Evidence of meeting #24 for Environment and Sustainable Development in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was housing.
A recording is available from Parliament.
Liberal
Eric St-Pierre Liberal Honoré-Mercier, QC
The report highlights that DFAA, the disaster financial assistance arrangements program, provides financial assistance to provincial and territorial governments following disasters caused by natural hazards.
Would you say that most of those natural hazards are exacerbated by climate change? Can you quickly comment on the link between climate change and these natural disasters?
Interim Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
The short answer is yes. Climate change is increasing the frequency and severity of severe weather events. That, in turn, would increase the costs under the DFAA. Going back to an earlier comment made by my colleague, who is the expert in this specific area, a big increase in the cost, as well, has to do with housing price inflation, construction inflation, over time. It's increasingly expensive to build homes in the first place. Then to rebuild homes, that, in turn, is also driving up the cost, but certainly climate change and the increasing severity and frequency of weather events is a major driver.
Liberal
Eric St-Pierre Liberal Honoré-Mercier, QC
Thank you. I appreciate your thoughts there. I'll pick on the report again because I thought it was a pretty good report. It mentions that the federal costs under that program are increasing rapidly. I believe it's to the tune of $881 million per year, maybe—don't quote me on that. I think it's gone up to $1.2 billion per year from last year to 2035, I believe, which is a pretty significant increase.
What would you anticipate those costs to be going out to 2040 or even out further to 2050? Would you anticipate a significant increase annually as well?
Interim Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
Our forecast cuts off at 2035. If the committee is interested, we'd be happy to take the time to go back and extend the forecast.
I would say, going back to a point that one of the other members of the committee made earlier, we're dealing with a situation where, in comparison to a lot of economic and fiscal forecasting, there's a nice, relatively smooth, straight line going into history. We're dealing with an inflection point in these costs. Going out for 10 years, as you can see in one of the annexes of the report, we have a broad swath of potential outcomes. The uncertainty would increase substantially as you go forward.
Again, if there's interest and a motion from the committee, we're happy to go back and extend those numbers further.
Liberal
Eric St-Pierre Liberal Honoré-Mercier, QC
If it wouldn't be too much work, I'd love to see what those costs would be modelled out to 2050, just to get a sense. We often talk about climate change and climate mitigation policy, and often, the opposition will talk about the costs of climate policy. I'm curious about the costs of inaction, so I'd love to see some figures for 2050, if it's not too much work.
Going back to those costs—I believe they're $1.2 billion per year—would you say taxpayers are bearing the brunt of the costs of this program?
Interim Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
By definition, it's a federal program. People across the country ante up cash out of their back pockets, and they pay taxes to Ottawa. Ottawa then, in turn, appropriates the money to spend on federal programs, and that includes the DFAA. All of us, everyone across the country, are paying for it.
Liberal
Eric St-Pierre Liberal Honoré-Mercier, QC
Can there be a last question before the chair cuts my mic off?
Would you say industry or big polluters are bearing any of these costs? Maybe you could comment on the role of big polluters.
Interim Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
I think that's outside of the scope of the DFAA report, but thank you for the question.
Liberal
Eric St-Pierre Liberal Honoré-Mercier, QC
Ms. Withington, according to Statistics Canada data, which regions are the most affected by natural disasters? Can you quickly compare urban and rural data?
Assistant Chief Statistician, Economic Statistics, Statistics Canada
Rural areas are certainly more affected by flooding than urban areas. As I said, Manitoba and Alberta are the hardest hit by disasters. However, over the past year, we've had incidents across the country. Some provinces are more at risk. I think that British Columbia—
My time is up.
Assistant Chief Statistician, Economic Statistics, Statistics Canada
Yukon and British Columbia are more at risk.
Liberal
Bloc
Patrick Bonin Bloc Repentigny, QC
Ms. Withington, you said that 25% of households were affected by climate change. Were you talking about last year?
Assistant Chief Statistician, Economic Statistics, Statistics Canada
Yes. That was last year.
Bloc
Patrick Bonin Bloc Repentigny, QC
Can you share this information in writing, if you haven't already done so?
Assistant Chief Statistician, Economic Statistics, Statistics Canada
Yes. Certainly.
Bloc
Patrick Bonin Bloc Repentigny, QC
In 2024, there was a report on the impact of extreme heat events on mortality. Can you provide a brief summary of the public health challenges and costs associated with climate change?
Assistant Chief Statistician, Economic Statistics, Statistics Canada
Certainly, in terms of health impacts, we have studies looking at that. We have seen excess deaths due to the extreme heat from the period of 2000 to 2020. We're also looking at how those are being attenuated. I believe two-thirds of homes have air conditioning, and most Canadians in large cities are within a 15-minute walk of a cooling centre.
Bloc
Assistant Chief Statistician, Economic Statistics, Statistics Canada
Yes.
Bloc
Patrick Bonin Bloc Repentigny, QC
Thank you.
Mr. Jacques, I recently saw an article in The Guardian about a University of Exeter study. It talked about climate shocks, the impact on gross domestic product, or GDP, and the fact that the governments weren't planning for this, or at least they weren't integrating it enough into their economic model.
Are you looking into climate shocks? For example, in the United Kingdom, the Institute and Faculty of Actuaries is talking about a potential loss of 50% of GDP between 2070 and 2090. These forecasts seem quite high to me.
Are you working on models that take greater account of climate shocks and truly major events, such as the melting of Arctic ice?
Interim Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
As I said, we published a report in 2022. Based on the data that we used, we forecast an impact of around 6% of GDP.
