Evidence of meeting #37 for Finance in the 43rd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was bank.
A recording is available from Parliament.
5:45 p.m.
Conservative
Marty Morantz Conservative Charleswood—St. James—Assiniboia—Headingley, MB
Is there an internal one, though, an unofficial one?
5:45 p.m.
Director General, Economic and Fiscal Policy Branch, Department of Finance
We continually monitor the situation, so we're always following the evolution of the economy.
5:45 p.m.
Liberal
5:45 p.m.
Conservative
Marty Morantz Conservative Charleswood—St. James—Assiniboia—Headingley, MB
On that point, is there any document whatsoever that you have and could table with the committee that would help us shed light on what the fiscal position of the country is?
5:45 p.m.
Director General, Economic and Fiscal Policy Branch, Department of Finance
We don't have anything like that at this time, no.
5:45 p.m.
Conservative
5:45 p.m.
Liberal
The Chair Liberal Wayne Easter
That would only be the budget, Marty, so you know what to call for.
We will go to Ms. Koutrakis, who will be followed by Mr. Cooper, and we'll end with Mr. Fragiskatos.
Annie.
5:45 p.m.
Liberal
Annie Koutrakis Liberal Vimy, QC
Thank you, Mr. Chair, and thank you to all our witnesses this afternoon.
I have two questions, both for the Department of Finance.
First, the main estimates show that there is a net increase in statutory budgetary expenditures which has been offset by decreases in interest on unmatured debt and other interest costs. Given that interest rates are at an all-time low but borrowing will go up because of dealing with the COVID-related deficit, how do you see the net impact on interest payments playing out? Also, how are we taking advantage of these extremely low interest rates on our overall debt costs?
5:45 p.m.
Chief Financial Officer, Department of Finance
Thank you very much for the question. I think I'll refer it to my colleague, Ms. Leah Anderson, to see if she's able to respond to that question on the declining interest rates and the impact.
5:45 p.m.
Assistant Deputy Minister, Financial Sector Policy Branch, Department of Finance
Overall, declining interest rates are a good thing in terms of the debt. We have had to issue quite a bit more debt given the COVID crisis, the response and the unprecedented number of support measures that we've put in place.
Going forward, given these expenditures and the debt incurred, we are actively looking at the debt structure and what is the best structure of that in the circumstances, given interest rates and estimates. We're actively looking at that and we'll be advising this committee and the public on plans as that's developed.
5:45 p.m.
Liberal
Annie Koutrakis Liberal Vimy, QC
Okay.
The main estimates include an amount to support analytical capacity building within the department. Can you offer some detail about what exactly these analytical capacity-building activities are? Also, how will these analytical capacity-building activities support the work that is being done by the Department of Finance? Perhaps you can offer some examples, if possible.
5:45 p.m.
Chief Financial Officer, Department of Finance
Most of the work is related to new and continuing work on Trans Mountain entities and the divestiture of Ridley Terminals that we can't address with our existing departmental resources. We're looking at this funding to other departments to engage indigenous groups and to engage with expert financial and legal advisers and additional staff. It will help support the government's ongoing ownership of these assets. That's the main part of that capacity building.
I don't know if any of my colleagues would like to elaborate on that.
5:50 p.m.
Liberal
The Chair Liberal Wayne Easter
I don't see anyone coming forward.
This is your last question, Annie.
5:50 p.m.
Liberal
Annie Koutrakis Liberal Vimy, QC
Yes. I'm sorry about that.
My question is for OSFI.
Can you offer some detail around how the $1.2 million—I know it's not a big amount—in program expenditures will be used to support the work of the chief actuary?
5:50 p.m.
Chief Financial Officer, Office of the Superintendent of Financial Institutions
I'll answer that.
The office of the chief actuary provides, as I mentioned a earlier, a set of actuarial and valuation advisory services to various benefit and pension plans within the government. Those services include assessing obligations and costs, and looking at the design, funding and administration of plans and programs.
Hopefully that gives you a little bit of flavour of the types of services it offers and the funding that goes with it.
5:50 p.m.
Liberal
The Chair Liberal Wayne Easter
Thank you.
We have about four minutes each for Mr. Cooper and Mr. Fragiskatos.
Michael, you're on.
5:50 p.m.
Conservative
Michael Cooper Conservative St. Albert—Edmonton, AB
Thank you, Mr. Chair.
Thank you to the officials.
I see the Office of Infrastructure of Canada is set to receive an additional $5.7 billion. I would note that the Office of Infrastructure of Canada has seen total spending increase by 82.6% between 2014 and 2018-19. Would any of the officials be in a position to elaborate on what this additional funding is directed for?
5:50 p.m.
Liberal
The Chair Liberal Wayne Easter
We'll turn back to you, I believe, Ms. Bess, to direct that question somewhere.
5:50 p.m.
Chief Financial Officer, Department of Finance
Okay. Thank you very much for the question.
We're here, I guess, to study the Department of Finance main estimates. I can't really comment on the Office of Infrastructure of Canada, unfortunately. My apologies.
5:50 p.m.
Conservative
Michael Cooper Conservative St. Albert—Edmonton, AB
Yes.
Speaking of something relating to the Department of Finance specifically, I would note that in the department's recent departmental results report for 2018-19, of the 39 targets provided for in that report, one of the indicators was to see total business tax costs be lower than the G7 average. I see that the status has not been updated. Would you be able to provide an update on whether or not that target was achieved?
5:50 p.m.
Senior Assistant Deputy Minister, Tax Policy Branch, Department of Finance
Thank you for the question.
I don't have the data in front of me. There are various ways of measuring this. For example, the effective marginal tax rates on new business investment, I believe, are the lowest in the G7. I think there are indications that the Canadian corporate income tax system is competitive. As you know, the government took steps in late 2018 to implement accelerated writeoffs of capital investments, and those actually significantly reduced the effective marginal tax rate on new business investment.
If the committee would like more information—