAS and GIS. We not only did that financially, but we also committed to creating those long-term care standards that seniors deserve in their most vulnerable years of life. I know that work is going to continue. I look forward to working with the members opposite to ensure that happens.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

Madam Speaker, one of the areas of focus in Bill C-2 is, of course, the tourism sector. I wonder if the member has any insights as to whether there will be more. This will not be enough to support key tourist destinations. Part of the problem is that we need to think of all the ways in which COVID continues to impact tourism, particularly on inconsistent rules about whether people need certain tests to re-enter Canada from the United States. I do not know if the member has any thoughts on that.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Madam Speaker, I am not sure if I can give a brief answer to this question. It is something that is very close to my heart. However, Bill C-2 does commit to continue to provide support. I really respect our restaurant owners and all the hoteliers in the tourism industry, understanding just how gendered that impact is within the tourism industry, and how much more support we need to provide.

I look forward to continuing to work with the member for Saanich—Gulf Islands in ensuring that all of our tourism within Canada is thriving. I would love to see more Canadians going out and about to different parts of the country.

[Greg McLean, Conservative, Calgary Centre, AB]

Madam Speaker, I congratulate all of my colleagues for winning their election in this 44th Parliament and making sure that we come here to discuss Canada's issues in Parliament. I am looking forward to that and more debate in the House of Commons.

First, as it is the first time I have risen in the House since the election, I would like to thank the constituents of Calgary Centre for giving me the honour of coming back here to represent their interests in the House of Commons, in the debates that we are going to have here, and make sure that we have better legislation for Canadians going forward. I also want to thank my campaign team and my wife, in particular, who has always been my biggest supporter.

Today, we are talking about Bill C-2 and how we can try to make it better. This is about government spending, and it is one of the main things the government does. I also want to talk about inflation, especially monetary inflation, the cost-of-living increases and, of course, asset inflation.

I will start with the fiscal situation and federal government debt.

When I ran for Parliament in 2019, I decided to become a candidate because I thought Canada was overspending. We were spending our children's money, and going deeper into debt to pay for today's programming at the expense of tomorrow's taxpayers. In 2019, Canada's debt was $721 billion. Where is it now? It is $1.234 trillion.

I will note that I will be splitting my time with the hon. member for Edmonton West.

We have $1.234 trillion in debt, which is $500 billion more in debt than we had two years ago. The government has based this on what it wants to continue, a debt-to-GDP ratio of around 53%, which is up from 30% only a few years ago. That is a ridiculous increase, and the government plans to leave it there in its spending plans for the foreseeable future. It is as if arriving at a 53% debt-to-GDP ratio is the goal, and we just keep adding debt so the debt ratio of our country is kept high, and it is very high. This is a government that believes it does not have to make choices about where it spends taxpayers' dollars or borrows funds from future generations.

Interest rates are low, because the debt issued is held by the Bank of Canada. Interestingly, in a technocrat approach to access leverage, a Canadian Crown corporation buys the debt that it issues to the government to pay for its spending. It is a nice balance-sheet trick where the entity that is setting the market rate for issuing government debt actually participates in the market as a buyer to ensure that the debt is bought at that market rate. The end result of this is that the Bank of Canada, a funded subsidiary of the Government of Canada whose debts are guaranteed by the taxpayers of Canada, has grown its balance sheet from $105 billion in 2020 to over $500 billion today. Of course, it has the bonds on its balance sheet guaranteed by the taxpayers of Canada as well, but let us remember that it bought these bonds, some from bond sellers in the open market, at a rate that it set at very low.

I will give a little background to understand this concept. Low interest rates, or “coupons” as they are sometimes called, equate to higher bond prices. The correlation is automatic. When the government is buying bonds from market participants at a low market rate that it set, it is overpaying for the bond. Eventually, rates will reset higher. Higher rates equal lower prices for the bonds on the Bank of Canada's balance sheet. What does that mean? It means that the adjustment to reducing the quantitative easing experiment in which the government is participating is going to be very expensive. We are buying high and we will need to sell lower. How much lower? Well, with an increase of $400 billion on its balance sheet, normalization will require a loss of billions of dollars of value for the Bank of Canada per year until $400 billion of Government of Canada debt has been sold into the market. This quantitative easing, a way for central bankers to keep public spending ratcheting higher, in any iteration, in any country, has never shown a path out. We are experimenting here without any concept of the outcome.

Remember that Canada's debt total is $1.234 trillion. About 40% of that is now held by the Bank of Canada, so we, the people of Canada, have become the de facto only buyer of Canada's debt. We must add those billions in impacted losses onto Canada's fiscal deficits going forward, because they are not included in any of the fiscal plans at this time. These are the plans continuing to have a debt-to-GDP ratio above 50% for the foreseeable future. Even after the recession of 2008-09, that ratio was only 30%.

Canada is on a train to a cliff, and the conductor is not looking ahead. There is no magic money tree.

Canadians will recall the last time in our recent history when government spending grew out of control, which was from the Trudeau government deficits in the 1970s and 1980s.

With rising interest rates, payments on our national debt became the government's largest expense line item. Taxpayers were paying bondholders from around the world excessive amounts of interest. Those tens of billions of dollars per year that taxpayers contributed could not be allocated to programs like improvements in our health care system.

The final outcome of this period was the Chrétien Liberal government cutting federal funding to health care in 1996. At the time, it was Canada's second-largest budget line item after interest payments on debt. Is this foreshadowing?

Canadians still have health care, although the federal government's share has fallen from the conventional 50% to 22%. The rest has been thrust onto the backs of the provinces unilaterally. The provinces' finances have suffered ever since.

Let us think about the Liberal government's promises on spending in provincial government jurisdiction, on borrowed money. What happens to these services when the bill becomes due?

Debt ratio metrics are only relevant when we are comparing to other countries. As far as balance sheets of governments go, the measure is irrelevant. Corporations have debt-to-value ratios because it is a measure of how they can leverage their operations with cheaper tax-assisted financing and therefore earn a higher return for their owners. That notion does not exist for governments, and no government should ever embrace the notion that a country accumulates debt it will never pay back.

It is an excuse to have future generations of Canadians pay for today's expenses, as if our children will not have their own bills to pay with their own taxes. They will be paying for decades for services we delivered today.

Let us remember that a country's debt profile is not just the federal government's debt, we need to include provincial government debt, which has skyrocketed during COVID because of the provinces' needs to increase health care funding during a health crisis. It also includes corporate debt, which has increased remarkably, and household debt.

In total, Canada's debt-to-GDP ratio rose by 80% in 2020, by far the largest increase in the world. The closest runner-up in this ratcheting metric was Japan at a 50% increase. The U.S. saw a 45% increase, the U.K. saw a 35% increase, China saw a 30% increase and Australia only saw a 12% increase. Comparably, Canada stands alone in its profligacy.

Monetary inflation leads to asset inflation, which is most exemplified by the housing market. Mortgage debt increased by $100 billion. Canadian households are personally in debt for $2.5 trillion, or $64,000 per capita. Mortgage debt has increased by 22%. Single-family home prices have increased by a similar amount of 23% over the past year.

Canada now stands at the top of the most overvalued housing markets in the world. Whereas in the U.S. the increase in real disposable income slightly exceeds real home prices, in Canada housing prices have increased at a rate almost double the increase in real disposable income.

This is trouble we need to address here at this level so we understand what the future looks like for Canada's finances. We need to examine this bill closely in an actual team Canada approach.

In that respect, I am looking forward to this bill's review at the House of Commons Standing on Finance, where all members of the House of Commons will be able to provide input to ensure the bill meets the needs and expectations of Canadians.

[Kody Blois, Liberal, Kings—Hants, NS]

Madam Speaker, I have been here for two years, and I have found the member to be quite articulate in his points. However, one thing that concerned me in his speech, and he talked a lot about debt and deficits, was he made almost no mention of the fact that we have just gone through a global pandemic and the fact that the government has had to intervene to make sure that Canadian businesses and individuals were supported.

It was not just Canada but across the globalized economy, countries have been intervening. Would the member suggest we not have intervened? Let us bring this back to Bill C-2, because that is what we are here to talk about right now. Does the member support this legislation? Does he think this is needed, notwithstanding his treatise on debt and deficit spending?