Thank you, Mr. Chair. I'm here today as chair of the government relations committee of the Canadian Retail Building Supply Council, an umbrella organization made up of five of Canada's regional and provincial building supply associations. Our pre-budget submission is supported by the Canadian Hardware and Housewares Manufacturers Association, and a letter to that effect is contained in our brief.
The CRBSC and CHHMA represent 2,300 companies that in 2009 employed 75,000 Canadians and generated some $83 billion in sales. Members include all major aspects of the building materials, hardware, housewares, and lawn and garden products industries. The contents of our submission reflect the views of 451 companies that participated in our pre-budget survey this summer.
The foundation of that submission is our statement that “the housing market, including renovations, should be regarded as an economic driver capable of generating tremendous returns not only for wage earners and businesses, but also for governments at all levels.”
This is an observation that CRBSC has consistently made in its pre-budget submissions to the standing committee. It was forcefully confirmed by the Canada Mortgage and Housing Corporation in its 2010 Canadian Housing Observer, released in late September. It reported that household spending totalled $307 billion in 2009 and accounted for 20.1% of total GDP. A major portion of that total came from new home construction, renovations, and resales.
Our brief referred to the CMHC's May edition of its quarterly national housing outlook, which estimated 679,300 total housing starts and resales that year. That total was revised downward to 648,700 units in the August 30 issue of that publication. Estimates for total starts and resales for 2011 remained unchanged at 632,000. These projections are broadly consistent with the results of our pre-budget survey. Our submission states that the standing committee should recognize that the outlook for the housing market through the end of 2011 shows no signs of robust growth.
In its report to the House of Commons, the standing committee should emphasize that low interest rates and strong levels of consumer confidence are the key determinants of both a healthy housing market and overall economic growth.
Of our retailer members and our supplier members, 91% and 78.7% respectively reported that the home renovation tax credit had a positive impact on their companies. While not recommending a resurrection of the HRTC, we do suggest that the standing committee bear in mind that in the event of another general business slowdown, the HRTC was an existing model for creating activity in the housing market to the benefit of the national economy.
Our submission recommends that the standing committee support two measures that would prove beneficial to the housing industry. First, the withdrawal limit of the first-time homebuyers program should be increased and its principle extended to include residential repairs and renovations. Our pre-budget survey demonstrated clearly that financial incentives are the best way to motivate Canadians to become more environmentally friendly as well, with education being the second most favoured method. Our second recommendation is to emulate the success of the Energy Star program with other initiatives to facilitate environmentally responsible consumer behaviour.
Much has been made of the estimate that the budget will return to surplus in fiscal year 2015-16. Much less has been said about the fact that, as the summary statement of transactions contained in the recent economic and fiscal update show, the federal debt will increase by $107 billion to $626 billion in 2015-16. Our final recommendation, therefore, is that a contingency reserve of at least $3 billion be reinstated as a budget line item commencing with Budget 2011.
Thank you for your attention to my remarks. I look forward to discussing them further with you.