Debates of May 30th, 2016

Finance — Main Estimates 2016-17

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, I am quite aware of the multiple recessions we experienced during the time of the previous government. That is on the record.

I am also quite aware of the debt that was left us from the previous government. I am also quite aware of the low growth that was left to us by the previous government. Clearly the Conservative spending did not lead us to a higher growth situation.

That is exactly why we have embarked on a different plan, a plan to invest in growth for the future of Canada, a plan that will make a real difference for Canadians.

[The Chair, Conservative, Bruce Stanton]

We are at the seven and a half minute mark. You can split either way, but we will go to the hon. member for Milton.

[Lisa Raitt, Conservative, Milton, ON]

Mr. Chair, I wonder if the minister can help me with respect to some documentation in his budget. The outlook for budgetary revenues, page 235 of this year's budget, shows some GST revenues growing from $33.1 billion to $40 billion between the years 2015-16, 2020-21. That is a 21% increase in GST revenue.

Could the the minister tell us what he is basing that on?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, the way GST revenues work is that they are a function of consumption, they are a function of how much goods and services Canadians purchase.

In our budget, we looked at what we believed to be the consumption patterns of Canadians. We then made a mathematical equation against those consumption patterns, using the factor that we use for GST. The multiplication of the consumption patterns against the actual amount of GST results in a number, and that number was the number we used in our budget in order to provide what we saw as the forecast for GST revenues in the time period under question.

[Lisa Raitt, Conservative, Milton, ON]

Mr. Chair, could the minister agree with me that going into debt to boost economic growth is usually done in times of recession?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, we have taken a look at the situation we find ourselves in, which is low growth, and the demographic challenges we face. We recognize that they are really structural reform issue possibilities, there are monetary possibilities or fiscal measures. We have chosen fiscal measures which we know is the right approach for us at this time to grow our economy.

[Lisa Raitt, Conservative, Milton, ON]

I am sorry, Mr. Chair, I asked the minister whether one normally goes into debt in order to boost economic growth in times of recession. The answer is yes. The answer here as well is that we are not in a recession.

I do have another question. Could the minister let me know whether he has been warned by finance officials that a downside to adding public investment in our country is that it actually crowds out private investment.

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, the time to make investments in the economy is when there is usable capacity in the economy, and that is exactly where we find ourselves right now.

That means we will not be crowding out private spending at this juncture in time. We will be adding to the capacity of our economy, adding to the GNP of our country, and that is exactly why we are doing it because there is the room available for us to do that.

We know that is the appropriate thing to do with this environment, and it has clearly been approved by people around the world and within our country.

[Lisa Raitt, Conservative, Milton, ON]

Mr. Chair, what the minister is referring to is the term “economic slack”, and the economic slack in our country is because of the commodity shock, which we are actually experiencing. In fact, that is exactly what the OECD says.

I would like to know from the minister if it is appropriate to build a transit line in Toronto with public funds as a stimulus measure when the issues are really happening in Alberta.

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, we have made a commitment to Canadians, whether they live in Victoria, northern Canada, Prince Edward Island, or Toronto, to grow the economy. That means making investments, and we are going to move forward on those investments. They are going to include investments in Calgary, in Fort McMurray, and across the country so that we can grow our economy, making a real and measurable difference for Canadians today and tomorrow.

[Lisa Raitt, Conservative, Milton, ON]

Mr. Chair, does the minister realize that there is a difference between spending and investing in order to boost growth?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, I realize that what is most important is that we make investments in order to grow the economy. That is why we have embarked on that plan. That is why we outlined for Canadians an historic $120-billion infrastructure investment. That is why we are moving forward quickly on investments in research in universities and in federal infrastructure, because we know those sorts of investments are going to help get our economy going now and create a more productive environment for the future.

[Lisa Raitt, Conservative, Milton, ON]

Mr. Chair, I ask these questions of the minister for this reason. We are experiencing an economic growth issue in the country right now. It has been correlated directly to what we are experiencing in terms of the commodity shock. My concern is that the government has done nothing to try to ebb whatever is happening there in terms of doing investments directly to the places that need help the most, that have the economic slack, that have the ability to increase production, because quite frankly there is a great want for something to happen out there. This spend does not necessarily benefit them if it is done all the way across the country. A targeted investment is something that Canadians understand, and it is a good reason to go into debt, just as we did in the 2008-09 recession.

The difficulty I have with the plans that the government has put together is that quite frankly there is no plan. If there is a plan in order to stem what is happening in the economic shock, then why did the Liberals layer on regulations to make it more difficult to have businesses invest in those areas? Why do they give us such great uncertainty about whether or not private projects are going to go forward? Why do they talk about increasing taxes? Those things do not help growth.

What we have here today, and what we are looking at both in the main estimates and in the budget, is the realization that the government is just about spending Canadians' hard-earned tax dollars. That is all it is.

While he glowingly quotes the puff pieces he is reading from different places around the world, I can attest that there is only one finance minister in our great country who has ever received an international award for being the best finance minister. That is the late Jim Flaherty.

There is a quote I would like the minister to remember as he walks away from this place tonight. I thank him for his time and I thank him for some of his answers. Some of them were talking points, but that is okay; we all do that on occasion.

I would like him to remember this as well. The greatest concern right now is that there seems to be one plan and one plan only that involves spending a great deal of Canadian taxpayer money, and it is all put on the dice. The roll of the dice, as he eloquently pointed out at one point in time, is hoping that Canada's economy will grow. However, Maclean's wrote about this recently as well. Despite all these great articles being written around the world our own magazine says:

When all is said and done, [the Minister of Finance's] plan to put Canada deeper into debt to boost growth may not result in any additional growth, just a whole lot more debt.

That is exactly what Her Majesty's loyal opposition is concerned about. Therefore, at the very least, to conclude and finish with the question, does the minister have a plan B?

[The Chair, Conservative, Bruce Stanton]

We are actually out of time. We are going to go to resuming debate and the hon. member for St. John's South—Mount Pearl.

[Seamus O'Regan, Liberal, St. John's South—Mount Pearl, NL]

Mr. Chair, I am thankful for the time that I have to speak to this committee about the specific concerns of my district of St. John's South—Mount Pearl.

It has been a great pleasure to listen to those across the way talking about fiscal prudence. It brings up questions of the time space continuum, and perhaps forgetting about the past and being $150 billion in debt. Enough of that.

We want to talk about the future, and perhaps we can talk about our young people. I was fortunate enough, at the young age of 21, to get my first job. I was the executive assistant to the minister of justice in the Government of Newfoundland and Labrador, Mr. Edward Roberts. I was young as an executive assistant, otherwise known as an EA. Therefore, I was known around the legislature as Doogie Howser, EA.

I took that as a compliment because Doogie Howser was a hero back in the late 1980s, early 1990s. It was a venerable show and launched the career of one, Neil Patrick Harris. It featured the stern but wise father, Dr. David Howser, and his pals, including his window-entering best buddy Vinnie.

He always found the time at the end of every episode to enter some secret tidbits of wisdom into that computer journal of his, saving it on his three-and-a-half inch floppy disk.

I have to ask the minister, when thinking of the future, when thinking of those who will be affected by this budget in the years before us, what tidbits of wisdom does he have within this budget for a generation that awaits those answers?

[Bill Morneau, Liberal, Toronto Centre, ON]

Mr. Chair, I would like to thank the hon. member for his insight, his humour, and his question.

I would like to start by addressing the challenge we are facing. I heard from the hon. member opposite what I believe to be a significant misunderstanding of the challenges we are facing right now in the economy.

The member opposite identified the shock in oil prices as being the economic challenge that we are facing. In fact, I believe that is one very significant challenge that we are facing, but we are facing a much more significant challenge over the long term in this country.

We are facing a challenge that we have been looking at for a while. We are facing low and volatile global growth. We are facing a demographic challenge that means that over the long term, we will have significantly fewer workers per retiree in this country.

In those sorts of circumstances, the right policy response is to make investments to improve the protective capacity of our country. We are making short-term investments that are going to help us with the shock. We are making investments in people through improving our employment insurance system.

However, importantly, we are facing up to the real challenges that we know must be faced to help Canadians over the long term. As we face those demographic challenges, it would be irresponsible if we did not take action today to ensure that we can have a more productive economy tomorrow. That is exactly what we have embarked on in budget 2016.

The discussion today is about that. It is about how we are going to make a difference in the future for those people we are responsible for, and those young people today who are going to be facing a more uncertain future. That is what we are doing.

We are proud of what we are doing. We are pleased to be able to present it to this House tonight.

[The Chair, Conservative, Bruce Stanton]

It being 12:50 a.m., pursuant to Standing Order 81(4), all votes are deemed reported. The committee will rise and I will now leave the chair.

[The Deputy Speaker, Conservative, Bruce Stanton]

This House stands adjourned until later this day at 10 a.m. pursuant to Standing Order 24(1).

(The House adjourned at 00:53 a.m.)