Bill C-8

Economic and Fiscal Update Implementation Act, 2021

An Act to implement certain provisions of the economic and fiscal update tabled in Parliament on December 14, 2021 and other measures

Part 1 amends the Income Tax Act and the Income Tax Regulations in order to
(a) introduce a new refundable tax credit for eligible businesses on qualifying ventilation expenses made to improve air quality;
(b) expand the travel component of the northern residents deduction by giving all northern residents the option to claim up to $1,200 in eligible travel expenses even if the individual has not received travel assistance from their employer;
(c) expand the School Supplies Tax Credit from 15% to 25% and expand the eligibility criteria to include electronic devices used by eligible educators; and
(d) introduce a new refundable tax credit to return fuel charge proceeds to farming businesses in backstop jurisdictions.
Part 2 enacts the Underused Housing Tax Act . This Act implements an annual tax of 1% on the value of vacant or underused residential property directly or indirectly owned by non-resident non-Canadians. It sets out rules for the purpose of establishing owners’ liability for the tax. It also sets out applicable reporting and filing requirements. Finally, to promote compliance with its provisions, this Act includes modern administration and enforcement provisions aligned with those found in other taxation statutes.
Part 3 provides for a six-year limitation or prescription period for the recovery of amounts owing with respect to a loan provided under the Canada Emergency Business Account program established by Export Development Canada.
Part 4 authorizes payments to be made out of the Consolidated Revenue Fund for the purpose of supporting ventilation improvement projects in schools.
Part 5 authorizes payments to be made out of the Consolidated Revenue Fund for the purpose of supporting coronavirus disease 2019 (COVID-19) proof-of-vaccination initiatives.
Part 6 authorizes the Minister of Health to make payments of up to $1.72 billion out of the Consolidated Revenue Fund in relation to coronavirus disease 2019 (COVID-19) tests. It also sets out reporting requirements for the Minister of Health.
Part 7 amends the Employment Insurance Act to specify the maximum number of weeks for which benefits may be paid in a benefit period to certain seasonal workers.

Economic and Fiscal Update Implementation Act, 2021

[Fraser Tolmie, Conservative, Moose Jaw—Lake Centre—Lanigan, SK]

Mr. Speaker, I thank my colleague for his comments concerning Veterans Affairs and the challenges that francophone veterans are facing with the backlog. I find that unacceptable. If people have served in our forces, it does not matter if they are men or women, or English or French. They have served this country. They deserve and are entitled to fair treatment and fair service. I want people to please know that when we sit at committee, we will be fighting against that poor service and backlog. I am very disappointed that that is a challenge we are facing.

With regard to municipal taxation, I am a former mayor of the city of Moose Jaw. What happens is that the municipality gets 8% of tax revenue. That same taxpayer is paying 92% to the federal and provincial governments. Municipalities deal with cleaning garbage, paving roads, providing parks and all those essential things, as well as infrastructure required so that Canadians can get to their workplaces and have a healthy lifestyle.

There is overreach. We continually see an overreach by the Liberal government in everything, whether it has been the municipality tax or the Emergencies Act. It is always overreaching and always overstepping the mark.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Speaker, it is great to be here this morning talking about government spending again. Spending is something the government knows how to do very well, and it has been very actively spending taxpayers' dollars as it sees fit, as if it is the government's own slush fund. I am here to speak against Bill C-8, because some of that bill would actually do the exact same thing that has happened before.

Let us review what is going on in the Canadian economy as we speak today. Typical housing prices have gone from $345,000 to $810,000 in the biggest one-time gain of all time. Newly created government cash, $400 billion, was pumped into the financial markets, and a lot of that money went into high-risk mortgages at rates less than inflation. Those are concerns that Canadian taxpayers should have going into the future, because we are insuring a lot of those high-risk mortgages. We are seeing the price of food going up, and that is something I hear of quite often. The price of chicken, for example, is up 6.2%, beef is up 12%, bacon is up 20% and bread is up 5%. Those are old numbers. Those numbers are no longer relevant. We could almost double them today and that is what we would see when we go to buy things at the grocery store.

Inflationary pressures, not COVID pressures, are starting to become a major factor in what Canadians are facing moving forward.

We see the economies opening up here in Canada. Saskatchewan has been open for literally over a month and a half. Masking mandates have been removed and vaccine passports have been removed. Canadians are getting back to business, except for federal employees who, for one reason or another, decided not to be vaccinated or not to reveal their status. Those people are still sitting in unemployment lines or have been laid off or fired. It is really sad when we look at the history of these people and what they have contributed to our economy and to our civil service. These are penitentiary guards and other federal workers who have given their hearts and souls to their jobs, only to be told, because they did not release their medical status, that they were no longer needed or wanted.

It is amazing to lose people with that type of skill set and that experience at this point in time, in a situation where we have unemployment. People are demanding and looking for labour. The government is going to have a huge problem filling the shoes of those people who have left.

I think the government has forgotten history, and I am going to go on a trip down memory lane, just as I did last week when I was talking about our motion to look for a way back to a balanced budget. The government has not remembered the mistakes of the past. It has not talked to former Liberal members who went through the process of trying to actually balance the budget after they were told they had to.

Let us go back to the 1990s. Let us look at the situation in 1992 and 1993. All of a sudden, the warning signs were going off. We had inflation. We had gone through a period in the eighties when, if someone got a mortgage at 14%, they were excited. I can remember buying my first house. I was excited. I got a mortgage at 14%. Now, if I cannot get a mortgage at 2.5% or 3%, I am mad. That really tells us the difference between where we are sitting right now and where we are possibly heading again.

We saw rapid inflationary pressures. We were seeing oil and gas pressure. The Canadian economy was showing strides. If someone had a job, they were excited. When I was coming out of high school in 1984 or 1985, if I got a job at McDonald's I was taking it, because there were not a lot of jobs to be had. A lot of people flocked to university, just because they had no options other than continuing to go to school. There were no jobs to be had.

In 1994, Moody's investors lowered our credit rating. In 1995 and 1996, we had more people jumping on that and saying that Canada needed to do something, and in 1996 Jean Chrétien and finance minister Paul Martin had to go through the process of making decisions they did not want to make. They were decisions I hope no future governments will ever have to make. The federal government, for example, wanted to block transfers to the provinces. It cut health care funding substantially, compared with 1993 levels, and those levels did not return to normal, or 1993 levels, until 2004. It took that long to get things back in order so that we could actually start putting more money back into our health care system.

Basically, we saw a situation where people were looking at the economy and were in dire need, and there were just no financial resources there to help them out. We had spent the cupboard bare, and the government had to make all sorts of difficult choices, both at the federal and provincial levels, to pay back the excess of borrowing that happened in previous governments, such as the Trudeau governments of the early and late seventies. I do not want to see that repeated. I do not want to see that handed on to my kids or my grandkids. Hopefully I will have grandkids somewhere down the road.

We are spending a lot of money. We are seeing inflationary pressures and all sorts of instability around the world. We are spending our reserves, which we may need to save for another rainy day, like we did when COVID-19 first hit or when we had the great recession of 2008. At that time, we had the fiscal capacity to spend some money and strategically use it in such a way to advance our communities and help things that needed to be done get done earlier so we could get back to balanced budgets in 2015. Now we are seeing the government spending like crazy.

Part of it is okay. I have to admit that part of it is fine. Supporting people during the time of COVID-19 was important. We had to be there for people. I think all parties agreed with that. However, now as we get out of COVID and start looking into the future post-COVID, all of a sudden we have not learned a lesson and we continue to keep spending and spending. We have to wonder: What is the role of taxpayers? Are taxpayers really on board with this type of spending? If we go back to the last election, they did not vote for a coalition government. They did not vote for a new dental care program or a new pharmacare program. They did not vote for a coalition government. If we asked them that today, they would be totally against it, and it would have changed their voting habits in the last election.

When we look at the costs of these types of programs, one has to wonder: Who is going to pay for them? How are we going to pay for them? There are some options. If we want a dental care program or health care program, there are options to pay for that. One of them is to quit shutting down the industries that actually would pay for it, like the oil and gas sector, for example. We have the safest and most ethical oil and gas in the world. We just need to get it to market. By getting it to market, we would have royalties that could be used to keep our deficits low, pay for services like a dental care program, increase funding to health care and education and transition to a green economy, which is somewhere we all know we have to go. However, our transition is not going to be paid by royalties off oil and gas; it is going to be paid off with deficits and debt.

The Liberals call this investment. That is fine, but in the same breath, why are we borrowing money when we have the ability to raise the money? That is what drives me and a lot of Canadians crazy, because they see opportunities for the government to get this economy going and what does it do? It brings in regulations and policies that slow or shut it down. It brings in policies that are not being followed anywhere else in the world and it is putting Canadians through restrictions that nobody else has to face.

A classic example is the oil and gas regulations for the environment we have here in Canada, and our friend President Biden and the regulations he put in place. If he was so in favour of what we have done in Canada, why did he not copy us? Why did he not bring in our regulations? Why did he not bring in the exact same regulations we have here? Has he done that? Is he going to do that? The answer to that is no, because he will not risk the U.S. economy in light of what he needs to do in moving forward with electronic vehicles or the green economy. He is not going to throw that away. He is basically going to try to do both at the same time, which is what Prime Minister Harper was trying to do. He was balancing the economy and the environment together.

We can look at other sectors. If we talk to those in the manufacturing sector, they are saying we are losing manufacturing left, right and centre. They are saying nobody is reinvesting in Canada because it is too expensive to operate here in Canada. I was in the U.S. two weeks ago and had some closed-door meetings with some senators. They were saying the reputation of Canada being a great member of the supply chain is at serious risk. They were saying that we cannot seem to get it together and that we do not have the ability to be part of a supply chain anymore. They said we are great for one-off purchases, but if we want to part of and embedded in the supply chain, we need to improve our border efficiency, our reliability and our tax structure. Not all of these are federal problems; I will agree with that. Some of them are municipal and some are provincial. However, we need to get to work on them, and that is where we need to focus.

When we look at things we could be spending money on, things that could grow our economy and make things grow stronger, that would be wise to consider. More importantly, we need to be smarter and more proactive. Let us spend money where it is needed and required immediately, not chase new dreams and new structural deficits and debts that will leave our kids basically out in the cold, making the exact same decisions that Paul Martin and Jean Chrétien had to make. Even Ralph Goodale was part of that role.

I encourage the Liberals to talk to some old Liberals. I think a lot of the old Liberals, like Dan McTeague, would say, “What is this party?” [Technical difficulty—Editor] what the government has been doing. They would not endorse it. They would not say this is a prudent way forward. They have the scars of going through the 1995-97 cuts and have experienced that. Let us not make the same mistakes. Let us learn from history. Let us move forward and do it in a prudent, proactive way.

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

Mr. Speaker, regarding Bill C-8 and, obviously, the significant impact it would have on our country and our fiscal situation, I would like to ask my colleague's opinion. The Liberals have an opportunity to vote in favour of a Conservative motion here this afternoon that would provide some important context to address some of the fiscal realities that our country is facing. I wonder if my friend and colleague could comment on that vote, which will take place just after question period.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Speaker, I think a lot of people are following this vote very closely because it sends a signal to Canadians about how, and whether or not, the government is going to act responsibly. Having a game plan on how we are going to pay back our debt or get to a zero deficit is not a bad thing. Having a strategy in place to say this is our focus as we go out of the COVID world into an economy that is possibly facing another global war with what we are seeing in Ukraine and Russia is probably a good thing. Actually making sure that we have our ducks in a row physically and financially is very important.

Canadians want to see that out of the government, but right now what they are seeing out of the government is confusion. They are seeing a lot of spending. They are seeing a lot of untargeted hyperopia on things the government wants to do moving forward, but nothing that really focuses on Canadians to actually set their families up for the future, and nothing that will prevent our kids from making the horrible decisions the Liberals made in 1995-96 because of the irresponsible spending before them.

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

Mr. Speaker, I thank my colleague for his speech.

I am a bit surprised to hear him argue against dental care. I would imagine that getting reimbursed for dental care would save people in his riding a lot of money.

However, I would also suggest to him that, if we want to pay for new services, then we need to go and get the money where it can be found.

What does my colleague think about a special tax on the indecent profits being made by the big banks? They made $60 billion in profit last year, which represents an increase of 40% in just one year.

Why not tax the super-rich and corporations like banks that make outrageous profits?

[Randy Hoback, Conservative, Prince Albert, SK]

Madam Speaker, the hon. member makes an excellent point. One would think people in Saskatchewan want dental care, and yes, they do, but they do not want to burden their kids with all sorts of expenses they cannot afford. This is a structural change in government spending, so we need tax revenue, not just today but in the future, to pay for it. How are we going to do that? We just shut down the oil and gas sector and we just heard from the manufacturing sector that it is leaving, so what are we going to do? My suggestion, if we want a dental program and pharmacare program, is to maybe get the cash first. Maybe pay for it instead of financing it through deficit and then waiting for somewhere down the road to pay for it.

We talk about the big banks and the people who make tremendous amounts of money with their corporations. Proper taxation is very important, no question about it, but keep in mind that when a big bank makes money, what does it do? It pays out dividends. What do shareholders do? They reinvest it back into the Canadian economy. They buy things, or they borrow from the bank and use the money in their business to function their operating capital. If we want to have fair taxation rates for banks, let us talk about that; let us make that part of the debate. However, why not raise that money first before we start committing Canadians to a structural expense that they may not be able to afford?

[Denis Trudel, Bloc, Longueuil—Saint-Hubert, QC]

Mr. Speaker, the Intergovernmental Panel on Climate Change, the IPCC, released a report this morning at 11 a.m. I would like to know what my colleague thinks about it.

For example, the report states that projected carbon dioxide emissions from existing and currently planned fossil fuel infrastructure exceed the total emissions that would limit global warming to 1.5 degrees Celsius. That is a big deal.

Furthermore, the IPCC calculates that, by 2050, the equivalent of $1 trillion to $4 trillion U.S. in fossil fuels must be left in the ground to limit global warming to 2 degrees Celsius.

I would like to know what my colleague thinks about that.

[Randy Hoback, Conservative, Prince Albert, SK]

Mr. Speaker, well, I have not seen the entire report so it is hard to comment, but with regard to his comments about fossil fuels and keeping them in the ground and emissions, let us talk about a few things. First of all, this is a global crisis, and where is the most environmentally friendly fossil fuel in the world? It is in Canada. If we want to shut down the Canadian industry, okay, shut that down, but it is going to get replaced because people are still burning fuel. What the Europeans found out when they could not get oil and gas from Russia is that they are still burning fuel, so where is it going to come from? It is the areas that are not environmentally friendly, which will actually increase the speed of carbon emissions in the world and provide cheap, dirty, unethical oil all over the world.

We have a choice to make, and it is a very clear choice. We can have energy security here in Canada, with a very safe, green, ethical fund growing in Canada's oil and gas sector, whether it is in Newfoundland, Alberta or Saskatchewan, or we can get oil from Venezuela or from third-world dictatorships like Russia. What do we want? We have to decide, because right now the decisions that are being made do not make a lot of sense.

[Ed Fast, Conservative, Abbotsford, BC]

Mr. Speaker, my colleague for Prince Albert has it right. Canada is the place where we should be investing. We should be harnessing the power of our energy sector to get clean energy to the rest of the world. Unfortunately, the NDP-Liberal coalition government does not understand that.

We know that this Thursday, the NDP-Liberal government is going to be tabling its 2022 budget. Quite frankly, based on the government's track record these past seven years, I expect it will again fail to meet the expectations and aspirations Canadians have for their future. For two long years, Canadians have been resilient, hoping to see a return to normal once mandates began to lift, lockdowns were lifted and Canadians were vaccinated, but instead, Canadians are struggling more than ever due to a soaring consumer price inflation rate, which stands at 5.7% today and is going up. In fact, the Governor of the Bank of Canada has suggested that it is going to get worse before it gets better, and Canadians have a right to be concerned. They see inflation at a 30-year high and skyrocketing housing prices, which have exacerbated the mess that our Liberal government has made of the economy.

Economists have been warning for well over a year that there was an inflation crisis coming, yet the experts in our government assured us that inflation was transitory and there was nothing to see here. Meanwhile, hundreds of billions of dollars in special stimulus, as the Prime Minister called it, was being pumped into our economy. Of course, those were taxpayers' dollars, and they were beginning to flood into our economy, with the excess cash driving the inflation rate and driving up the cost of everything.

The Conservatives had warned the finance minister that out-of-control borrowing and spending without a plan to return to balanced budgets and a plan to manage the massive debt the Liberal government was leaving behind would leave future generations of Canadians to pay for this mess, this huge albatross hanging around their necks, going forward. However, we understand why this has happened. It is because, as members know, the Prime Minister said that he does not think about monetary policy. For the leader of this country not to care about monetary policy and its role in driving inflation in this country is appalling.

When I have an opportunity to continue my speech after question period, I would love to elucidate and expand on those comments.

The House resumed from April 4 consideration of Bill C-8, An Act to implement certain provisions of the economic and fiscal update tabled in Parliament on December 14, 2021 and other measures, as reported (with amendment) from the committee, and of the motions in Group No. 1.

Report Stage

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Mr. Speaker, as the member of Parliament for Renfrew—Nipissing—Pembroke, I welcome this opportunity to put the observations my constituents share with their MP on the public record. I am their servant. While the bill may have many parts, I intend to focus on the sections relevant to Canadians.

With Liberal inflation, tax cuts are non-existent. With Liberal inflation, house prices will keep on rising. This will fuel more Liberal inflation, which in turn raises house prices even higher. It is a vicious circle.

What started this cycle? This cycle was started by huge deficits commencing back in 2015 after the federal election. The Conservatives do not blame COVID-19 pandemic mitigation measures, which we supported. The Prime Minister's inflationary deficits have been a signature policy of the government since long before COVID-19 hit. In fact, billions and billions of deficit dollars are being spent on things unrelated to the pandemic.

In the case of defence spending, the Parliamentary Budget Officer has identified billions in borrowing that are unaccounted for. Taxpayers’ dollars are being poured down a black hole, but this socialist government refuses to tell Canadians what that spending is for. Canadians have a right to know how their tax dollars are being spent.

When the NDP-Liberal socialist alliance inflates the monetary base, it is effectively devaluing the spending power of the money people have. By devaluing that spending power, it is actually hurting the people who have to spend that money on basic goods. The only way to get ahead of the inflationary spiral is to quit printing money. By continually printing money, which is called running a deficit, our currency is debased. This leads to greater deficits and more Liberal inflation. This in turn makes everything more unaffordable.

Canadians who contact me are fearful about any Liberal plan to implement an electronic currency, or e-currency. They have no confidence that the money they earn and the money they save will keep its value. My constituents have read about negative interest rates, the seizure of bank accounts and social credit scores that Communist China keeps on its citizens, and they do not like what they hear. Accounts can be seized with the stroke of a keyboard. Just ask any “freedom convoy” supporter.

Canadians who contact me tell me how divisive to society these socialist policies are. Since 2015, the gap between the rich and the poor in Canada has actually widened. Nowhere has this policy failure been more evident than in the rise in the cost of a single-family home. This is a big problem. Unaffordable housing prices are a direct result of the NDP-Liberal socialist coalition’s monetary policy. Blaming the Russians, Chinese, new immigrants, unseen foreigners or whoever else the socialist coalition wants to reserve this week’s two minutes of hate for is divisive, hateful and just another diversionary tactic to draw attention away from the real problems Canadians face.

Young Canadians who call me simply expect a fair chance. They would like to believe that Canada is a country in which hard work and savings are realistic paths to home ownership. Young people in Renfrew—Nipissing—Pembroke want affordable housing where they can raise families, while not losing more than half of their paycheques each month to put a roof over their heads. Seniors want to grow old living in their own homes. This is not an unrealistic ask in a functioning democratic and free-market society.

The socialist coalition wants to move away from this successful model. Since the government came to power or shortly thereafter, six years ago, the average price of a family home in Canada has shot up 87%. In 2016, the average price of a new house was $476,000. It is now $811,000, according to the Canadian Real Estate Association. What was the coalition's response? It was another tax.

Starting in the 2022 calendar year, Bill C-8 will charge a 1% federal surtax on non-resident owners of passively held real estate in Canada. That means even Canadians who own a home but live abroad for work are going to pay an extra 1% annually on the value of their home back here. It is like a municipal tax for those people who own property or their own single-family home, only the money goes to the feds. I am still waiting for a credible explanation of how this will create more affordable housing.

The proposal is troubling in other ways. Taxing properties is municipal jurisdiction. Municipalities in my riding of are having serious financial difficulties. Now the federal government wants to pick their pockets too.

Interfering in property tax is a serious mistake. It sets a dangerous precedent of interference from the federal government. Municipalities in the counties of Renfrew—Nipissing—Pembroke charge a range of development fees. In Arnprior, development charges for a single or semi-detached dwelling run around $16,000. In Renfrew, it is $9,000. In Petawawa, development charges are over $6,000. In Cobden, the cost is roughly $5,800, and it is under $4,000 in Pembroke.

Six municipalities in Renfrew County do not charge development fees: Admaston/Bromley; Bonnechere Valley; Laurentian Hills; North Algona Wilberforce; the township of Killaloe, Hagarty and Richards; and the township of Head, Clara and Maria.

In a recent presentation to county council, which is looking to increase development charges, fees in the rest of Ontario were examined. Some counties across Ontario charge almost $25,000 in development charges for a single detached or semi-detached dwelling. Others, such as my neighbour to the south, Lanark County, charge on the lower end of the scale at roughly $1,500 for development charges on a new residential home.

The federal government needs to be working in co-operation with municipalities to help them decrease development fees. Only by increasing the housing supply will prices stabilize. Residents in Renfrew—Nipissing—Pembroke are very concerned about the planned home equity tax. That is another idea that undermines the municipal property tax base.

With record sales, high prices for real estate, and the recent disclosure about CMHC funding studies to look at ways to raise revenues by taxing principal residences, Canadians have every right to be skeptical when half-hearted denials are made by the federal government. Canadians will have to wait and see when a new federal home equity tax, currently under consideration, will be implemented.

The House resumed from April 28 consideration of Bill C-8, An Act to implement certain provisions of the economic and fiscal update tabled in Parliament on December 14, 2021 and other measures, as reported (with amendment) from the committee, and of the motions in Group No. 1.

Economic and Fiscal Update Implementation Act, 2021

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Madam Speaker, it is always such an honour to rise in this place and speak on behalf of my community of South Shore—St. Margarets.

Today, we are debating the report stage of Bill C-8, an act to implement certain provisions of the economic and fiscal update tabled in Parliament on December 14, 2021 and other measures, in other words, more government spending on COVID‑19. Let us look at the NDP and Liberal COVID spending to date in this bill. The fall fiscal update added another $70 billion in new spending, and this spending is on top of that. The $70 billion I mentioned does not even include the Liberal campaign promises, which would be tens of billions more if, and that is a big if, the NDP-Liberal government lives up to their campaign promises and their coalition. The bill is going to add $70 billion on top of what we saw in the public accounts, the $1.4 trillion of debt that Canadian taxpayers are now on the hook for. Let us think about that: $70 billion more, on top of the $1.4 trillion that has already been added until now.

It is said that one should know history so one does not repeat it. I guess the current government does not know history, because if it did, it would see that the son is repeating the mistakes of the father. To understand the context of what this bill and this spending's impact on the economy will be, let us take a look at what the father did. It tells us what the country will face in the coming years because of the fiscal mismanagement of the son and the father.

In the federal election of 1968, Pierre Trudeau reassured Canadians that a Liberal government would not raise taxes or increase spending. The government, he said during the election of 1968, is not Santa Claus. How did that work out?

When Pierre Trudeau became prime minister, real government spending increased from 17% of GDP to 24.3%. In other words, the federal government's share of the economy rose 42% under Trudeau senior. Every single area of the federal government's spending increased under Trudeau senior, except defence spending, where he cut spending in half as a percentage of the budget. When Pierre Trudeau took office, we spent more on national defence than we did on servicing the country's debt. When he left office in 1984, for every dollar the government spent on defence, we spent three dollars on paying just the interest on his national debt.

How did he do it? He created 114 agencies and commissions. He created seven new government departments, for a total of 464 Crown corporations with 213 subsidiaries. The annual deficit rose to almost $40 billion. That does not seem so unreasonable, given what we have seen with the spending in this place lately. However, that $40 billion was on a base budget, an annual Government of Canada budget, of $100 billion.

I raise this because, as the adage goes, “Like father, like son.” Pierre Trudeau once said, “We're going to build socialism here.” Well, he did, and his son just formalized it.

People who grew up in the 1930s, such as Pierre Trudeau, saw Roosevelt's New Deal of massive government infrastructure spending to pull the U.S. out of the Great Depression. They thought that this approach in the 1970s would stimulate us out of the “stagflation” of that time, which was, for those who do not remember, high inflation combined with high unemployment and a stagnant demand in the economy. It was disastrous.

It was so bad that at one point Pierre Trudeau brought in wage and price controls. He said, “Zap, you're frozen”, and froze all wages and prices. When those socialist wage and price controls came off, the floodgates of wage demands and price adjustments went up even faster. By the time Pierre Trudeau left office, 38¢ of every dollar collected in taxes by the Government of Canada was to pay interest, and only interest, on the debt. The biggest single government program was paying interest on Pierre Trudeau's debt. The government in 1984 spent more on debt interest payments than it spent on defence spending and health care combined. Trudeau's policies of massive spending led to a rapid rise in interest rates to try to reduce inflation. All that government spending simply made it worse.

In the early 1980s, banks were creating home mortgages at 21% annual interest rates. When Brian Mulroney took office in 1984, and I joined that government as a young staffer, we had to break the cycle of spending and deficits that were killing Canada's economy and jobs. By 1987, Mulroney was managing the government in an operating surplus position, reversing the structural deficits created by the Liberals. The deficits after 1987 were entirely as a result of paying interest on Pierre Trudeau's debt.

The government remained in an operating surplus through successive prime ministers until the current Liberal government came to office. The Mulroney government reined in spending and fundamentally restructured the economy with a new vision to deal with the economics of the day. There were fundamental changes, such as a complete restructuring of Canada's financial services industry; the first introduction anywhere in the world of free trade, which did not exist anywhere before then; the replacement of the 13.5% manufacturers' sales tax with the 7% goods and services tax; the elimination of the national energy program and the job-killing foreign investment review agency; and, yes, the privatization of 23 Crown corporations, which I was proud to be a part of, including Air Canada.

The Chrétien government continued this work with further cuts in government spending, although it took a different approach. It collapsed the separate unemployment insurance fund into the consolidated revenue fund, and then artificially kept payments high in order to build up a surplus that was not needed to pay unemployment insurance but was used to pay down the debt. It dropped the government spending on health care by 50%.

It took the governments that followed more than 25 years to break the back of Trudeau's disastrous spending, but he was a piker compared to his son, who has added more debt to Canada's national accounts in six years than all other governments since our founding in 1867. The son, in 2015, promised small stimulus deficits that would be balanced by 2019. Just like his father did in 1968, when he said he would not spend, the son promised the same thing in 2015. We know how that turned out.

The government spent $600 million on high school students living at home in its first round of COVID spending. The government also spent $11.8 billion on CERB for 15- to 24-year-olds who were living with their parents; $7 billion on spouses in households with more than $100,000 in earnings; $110 billion on the Canada wage subsidy. Some studies have found that the money did obviously go to struggling companies during COVID, but many were strong enough to withstand it on their own; 24% of that money went to companies whose revenue actually increased during COVID, and 49% to companies whose profits increased during COVID.

Spending more than $600 billion in two years, printing more than $3 billion a week in new money, has caused the structural inflation of almost 6% we now see. In the coming year or two, we will start to see wage inflation as a result of the way companies, both unionized and not, determine how their employees get pay raises, which is usually based on inflation. As publicly traded companies raise salaries at all levels, because consultants and their HR board committees will say they need to do so or risk losing their employees to other competitors, combined with the demands for CPI adjustments in union contracts, that is what is going to create wage inflation. We have not seen anything yet. Wage inflation will fuel further goods inflation as more dollars will flood the market chasing limited goods, which in turn leads to higher inflation.

The consequences of providing all these universal government COVID programs, pushing all this money into the economy at levels not needed, and now new social programs when the government is not even properly funding health care, will add to the structural deficit that the country has. The government has no plans to reduce the footprint of government in the economy, which means we are heading toward stagnation, a 1970s-type of situation.

I cannot support this bill, because Bill C-8 and the recently tabled budget will just make Canada's finances drastically worse. The NDP and the Liberals have not learned in their pact from what happened in the 1970s, and they had a pact in the 1970s, too. History is repeating. Like father, like son.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Madam Speaker, if the member for Carleton does ultimately become leader of the Conservative Party, there is no doubt he has a credible finance critic for the Conservative right. What we all just witnessed is that reform mentality, that extreme right, of just cutting everything. That is the type of opposition that we could be heading towards, so I wish him well in his future endeavours.

Is the position of the Conservative Party now that the expenses that were used to support programs, such as the wage subsidy and the CERB program, was money not well spent? Does he believe that we should not have ventured into that area?

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Madam Speaker, I am always intrigued by the interventions of the member for Winnipeg North, and I appreciate that he thinks I am a future finance minister. I hope he passes that on to the member for Carleton and others. Well, I promoted myself to government.

As members know, we supported those initial programs because of the speed with which the pandemic hit us. Absolutely, all of the parties supported it. However, after we reviewed them a month in, and we all recall that back then people thought it would be for a very short time, but it ended up being longer, and it was time for more targeted programs. It was clear that not all companies and all people were suffering at the same level during COVID. The government failed to do that, and that is the danger of universal social programs.