Evidence of meeting #79 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 services.
A recording is available from Parliament.
4:40 p.m.
Liberal
Charles Sousa Liberal Mississauga—Lakeshore, ON
Thank you for your presentation and for being here today and listening to some of the questions that are coming before you.
I'm trying to get some clarity here. We talked about increasing debt. We know it's an issue. We all want to try to control it, recognizing the sensitivity around the demand and the requirements for some of the programs that are coming.
What is Canada's current GDP?
4:40 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
It's about $2.8 trillion, on a nominal basis.
4:40 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
It would have been significantly lower than that on a nominal basis.
4:40 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
Probably.
4:40 p.m.
Liberal
Charles Sousa Liberal Mississauga—Lakeshore, ON
There you go.
We have a doubling of power in terms of our economic vitality as a country, and that has been growing. How does that compare with other countries with respect to our debt-to-GDP ratio?
4:40 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
Compared to G-7 countries, I think we have the lowest debt-to-GDP ratio.
4:40 p.m.
Liberal
Charles Sousa Liberal Mississauga—Lakeshore, ON
Very good.
I know some of the opposition members try to compare what we've done in the last eight years during the pandemic, and they have been very challenging times.
Under Stephen Harper, did the debt grow?
4:40 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
I'd have to go back into the historical numbers—
4:40 p.m.
Liberal
Charles Sousa Liberal Mississauga—Lakeshore, ON
I have the numbers. They almost doubled during that time. Even if we do these programs and these initiatives, is it debt that's the issue, or is it our ability to sustain debt, service it and grow our economy? What is more important to you?
4:40 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
That's a very good question. I think debt sustainability is a main concern.
4:40 p.m.
Liberal
4:40 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
I'd verify it, but it's usually very solid.
4:40 p.m.
Liberal
Charles Sousa Liberal Mississauga—Lakeshore, ON
—notwithstanding some of the concerns that are being discussed that we are all concerned about.
One of the issues that we're looking at under Treasury Board is a savings of about $15 billion going forward—not an increase, but a savings—and finding ways to become more efficient. How would that impact our debt-to-GDP ratio, given what you...? They've given you hypotheses as to increasing spending. What would happen if we actually decreased some of that spending?
4:45 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
Well, it depends where the spending would be decreased. It's one thing to look at savings. What is more important at the macro level is what happens with the overall spending.
4:45 p.m.
Liberal
Charles Sousa Liberal Mississauga—Lakeshore, ON
It's important, though, for us to maintain some of those efficiencies to sustain our programs.
Debt servicing is another issue that we monitor. Back in 1995 and 2000, do you have a sense of what our debt servicing ratio was?
4:45 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
It was probably upwards of 30%.
4:45 p.m.
Liberal
Charles Sousa Liberal Mississauga—Lakeshore, ON
That's much higher than what it is today. That's almost double, is it not?
4:45 p.m.
Liberal
Charles Sousa Liberal Mississauga—Lakeshore, ON
When we revolved our bonds—and we have quite a few of them every year that come up—what did we do in the last five or six years? What did we put those bonds at?
4:45 p.m.
Parliamentary Budget Officer, Office of the Parliamentary Budget Officer
The interest rate has been anywhere between 1% to 4% or 5%, depending on the maturity.
4:45 p.m.
Liberal
Charles Sousa Liberal Mississauga—Lakeshore, ON
We locked those in for a long period of time—if I'm not mistaken, for almost 30 years. Had we not done that, what would have happened today?