Mr. Speaker, for those following the debate on this budget implementation act, I will provide the necessary context for how we ended up with the most expensive federal budget in our lifetime.
It is imperative that we as legislators look at the full picture and to the future when debating a bill like this. Right now in Canada there are countless families and businesses on the brink of losing everything they have. The recent job numbers are horrendous, as our economy shed another 207,000 positions and our unemployment rate is 8.1%. These are not just numbers and statistics; they are people's livelihoods and careers. Many of these jobs were in the service and retail industry. These workers now find themselves without a pay cheque and some fear their jobs will never come back.
Every single constituency has been hit hard. All we have to do is look at the empty storefronts and vacant buildings to understand the severity of the economic and health crisis our country is facing.
We are now in the third wave and my province of Manitoba is back in lockdown. We are not unique as every province is in a race to stop the spread of COVID variants. While other nations have done a tremendous job of procuring enough vaccines for the first quarter of 2021, which helped them to mitigate against the third wave, we, in Canada, have not been so fortunate. We find ourselves in this terrible position due to a series of failures.
For my Liberal colleagues who might not take my word, I only need to point to the recent Auditor General's report that proved beyond a reasonable doubt that the government was woefully unprepared for the pandemic. My Liberal colleagues could also review the speech given by the member for Kingston and the Islands when he admitted, “if vaccines came sooner we probably would not be standing in this place right now,” which was in response to the emergency debate that took place just last week. For once in my parliamentary career I can say that I agree with my hon. Liberal colleague.
I do not plan on litigating everything that has happened to date. For the purposes of this debate, it must be said that if we were able to procure enough vaccines for the first quarter of 2021, we would be in a far better position than we find ourselves today. If the government had moved quickly to shutdown flights from countries, where the variants are out of control, it would certainly have helped limit the spread of these variants. Not only has those failures cost people's lives, but it has resulted in prolonging the pandemic.
There is a direct correlation between those failures and their direct impact on our economy and the nation's finances. Within this omnibus bill, the government has acknowledged that the pandemic will continue for quite some time.
It is clear that the government needs to extend the programs on which many businesses and companies are relying, as either their doors are now locked or they are operating with very limited capacity. Just because the doors are closed, though, does not mean the bills do not continue to pile up. To no fault of their own, businesses and their employees are paying the price of the federal government's failure of not procuring enough vaccines for the first quarter of 2021 and for failing to keep the variants out of our country, and certainly for the lack of distribution of the same.
The last thing people want to do is to continue to apply for more financial support, but they do not have a choice. They cannot afford to go through another lockdown and they need to pay their bills. Therefore, I support those very specific clauses in the legislation to extend these programs. In fact, there are other specific measures I support, but in a bill as lengthy as this one, there are bound to be a few things that every member can get behind.
The road ahead of us is paved with uncertainties and risks, so we are already seeing the unintended consequences of the government's policies. The first risk is the very real threat of inflation. The Bank of Canada recently sent out a warning to investors that rising inflation numbers could result in it hiking the interest rate. If we couple that with the recent report that close to half of Canadians are $200 or less away from not being able to cover their bills and debt payments at the end of each month, that should keep every member of Parliament up at night.
If we look at the skyrocketing housing prices, we are witnessing in real time the dream of home ownership slipping away. I shudder at the thought of what is going to happen to those who will have to remortgage their homes at a much higher interest rate.
The second threat is the growing size of our country's debt and the cost to service that debt, as was mentioned by many of my colleagues. I know that every government must grapple with making choices and setting priorities, but I fear there are some who cannot see the forest for the trees. In a perfect world, every government has the financial capacity to carry out its mandate, but we do not live in that utopia where everything can get funded all at once. The size of this deficit makes one wonder who got left out.
Last week, the Parliamentary Budget Officer issued his analysis of the budget. He projects that the ratio of federal debt to gross domestic product will hit 52.1% this year and remain well above the pre-pandemic level of 31.2% for quite some time. In the report, there was another startling number that deserves repeating. The long-term projections presented in the budget show the federal debt-to-GDP ratio remaining above its pre-pandemic level through to the year 2055. That is a staggering 34 years from now. I doubt that I will witness the momentous occasion when the Government of Canada returns to pre-pandemic debt numbers, but my grandchildren and their families will most certainly be stuck with the bill, and that bill right now is that the average Canadian family owes over $77,000 in federal debt.
Any time a government goes this far into debt, it is completely irresponsible to not have a road map or a plan to get its fiscal house back in order. The interest payments alone on our debt are expected to hit almost $40 billion a year in the next few years. For my Liberal colleagues who do not share the same hesitations about their spendthrift ways, I will quote Paul Martin, who was a long-serving Liberal finance minister. He said, “The debt and the deficit are not inventions of ideology. They are facts of arithmetic. The quicksand of compound interest is real.” He said those words over 20 years ago and they still ring true. It would seem that modern monetary theory has found a receptive audience within the government.
I want to reference Jonathan Hartley, an economics researcher, who recently wrote about the pitfalls of this new economic model being touted by the left-of-centre politicians. He said, “The defining feature of [modern monetary theory]—and what distinguishes it from [other] economic theories—is its insistence that, so long as a government's debt is denominated in its own currency, there is no upper limit on the state's monetary borrowing.” He went on to say that under this theory “public debt is irrelevant”. He did not say that, but he referred to it as part of that theory. He further stated, “a country's central bank can always avoid default by printing more money.”
We know that there are real risks to this approach, and there are countless examples of debt monetization leading to out-of-control inflation. The Bank of Canada must adjust to the reality that this cannot go on forever. The Bank of Canada has been buying a minimum of $4 billion in government bonds every week, accumulating more than $250 billion of the securities over the past year. As reported, its share of the holdings of the outstanding bond market continues to grow, and it currently owns more than 35% of the total marketed outstanding Government of Canada debt. We should all be watching the Bank of Canada's actions and future decisions.
I do not say these things to cause alarm, but rather as someone who witnessed the crushing interest rate hikes and inflation in previous decades. I fully understand the necessity to help get our economy back on track and those suffering. However, we must quickly turn our attention to getting our finances under control. As parliamentary committees gear up to study the various parts of this omnibus bill, Canadians are counting on all of us to get this right, so we must ensure that every dollar being spent will, in fact, grow our economy and improve the lives of those we represent.