Government Operations Committee on Sept. 25th, 2025

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

Thank you.

I was delighted to read, in your report, “Federal Infrastructure Spending”, that you mention that the objective of your work is to improve the quality of parliamentary debates and promote greater budgetary transparency and accountability. I agree as well.

That said, I'm concerned that, when you appeared before OGGO last week and answered a number of questions from all parties, the next day, during question period, the only comments made came from a single point of view and did not reflect your comments. I remember hearing you speak about rupture with the United States and that we're facing a different world from an economic perspective. How can we, therefore, guarantee that your comments today will contribute to improving the quality of parliamentary debate, which is the objective?

[Jason Jacques]

It's a really good question. I'd say that there's an onus on us as an organization, and there's an onus on parliamentarians.

Today's report has about 2500 words in it, in either official language. The onus on us, as an organization, is to ensure that the words are very carefully chosen to ensure that, to the greatest extent possible, they can't easily be taken out of context.

Another change we're making in the office—and you see part of it today, as we are joined by colleagues and technical experts—is trying to reinforce the technical grounding and the numbers in the presentation to the committee, so trying to take away some of the words and inject some more facts and numbers.

The last change we're making on our side, as some parliamentarians may be aware, is that, for the first time ever, we introduced a media blackout in the office when the report was released at 9:00 this morning—and that was very deliberate. Because of the invitation from the government operations committee, we wanted to try something very different. We released the report; we then had many meetings with parliamentarians to provide briefings and background on the report; and our first on-the-record testimony was here. The hope was that our words would be going to you first, so parliamentarians would have a very clear sense of what we're saying and how we're presenting the work.

In terms of the next step of having parliamentarians, potentially, represent the work in a more balanced way, I don't have a good answer for that. However, if you figure it out, let me know, and I'll be happy to help you implement it.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

I agree 100% with your comments that words do matter, so thank you for saying that.

I have a second question about your report on the economic and fiscal outlook. How long did it take your office to prepare such a report?

[Jason Jacques]

In terms of duration, the work started at the end of August. It was from around the midpoint of August until around now.

It's a tremendous amount of work, but we have a really great team in place who have years of experience at this point, so we can turn things around relatively quickly.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

Thank you for that.

As my colleague MP Gaudreau mentioned, do you think it's fair that we as parliamentarians only receive a few hours to review such a comprehensive report? Does it do justice to your work?

[Jason Jacques]

It's not for me to judge whether it does justice to our work, because we're doing work for parliamentarians.

I'm not supposed to do this, but I'll do it anyway. I'm going to turn the question back on parliamentarians to ask if there is a better way for us to present the work to you so you can make it more useful.

Today we tried something new by having the technical experts here. We tried the media blackout with an idea that we can cut through the noise and present the results directly to parliamentarians, our clients.

If there are other suggestions you have that would make it more useful for you, we're all ears. Our office was created to support parliamentarians. Money comes in from across the country. It comes to Ottawa, and Parliament cuts a cheque to create a parliamentary budget office. If you pay somebody to cut your lawn, and they're doing a bad job, you either fire them and find somebody else or you give them additional direction regarding how they can do it better.

Hopefully you don't fire us, but hopefully you provide us with additional direction.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

Thank you.

[The Chair, Conservative, Kelly McCauley]

That's our time.

Ms. Gaudreau, you have two and a half minutes, please.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

At the last committee meeting, we talked about uncertainty and a lack of transparency. Those are areas of concern for credit rating agencies. Earlier, I also talked about the IMF and its three budget rules. We also talked about what will happen in 10 years.

Is there cause for concern?

How is the government managing the messaging around its fiscal policy?

[Jason Jacques]

I think the answer to that question is there in your own words, which is to say, transparency.

Under our mandate, one of the roles of our organization is to promote financial transparency. We want to see more transparency regarding fiscal anchors, in terms of the Government of Canada's fiscal and economic plans. That is the first step in reducing uncertainty for credit rating agencies and, in the long term, for all Canadians. It's always hard to receive shocking news in a problematic situation, but the government can alleviate those concerns by having a plan.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

In a democracy like ours, there are pillars. The first of these pillars is transparency. However, I fear that the government is avoiding a major political debate on public finances on the basis of American policy and tariffs. That's what we heard today. I'm concerned that the government is overriding sound management by saying that the end justifies the means.

What do you think?

[Jason Jacques]

I think that's a good point. I hope that the people at the Department of Finance are working hard to ensure that the people who will be affected by the major upcoming changes are supported.

[The Chair, Conservative, Kelly McCauley]

Mr. Chambers, welcome to OGGO.

Go ahead for five minutes, please.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you very much, Mr. Chair.

It's a pleasure to be at the mighty OGGO. We have to make sure we get that on the record for Hansard.

Mr. Jacques and your team, thank you for showing up. I appreciate your work.

With it being well over a year since we've had a budget, it's nice to have some picture as parliamentarians for, as you say, setting the table for what's to come.

I hope to make sure I understand some of the assumptions you've made so I understand your very sobering testimony. I thank you for mentioning how serious a moment we're in, fiscally.

If I look at appendix A, titled “Detailed economic outlook”, you're not forecasting a recession. Is that correct? You have unemployment going up in 2025 but coming back down afterwards in 2026 onwards, and you have real GDP growth, which is small, but it's positive, at 1.2% and 1.3% and ongoing.

You're not projecting a recession. Is that correct?

[Diarra Sourang]

No, we are not projecting a recession, just very moderate growth.

[Adam Chambers, Conservative, Simcoe North, ON]

Our current debt service costs, or even just the amount of debt we're taking on each year, are increasing at an alarming rate without any economic recession or headwinds. That's not to say we don't have economic challenges, but my point is your assumptions are that the economy is actually growing from here on out and that unemployment is falling, and we're still seeing some fairly serious and substantial increases in annual debt service costs, as my colleague just pointed out, up about $80 billion a year. Is that correct?

[Diarra Sourang]

That's correct.

[Adam Chambers, Conservative, Simcoe North, ON]

I'm not challenging your assumptions, but obviously there are other pathways the economy can take. Some people are saying unemployment may continue to increase and growth might actually be a lot slower than we project. If unemployment goes up further or growth is not as high as you project, what will happen to the deficit and the subsequent debt service costs?

[Jason Jacques]

If the economic path is worse than projected or worse than we anticipate, then the deficit figures will deteriorate.

[Adam Chambers, Conservative, Simcoe North, ON]

All right.

[Jason Jacques]

Something I think I mentioned to the committee last week is that on our end, we're feeling pretty good about where things stand in the short term—between where we are now and going out over the next 12 to 18 months. The big question—and it's a policy question, which isn't in our bailiwick but certainly is in the bailiwick of parliamentarians—is this: Where do we end up in years three, four and five given the rupture the Prime Minister has referred to and given the Prime Minister's reference to there being no going back? How do we get to those areas of growth? What are the policies that will be in place to ensure the Canadian economy can return to its full potential growth?

[Adam Chambers, Conservative, Simcoe North, ON]

What I'm highlighting, or that I'm glad you're confirming, is that we might not be in the worst economic environment yet, and what we're actually seeing with the levels of spending is that we're increasing the risk to the fiscal framework of the country before facing potentially much more serious economic challenges. If we're going to spend almost 14¢ of every dollar on interest on the debt without a recession in the next couple of years, what could that be if there is a recession? It could be 15, it could be 18, it could be any number.

Would you view that as a risk to the framework?

[Jason Jacques]

Going back to the quote, no one ever got laughed out the room by quoting the Governor of the Bank of Canada. It's positive growth, but it's not going to feel good for most Canadians across the country. Yes, in a situation, it definitely gives one pause when the economic numbers are positive and the fiscal numbers are negative, and substantially negative.

[Adam Chambers, Conservative, Simcoe North, ON]

And we're borrowing record amounts of debt in the markets today, correct?

[The Chair, Conservative, Kelly McCauley]

That's your time. I'm sorry.