Finance Committee on May 18th, 2023

[The Chair, Liberal, Peter Fonseca]

I call this meeting to order.

Welcome, everybody, to meeting number 90 of the House of Commons Standing Committee on Finance. Pursuant to the order of reference of Tuesday, May 2, 2023, and the motion adopted on May 16, 2023, the committee is meeting to discuss Bill C-47, an act to implement certain provisions of the budget tabled in Parliament on March 28, 2023.

Today's meeting is taking place in a hybrid format pursuant to the House order of June 23, 2022. Members are attending in person in the room and remotely using the Zoom application.

I'd like to make a few comments for the benefit of the witnesses and members. Please wait until I recognize you by name before speaking. For those participating by video conference, click on the microphone icon to activate your mike, and please mute yourself when you are not speaking. For interpretation for those on Zoom, you have the choice at the bottom of your screen of floor, English or French. For those in the room, you can use the earpiece and select the desired channel.

I remind you that all comments should be addressed through the chair. For members in the room, if you wish to speak, please raise your hand. For members on Zoom, please used the “raise hand” function. The clerk and I will manage the speaking order as best we can, and we appreciate your patience and understanding in this regard.

Also, members and witnesses, if you are speaking, just make sure the red light is on so that all of what you have to say is captured by the interpreters and by the House.

Let me just begin by thanking our witnesses. I know you didn't have a lot of time before you were contacted to appear before our committee on the BIA, but we do appreciate that you were able to graciously be here for us to provide your testimony. I'll say that in advance on behalf of all the committee members and the clerk, the analysts, the staff and everybody who is here. We really do appreciate it.

With us today from Air Passenger Rights, we have Dr. Gábor Lukács, who is the president of the organization. We also have, from the Chamber of Commerce of Metropolitan Montreal, the president and CEO, Michel Leblanc. From Équiterre, we have Andréanne Brazeau, who is an analyst of climate policy; and from the Macdonald-Laurier Institute we have Philip Cross, who is a senior fellow. Welcome.

Members, I didn't mention this yet, but we have the Canadian Home Builders' Association and the CEO Kevin Lee. We're still having some technical issues with the sound, and we're trying to get that rectified. Hopefully when others have given their opening remarks, we'll be ready for Mr. Kevin Lee to join us. We're also having some technical difficulties with Henderson Brewing and Mr. Steve Himel. We'll also try to rectify that before our last witness speaks and allow Mr. Himel to join us for this panel and make his opening remarks.

With that, we're going to start with Dr. Gábor Lukács of Air Passenger Rights, please, for five minutes.

[Dr. Gábor Lukács, President, Air Passenger Rights]

Mr. Chair and honourable members, Air Passenger Rights is Canada's independent, non-profit organization of volunteers devoted to empowering travellers. We have a track record of successfully predicting shortcomings and loopholes in legislation related to air passenger rights.

Five years ago, we testified before the House of Commons and the Senate respective committees and cautioned that the Transportation Modernization Act was inadequate. In 2019, we published a 52-page report with predictions of how airlines would likely exploit the air passenger protection regulations' shortcomings and loopholes. In December 2022, we cautioned that Canada's air passenger protection regime was broken, and we proposed specific legislative amendments as a solution. Mere days later, during the holiday season, Canadians witnessed a second meltdown of air travel that year, compounded by airlines' flagrant disregard for passenger rights under the APPR..

Our predictions are based on the experience of the passengers we help daily in their struggle to enforce their rights. They have been validated by the four years that have passed since the regulations came into force. Today, even the government acknowledges that our air passenger protection regime needs to be substantially strengthened. Unfortunately, the legislative amendments put forward in Bill C-47 have the opposite effect.

First, the government proposes to create a secretive, star chamber-like process for adjudicating consumer disputes between passengers and airlines with no right of appeal. The adjudication will be conducted on the basis of confidential information instead of evidence, with the exclusion of the public and the media. This is unheard of in consumer disputes.

Bill C-47 therefore violates Canadians' freedom of expression and the open court principle guaranteed by section 2(b) of the Charter, as well as the right to a fair hearing in accordance with the principles of fundamental justice, protected by section 2(e) of the Canadian Bill of Rights.

Second, proposed section 85.12 is effectively a Henry VIII clause that allows the Canadian Transportation Agency to change the law while bypassing the system of checks and balances set out in the Statutory Instruments Act. The agency will be able to make and modify guidelines affecting passengers' rights overnight without examination by the Clerk of the Privy Council and the deputy minister of justice, without publication in the Gazette and without scrutiny by Parliament's committees.

Third, Bill C-47 perpetuates existing loopholes and creates a new one. In spite of the government promise to the contrary, the bill retains the “required for safety purposes” excuse for airlines to avoid paying compensation and shunts that excuse into regulations. This made-in-Canada loophole has unnecessarily and disproportionately complicated adjudication of disputes between passengers and airlines.

Since evidence about the reasons for a flight disruption is in the airlines' exclusive control, passengers are at a great disadvantage in enforcing their rights to compensation. Bill C-47, however, shifts the burden of proof to the airlines in such disputes only if the passenger gives up their right to a fair and open hearing before an impartial judge and instead agrees to submit to the star chamber-like process.

Bill C-47 also creates a new loophole. Clauses 467 to 470 would allow airlines that sign a so-called compliance agreement to avoid paying penalties for violating passengers' rights.

To summarize, many of the government's proposed amendments to the Canada Transportation Act miss the mark, do the opposite of their stated purpose and will weaken not only air passenger protection but also fundamental rights in Canada.

We urge you lawmakers to amend division 23 and not to forgo this historic opportunity to create a robust air passenger protection regime in Canada. A suitable model for amending division 23 would be Bill C-327, a private member's bill to harmonize Canada's air passenger protection regime with the European Union's gold standard. Bill C-327 has been endorsed by Canada's leading consumer protection organizations, and it is what Canadians need.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, Dr. Lukács.

Now we will hear from the Chamber of Commerce of Metropolitan Montreal.

Please go ahead, Monsieur Michel Leblanc.

[Michel Leblanc, President and Chief Executive Officer, Chamber of Commerce of Metropolitan Montreal]

Thank you, Mr. Chair.

I would like to thank the members of the Standing Committee on Finance for giving me the opportunity to voice the concerns of the Chamber of Commerce of Metropolitan Montreal. As time is very limited, I will restrict myself to five items.

The first item, which is not new, is the business community's desire to know that there is a trajectory for the government of Canada to return to balanced budgets and to see this enshrined in official documents. If there isn't, it opens the door to the risk of a steeper, faster trajectory in the future, leading to fiscal pressure and tax increases. From a business point of view, what's important is predictability. Achieving a balanced-budget trajectory should be seen as an assurance of that predictability, not as a goal of rapid spending cuts or tax increases.

The second item that is very important from the business community's point of view - and it's also in this budget - is Canada's response to the U.S. Inflation Reduction Act, and to the very significant investments the U.S. is making in the green economy. Clearly, Canadian companies will have to be competitive. Our projects will have to move forward, and our investment strategies will have to be at least as robust as what we're seeing in the U.S. budget. We're very pleased to see that the Canadian response involves an investment-to-GDP ratio twice as high as that seen in the United States. For us, the Canadian response is very important. We believe that supporting the electric battery sector, which is very positive for the Montreal region, and supporting the green shift, from the point of view of urban SMEs, is very strategic.

As part of these major investments, we feel it's very important to also address issues related to the efficiency of government services. The past year has shown just how difficult it is for the government of Canada to deliver its often monopolistic services efficiently. Examples include the processing of temporary immigration applications, the issuing of passports and the situation at airports. We are asking that the budget bill include a strong commitment to disbursing funds to improve the efficiency of government services.

A fourth item is very important to us, and that's Canadian interprovincial trade. For years, there have been strategies to encourage Canadian companies to export their products. We saw the tension surrounding the renewal of the free trade agreement with the United States. Canada has signed free-trade agreements with other regions of the world, yet within Canada, interprovincial trade is sub-par. Quebec and Montreal companies, especially the smaller ones, are not working as hard to enter markets in the rest of the country. Conversely, I'd say that companies from the rest of the country are less active in Montreal and Quebec. This budget includes funds to strengthen interprovincial trade. We're asking that these funds be disbursed quickly so that organizations on the ground can help our companies find new markets in the rest of Canada.

Let me conclude by pointing out that the budget does not contain a single line of expenditure that seems to be increasing in all other OECD countries, namely money needed for military equipment and national defence. The world is changing rapidly right now, not least because of international tensions, commitments to support Ukraine, pressure on our equipment and the realization that we have limited capacity to protect our territory properly, particularly in the Arctic. This budget provides no response to these pressures. We believe that now is the time to study how Canada will increase resources allocated to defence issues, without necessarily leading to an increase in taxes to finance this spending.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Leblanc.

Now we will hear from Équiterre and Ms. Andréanne Brazeau.

[Andréanne Brazeau, Analyst, Climate Policy, Équiterre]

Good afternoon, Mr. Chair.

Good afternoon, members of the Committee.

My name is Andréanne Brazeau and I'm a climate policy analyst at Équiterre, one of the country's leading environmental organizations, which this year is celebrating 30 years of environmental and climate action.

Our organization works on four key issues: climate, sustainable mobility, food systems and, finally, the consumer and waste management sector.

Équiterre aims to advance these issues in a way that benefits Canadian families and helps lower the cost of living, while helping to combat the climate crisis and the collapse of life.

Our organization is also a member of the Green Budget Coalition, which includes some twenty Canadian organizations whose mission is to promote a set of recommendations relating to the annual federal budget.

First, Équiterre salutes the various initiatives announced in the latest budget that promote social justice, such as the new Canada Dental Benefit. It also supports all the measures in Bill C-47 that aim to tighten penalties and monitoring to limit environmental damage, as well as measures that encourage the consumption of durable goods.

For example, section 232 of Bill C-47, which amends section 36 of the Customs Tariff Act, proposes to add the General Preferential Tariff Plus to goods originating in a country that complies with international standards relating to sustainable development, labour rights and human rights. Équiterre believes that this is a major step forward in raising the socio-environmental standards of international trade.

Then, more generally, Équiterre believes that the federal government's budget presents several interesting measures for the transformation of our economy, including assistance for the decarbonization of the country's power grids as well as the conditions established for this assistance, particularly with regard to labour and the cost of energy for families. Tax credits in this sector are also good news, especially as they were a key demand of the Green Budget Coalition, of which Équiterre is a member.

The budget announces the government's first steps towards the right to repair, a promising sector given that our economic system needs to be fully transformed to become carbon neutral, circular and more equitable. According to some data, the repair industry's revenues in 2030 could vary between $47 billion and $51 billion and create between 400,000 and 450,000 jobs in Canada.

Équiterre therefore welcomes these first steps, which aim to establish a targeted framework for household appliances and electronics in 2024.

However, as provided for in the Minister of Finance's mandate letter, Équiterre would still have liked to see the immediate introduction of a repair fund or fiscally green measures to encourage the growth of the repair sector, a sector of the future that will enable us to take concrete action to reduce household spending and consumption.

More generally, other items in the budget seem problematic in the context of the climate crisis. First, we feel that investments in the development of carbon capture and storage, an unproven technology, take up an inordinate amount of space in the government's finances this year. These investments divert attention from the real challenge at hand: the just transition to sustainable employment for workers in jobs that are doomed to disappear, at a time when the global economy is in the throes of transformation and Canada is falling behind.

For Équiterre, continuing to invest in the exploration of new hydrocarbon deposits in the Arctic is another inconsistency in the federal budget. Investments in the development of the hydrogen industry, including hydrogen produced from fossil fuels, are also problematic. Hydrogen is a form of energy with limited potential, and a niche product. So we mustn't fall for false solutions to the climate crisis.

On the transport side, it's mainly road transport that is responsible for the sector's greenhouse gas emissions. Équiterre therefore deplores the fact that the latest budget includes no new measures to develop, for example, public transit and active mobility, while the number and size of vehicles on our roads continue to grow.

In short, several elements of Bill C-47 seem interesting to us in terms of facilitating the transition to a carbon-neutral and equitable economy. Nonetheless, much remains to be done to ensure that the industries with the highest emissions contribute to prioritizing their reduction at their source and fostering a more equitable and sustainable society.

Larger sums will certainly have to be disbursed in the future to prepare Canada for the climatic hazards whose effects we are already experiencing from one end of the country to the other, in different, but no less serious ways.

Thank you for your attention and for listening. We'll be happy to answer your questions.

[The Chair, Liberal, Peter Fonseca]

Thank you, Ms. Brazeau.

Now we'll go to the Macdonald-Laurier Institute with Mr. Philip Cross, please.

[Philip Cross, Senior Fellow, Macdonald-Laurier Institute]

Thank you.

Canada is in the grip of its slowest decade for economic growth since the 1930s. This is evident in the average annual increase of just 0.8% in real GDP per capita over this period. This extended period of almost no growth has widened the gap between per capita growth in the U.S. and Canada. Since 2016, U.S. real GDP per capita rose a cumulative 11.7%, versus a 2.8% gain in Canada.

This divergence of growth between the two countries occurred before, during and after the pandemic. The ability of the U.S. to sustain growth over the past decade shows that Canada's stagnation was not the inevitable result of an aging population or the exhaustion of technological innovations, but instead reflects factors under Canada's control.

The most obvious sectoral sources of Canada's stagnation are in business investment and exports. Since 2014, business investment in Canada fell 17.6% in volume, compared with a 23.5% gain in the U.S. Meanwhile, after peaking in 2015, Canada's exports receded 0.4%, versus a 14% gain in the U.S. That's despite the stimulus from a 25% devaluation of the Canadian dollar.

Business investment in plants, equipment and exports of goods together account for 37% of Canada's economy. When over one-third of an economy contracts over an eight-year period, inevitably overall growth will be significantly reduced. This is especially true for investment and exports, which contain Canada's most productive and innovative technologies, because they face the most pressure to compete and innovate. The prolonged slump of business investment and exports also reflects the limitations of monetary policy to influence the industry's structure.

Slumping business investment in Canada is a particular concern. There is a growing sentiment that Canada has wasted a decade of low interest rates on more government debt and housing, rather than business investment. Low levels of investment resulted in an outright decline in the net capital stock available per worker in manufacturing and economy-wide. The long-run implications of falling capital stock levels per employee are worrisome since, “In the long run, GDP and the capital stock tend to grow at the same rate”.

Beyond the direct impact on overall economic growth, the persistent slump in both business investment and exports is symptomatic of structural shortcomings in Canada's economy. These include low rates of business formation, regulatory uncertainty and barriers to investment, restrictions on internal trade, faltering confidence of foreign investors in Canada, and low levels of productivity and innovation.

One manifestation of chronic weak business investment and low productivity is the OECD's forecast that Canada's per capita GDP growth between 2020 and 2060 will be the lowest amongst its 29 members. This underscores that Canada's economic growth will continue to falter for decades without fundamental changes in our approach to the economy. A return to sustained faster economic growth in Canada will not come from selecting from the menu of policies proposed by government advisers offering one-time boosts to incomes, but from harnessing the potential of Canada to innovate and from its entrepreneurs.

I'm going to skip a couple of paragraphs to save time here.

A return to sustained economic growth in Canada should be a bipartisan issue. Keir Starmer, the new leader of the Labour Party in Britain, acknowledged recently in an interview with The Economist that “economic growth is the absolute foundational stone for everything.”

Conversely, Paul Collier summarized the effect of slow growth, such as we have seen in Canada in recent years, by noting that while “Growth is not a cure-all...lack of growth is a kill-all.” In the absence of growth, societies are prone to adopting policies that hamper further growth such as protectionism and a destructive focus on the distribution rather than the creation of wealth. Such policies create a vicious circle that weakens business investment, innovation and entrepreneurship.

Economists have only an incomplete understanding of the forces that sustain economic growth over long periods. Broadly speaking, they have pursued two approaches. One focuses on higher inputs and greater efficiency, which is the goal of most policy initiatives. At best, they provide a one-time boost to incomes and often not even that in the absence of the proper environment for growth.

The second approach emphasizes innovation, which is more the product of a culture that encourages entrepreneurship. In the absence of such a culture, even adopting policies that should strengthen growth such as the free trade deals Canada has with all the other G7 nations, high rates of immigration and a high level of education will fail to raise growth.

[The Chair, Liberal, Peter Fonseca]

Could I ask you to start to wrap up, Mr. Cross, please?

[Philip Cross]

It is long overdue that Canada acknowledges its growth crisis and undertakes to create a culture in which innovation flourishes.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you very much for that. You'll have more time to elaborate when it gets to members' questions.

Members, I have the Canadian Home Builders' Association. I want to say that Kevin Lee had made a superhuman feat while others were giving their opening remarks. He ran out to get an approved headset and is back here with us.

Mr. Lee, thank you so much for doing that. Now we're going to hear from you.

[Kevin Lee, Chief Executive Officer, Canadian Home Builders' Association]

You're very welcome. I'm in Vancouver, so I didn't even know where I was going. It worked out okay.

Thank you very much, Mr. Chair and members of the committee, for the opportunity to speak today.

As you likely already know, we are in a construction slowdown thanks to the interest rate increases of last year. As they rose, sales slowed to a trickle. As a result our CHBA housing market index now suggests that we could see as much as a 30% drop in housing starts, which corresponds to other data we're collecting, like 23% of members cancelling projects and some 59% expecting to build fewer homes this year.

This is the opposite of what is needed given the housing affordability crisis in Canada, driven in large part due to the severe housing shortage. CMHC analysis shows that to make up our housing deficit we would need to build 5.8 million homes over the next decade, which would require more than doubling our housing starts.

How do we get back on track?

Firstly, let me say there is no silver bullet. We need a comprehensive approach from all angles and from all levels of government. The focus should be on three key areas. We need to fix the mortgage system so well-qualified young people can buy new homes and, in response, industry can build more. We need to stop government policies that add costs to housing and find ways instead to reduce costs, and we need to address the labour shortage.

Regarding the mortgage system, Canada has been so worried about its financial system's stability that we have taken away the ability of young Canadians to buy homes. We've overcorrected at the cost of dropping home ownership rates from nearly 70% in 2011 down to about 66% in 2021. One would would expect this would all be to protect against what would be rising mortgage defaults, but instead the mortgage arrears rates have fallen to historic lows of about 0.15%. Furthermore, young Canadians have the lowest risk profile of any mortgage borrower.

As this budget looks at its oversight of OSFI, all government departments, regulators and agencies should be tasked to work together to balance risk with the need to build more homes, address affordability and return home ownership to being an attainable dream for more Canadians.

It's not time for OSFI to tighten mortgage rules still further. In fact, it's quite the opposite. It's time to find ways to relax the stress test on both insured and uninsured mortgages responsibly. It's also a time to allow mortgage insurers to return to 30-year amortization periods to enable well-qualified first-time buyers to be able to access the market. This will enable more housing to be built, thereby avoiding cost acceleration and enabling the home ownership rate to turn around as it should.

Governments also need to stop adding costs to homes and instead need to do their part to reduce the price of homes. The GST rebate on new homes hasn't changed since its inception in 1991. In the over 30 years since that time, the price of homes has more than doubled. It's time to double the GST rebate thresholds themselves. I would add that the first-time homebuyers plan, the tax-free home savings account and renovation tax credits are all good steps as well, given that every little bit helps.

Also, regarding the GST, we need to zero-rate purpose-built rental construction, as we do groceries, since GST cannot be collected on rent. Currently, the GST translates to higher construction costs and higher rent. Capital gains and capital costs allowance treatment also harm the business model of purpose-built rental. Developers are far better off building condos. Tax reform on rental is therefore needed to fix the broken business model of purpose-built rental and get the hundreds of thousands of units we need under construction.

Meanwhile, every code or standard change these days, and there are many, is increasing the cost of construction. It's time to make affordability a core objective of the national building code and only allow cost-neutral changes. If the change is important but it's more expensive, we need to invest in R and D to make it affordable before regulating.

Cities need to stop adding costs to construction by continually increasing development costs and taxes. They need to change their approach and accelerate development. The rollout of the housing accelerator fund is an important step in encouraging that change. The tying of infrastructure and transit investment dollars to housing supply outcomes also needs to move forward.

We also need to cut red tape that adds costs. Simply, industry needs to be exempted from the underused housing tax. Our members are filling out thousands of forms for nil returns for the underused housing tax for no reason.

Finally, and very importantly, there's the labour shortage. The Canadian apprenticeship service, the labour mobility deduction and the doubling of the deduction for tool expenses are all good steps, but we still need many more people. The plans of the government to focus immigration on skilled workers, especially for home construction, are critical to getting more homes built faster. Even with that, we will not have enough workers to double housing starts.

We need to increase productivity through factory-built solutions, but that will take investments and the volatility of the market makes that investment risky. CHBA is beginning an industry transition strategy that will outline the types of changes required, the risks involved and the way the federal government can help support that transition.

We recommend that the government prioritize and support investment in modular and other factory-built technologies, similar to the most recent federal budget's emphasis on clean technology investments through tax credits and strategic funding.

With that, I'll end it.

Thank you very much. I look forward to answering any questions you may have.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Lee. Again, thank you for your efforts to be with us and to get that headset. We heard you very clearly.

We are going to go to the rounds of questions from members now with the first round of six minutes to each party.

We're starting with the Conservatives. We have MP Morantz for the first six minutes.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Thank you, Mr. Chair.

I'm going to direct my initial questions to Mr. Cross.

It's a delight to see you in person. We have spoken a few times over the last few years over Zoom, so it's great to have you before the committee.

I want to give a bit of history. When I was first on the finance committee, very early on, we had the outgoing governor of the Bank of Canada, Mr. Poloz, at the committee. I asked him about his program of quantitative easing and whether historically that sort of thing had been inflationary. He insisted it wasn't and that we should be worried about deflation. Then we had the current bank governor, Mr. Macklem, who said in one of his press conferences about a year and a half ago that interest rates would remain low for a long time.

I find it interesting, with the greatest respect, that sometimes economists get to say all kinds of things and it's probably the only profession in which you can be so wrong and get to keep your job.

However, now we have a situation in which we have massive inflation and interest rates are high, so I'd like to get your confirmation on a number of issues. For example, would you agree that the quantitative easing combined with profligate government spending over the course of this government is a factor in inflation in Canada?

[Philip Cross]

It is undoubtedly. There's no question that the Bank of Canada acknowledges that inflation is caused by demand outstripping supply. Demand growth was deliberately fuelled by what was believed to be stimulative fiscal and monetary policies during the pandemic. The pandemic obviously did some damage to supply, more than economists thought, so it's the combination of the two.

It's quite refreshing—you should look up what Mervyn King, the former governor of the Bank of England, said. He very clearly stated—unlike a lot of the obfuscation you get from central bankers here in Canada—that we increased the money supply, which increased demand, and that increased inflation. It's that simple.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Thank you for that answer.

I couldn't get the current bank governor to say that. He's happy to say that quantitative tightening is a great tool to help control inflation, but he wouldn't confirm quantitative easing as being the cause of it.

Would you agree, then, with the claims of the Prime Minister and the finance minister that inflation has come to our shores because of external factors? Is that accurate?

[Philip Cross]

Clearly the initial onset might have been due to some supply disruption, but we're now two years in. In the latest inflation report that was released by my former colleagues at Statistics Canada on Tuesday, services have now replaced goods. You can no longer say this is supply chains, computer chips and all those things or even food and energy. Inflation is increasingly embedded in the service sector of the economy, and that's driven by domestic factors and wage inflation.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

I'm going somewhere with this. I don't mean to interrupt you, but now we have homegrown inflation. We're two years in with a government that's willing to spend endlessly. It has doubled the national debt. It's adding another $60 billion in spending over the next five years, just over and above what they announced in November. Because of that, the Governor of the Bank of Canada has, despite saying interest rates will stay low for a long time and people shouldn't worry about that, now raised the bank rate to 4.5%.

I know it seems self-evident, but I just want to get confirmation from you on the record. Is there a direct correlation between inflation and the bank increasing interest rates?

[Philip Cross]

Unquestionably. Even a bank would say, of course, that's why we're raising interest rates; it is to bring inflation under control.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

There's a direct correlation between increased interest rates and how much people pay on their mortgages.

[Philip Cross]

Undoubtedly. The Bank of Canada gave a briefing on that very subject today.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

There's a direct correlation between inflation, which is largely caused now by domestic spending policy, and the price of housing. Yes...?

[Philip Cross]

Do you mean the price of housing or the cost of owning a home? They're two different things.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

It's the cost of owning a home.

[Philip Cross]

On the cost of owning a home...yes.