Evidence of meeting #36 for Finance in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was quebec.
A recording is available from Parliament.
Liberal
Jake Sawatzky Liberal New Westminster—Burnaby—Maillardville, BC
Are there certain sectors that see specific benefits from this?
Professor, Department of Economics, Wilfrid Laurier University, As an Individual
I'd have to circle back to you on that for details, but you would certainly expect it in sectors in which skills depreciate quickly. For example, in something like IT and working with AI, if you've been out of the labour force for the past couple of years, you're walking back in with skills that are almost obsolete if you were in that sector. It's those sectors in which moms would certainly benefit the most.
Liberal
Jake Sawatzky Liberal New Westminster—Burnaby—Maillardville, BC
That's very interesting.
How was the $10-a-day child care rolled out? In your view, could that be continued? Could it be improved?
Professor, Department of Economics, Wilfrid Laurier University, As an Individual
We have seen a huge drop in child care costs. You can look at the price indices for that. That's really simple and straightforward. However, we do see an increase in demand, and with that, there is a demand for high-quality care. We really need to keep an eye on that quality and make sure more spaces are available.
Liberal
Jake Sawatzky Liberal New Westminster—Burnaby—Maillardville, BC
Does access to early learning programs increase the long-term economic outcomes for the children who have access to early learning?
Professor, Department of Economics, Wilfrid Laurier University, As an Individual
For a lot of children, there's really no effect. They were already getting good care beforehand, and they will continue doing so. However, there are many children who gain something in that early learning, which turns into an investment that continues throughout their schooling and into their wages later in life.
Liberal
Jake Sawatzky Liberal New Westminster—Burnaby—Maillardville, BC
Thanks.
Do you have any policy recommendations on this topic?
Professor, Department of Economics, Wilfrid Laurier University, As an Individual
The biggest thing to pay attention to is the caregivers labour force. Make sure that high-quality people are attracted to those jobs in a labour market that does not seem to function very well on its own as a competitive market.
Liberal
Jake Sawatzky Liberal New Westminster—Burnaby—Maillardville, BC
On a similar note, there's a lot of talk about the national school food program making food accessible for people who might not be able to afford it. I wonder if you could touch on that. Has this come to your research?
Professor, Department of Economics, Wilfrid Laurier University, As an Individual
I can't say that it has come to my research. I think it's important, but that is a personal view.
Liberal
Jake Sawatzky Liberal New Westminster—Burnaby—Maillardville, BC
Thank you very much. I appreciate that.
Ms. Robson, you ran out of time during your opening remarks. Is there anything else you would like to note?
Associate Professor, Carleton University, As an Individual
Thank you very much. I appreciate the opportunity.
I would end with a final call to this committee, as you pursue this study, to focus on opportunities to strengthen intergovernmental agreement in the federation, rather than fanning regional grievances and frictions.
Liberal
Jake Sawatzky Liberal New Westminster—Burnaby—Maillardville, BC
On a similar topic, Canada has maintained a focus on fiscal responsibility through declining debt-to-GDP targets over the medium term while still making targeted investments in affordability, productivity and economic growth. To what extent do you believe Canada's current fiscal approach appropriately balances the need for targeted federal spending with maintaining a credible fiscal anchor, such as a declining debt-to-GDP ratio?
Liberal
The Chair Liberal Karina Gould
I apologize, Mr. Sawatzky, but that concludes your time. Perhaps someone will ask a similar question, and we'll hear the answer.
Mr. Garon, you have the floor for two and a half minutes.
Bloc
Jean-Denis Garon Bloc Mirabel, QC
Thank you, Madam Chair.
I'll continue with you, Professor Schirle. We were on a roll. I was having a lot of fun.
Quebec has some of the best drug insurance coverage in Canada, both public and private. In Quebec, everyone is covered, without exception.
When the federal government decides to have its own pharmacare plan rather than transfer money to Quebec to improve its own plan, and seniors have to go to the Canada Revenue Agency portal to get their medication reimbursed instead of getting it free of charge right away at the pharmacy, explain to me what market failure that solves.
Professor, Department of Economics, Wilfrid Laurier University, As an Individual
I don't think that program is in place across Canada, but this is an opportunity for the rest of Canada to learn from Quebec.
Bloc
Jean-Denis Garon Bloc Mirabel, QC
I'm talking about Quebec, Professor Schirle. The Bloc Québécois is talking to you about Quebec. We have that program. The answer is that there's no market failure.
Quebec has a day care centre system. Since the nineties, we've had early childhood care. Obviously, there are a lot of benefits to that. You quoted a document that contained errors, saying that it also increased the crime rate among children. It was the wrong academic paper to quote. There are still advantages.
Quebec has just as much child care coverage, and Ottawa sends a transfer to Quebec with conditions for a service it created itself. Explain to me what market failure this fixes in Quebec.
Professor, Department of Economics, Wilfrid Laurier University, As an Individual
I would need to dig into the details of Quebec's system more closely to offer a proper answer.
Bloc
Jean-Denis Garon Bloc Mirabel, QC
The answer is that there are no market failures.
The Government of Quebec manages its own preschool, primary and secondary schools. Quebec has the infrastructure, and Quebec government employees are on the ground, and the Quebec government wants to get involved in school food, which has a lot of advantages.
Rather than transferring money to Quebec so it can better feed its children as quickly as possible, how are transfers that are conditional, with conditions attached to them from Ottawa, an advantage? Explain to me how this spending power procedure solves a market failure.
Conservative
Greg McLean Conservative Calgary Centre, AB
I'm going to pose my questions to Mr. Dufort, first of all, please.
I'd like to talk to you about the discipline of financial markets. Both levels of government—provinces and the federal government—as Madame Robson has pointed out, spend a lot of money. The provinces actually spend more. They raise more and spend more, yet there is much more debt at the federal level than there is at the provincial levels of government combined. That's partially because of discipline, because the provinces would have a downgrade in their debt rather quickly if they overspent the way the federal government overspends.
Do you have any comment on that?
Senior Policy Analyst, Montreal Economic Institute
You're right to mention that the federal government goes into debt year after year. That's true. I also want to say that we've seen a significant increase in the deficit, particularly under Justin Trudeau's government, up to and including Mr. Carney's. That's a bit unfortunate, because there's going to be a fairly significant increase in debt between now and 2030, according to projections made just last month by economist Trevor Tombe. So we're headed for a situation where we're taking on more and more debt, and that's becoming very problematic in Canada.
Conservative
Greg McLean Conservative Calgary Centre, AB
The relation I want to make is between the provinces and the federal government.
One of the big differences, of course, is that the federal government is in charge of monetary policy, so the federal government has a bank that it can effectively borrow money from on its own. Quantitative easing means that when the federal government doesn't meet the needs of financial markets in issuing debt, it puts that debt on the balance sheet of the Bank of Canada. In that respect, it has a tool that the provincial governments do not have in order to have somebody take on debt that is mispriced in the market.
Is that a fair way of reducing the provincial...? Well, for wage earners across Canada, it's effectively making their dollars inflated because of the Bank of Canada's intervention.
Senior Policy Analyst, Montreal Economic Institute
That's a great question. We can see that it's problematic because the deficit continues to grow.
As for the relationship with the Bank of Canada, I'll be careful about what I say, but it's a relevant comment. As for the relationship and the differences between the federal and provincial governments, I won't venture an opinion on the impact of the central bank, but one thing is certain: We can see that the trend is upward in terms of the deficit, and therefore in terms of debt for future Canadians.
Conservative
Greg McLean Conservative Calgary Centre, AB
I'll go back to the fund that the government's proposing to put together for $25 billion, which may or may not be a smokescreen, because it is just another tool for government spending.
Can you tell us if you would put your money into a government-run fund at this point in time, given this government's seeming lack of ability to invest in anything?