Government Operations Committee on Oct. 2nd, 2018

[Yves Giroux]

That's a very hypothetical question. It would be quite hazardous for me to try to answer because it depends on what would have been, what assumptions we make as to what the level of transfers would have been in the absence of past policy actions. For sure, if the health transfers were higher than they are now, the provinces would be in a better position. That being said, it depends on the magnitude of these higher transfers as to whether it would be significant or not that significant an improvement in provincial fiscal situations.

[Irene Mathyssen, NDP, London—Fanshawe, ON]

I guess the flip side of that is if, for example, provinces were successful and convinced the federal government that transfers should in fact be increased, the health and social transfer. Do you have any sense of how that would affect the federal government in terms of sustainability and its ability to balance?

[Yves Giroux]

In the fiscal sustainability report that we released last week, we estimate that the federal government has fiscal room amounting to $29 billion. That could be a mix of tax cuts or an increase in expenditures. Expenditures could be defined as increased transfers to provinces and territories. So there is that amount of fiscal flexibility in the status quo, assuming status quo policies, of course, for all jurisdictions. That's the amount of fiscal flexibility that would be available to the federal government. It could be transfers to provinces. That would significantly improve the situations for provinces and territories.

[The Chair, Conservative, Tom Lukiwski]

Thank you very much.

Mr. Giroux and Mr. Jacques, thank you so much for being here, your first time before our committee in your new capacity. I wish you the best of luck.

I note with interest, of course, that you are an economist and Madam Ratansi always likes to remind people that she's an accountant. I harken back to the old saying of former prime minister Harper that he wished he could become an economist because he just didn't have the personality to become an accountant.

[Voices]

Oh, oh!

[Yasmin Ratansi, Liberal, Don Valley East, ON]

Hello. He didn't.

[The Chair, Conservative, Tom Lukiwski]

I have to disagree with that because I think his personality....

[Yasmin Ratansi, Liberal, Don Valley East, ON]

He's an economist.

[The Chair, Conservative, Tom Lukiwski]

Thank you very much for being here.

Colleagues, the meeting is adjourned.