Thank you, Alla.
Good afternoon, committee members.
The budget contained many positives points for businesses seeking to recover from the pandemic. Its focus on growth and jobs is an important step towards economic recovery, yet our country's drivers of growth will need to shift from public to private spending.
Our businesses from main street to the C-suite are seeking a clear and predictable plan to help them lead Canada's economic revival. Businesses are ready to kick-start our shared recovery, but they need the government to do its part in creating an encouraging business environment.
We must collectively become growth-minded when the pandemic ends, avoiding our historic 2% growth trap. While 2% reduces the federal deficit, it allows the federal debt to grow and it constrains opportunity for all.
There are several aspects of the budget that could be improved to spur Canada's economic revival.
First is unlocking business investment for recovery and job creation. For instance, while the budget moves forward with the acceleration of capital cost allowance deductions for Canadian-controlled private corporations on a temporary basis, the measure should be extended to publicly traded firms, as is typical under the CCA system. This, for instance, would help marshal the broadest scope of business investment.
Second, the government should be more ambitious in its approach to fixing Canada's costly and burdensome regulatory environment. Moreover, it should be cautious in how and when it adds new complexity to its regulatory frameworks. For instance, the proposed new regime for interest deductibility is one example of adding new complexity onto existing complexity.
Finally, moving towards a fiscal anchor rather than fiscal guardrails is warranted to guide and control expenditure choices. With significant spending committed in the medium term, a fiscal anchor would help impose discipline over fiscal policy decisions for the long term. Public debt can never be permitted to put public services at risk. Left unmoored, public debt risks being caught up by inflationary and credit pressures.
Again, thank you very much for having us here today.
We look forward to our discussion with you.