Madam Speaker, I will be sharing my time with the member for Whitby.
We are fully aware that the effects of high inflation are being felt across the country. As the member for Burnaby South surely knows, it is a global phenomenon, and the price of goods has increased around the world. This is due to a number of factors.
First, during the pandemic, millions of people reallocated money they usually spent on services to the purchase of physical goods. This put extraordinary pressure on global supply chains and led to shortages and bottlenecks. Furthermore, droughts in the main food-producing regions, including the Canadian Prairies, resulted in higher grocery bills. All of this has been exacerbated by the current instability of global markets following Russia's illegal and unwarranted attack on Ukraine.
President Putin's unjustified war has led to an increase in the price of raw materials and again threatens to disrupt the supply of goods. This puts upward pressure on prices. There is also the pandemic, which continues to threaten global supply chains and increase inflation as a result of a resurgence of cases in China and another wave starting in Europe at this time.
Many factors are putting upward pressure on prices. Canadians are worried about the rising cost of living and I am too. The Bank of Canada and private sector economists predict that inflation could remain higher for a little longer than initially thought. However, they expect it to go back down to the 2% target over the next two years, as the repercussions of the pandemic start to fade.
Let us face it, these are truly uncertain times on many fronts. The Russian invasion of Ukraine is a new major source of uncertainty. The price of oil and energy have recently spiked. Our government acted swiftly and decisively with the European Union, the United States and the United Kingdom to impose the harshest sanctions ever placed on a major economy. For those sanctions to be truly effective and have a real impact, we must be prepared for any adverse consequences to our own economy. This could temporarily affect the cost of living for Canadians.
Opposition members often bring up the rising cost of oil and gas. It is true that prices have risen sharply as of late. However, my colleagues have an unfortunate tendency to make obscure connections to explain this increase, for example by tying it to our pandemic spending or our tax on pollution.
They are obviously ignoring the main factor behind this increase, which is, of course, Russia's unjustified war against Ukraine. The Conservatives like to say that we must do more for Ukraine. They even brought up a no‑fly zone over Ukraine before changing their minds a few hours later. They seem to be not only unsure of where they stand, but also completely oblivious to the economic consequences of this war and of our sanctions.
That said, I remind members that the federal government's assistance programs, such as the Canada child benefit, old age security, the guaranteed income supplement and the GST credit are indexed to inflation. This ensures that the benefits will increase in tandem with the increase in the cost of living.
In recent years our government has also lowered taxes for the middle class and increased taxes on the wealthiest 1% of Canadians. We are also working very hard to address the high cost of housing.
Over the longer term, Canada's monetary policy framework is the best weapon in our arsenal to keep prices stable and keep inflationary pressures in check. That is why, last December, our government and the Bank of Canada announced the renewal of the 2% inflation target for another five-year period. This renewed framework will keep the bank focused on delivering low, stable and predictable inflation for Canada.
Since Canada adopted an inflation targeting framework about 30 years ago, inflation has averaged close to 2%. This has contributed to our country's strong labour market performance, to our economic growth and, of course, to our prosperity. Maintaining a stable environment for the prices that Canadians pay is a paramount objective for Canada's monetary policy, as implemented by the Bank of Canada.
I trust that my fellow members are aware of the efforts that our government is making to address the rising cost of living and to make life more affordable for Canadians. It is also important to remember that the significant support our government delivered to Canadians and businesses during the pandemic has contributed to a rapid and resilient recovery so far.
Canada has far exceeded expectations, surpassing its goal of one million new jobs and posting the strongest job recovery rate in the G7. Still, we recognize that the recovery is happening more slowly in some sectors. That is why the government has shifted from very broad support to more targeted measures that provide help when and where it is needed.
It is also true that some sectors and businesses have seen their profits go way up during the pandemic. We know that banks have continued to make a lot of money during the pandemic. That is why one of the planks in our campaign platform was to raise corporate income taxes on the largest, most profitable banks and insurance companies in the country and on corporations earning more than $1 billion per year.
That is very important, because we want to build a sustainable, united Canada. We want to build a fairer, more equitable Canada where nobody is left behind. That means focusing on jobs and economic growth. It means making sure the cost of living is within everybody's reach.
I know our government will have much more to say about this in our next budget. I am looking forward to debating it here in the House.
