Evidence of meeting #31 for Finance in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was credit.
A video is available from Parliament.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
I'll split my time with Mr. Kelly.
Officials, thank you for being here.
With regard to Canada's standing in the G7, where does Canada sit when it comes to household debt?
Senior Director, Economic Analysis and Forecasting, Department of Finance
We have the highest household debt-to-income ratio.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
It's the highest in the G7. Wow.
When did our ranking get there? Do you have any idea?
Senior Director, Economic Analysis and Forecasting, Department of Finance
I believe it was within the last 10 to 12 years, but I don't have the stat directly at hand.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
Okay.
You mentioned the debt-to-income ratio. Would you say that has gone up in the last 10 years?
Senior Director, Economic Analysis and Forecasting, Department of Finance
Yes.
Conservative
Senior Director, Economic Analysis and Forecasting, Department of Finance
Again, I don't have the stat directly at hand. I can follow up on that.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
I have a stat here. It's up to 177% now.
What does that mean for Canadians? If you're earning a dollar.... What does that mean for how much Canadians are in debt for every dollar that they earn?
Senior Director, Economic Analysis and Forecasting, Department of Finance
The simple math is $1.77, but I think it's—
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
That's what each Canadian owes for every dollar they make.
Senior Director, Economic Analysis and Forecasting, Department of Finance
Yes.
One notion is that it's a stock, and another is that it's a flow. It's not as though you have to repay your stock of debt every year.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
The debt-to-income ratio has gone up, and Canadians basically owe more than they make. Am I correct?
Senior Director, Economic Analysis and Forecasting, Department of Finance
They also own far more than they make, four times as much as they make.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
Our debt levels also have gone up significantly. Am I correct?
Senior Director, Economic Analysis and Forecasting, Department of Finance
That's correct.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
Okay.
Are consumer insolvencies a concern? Are they trending upward right now?
Senior Director, Economic Analysis and Forecasting, Department of Finance
As I mentioned, they have trended up from the record lows they hit in the pandemic, but they have really just returned to the pre-pandemic historical average, which is extremely small. We're talking about 0.2% of the population.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
According to the Canadian Association of Insolvency and Restructuring Professionals, these kinds of insolvency levels haven't been seen since 2009. It's the second-highest level since the Office of the Superintendent of Bankruptcy started tracking proposals. Unlike in 2009, the insolvencies are driven by cost of living, as opposed to high unemployment.
Is there a concern with that? Is that something you guys are seeing as well?
Acting Senior Director, Housing Finance, Department of Finance
I can make one point there.
We were talking about mortgage debt earlier. I think you're talking about broader consumer debt. I'm thinking of the Bank of Canada's financial stability report published in 2025, which did look at different types of borrowers. It did identify that for borrowers without mortgages, there were some increasing signs of “financial stress”.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
Definitely, and would it not be a huge concern that unsecured debt is going up?
Acting Senior Director, Housing Finance, Department of Finance
You mean credit cards and that type of borrowing.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
Yes. That is exactly my point. The more we talk to our constituents, that's the concern we hear. Food bank usage has gone up to 2.2 million visits a month. Does this not coincide with, let's say, higher costs at the grocery store? Canada does sit at the highest level of food inflation in the G7.
Are you guys seeing this trend as well? Are these things coinciding with each other?
Senior Director, Economic Analysis and Forecasting, Department of Finance
Certainly, and not to be just a broken record here, but I think this is very much in line with the policies the government is introducing to try to address specifically what you're talking about.
Conservative
Jasraj Singh Hallan Conservative Calgary East, AB
Mr. Torgunrud, let's talk about the policy.
We know that Canada's food inflation is the highest in the G7. You work for the finance department. Would you not think that any input into food going up would make the cost of food go up, and food would cost more at the grocery store?