Finance Committee on March 17th, 2021

[Tamara Jansen, Conservative, Cloverdale—Langley City, BC]

Thank you.

Mr. Wudrick, the Business Council of Canada said, “The pandemic ignited an explosion in public spending and debt.” The federal debt-to-GDP ratio before COVID was 30%. Now it's 50%. Since we were told by the finance minister that the stimulus package was “preloaded”, which I'm assuming is meant to explain why they spent the most out of all the G7 partners, and now, looking at what appears to be a plan in Bill C-14 to get permission to spend another somewhere in the range of $700 billion, with a $100-billion slush fund and a $600-billion debt ceiling increase, should Canadians be worried that the Liberal government is out of control?

[Aaron Wudrick]

I think Canadians definitely should demand and expect to have a budget. When a government wants to spend money, it's very simple: You come forward, explain what your plan is, and make your case for it. They're not doing that. They are using the pandemic as an excuse to not present a budget.

I was forgiving of that last year. I think most people were. But if you look around the world, all of our G7 peers have managed to present budgets. Every province in Canada except Nova Scotia has been able to. In fact, Ontario will present three budgets. Since their 2019 budget, which was after the federal budget, they'll have presented three budgets before the federal government has presented one.

Just in terms of accountability and transparency, I think it is irresponsible. They're out of excuses. They need to present a budget as soon as possible.

[Tamara Jansen, Conservative, Cloverdale—Langley City, BC]

Thank you very much.

Mr. Moody, the finance minister has talked about a preloaded stimulus plan to explain the overspending we've seen so far. We're being asked to vote on this $100-billion stimulus spending and a debt ceiling increase of over $600 billion with Bill C-14. Without even a budget in place, do you think we as parliamentarians can truly vote responsibly on this bill? I mean, I personally feel that I have a gun to my head, since they're tying these figures to the support that Canadians and small businesses need to survive the pandemic.

[Kim G.C. Moody]

Well, I think the short answer is “no”. How do you vote on something when you don't really know what the plan is? I agree with Mr. Wudrick as well that we need a budget. We need a plan.

That's why I used the simplistic example of Mr. Apple and Mr. Orange. One of them has a plan and one doesn't. The one who has a plan typically will follow that plan—you hope—and make logical steps. If you don't have a plan, I don't know how, logically, you can vote on something like this.

That's just my personal opinion.

[Tamara Jansen, Conservative, Cloverdale—Langley City, BC]

Mr. Wudrick, would you agree that we as parliamentarians basically have a gun to our heads at this point in time?

[Aaron Wudrick]

Yes. I would also point out that the government had a recess at Christmas. If there was such great urgency, it would have been perfectly acceptable to extend the sitting of Parliament and to have debate on the bill, not to demand that you roll everything together now and essentially frame it as “If you don't support this bill, then you don't care about Canadians.”

[Tamara Jansen, Conservative, Cloverdale—Langley City, BC]

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you, Tamara.

We'll go to Ms. Dzerowicz.

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you so much, Mr. Chair, and thanks to everyone for this important conversation.

My first questions are actually for Mr. Cochrane.

Mr. Cochrane, I think you would get most Canadians to agree that tax fairness is important, not only to people in my riding of Davenport but to Canadians right across the country. It's one of the top issues we all talk about.

Just based on the conversation today, I'm not quite sure if you know this. Our federal government, since we were elected, has spent over $1 billion to fight tax evasion or to close down tax loopholes. Did you know that we've committed that money and that we've been spending it?

[DT Cochrane]

Yes, and my organization gave your government kudos for doing so. There's just much more that needs to be done and can be done. There are many more tools in the fiscal tool kit that your government's just not using. It has made hints that it will use some of them, but it has not said concretely what that will actually look like, despite widespread calls to implement these kinds of measures to create the fiscal space that's needed to address both the pandemic aftermath and the climate crisis going forward.

[Julie Dzerowicz, Liberal, Davenport, ON]

The second part of my question for you is this: Did you know that we've also committed an additional $600 million to continue to tackle tax evasion in the fall economic statement?

The other thing I wanted to make sure that you were aware of, and it's important for everybody to be aware of as well, is that there are some additional measures that we've promised, like taxing digital giants like Google and Facebook, limiting stock option deductions for high-income individuals, and taxing non-resident foreign owners of Canadian real estate.

Are you aware that all of that has been committed to in our fall economic statement as well?

[DT Cochrane]

Yes, I'm aware of those. The digital giants taxation is again something that we gave big kudos for, although a thumbs-down for delaying the implementation for a year, which is costly.

Actually, I would pose a question that we have, if I could. Will that tax apply to Uber and Lyft? We aren't clear if they are considered digital services.

[Julie Dzerowicz, Liberal, Davenport, ON]

Mr. Cochrane, I'm so sorry, but I'm not going to be able to answer your question. It's my four minutes.

[DT Cochrane]

Okay.

[Julie Dzerowicz, Liberal, Davenport, ON]

I do want to make sure that you know, and that all Canadians know, that we've put a substantial amount of effort into this. It's important to us, and we'll continue to fight tax evasion.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

I have a point of order, Mr. Chair.

There hasn't been a single conviction from the Paradise papers, the Panama papers or the Bahamas papers.

[The Chair, Liberal, Wayne Easter]

That's not really a point of order. It's a point of debate.

Go ahead, Ms. Dzerowicz.

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you so much, Mr. Chair.

[The Chair, Liberal, Wayne Easter]

You have one minute.

[Julie Dzerowicz, Liberal, Davenport, ON]

The second thing I would mention is that there seemed to be some indication that the emergency supports we've been giving haven't been positively impacting those on the lower end of the income scale.

Mr. Cochrane, I wonder if you could maybe respond to this. A recent Statistics Canada report indicated that households in the lowest income quintile increased their share of disposable income from 6.1% in the first quarter to a high of 7.2% in the second quarter of 2020, while those in the highest income quintile decreased their share of disposable income from 40.1% to 37.7% over the same period.

Would you comment on this?

[DT Cochrane]

That just shows what can be done through government action. We have seen unprecedented levels of spending that had this unexpected positive impact—and I mean unexpected to many commentators. There were a lot who said, “Put money out there and it will help address inequality.”

I'm here to say, go further and do more. It's great. We need to lift everyone fully out of poverty. A cut to poverty levels is great. Go further. Do more. You have the fiscal space to do it. Increase the fiscal space by implementing tax measures that keep the money moving, so that it doesn't remain the power of the wealthy.

[The Chair, Liberal, Wayne Easter]

Thank you, all.

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you.

[The Chair, Liberal, Wayne Easter]

The last question goes to Elizabeth May, and then we'll have to close.

[Elizabeth May, Green, Saanich—Gulf Islands, BC]

I have to say thank you very much, Chairman, for this kindness, and to all my colleagues. The witnesses were so interesting today.

My question is for Dr. Cochrane.

Given that we need to have, I believe, new sources of revenue to ensure that, as the economy picks up post-pandemic, we're able to bring in social programs that address the inequities that have become so apparent through COVID, given the choice, if you had to pick one measure, which one do you think you would most like to see in Chrystia Freeland's next budget? Is it the wealth tax? Is it the excess profits tax?