Bill C-59 (Historical)

Fall Economic Statement Implementation Act, 2023

An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023 and certain provisions of the budget tabled in Parliament on March 28, 2023

Part 1 implements certain measures in respect of the Income Tax Act and the Income Tax Regulations by
(a) limiting the deductibility of net interest and financing expenses by certain corporations and trusts, consistent with certain Organisation for Economic Co-operation and Development and the Group of Twenty Base Erosion and Profit Shifting project recommendations;
(b) implementing hybrid mismatch rules consistent with the Organisation for Economic Co-operation and Development and the Group of Twenty Base Erosion and Profit Shifting project recommendations regarding cross-border tax avoidance structures that exploit differences in the income tax laws of two or more countries to produce “deduction/non-inclusion mismatches”;
(c) allowing expenditures incurred in the exploration and development of all lithium to qualify as Canadian exploration expenses and Canadian development expenses;
(d) ensuring that only genuine intergenerational business transfers are excluded from the anti-surplus stripping rule in section 84.1 of the Income Tax Act ;
(e) denying the dividend received deduction for dividends received by Canadian financial institutions on certain shares that are held as mark-to-market property;
(f) increasing the rate of the rural supplement for Climate Action Incentive payments (CAIP) from 10% to 20% for the 2023 and subsequent taxation years as well as referencing the 2016 census data for the purposes of the CAIP rural supplement eligibility for the 2023 and 2024 taxation years;
(g) providing a refundable investment tax credit to qualifying businesses for eligible carbon capture, utilization and storage equipment;
(h) providing a refundable investment tax credit to qualifying businesses for eligible clean technology equipment;
(i) introducing, under certain circumstances, labour requirements in relation to the new refundable investment tax credits for eligible carbon capture, utilization and storage equipment as well as eligible clean technology equipment;
(j) removing the requirement that credit unions derive no more than 10% of their revenue from sources other than certain specified sources;
(k) permitting a qualifying family member to acquire rights as successor of a holder of a Registered Disability Savings Plan following the death of that plan’s last remaining holder who was also a qualifying family member;
(l) implementing consequential changes of a technical nature to facilitate the operation of the existing rules for First Home Savings Accounts;
(m) introducing a tax of 2% on the net value of equity repurchases by certain Canadian corporations, trusts and partnerships whose equity is listed on a designated stock exchange;
(n) exempting certain fees from the refundable tax applicable to contributions under retirement compensation arrangements;
(o) introducing a technical amendment to the provision that authorizes the sharing of taxpayer information for the purposes of the Canadian Dental Care Plan;
(p) implementing a number of amendments to the general anti-avoidance rule (GAAR) as well as introducing a new penalty applicable to transactions subject to the GAAR and extending the normal reassessment period for the GAAR by three years in certain circumstances;
(q) facilitating the creation of employee ownership trusts;
(r) introducing specific anti-avoidance rules in relation to corporations referred to as substantive CCPCs; and
(s) extending the phase-out by three years, and expanding the eligible activities, in relation to the reduced tax rates for certain zero-emission technology manufacturers.
It also makes related and consequential amendments to the Excise Tax Act and the Excise Act, 2001 .
Part 2 enacts the Digital Services Tax Act and its regulations. That Act provides for the implementation of an annual tax of 3% on certain types of digital services revenue earned by businesses that meet certain revenue thresholds. It sets out rules for the purposes of establishing liability for the tax and also sets out applicable reporting and filing requirements. To promote compliance with its provisions, that Act includes modern administration and enforcement provisions generally aligned with those found in other taxation statutes. Finally, this Part also makes related and consequential amendments to other texts to ensure proper implementation of the tax and cohesive and efficient administration by the Canada Revenue Agency.
Part 3 implements certain Goods and Services Tax/Harmonized Sales Tax (GST/HST) measures by
(a) ensuring that an interest in a corporation that does not have its capital divided into shares is treated as a financial instrument for GST/HST purposes;
(b) ensuring that interest and dividend income from a closely related partnership is not included in the determination of whether a person is a de minimis financial institution for GST/HST purposes;
(c) ensuring that an election related to supplies made within a closely related group of persons that includes a financial institution may not be revoked on a retroactive basis without the permission of the Minister of National Revenue;
(d) making technical amendments to an election that allows electing members of a closely related group to treat certain supplies made between them as having been made for nil consideration;
(e) ensuring that certain supplies between the members of a closely related group are not inadvertently taxed under the imported taxable supply rules that apply to financial institutions;
(f) raising the income threshold for the requirement to file an information return by certain financial institutions;
(g) allowing up to seven years to assess the net tax adjustments owing by certain financial institutions in respect of the imported taxable supply rules;
(h) expanding the GST/HST exemption for services rendered to individuals by certain health care practitioners to include professional services rendered by psychotherapists and counselling therapists;
(i) providing relief in relation to the GST/HST treatment of payment card clearing services;
(j) allowing the joint venture election to be made in respect of the operation of a pipeline, rail terminal or truck terminal that is used for the transportation of oil, natural gas or related products;
(k) raising the input tax credit (ITC) documentation thresholds from $30 to $100 and from $150 to $500 and allowing billing agents to be treated as intermediaries for the purposes of the ITC information rules; and
(l) extending the 100% GST rebate in respect of new purpose-built rental housing to certain cooperative housing corporations.
It also implements an excise tax measure by creating a joint election mechanism to specify who is eligible to claim a rebate of excise tax for goods purchased by provinces for their own use.
Part 4 implements certain excise measures by
(a) allowing vaping product licensees to import packaged vaping products for stamping by the licensee and entry into the Canadian duty-paid market as of January 1, 2024;
(b) permitting all cannabis licensees to elect to remit excise duties on a quarterly rather than a monthly basis, starting from the quarter that began on April 1, 2023;
(c) amending the marking requirements for vaping products to ensure that the volume of the vaping substance is marked on the package;
(d) requiring that a person importing vaping products must be at least 18 years old; and
(e) introducing administrative penalties for certain infractions related to the vaping taxation framework.
Part 5 enacts and amends several Acts in order to implement various measures.
Subdivision A of Division 1 of Part 5 amends Subdivision A of Division 16 of Part 6 of the Budget Implementation Act, 2018, No. 1 to clarify the scope of certain non-financial activities in which federal ‚financial institutions may engage and to remove certain discrepancies between the English and French versions of that Act.
Subdivision B of Division 1 of Part 5 amends the Trust and Loan Companies Act , the Bank Act and the Insurance Companies Act to, among other things, permit federal financial institutions governed by those Acts to hold certain meetings by virtual means without having to obtain a court order and to permit voting during those meetings by virtual means.
Division 2 of Part 5 amends the Canada Labour Code to, among other things, provide a leave of absence of three days in the event of a pregnancy loss and modify certain provisions related to bereavement leave.
Division 3 of Part 5 enacts the Canada Water Agency Act . That Act establishes the Canada Water Agency, whose role is to assist the Minister of the Environment in exercising or performing that Minister’s powers, duties and functions in relation to fresh water. The Division also makes consequential amendments to other Acts.
Division 4 of Part 5 amends the Tobacco and Vaping Products Act to, among other things,
(a) authorize the making of regulations respecting fees or charges to be paid by tobacco and vaping product manufacturers for the purpose of recovering the costs incurred by His Majesty in right of Canada in relation to the carrying out of the purpose of that Act;
(b) provide for related administration and enforcement measures; and
(c) require information relating to the fees or charges to be made available to the public.
Division 5 of Part 5 amends the Canadian Payments Act to, among other things, provide that additional persons are entitled to be members of the Canadian Payments Association and clarify the composition of that Association’s Stakeholder Advisory Council.
Division 6 of Part 5 amends the Competition Act to, among other things,
(a) modernize the merger review regime, including by modifying certain notification rules, clarifying that Act’s application to labour markets, allowing the Competition Tribunal to consider the effect of changes in market share and the likelihood of coordination between competitors following a merger, extending the limitation period for mergers that were not the subject of a notification to the Commissioner of Competition and placing a temporary restraint on the completion of certain mergers until the Tribunal has disposed of any application for an interim order;
(b) improve the effectiveness of the provisions that address anti-competitive conduct, including by allowing the Commissioner to review the effects of past agreements and arrangements, ensuring that an order related to a refusal to deal may address a refusal to supply a means of diagnosis or repair and ensuring that representations of a product’s benefits for protecting or restoring the environment must be supported by adequate and proper tests and that representations of a business or business activity for protecting or restoring the environment must be supported by adequate and proper substantiation;
(c) strengthen the enforcement framework, including by creating new remedial orders, such as administrative monetary penalties, with respect to those collaborations that harm competition, by creating a civilly enforceable procedure to address non-compliance with certain provisions of that Act and by broadening the classes of persons who may bring private cases before the Tribunal and providing for the availability of monetary payments as a remedy in those cases; and
(d) provide for new procedures, such as the certification of agreements or arrangements related to protecting the environment and a remedial process for reprisal actions.
The Division also amends the Competition Tribunal Act to prevent the Competition Tribunal from awarding costs against His Majesty in right of Canada, except in specified circumstances.
Finally, the Division makes a consequential amendment to one other Act.
Division 7 of Part 5 amends the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act to exclude from their application prescribed public post-secondary educational institutions.
Subdivision A of Division 8 of Part 5 amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to, among other things,
(a) provide that, if a person or entity referred to in section 5 of that Act has reasonable grounds to suspect possible sanctions evasion, the relevant information is reported to the Financial Transactions and Reports Analysis Centre of Canada;
(b) add reporting requirements for persons and entities providing certain services in respect of private automatic banking machines;
(c) require declarations respecting money laundering, the financing of terrorist activities and sanctions evasion to be made in relation to the importation and exportation of goods; and
(d) authorize the Financial Transactions and Reports Analysis Centre of Canada to disclose designated information to the Department of the Environment and the Department of Fisheries and Oceans, subject to certain conditions.
It also amends the Budget Implementation Act, 2023, No. 1 in relation to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and makes consequential amendments to other Acts and a regulation.
Subdivision B of Division 8 of Part 5 amends the Criminal Code to, among other things,
(a) in certain circumstances, provide that a court may infer the knowledge or belief or recklessness required in relation to the offence of laundering proceeds of crime and specify that it is not necessary for the prosecutor to prove that the accused knew, believed they knew or was reckless as to the specific nature of the designated offence;
(b) remove, in the context of the special warrants and restraint order in relation to proceeds of crime, the requirement for the Attorney General to give an undertaking, as well as permit a judge to attach conditions to a special warrant for search and seizure of property that is proceeds of crime; and
(c) modify certain provisions relating to the production order for financial data to include elements specific to accounts associated with digital assets.
It also makes consequential amendments to the Seized Property Management Act and the Forfeited Property Sharing Regulations .
Division 9 of Part 5 retroactively amends section 42 of the Federal-Provincial Fiscal Arrangements Act to specify the payments about which information must be published on a Government of Canada website, as well as the information that must be published.
Division 10 of Part 5 amends the Public Sector Pension Investment Board Act to increase the number of directors in the Public Sector Pension Investment Board, as well as to provide for consultation with the portion of the National Joint Council of the Public Service of Canada that represents employees when certain candidates are included on the list for proposed appointment as directors.
Division 11 of Part 5 enacts the Department of Housing, Infrastructure and Communities Act , which establishes the Department of Housing, Infrastructure and Communities, confers on the Minister of Infrastructure and Communities various responsibilities relating to public infrastructure and confers on the Minister of Housing various responsibilities relating to housing and the reduction and prevention of homelessness. The Division also makes consequential amendments to other Acts and repeals the Canada Strategic Infrastructure Fund Act .
Division 12 of Part 5 amends the Employment Insurance Act to, among other things, create a benefit of 15 weeks for claimants who are carrying out responsibilities related to
(a) the placement with the claimant of one or more children for the purpose of adoption; or
(b) the arrival of one or more new-born children of the claimant into the claimant’s care, in the case where the person who will be giving or gave birth to the child or children is not, or is not intended to be, a parent of the child or children.
The Division also amends the Canada Labour Code to create a leave of absence of up to 16 weeks for an employee to carry out such responsibilities.

Report Stage

[Warren Steinley, Conservative, Regina—Lewvan, SK]

Mr. Speaker, I have a quick question for my colleague. Did she ever think that Canada would pay more in debt-servicing than it does in health care transfers to the provinces? That is something I never thought I would see, $54.1 billion in debt repayment, which is more than what we are going to give to the provinces for health care. What do you have to say about that, and what do you think your constituents would say about that?

[The Speaker, Greg Fergus]

I am certain that question was through the Chair to the hon. member for Sarnia—Lambton.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Mr. Speaker, health care is super important to Canadians. Our health care system is ailing. We do not have enough doctors as it is. What drives me crazy is not just that we are going to pay $56 billion of interest on the debt, but also the fact that we have turned down $59 billion for LNG from Germany, $59 billion of revenue from Japan for LNG, another $60 billion from the Netherlands for LNG. Those are all things the Liberal government has turned down. That money could help pay off the debt and help our health care system.

[Randeep Sarai, Liberal, Parliamentary Secretary to the Minister of Veterans Affairs and Associate Minister of National Defence]

Through you, Mr. Speaker, I just want to ask this. The member opposite was blaming the insurance premium going up on, I believe, her staffer or somebody at her house. I wonder if it was from a car accident or repairs or if it was from a flood to a house or whatnot. How can the government be responsible for insurance premiums? I would really like to know how the budget was responsible for the insurance premium hike of $1,000.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Mr. Speaker, absolutely, I can be very concise, because the insurance company told my staffer that the reason for the $1,000 increase in premiums was inflation and car theft. The Liberal government, with Bill C-75, made car theft go up 100% across the country, and it is driving inflation by pouring deficits on the inflationary fire.

[Randeep Sarai, Liberal, Parliamentary Secretary to the Minister of Veterans Affairs and Associate Minister of National Defence]

Mr. Speaker, last November, the government introduced Bill C-59, the fall economic statement implementation act of 2023. Among other measures, Bill C-59 proposed significant amendments to our Competition Act. I am proud to share that the Standing Committee on Finance has recently completed its review of the bill and has made several amendments to further strengthen existing proposals.

For many years, Canada's markets have been described as overly concentrated and not competitive enough. In fact, the landmark Competition Bureau study last year, based on Statistics Canada data and analysis from a University of Toronto professor, made critical findings in this respect, showing that competitive intensity has been on the decline over the past two decades, which is reflected in a number of important indicators. These trends have been exacerbated by the inflationary pressures our country is facing following a global pandemic and increasing geopolitical uncertainty.

Bill C-59 was introduced to help build a stronger domestic economy through more competition and contestable markets to bring lower prices, more choice and better product quality for consumers across all sectors. The proposed amendments to the Competition Act in Bill C-59 arose out of a comprehensive public consultation conducted from November 2022 to March 2023.

Having heard from stakeholders, the government introduced Bill C-56, the Affordable Housing and Groceries Act, which was ultimately passed by this Parliament in December 2023.

Completing its response to the consultation, the government then presented a more extensive set of reforms by way of Bill C-59. The measures in this bill include strengthening provisions with respect to merger review, enhancing protections for consumers, workers and the environment, and broadening opportunities for private enforcement.

We should not underestimate just how critical these reforms are for modernizing our laws and promoting competitive markets. The commissioner of competition has stated on multiple occasions that the amendments in Bill C-56 and Bill C-59 are “generational.” I would therefore like to highlight some important reforms that have been proposed.

To begin with, anti-competitive collaborations between competitors would be under increased scrutiny as the bureau would be able to examine and, if necessary, seek penalties against coordinated conduct that lessens competition. Up until now, at worst the participants would be told to stop what they are doing. The expansion of private enforcement and the ability of the Competition Tribunal to issue monetary payment orders in cases initiated by private parties are also significant changes to our existing enforcement approach. By relaxing the requirements to bring a case and providing an incentive to bring matters directly to the Competition Tribunal, there would be greater accountability throughout the marketplace and more action on cases that the Competition Bureau may not be able to take.

More competition is always beneficial to consumers, but the bill also takes some direct approaches to protect consumers. These include strengthening provisions on deceptive marketing, such as applying requirements more broadly so vendors must present the full cost of a product or service up front without holding back mandatory fees, known as “drip pricing.” The law is further being refined to make it easier to ensure that advertised rebates are authentic when compared to a vendor's past prices. Businesses making environmental claims about their products would be required to have undertaken adequate and proper testing before advertising their benefits. Together, these changes would ensure that consumers have accurate and complete information about products and services in order to make informed purchasing decisions.

I would also like to highlight barriers to repair, which have been an issue of great importance in recent years. Where manufacturers refuse to provide the means of diagnosis or repair in a way that harms competition, remedial orders would be available to require them to furnish what is necessary. This could help a wider variety of service providers offer more options to consumers when choosing where to repair their products.

On top of everything I have mentioned so far, anti-reprisal provisions would also ensure that the system can function. These are included to ensure that workers and small businesses are protected from potential retaliation when they work with the authorities to address anti-competitive behaviour and violations of the act by other parties.

These reforms, along with various administrative changes, aimed at facilitating efficient enforcement of the act, are crucial to ensuring that Canadian markets remain competitive and in line with international practices.

It has been acknowledged by all members of the House that our competition framework requires reform. My colleagues have engaged in thoughtful discussion on ways to modernize the existing marketplace framework. Nothing exemplifies this better than the enthusiasm shown by members of all parties to strengthen these provisions of Bill C-59 once it reaches the Standing Committee on Finance, especially in light of recommendations made by the commissioner of competition.

The amendments adopted in committee notably relate to merger review, deceptive marketing, and refusal to repair. The committee members were quite interested in enhancing protections for consumers and the environment, and these are the ones that I would like to draw attention to now.

First, clarifications were made to ensure that in the Competition Act's various provisions on drip pricing, the only amounts that could be excluded from the upfront price are those imposed by law directly on the purchaser of the product, such as sales tax. Next, with the committee's amendment, sellers advertising reduced prices would now be required to be able to prove that regular price is authentic in order to publicize their discounts.

On the topic of doubtful environmental claims, or so-called greenwashing, the law would also require that those who make environmental claims about their businesses or business activities, not only specific products, must have adequate and proper substantiation in hand to support such claims. On refusal to repair, the committee added some helpful clarifications to ensure that the scope of provision was broad enough.

In sum, amidst the period of inflation and growing affordability concerns, it is crucial that our markets remain resilient and open to competition. Bill C-59 would reform Canada's competitive landscape, encourage greater innovation, and improve affordability for Canadians.

Therefore, I would like to urge my colleagues from all sides of the House to work together to expeditiously pass this crucial piece of legislation.

[Marilyn Gladu, Conservative, Sarnia—Lambton, ON]

Mr. Speaker, the member opposite talked about the importance of increasing competition, and I do agree with that.

However, it does not seem consistent with the actions of the government that approved the Shaw merger with Rogers and the acquisition of the HSBC bank by RBC. These things are definitely not increasing competition.

Could the member explain how that is consistent with the Liberal government's direction?

[Randeep Sarai, Liberal, Surrey Centre, BC]

Mr. Speaker, that is a good question.

Whenever any banks or any major telecoms merge, the scrutiny is very strict. There is always a review under the Competition Act. Banking regulators and public opinions are even brought into the question. It is only after thorough commitments and signs from such parties do they actually agree in these cases. Many have been rejected or have been pushed back before. In this case, they are being cautious.

Currently, in the competition world, our grocery sector is the one that everyone is monitoring very strongly and carefully. In that case, I think we will see the addition of more competition rather than any mergers or reductions.

[Lori Idlout, NDP, Nunavut, NU]

Uqaqtittiji, there are parts of the fall economic statement that I did appreciate, but other parts did not go far enough, including addressing corporate greed.

Just yesterday, I summoned to the indigenous and northern affairs committee, the CEO of The North West Company and asked him about his salary. His annual salary is $3.91 million. I asked him what the salary of a cashier in his stores are. The salary of the cashiers, in Iqaluit, where the cost of living is much higher, is $37,000 a year.

I wonder if the member could tell the House what the Conservatives are claiming causes inflation, which are things like carbon tax. Could the member maybe correct the record about what is causing the price increases in Canada?

[Randeep Sarai, Liberal, Surrey Centre, BC]

Mr. Speaker, no more is it a testament than in places like Nunavut and Iqaluit, where one is seeing this discrepancy between the person actually selling the groceries and feeding a family, and the elite at the top. That is why we put measures, including the capital gains changes, where a lot of corporate executives were able to discount some of the tax rates that would normally be applicable if they paid that in a salary format as opposed to stock options. These are some of the ways that the playing field becomes level.

However, there is more work to do. That is absolutely right. The right to organize is something we have guaranteed in the House as well. The Liberals have committed to that. This government has committed to that. We have reversed measures the Conservative government had imposed prior, and that will strengthen the right to organize and get better wages for those members.

[Mark Gerretsen, Liberal, Kingston and the Islands, ON]

Mr. Speaker, I have a brief question. I find the last intervention about grocery prices to be very fascinating because the reality is that in Canada, 42% of the retail grocery sector is controlled by Loblaw, whereas the largest sector in the United States is Walmart, with 11%.

However, the Conservatives will never be heard talking about the massive profits that are being made by oil giants or by the grocery retailers. I am wondering what the member's comments on that would be.

[Randeep Sarai, Liberal, Surrey Centre, BC]

Mr. Speaker, it would be very difficult for them to say because the chief adviser in their Conservative caucus was considered, currently, before or after, by a side company, a sister company, I do not know exactly, but she is paid as a formal lobbyist for that very dominating grocer in the House. It becomes difficult for them to challenge when they are paid and supported by that particular organization.

I will leave it at that.

[Robert Gordon Kitchen, Conservative, Souris—Moose Mountain, SK]

Mr. Speaker, it is good to see that, even at this late hour, we still have people here intending and trying to learn from the incompetence that the present government is showing.

With the holiday season upon us once again, oh, we need to hang on a sec; I wrote this speech back in December, and the holiday season was upon us at that point in time. However, it shows the incompetence we see from the government that it has taken six months to get to this stage. It is interesting that when we look at things where things are being tabled, I guess we consider the holidays. In some ways, I am not being wrong when I say the holidays, because we do have Victoria Day coming up within a week, or as they say here in Ontario, May Two-Four day. It is a holiday that is coming, so I guess I am not being incorrect in that statement.

Now, Canadians all across the country are feeling the financial pinch, and many of them are trying to save money in any way they can. Unfortunately, the same cannot be said of the Liberal government, which continues to increase spending and taxes on the backs of middle-class people, as outlined in the fall economic statement. After nine years under the Prime Minister, Canadians are struggling while the government just keeps getting richer. We see this struggle in many different areas. Food bank usage is up across the country, with a record two million visits occurring in a single month, and that is projected to be increasing by another million.

First of all, I would like to thank the Salvation Army, which does a tremendous job in helping our Canadians with raising food for the food banks, helping to feed Canadians and stepping forward and stepping up. I know the Salvation Army was here this past week. I would also like to thank all Canadians who step up and contribute to these food drives and assist Canadians, because what we need is showing where Canadians are working for Canadians.

Unfortunately, as I said, we cannot say where the government can continue to increase spending and taxes on the backs of these middle-class people, and this is outlined in the Liberals' fall economic statement. After nine years of the government, we have seen that the cost of groceries continues to go up, and over 50% of Canadians are $200 or less away from going broke. The situation is alarming, and one would expect that a responsible government would introduce measures to address this, but no. Instead, the Prime Minister has announced more than $20 billion in new inflationary spending in the fall economic statement, and this will continue to keep inflation and interest rates higher than Canadians can afford.

Sadly, this does not come as a surprise to anyone who has been paying attention to the government's dismal history when it comes to managing the finances of this country. I will read from an article from The Globe and Mail, which says, “Every time the Liberals update the country on the state of its finances, it is accompanied by pages of prose [141 pages, to be exact, in this situation] trumpeting the government’s devotion to fiscal restraint. And yet, every time, spending somehow ratchets higher.” One need only glance at the projected deficits to see that this is true.

Let us go back in time to touch on budget 2023, where the finance minister said that the deficits for the next four years would be as follows: $35 billion, $26.9 billion, $15.7 billion and, finally, $14 billion in 2027-28. Let us keep in mind that those projections were made over a year ago, and not much has changed with respect to Canada's fiscal landscape since then. Now, let us take a look at the new deficit projections from the fall economic statement. It states that we will have a $38.4 billion deficit in 2024-25, then $38.3 billion, then $27.1 billion and, finally, $23.8 billion in 2027-28. This is an average of about $9 billion more per year. In what world is that considered fiscally responsible or showing restraint, as the Liberals would like us to believe? How is that possible?

In fact, with the BIA, which we are debating right now, we now have a better idea of what the national debt numbers will be. Remember that the national debt, back in 2015, when the Liberal government came into power, was just over $600 billion. In 2023, the government showed it to be $1.1 trillion. That 0.1 is $100 billion. When we put it in that perspective and look at this, people need to finally wake up to what those costs are. According to the statement in the fall economic statement, it will be $1.2 trillion.

As for this budget that came forward just now, the 2024 budget, which was supposed to be there to help generation Z and the millennials, when one looks at what that projects the national debt will be for 2025-26, is projecting it to be $1.5 trillion. That is a $200-billion to $300-billion increase. How is that helping generation Z and millennials? That is adding $300 billion-plus onto the debt, which they are going to have to pay at some time. How is it going to happen?

As for what this government is doing, it is upping the credit limit, and it is increasing it to $2 trillion, more than we have, and continuing. How is that teaching gen Z and millennials, or even anybody, how to save money? How can they afford to survive? We are not teaching them a thing, and this from a government that campaigned back in 2015 on having just two $10-billion deficits. That is simple math. It is not hard to figure out, but when it was $600 billion, assuming that they had two $10-billion deficits, our deficit should only be $620 billion. Those numbers do not seem to add up.

Furthermore, while the annual government revenue projections are to be $6 billion higher because of their inability to control Canada's debt, interest costs have skyrocketed and will have doubled in the last two years. Here are the budget projections for interest charges on the federal debt of budget 2023: $46 billion for 2024-25, $46.6 billion for 2025-26, $48.3 billion for 2026-27 and $50.3 billion in 2027-28.

Let us compare those interest figures with the new updated projections from the fall economic statement, where we have $52.4 billion in 2024-25, $53.3 billion and then $55.1 billion, ending with $58.4 billion in 2027-28. Interest costs are now the highest they have been in a decade, and the Liberals have no plan whatsoever to remedy this. This eats up and consumes the $6 billion in increased revenue I previously mentioned. That is net-zero increases.

To put this into perspective, the Prime Minister has allowed the interest costs for the federal government to run so high that the amount is now double what it spent on national defence, and it will be more than the federal government spends on health care next year, which is evident in our 2024 budget, where the interest rates that are being paid are higher than the total amount we would spend on health care.

This means that, instead of taxpayer money going toward our doctors and nurses, it will be spent on servicing a debt that should never have been this high in the first place. The government cannot be trusted to do what is in the best interests of Canadians, and it is time for a new Conservative government that truly understands what responsible fiscal management means.

The House resumed from May 9 consideration of Bill C-59, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023 and certain provisions of the budget tabled in Parliament on March 28, 2023, as reported (with amendments) from the committee, and of Motion No. 1.

Fall Economic Statement Implementation Act, 2023

[Chandra Arya, Liberal, Nepean, ON]

Madam Speaker, I am pleased to speak on Bill C-59, an act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023, and certain provisions of the budget tabled in Parliament on March 28, 2023. The bill would advance the government's economic plan to make life more affordable, build more homes faster and build an economy that works for everyone.

To build an economy that works for everyone, the bill delivers critical pieces of our fall economic statement. It would help make life more affordable. We are rolling out new measures to strengthen our economy, combat climate change and forge excellent career opportunities for Canadians, now and in the future.

The Liberals' plan is already yielding results and we continue to push forward. We are advancing Canada's clean economy with a clear timeline for deploying all investment tax credits by 2024. We are launching the Canada growth fund as the primary federal issuer of carbon contracts for difference. We are progressing the indigenous loan guarantee program.

Canada's economic prosperity increasingly depends on a focused strategy to boost growth, particularly in a globally competitive environment. The nation's future success relies on enhancing productivity, innovation and investments in pivotal sectors, such as technology, clean energy and advanced manufacturing. These fields are vital not only for generating high-quality jobs but also for maintaining Canada's competitive edge internationally.

Additionally, empowering small and medium-sized enterprises with supportive policies and tax benefits is crucial to foster entrepreneurship and economic expansion. Equally critical is attracting and retaining top talent. Policies that encourage skilled immigrants to settle in Canada, coupled with significant investments in the education and training of Canadians, are essential to develop a workforce capable of leading in a high-tech, competitive global market.

Canada stands out among G7 countries for maintaining the lowest deficit and net debt-to-GDP ratios, showcasing exceptional fiscal management. This indicates a more sustainable economic position compared to other G7 countries like the U.S., U.K., Germany, France, Italy and Japan, which generally face higher debts and deficits relative to their GDPs.

This fiscal prudence in Canada supports economic stability and investor confidence. Canada's strategic financial policies enable it to better manage economic fluctuations and invest in future growth.

Among G7 nations, Canada's credit rating is ranked near the top. Major credit rating agencies frequently cite Canada’s prudent fiscal policies, low debt-to-GDP ratio and robust institutional framework as key factors supporting its high rating. This strong credit status enhances Canada's ability to attract foreign investment and borrow at lower interest rates, significantly benefiting the economic environment relative to other G7 countries.

On advanced technologies like artificial intelligence, our approach in promoting reflects a robust and proactive strategy aimed at both fostering innovation and ensuring responsible development within the sector. Canada is globally recognized for its influential role in the artificial intelligence sector, distinguished by its significant contribution to AI research and development.

The nation's focus on AI underscores its dedication to technological progress and strategic economic integration. Leading the way in AI innovation are Canadian universities and research centres, which are vital in producing cutting-edge research and attracting international talent. AI's relevance to the Canadian economy is substantial, serving as a key economic engine.

This is supported by major governmental investments, including the $2-billion artificial intelligence compute access fund and the Canadian sovereign compute strategy, aimed at equipping Canada with the infrastructure and resources needed to sustain its competitive advantage in this critical field.

Artificial intelligence technologies in Canada find applications across diverse sectors, such as health care, environmental protection, agriculture, manufacturing and finance, promising to elevate productivity, competitiveness and job quality. For the companies in these sectors to adapt these AI technologies in their operations, we have provided $200 million. By proactively enhancing its AI ecosystem, Canada not only bolsters its global stature but also secures its economic future, positioning AI as a fundamental pillar of its national strategy for long-term growth and innovation.

Canada is strategically established as a significant contributor to the global supply chain for the critical minerals necessary for manufacturing advanced batteries in electric vehicles and energy storage systems. The country's abundant resources of lithium, cobalt, nickel and graphite make it a key player in the clean energy transition.

In response to the growing importance of these minerals for the global economy and environmental sustainability, we are actively expanding our mining and refining capabilities. This enhancement not only meets domestic demands for EV production but also serves international markets, especially those transitioning to greener technologies. We support this sector with favourable policies, substantial investment and collaborations with private companies and international partners. These initiatives aim to create a secure, sustainable and competitive supply chain that utilizes Canada’s natural resources responsibly.

Additionally, we prioritize partnerships with indigenous communities in mineral resource development, promoting inclusive growth and sustainable practices, thereby reinforcing Canada's reputation as a reliable and ethical source of critical minerals internationally. We are also promoting “one project, one environmental impact assessment” to speed up the implementation of projects.

Our strategic focus on economic growth ensures the sustainability of social programs and the continuation of high living standards amid an uncertain global landscape. After a contraction of 0.1% in the third quarter of 2023, Canada's GDP rebounded with 0.2% growth in the fourth quarter. In February, Canada's inflation rate was 2.8%, down from 2.9% in January. It rose slightly to 2.9% in March, roughly in line with the Bank of Canada's forecast.

Statistics Canada reported today that the economy added approximately 90,000 jobs, far exceeding the anticipated 20,000 positions. This marked the most robust month for job creation since January 2023. Nevertheless, the unemployment rate remained constant at 6.1%. These figures indicate that employers are ready and capable of hiring additional staff, despite the economic challenges posed by increased interest rates.

Bank of Canada governor Tiff Macklem has mentioned a possible rate reduction as soon as June. I have been saying for the last 12 months that we will see interest rate reversals starting mid-2024. Recent months have seen quicker-than-expected easing of price pressures, boosting the Bank of Canada’s confidence that inflation is returning to target levels.

The current high interest rates, which aim to curb borrowing and cool inflation by making debt more expensive, may not need to be maintained much longer. We are achieving a soft landing of the economy, though many had predicted we would fall into recession.