Finance Committee on May 2nd, 2023

[Chrystia Freeland, Liberal, University—Rosedale, ON]

First of all, thank you for the important point about the investments our government has made in Canadians and about the strength of Canada's fiscal position. It's really important for us all to be clear about that, so that Canadians understand the reality and are not misled by fiscal scaremongering.

On the clean economy and climate action, I'm very happy to speak through you directly to the people of Davenport. As you know, our ridings are neighbours, so your constituents are my neighbours.

I also thank you for your energetic advocacy of our government's climate agenda and I agree with you that we should all be climate activists.

I think when people look back on the budget that we are all ultimately going to pass, I think what history is going to show is that this was the budget that really kicked Canada's green industrial transformation into high gear with a worker-led agenda. I really believe that.

Through some of the unpleasantness, I just remind myself that we're doing that important work together.

With this budget, our government has now put forward a $120 billion green industrial policy. This is going to accelerate our work on reducing Canada's emissions and, crucially, it's going to create a lot of great jobs.

Three things made me really happy after the budget. One was S&P reiterating our AAA rating with a stable outlook—an important proof point. The second was TD coming up with a judgment about our budget and saying that Canada has done it and that we are now totally competitive as an investment destination when it comes to the clean economy. The third was Rystad Energy, a highly respected energy analytical firm, coming to exactly the same judgment of what Canada has done.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Dzerowicz.

That is the time. It goes quickly.

We have MP Ste-Marie now for two and a half minutes, please.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you, Mr. Chair.

Minister, I have two questions about the $80 billion earmarked for the green shift and transition we talked about.

Pursuant to Bill C‑47, that money will be administered by two institutions and thus evade Parliament's control. The department told us that there was a lot of money to support the oil and nuclear industry. Quebec is receiving some funding, but I was a bit envious, I must say, when I saw how much was going to Stellantis and especially Volkswagen. I wish Quebec would have gotten a game-changing investment like that.

Here, in front of all the committee members, can you assure me that Quebec will get its fair share of that $80 billion per capita? Furthermore, why are you putting that funding beyond Parliament's control?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

The answer to your first question is a very clear yes. I repeat, yes, Quebec will get its fair share. Every province and region in Canada will get its fair share of green transition funding. I'm glad you asked the question, because it gives me a chance to tell all Canadians how important it is to me personally that our green investments be guided by regional equity.

I want to assure you that we are working closely with the Province of Quebec. Right now, we are discussing the implementation of our green plan for Quebec. I really like what Quebec and Quebeckers are doing to support the green transition. They are activists. The federal government is here to help the transition and make further investments—and we will continue to be here. I would be delighted to work with you directly on those important efforts.

[The Chair, Liberal, Peter Fonseca]

Thank you, Minister.

Thank you, Mr. Ste‑Marie.

[The Chair, Liberal, Peter Fonseca]

Next we have MP Blaikie, please.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Thank you very much, Mr. Chair.

I just want to come back to the employment insurance question that you didn't have time to answer before.

Prepandemic, we had an inadequate EI system and premiums that were designed to adequately fund the inadequate system. Then during the pandemic, we had temporary changes. I don't think it was ever envisioned that the premiums structure that was in place for the inadequate system before the pandemic would be able to fund the changes from the pandemic. Now we're back to having the inadequate system, which is a retroactive burden on ratepayers to try to make up for what was spent during the course of the pandemic on an EI system that was nothing like what the premiums were designed to pay.

I would like an explanation as to why it is that the government thinks it's appropriate to back charge the EI system for what was, we hope, a once in a generation or longer event, and how the government intends to fund a meaningful modernization of employment insurance while the account is trying to pay back that debt.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Thank you for the question, which is important and complicated.

I want to start where you started. I believe, as Julie pointed out, both the EI system and CRA together, with the government and a Parliament that had the will to do it, we really managed to be there for Canadians during the pandemic. It's something I'm proud of. It saved lives, because it allowed us to do the right thing when it came to health, and it also rescued many families and people. It cost a lot of money, but it was the right thing to do, and I'm glad we did it.

In terms of what we do going forward, I am very glad that our government resisted, in the summer and fall of last year, irresponsible pressure from the Conservatives to cut contributions to EI and the CPP. Those would have impoverished the systems that working Canadians and Canadian seniors depend on.

I want to remind members of this committee, and Canadians listening, that fiscally irresponsible policy was advocated aggressively by the Conservatives. We held firm. I'm proud that we did. I'm proud that both contribute to our overall fiscal responsibility as a government and to the fiscal sustainability of these two essential systems, EI and CPP.

In terms of EI modernization, as you know, this budget takes some important steps in that direction with regard to seasonal work. Our government has extended the number of weeks people can be on EI for sick leave, and I am very supportive of that. There is more work to do on EI modernization. It's a very complicated system, and it's really important for us to approach EI modernization with the appropriate degree of care. That is what we intend to do.

[The Chair, Liberal, Peter Fonseca]

Thank you, Minister, and MP Blaikie.

We'll now go to MP Chambers for five minutes.

[Adam Chambers, Conservative, Simcoe North, ON]

It's nice to see you again, Minister, and thank you for coming.

Can you tell the committee, and Canadians, how much we're spending, or projected to spend, on interest on the debt this upcoming fiscal year? I'm just looking for the number.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

It's important to put things in context, that in both—

[Adam Chambers, Conservative, Simcoe North, ON]

Minister, my time is very limited. I'm asking, do you know the number? You have many officials beside you.

Will you tell Canadians how much we're going to spend on servicing the debt next year?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

It's really important to put numbers in context. Without context, numbers are meaningless. Our debt service charges are low in a historical context, and they are low compared with what our peers in the G7 are paying.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you for the context.

What's the gross dollar value we're going to spend on interest on the debt next year?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

Let me again....I am really opposed to fiscal fearmongering by the Conservatives. The important point to make for Canadians is that in a historic context, our debt service charges are reasonable and sustainable, and lower than they have been in many previous years. That's why S&P reaffirmed our AAA rating.

[Adam Chambers, Conservative, Simcoe North, ON]

I'm asking, will you tell Canadians how much we're spending on the debt? It's in black and white in your book.

Do you just not want to say?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

It's important to put all numbers in context,—

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you, Minister. I'll move to the next question.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

—and do you not agree that in a historic context, our debt service charges are absolutely handleable?

[Adam Chambers, Conservative, Simcoe North, ON]

Minister, how much are we projecting to send to the provinces for health care this year? Again, I'm looking for the number.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

I'm very glad to hear the Conservatives talk about health care. As you know, in this budget, our government made a historic investment of nearly $200 billion in health care. As we discussed with Mr. Ste-Marie, thanks to the unanimous consent of the House, we're sending $2 billion to the provinces right away to meet immediate needs.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you, Minister.

I'm not really sure how to proceed. We either ask a question that has a definitive, fact-based answer and don't get a response or ask a philosophical question. The truth is we're going to spend about $43 billion or $45 billion servicing the debt next year. We're projecting sending the provinces about $47 billion for health care.

We're spending almost as much on servicing the debt as we are spending on health care in this country. It bothers me that we're not willing to admit this. For some reason, we don't want to discuss that actual fact when it was this government, and you in particular, that said it would be irresponsible not to spend because interest rates are so low.

When you have a party, you have to pay the band. We're now seeing that you have to pay the band.

If we can't answer the fact-based question, I'll ask a philosophical question.

Do you consider yourself a Keynesian?

[Chrystia Freeland, Liberal, University—Rosedale, ON]

I consider myself a Liberal.

[Adam Chambers, Conservative, Simcoe North, ON]

Okay.

[Chrystia Freeland, Liberal, University—Rosedale, ON]

I consider myself a fiscally responsible finance minister who has found the balance that Canada needs between compassion and investments in our economic capacity, while maintaining a strong fiscal position.

Since we are discussing economic philosophy, which I actually think is the really correct and meaningful subject of discussion at this committee, I do think there is a clear philosophical difference between Conservatives and Liberals when it comes to the Canadian economy right now.