Government Operations Committee on March 27th, 2024

[The Chair, Conservative, Kelly McCauley]

Thanks. That is our time.

We are now in the five-minute rounds.

Mr. Lawrence.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Thank you.

Thank you, Premier, for coming here. As a member of the finance committee, let me express my extreme disappointment with the chair, who was unwilling to hear the representatives of over a million Canadians in the great province of Saskatchewan.

I want to focus relatively narrowly, with respect to the inflationary impact of the carbon tax. Tiff Macklem made it quite clear to the finance committee that, actually, 0.6% of inflation—which equates to around 20% to 30% of inflation, given the rate on any given day—is the responsibility of the carbon tax, and that the increase will be responsible for another 0.15%. This means that over 30% of inflation is a direct result of the carbon tax.

We were be unable to validate this until you took the actions that you did, Premier Moe.

Have you seen an impact on the reduction of inflation through Saskatchewan's actions with respect to the non-collection of the carbon tax on home heating?

[Scott Moe]

Statistics Canada, in their first report, said, “In Saskatchewan, the collection of the carbon levy ceased in January 2024, contributing to the province's year-over-year price decline of natural gas”. We're seeing it in Manitoba as well. The Province of Manitoba has forgone their fuel tax on the fuel they sell each and every day. What you're seeing is that the CPI is lowering in Manitoba as well.

My question to this committee would be this: If we were to lower—not increase, but lower or eliminate—what will be the 17¢ per litre of fuel charged to all Canadians this coming Monday, when they fuel their vehicles up to take their children to soccer or hockey or whatever sport or school they might be going to, what do you think that would do to our consumer price index across the nation? We'd likely achieve our 2%. We're at 2.7% now.

I think that would be positive. It would give the Bank of Canada the opportunity, hopefully, to start to lower the interest rate and start to solidify that certainty for investment, both foreign and domestic, into Canadian communities and Canadian industries, which, again, I would allude to as being the most sustainable in the world. The Saskatchewan story around the most sustainable food, fuel and fertilizer that we produce and provide to the world—Ontario has a parallel story and Quebec has a parallel story—is a story we told when we went to COP28 in Dubai. This is a story that we would encourage each of you, as federal members representing Canadians, and all of us collectively representing all Canadians, to share at every opportunity.

We are not climate laggards in this nation. We most certainly are innovators and leaders when it comes to addressing the challenges that we might face globally.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Thank you, Premier Moe.

Just to summarize before I pass this over to my colleague, Tiff Macklem, Governor of the Bank of Canada, said that we would see a third reduction in inflation. We've actually seen that in the province of Saskatchewan. The rate nationally is 2.7% and the current rate in Saskatchewan is 1.7%. We've had this validated.

As you said, the lower the inflation, the lower interest rates go, which means we have more investments, which can enhance our productivity, which can make all Canadians more prosperous. I am just shocked that the Liberals want to keep Canadians poor.

Thank you.

[Scott Moe]

The opportunity we have is to remove the consumer carbon tax on all things for everyone. That would reduce the inflationary effects we're feeling when we fuel our vehicles up, at 17¢ a litre. That same 17¢ a litre is being paid for the truck that is bringing that vehicle to our grocery store and the fellows who are producing it. We see that in Saskatchewan as well, not with our direct fuel but with some of the other fuel sources they are using in transporting that food.

It is a challenge. As I think you can tell, I feel there is a much better way for us to work collaboratively, whether that be across party lines or across subnational jurisdictions in the nation, if that may be, to really provide the Canadian way on leading the global conversation around climate change.

[Shelby Kramp-Neuman, Conservative, Hastings—Lennox and Addington, ON]

Perfect. Thank you, Premier Moe.

Let me begin by pointing out comments that came from a sitting cabinet minister. The Minister of Rural Economic Development of Canada, Gudie Hutchings, suggests that it's “a discussion that we’ll have down the road when we know that this one is working, but I can tell you Atlantic caucus was vocal with what they’ve heard from their constituents, and perhaps they need to elect more Liberals in the Prairies so that we can have [the] conversation as well”. She directly linked the prospect of carbon tax carve-outs to voting Liberal.

Premier Moe, how has this changed your relationship with Ottawa? Has it given you and your prairie colleagues confidence that Ottawa is acting in good faith when it comes to the carbon tax?

[The Chair, Conservative, Kelly McCauley]

You have about 10 seconds, Premier Moe.

[Scott Moe]

I don't think there are going to be very many more Liberals elected in Saskatchewan any time soon. The fact of the matter is that this is disappointing, but it does stack on a number of disappointing items.

Listen. Our relationship with the federal government is issues-based and policy-based. We don't agree with this policy and we don't agree with those statements.

[The Chair, Conservative, Kelly McCauley]

Thank you, Premier Moe.

Thank you, Mrs. Kramp-Neuman.

Mr. Drouin, welcome back to OGGO after a lengthy absence.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

Thank you, Mr. Chair.

Premier Moe, as my father always taught me, when you point the finger, there are always three fingers pointing right back at you. I know that you haven't removed your provincial sales tax on heating. I don't want to get into that, but I know for a fact that it hasn't been done. I know that you haven't reduced income taxes. I've looked at year 2023 and year 2024. It's the same. I know that it's important to talk affordability, but if you're going to point the finger at us, I think it's important to recognize that you also need to do something.

Yesterday the Prime Minister asked you to come up with a credible plan that will respect our Paris accord. You said something today that I'm shocked at, to be frank. You're against the clean fuel regulations.

Do you have canola farmers in Saskatchewan?

[Scott Moe]

Yes, certainly. We would likely be one of the largest canola-producing jurisdictions in the world and are advancing that into ultimately climbing that value chain with canola oil. We've made a significant investment, I would say, in canola oil manufacturing. The conversation around the carbon tax has been part of that investment challenge, I would say, but we are finding our ways through that.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

Are you aware as to why they've made those investments in Saskatchewan? Do you know why the Canola Council of Canada and the canola growers of Canada were all supportive of the clean fuel standard? Do you understand that? Do you know why?

[Scott Moe]

It's because they potentially would use some of that oil to reduce the emissions in the gasoline that we are burning and utilizing and that families are burning across Canada. Some of that conversation is happening.

However, I think there is a much more collaborative path forward on what will actually be achievable in this space. This is going to cause the cost of gasoline to go up for families. We are in the process, as well, of looking at whether we should be a feedstock and be transitioning a food product, really, to a fuel product for places that already have the clean fuel standard in place—like California, for example. That is an ongoing conversation. It's not in all states throughout the U.S., but it's an ongoing conversation in Canada as well.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

In order to develop the local market, that clean fuel standard is the regulation that allows canola farmers to sell more products for fuel. That's an important policy. That's why they've been so supportive of this particular policy.

You said that you participated in COP28. I'm assuming that you're in favour of international trade.

[Scott Moe]

Absolutely. We trade to over 150 countries each and every year. We export to them. We provide them with food security and fuel security.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

I'm assuming that you're also aware that many countries across the world, whether it's Europe.... The U.K. hasn't made this recent announcement.

Do you know what a carbon import tariff is?

[Scott Moe]

I'm aware of what a carbon import tariff is.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

Do you know what the impact is if Canada does not have a price on pollution? Do you know how devastating that would be for our farmers in Canada, in Saskatchewan?

[Scott Moe]

I know that we have a federal government that should be engaging proudly on behalf of the industries that are employing not only Saskatchewan residents—who, I would remind everyone, are Canadians as well—but all Canadians with respect to what we are doing in our industries today. As I said, the Saskatchewan story is not only in Saskatchewan. Every province has a story about what it is doing and how it is reducing its emissions in the industries that are employing people and creating wealth.

I would respectfully ask our federal government and all of those involved to take that story abroad. That's what we did at COP28, and that's what we continue to do through our 10 provincial trade offices that we have that work alongside our high commission offices and our ambassador offices around the world, including one in London and one in Germany representing the European Union.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

I certainly support the work that Saskatchewan farmers are doing. I've been to their farms. They are innovators. The University of Saskatchewan is doing some great work in terms of being able to measure that particular output. I'm afraid that if we don't put a price on pollution, then we are not going to be competitive in our export markets because eventually what's going to happen is that jurisdictions that do not have a price on pollution will be slapped with an import tariff. I don't see how that could be advantageous to our Canadian farmers.

[Scott Moe]

I rival that concern with the federal government making these policy decisions that are going to put our national and, I would say, our continental food and fuel security at risk. I mean, that is exactly what we saw happen in the European Union.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

That's why I'm pleading with you to come up with a regional plan that makes sense for Saskatchewan. Absolutely, if you want to exempt farmers, that's up to you, but a regional approach is much better than a federal approach. The Prime Minister asked you to come up with a plan. I'm pleading with you to come up with a plan that makes sense for Saskatchewan farmers.

Thank you.

[Scott Moe]

We did.

[The Chair, Conservative, Kelly McCauley]

Thanks. That is just past our time.

Mrs. Vignola, go ahead for two and a half minutes, please.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you, Mr. Chair.

Mr. Moe, you said earlier that the carbon market wouldn't necessarily work for Saskatchewan, that it was right for Quebec only. It would seem, then, that many things are right only for Quebec, despite proving successful for 20, 30, 40 and 50 years. The child care system and anti-scab legislation come to mind, but that's another story.

Do you think the Toronto, New York, Montreal and London stock exchanges are bad for Saskatchewan? The carbon market works the same way and would bring in a lot of money for Saskatchewan and Canadian provinces, without hurting the entire economy, as you suggested in your opening remarks.

Are you just as anti-stock market as you are anti-carbon market? Do you not think stock markets work for Saskatchewan, or is it just the carbon market that doesn't work for the province?