Thank you.
I'm pleased to have been invited.
In a democracy, government budgets reflect democratic compromise. This is true in most western democracies where voters are proportionately represented in Parliament based on election outcomes. As we know, this is not true in the case of Canada, where 39% or 40% of the vote is usually enough to capture a majority of seats in Parliament.
Since the mid-1980s, Canadian minority governments with a majority of seats in Parliament have not simply allowed, but actually assisted, the redistribution of income from middle-income groups to higher income groups. When we compare ourselves to 15 wealthy western democracies, Canada ranks near the bottom in measures of income equality—in my brief I have a figure from the OECD showing that—and in measures of the role of government in assisting those in need. I have two figures in my brief showing that. Thus far, Canada is doing nothing to halt the upward redistribution of income and wealth. Government budgets, economic policies, and labour market policies are responsible for much of this upward redistribution of income and wealth. The result is an increasingly polarized society in which a minority of very high-income individuals, households, and neighbourhoods co-exist with an increasing majority of low-income individuals, households, and neighbourhoods. I have two figures that show this for Canadian metropolitan areas, where the middle-income group and middle-income neighbourhoods are becoming far less numerous than they have been in the past. Fortunately, these trends are reversible. They are not inevitable, but the outcome of choices we make annually in our federal, provincial, and municipal budgets.
I have three recommendations for doing better, starting now.
One, do not make income inequality and income polarization worse. Some examples are that we not double contribution limits to tax-free savings accounts; do not introduce income splitting; and do not allow the temporary foreign worker program to expand in large urban centres, which is where most foreign workers go. Toronto has 19% and Montreal and Vancouver have 10% each of the temporary foreign worker population. This program adds competition to the bottom of the wage spectrum, reducing the likelihood of wage gains at the bottom, which is where we need them.
Two, promote income equality by assisting with the biggest budget item for low-income Canadians, which is housing. First of all, simply spend the money already allocated for affordable housing; this is the $253 million annually that the federal government committed for investment in affordable housing programs, which is to be matched by provinces and territories, producing almost half a billion dollars annually. I understand there has been no allocation of this federal funding since the March 2013 budget. While occasional funding such as this is helpful, proper planning for meeting housing needs must begin by developing and implementing a national housing strategy. This should be done within one year in cooperation with the provinces and territories, municipal representatives, the private sector, aboriginal people, and NGOs.
Three, and finally, reduce income inequality by reducing poverty. For example, enhance the Canada Pension Plan; increase employment insurance payments and introduce new rules to make the system fairer for all Canadians; make major new investments in the working income tax benefit; introduce a national care agenda, including child care and elder care; and join with the provinces and territories to create a national, anti-poverty strategy with real goals and measurable objectives.
These three affordable categories of measures are important first steps that can be taken right now. These and similar measures each succeeding year will stop the redistribution of income from the majority at the bottom to the minority at the top, and eventually lead to a much fairer society.
Thank you.