Evidence of meeting #113 for Government Operations and Estimates in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was saskatchewan.
A video is available from Parliament.
12:50 p.m.
Liberal
Irek Kusmierczyk Liberal Windsor—Tecumseh, ON
Sure.
It seems like you're only looking at one side of the ledger. You're not weighing the costs of climate change. Is it fair to say that your analysis is really only looking at one side of the ledger?
12:50 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
The analysis is typically a cost analysis, which is what I have been mandated by Parliament to do. I'm estimating the cost of proposals. If further analysis is deemed feasible and required, I'm sure there are lots of think tanks out there that are more than happy to do the cost-benefit analysis, and if the government itself has a cost-benefit analysis, I'm sure it would be more than happy to disclose that.
To my knowledge, there hasn't been that much work undertaken on the cost-benefit analysis, because it's a complicated field that requires lots of data spanning several years. That's why even though it would be ideal to have the cost-benefit analysis, the benefits are always not very tangible and not easily measurable.
12:55 p.m.
Liberal
Irek Kusmierczyk Liberal Windsor—Tecumseh, ON
Okay.
I take issue with your net analysis. I think it's incomplete, and I think it looks at only one side of the ledger. When we look just at the fuel charge impacts directly, which you speak about as well, you talk about eight out of 10 households being better off. Can you speak to that a bit? Looking just at the impact of the fuel charge as compared to the Canada carbon rebate, you mentioned that eight out of 10 families are better off. Can you speak to just the fuel charge, not the net analysis?
12:55 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
When we look at the impact of the fuel charge, we look at the amount that households pay directly—when they fill up their gas tanks or when they heat their houses—and the embedded energy component of the goods or services they buy, and we compare it with the carbon rebate they get. We find that, roughly speaking, four out of five households are better off with a carbon tax and the rebate than without.
12:55 p.m.
Conservative
12:55 p.m.
Bloc
Julie Vignola Bloc Beauport—Limoilou, QC
Thank you, Mr. Chair.
Mr. Giroux, Ms. Vanderwees and Ms. Giswold, thank you for joining us once again.
I have great admiration for your analyses. It's precise, valuable work. It's the labour of hard-working people. I appreciate it tremendously, especially since, in the case of the Main Estimates 2024‑2025, the government didn't see fit to publish the document in PDF format on its site. You were stuck with the CSV format, which is unreadable; or you had to follow along on the screen while taking notes on the side. My congratulations on managing to produce all this in record time, all things considered.
That said, I saw that the Canada Health Transfer will increase by $2.7 billion. That's a rough guess, because the main estimates came out before the budget, which will be released on April 16th. Anything can change, but we can assume that there really will be a $2.7 billion increase and that transfers will total $52.1 billion, as stated in your report.
Had the government fulfilled both Quebec's and Canada's premiers' request to transfer 35% of their health budget, how much would the health transfers amount to? Do you have any idea what that figure would be?
12:55 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
Unfortunately, I don't have these numbers on hand.
I remember we conducted a study a few years ago to estimate how much provincial health spending was covered by the Canada Health Transfer. One of the conclusions I remember well was that the definition of health care or health services had evolved over time to cover more services, which can affect the amount to be determined to reach a specific target, in this case 35%; all that to say, I don't have the figures on hand, unfortunately.
12:55 p.m.
Bloc
Julie Vignola Bloc Beauport—Limoilou, QC
The Main Estimates tabled in late February or early March contain $449.2 billion in spending, the bulk of which are transfers to provinces, organizations and the public. These transfers include $81.1 billion in seniors' benefits.
How much would this transfer amount to, had two categories of seniors not been created, if people aged 65 to 74 were still included, and if they were given the same pension increase as those aged 75 and over?
1 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
We don't have that figure either. We may have done the calculations as part of another query.
However, we can see that amounts for seniors' benefits will increase by almost $9 billion from 2021‑2022 to 2022‑2023, the year in which eligibility for those aged 75 and over was expanded or at least enhanced.
Given that, from a demographic point of view, a good proportion of Old Age Security beneficiaries are aged 65 to 75, we can assume that the cost would have been roughly the same, or perhaps even a little higher. However, I don't have those figures.
1 p.m.
Bloc
Julie Vignola Bloc Beauport—Limoilou, QC
Thank you.
Public debt charges currently stand at 10.4% of the budget, or $46.5 billion. They amount to “only” 10% of the budget because the budget is $450 billion. If the budget were $280 billion, the proportion would be greater. It's mathematical.
Can we consider this a healthy rate or should we start sounding the alarm—as we already have—more loudly to say this unacceptable?
1 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
That is a somewhat sensitive question to answer in absolute terms. From a historical perspective, during the 1990s, debt service costs were eating up roughly a third of federal revenues, if not more. That was an alarming situation. It's much less so now, given that it represents a much smaller proportion of federal revenues. However, we can still consider the other ways we could use that $46 billion if we didn't have to bear the costs of a debt of that size.
So two things can be said: From a global perspective, and from a historical one, that number isn't huge, but, $46.5 billion spent on debt servicing is still more than we allocate to national defence. It's also more than half of what we pay out in benefits to seniors, and it's about the same amount the federal government transfers to provinces for health care, or a little less. These are still significant amounts.
1 p.m.
Conservative
The Chair Conservative Kelly McCauley
That's your time.
Mr. Boulerice, we'll go back to you. Please go ahead.
1 p.m.
NDP
Alexandre Boulerice NDP Rosemont—La Petite-Patrie, QC
Thank you very much, Mr. Chair.
I would like to thank Mr. Giroux and his entire team for joining us today for this study. I feel that we can now ask questions related to the topic that the committee was normally slated to study.
Mr. Giroux, you know there's a huge housing crisis and it's been growing for years. By the way, so that it appears in the committee's report, I'd like to mention that this crisis is even greater among first nations. We're having trouble meeting our targets for providing not only a sufficient number of housing units, but also good quality units that are spacious enough.
Here are some figures. Between 2015 and 2022, the proportion of first nations homes in need of major renovation fell from 20.8% to 19.7%. As for the proportion of homes in need of replacement, not only did it fail to decrease, it actually increased over the same period, from 5.6% to 6.5%. Finally, in terms of new unit and new home construction, we're only at about 20% of the volume needed to close the gap with the Canadian average.
Also, we recently learned that Indigenous Services Canada's budget for housing construction will drop from $20.7 billion in 2024‑25 to just $16.3 billion in 2025‑26.
How do you think we can meet the federal government's 2030 targets by cutting funding for indigenous housing construction in this way?
1 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
That's a good question. Unfortunately, I don't think I'm the best person to tell you how we can achieve those targets or reduce first nations housing needs.
You might obtain a better answer, at least I hope so, from the Minister of Indigenous Services.
1:05 p.m.
NDP
Alexandre Boulerice NDP Rosemont—La Petite-Patrie, QC
Do you have any sense or estimate of the total investment it would take to close this gap for first nations across the country?
1:05 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
We issued a report on the federal government's housing investments. I believe we also considered the need for water and wastewater systems in first nations communities a few years ago. That said, I'm not sure we've reported specifically on first nations housing.
I can provide you with a written response, if that is of interest to the committee.
1:05 p.m.
NDP
Alexandre Boulerice NDP Rosemont—La Petite-Patrie, QC
I'd appreciate that, if you could. I know you have a lot of work to do, but this is the kind of information that will enable us to improve our work and have better public policies for Inuit and first nations.
I'm going to take you somewhere else now, Mr. Giroux. The scandal surrounding ArriveCAN, the infamous app launched during the COVID‑19 pandemic, has opened our eyes to the high costs of subcontracting, which are sometimes exorbitant, even scandalous. The Auditor General even told us that subcontracting rather than using the services of the public service could double the price.
Is that your assessment of it too?
March 27th, 2024 / 1:05 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
We didn't assess the amounts to see if the contracts awarded externally were good value for taxpayers. What we did find, however, was that spending on external consultants has steadily increased significantly in recent years. Many of these consultants provide services, for example to first nations and veterans, but there is also an increase in expenditures for consultants in IT, policy or management in government. This was done in conjunction with a significant increase in the size of the public service.
I've raised the issue of using external consultants on a number of occasions, in various committees, even though we're hiring a lot of staff in the public service. We have to ask ourselves whether we're hiring the right people when the government needs to use subcontractors at the same time as it's increasing the size of the public service.
To come back to your question, we didn't check whether each of these contracts represented good value for taxpayers. That's more a matter for the Auditor General.
1:05 p.m.
NDP
Alexandre Boulerice NDP Rosemont—La Petite-Patrie, QC
Thank you for your answer.
It's interesting to see these two parallel phenomena. It's a bit hard to explain, yes. The total amount of contracts awarded to consultants or subcontractors is now close to $22 billion.
Are Quebeckers and Canadians getting their money's worth? Is there a growing number of examples like ArriveCAN that don't always make the headlines?
1:05 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
I wouldn't go so far as to say that cases like ArriveCAN are widely being repeated everywhere.
The questions that arise the most concern the use of consultants to provide policy or management advice to the public service, when there is the expertise within the public service to provide advice, guidance and recommendations to ministers. It's a little more surprising that subcontractors are being used for this.
The same is true for the management advice provided to ministers, when the public service should normally be well equipped in that regard. These are valid questions, but my office doesn't have the capacity to assess whether there are many other cases similar to ArriveCAN.
I would like to think that the Auditor General is doing this study as part of her normal work.
1:05 p.m.
Conservative
The Chair Conservative Kelly McCauley
Thank you very much, gentlemen.
Ms. Kramp-Neuman, go ahead, please.