Madam Speaker, I am pleased to participate in the debate today on Bill C-30, an act to amend the Income Tax Act.
Before I go any further, let us all recognize that this bill ultimately proposes, for six months on a temporary basis, to increase the GST credit for those earning up to $49,200, or to $58,500 if it happens to be a household with children. That is when the benefit will be fully phased out. The cost of doing this will be around $2.5 billion. To put it another way, this will be yet another $2.5 billion being injected into our economy, where it will be spent driving, up further demand. This is the inflationary cycle that we are in.
Let us take a moment to stop and think about that. I am certain that I am not alone in hearing from citizens who are facing monthly mortgage payment increases they cannot afford. The stress and anxiety this is causing to many Canadian families is severe. However, let us also recognize that not everyone is impacted by this. Many of those who are wealthy are not only not impacted; some are actually coming out ahead and earning more interest on their savings and investments.
However, some of the financially most vulnerable, often working families with good jobs and living in established neighbourhoods, are the hardest hit. Let us keep in mind that they did not create this situation, but they are certainly being disproportionately impacted by it.
What have we heard from the government until only recently? Let us harken back to June, just as this place was preparing for the summer break. My office and, I am confident, a large majority of other members' offices, were getting call after call from people struggling with $2-a-litre gas, runaway grocery costs and rents. Conservative MPs, in question period after question period, were calling for the government to hear these calls and to act.
What did we get? We got a lecture by the finance minister on Bay Street, essentially telling our constituents that they never had it so good. The government tried to repackage its last two budgets as a so-called affordability plan, claiming that benefits were tied to inflation. I should note that the inflation was from last year and does not reflect the record high inflation of this year, so those CPI increases are from last year. It is a big shortfall that many are upset about. The minister claimed at the time that this was what was needed when clearly it was not.
Then what happened? Silence. There was so much silence that I have called it the “summer of silence”, as the government appeared to shut down. Sure, more taxpayer-funded projects were being announced. They were announced almost daily, keeping the ”Ottawa spends” Twitter account posting at a record pace, but what did the government do while Canadians saw more inflation records and higher interest rates? They saw nothing in response from their federal government. Believe me, I tried to look for statements with any recognition of what Canadians were going through.
What we can assume is that the Liberals spent the summer polling. I can only assume that when they came back, they did not like the numbers they were seeing, and that is why we are here today. Only now, after Conservatives have been banging on pots and pans about gas, groceries and rents, as well as increased mortgage costs, has the government finally conceded that it was wrong on inflation.
Do members remember that it was the Minister of Finance who claimed that deflation was the major concern and that the Conservatives had it all mixed up? Then when inflation was heading through the roof, the Liberals pretended that it was not. Wrong again. Then they said that their housing budget in the spring was actually an affordability plan, but it turned out that it did little for either. They were three strikes out.
While the government posted quarter after quarter of record revenues due to inflated prices, Canadians slipped further and further behind. When the Canadian public needed them, the only action they received was a government that acted as if it were uninterested, disconnected and distant. That is remarkable for a government that likes to say it has Canadians' backs. Here we are, months after the fact, discussing a payment that will not likely help those that it targets—students, persons with disabilities, pensioners and low-income families—until November or December, at best. How much suffering will happen before these payments finally arrive in the mail?
Inflation, it is said, is a silent tax that predominantly hurts the most vulnerable. I am sure any of the people who have spoken with me will tell us that is true, but what is also true is that the pain I speak of goes much further than just those targeted in Bill C-30. There are others who are also finding it harder and harder.
That list with the latest GDP projections downgraded our GDP for this year by a full percentage point. With growing unemployment and with new payroll and carbon taxes set to increase in the new year—and this before we take into account higher interest rates—there will be more “middle class and those seeking to join it” who will not be doing well.
Let me explain by returning back to Bill C-30, the bill that is essentially capped and fully phased out for those families making $58,500, which includes the vast majority of working families who are being hit the hardest. I do not want to make my comments sound partisan for the sake of being partisan, but our banks are not partisan. Their chief economists are typically offering unbiased advice, and they are all clear that the government cannot continue to pour more fuel on this inflationary fire. The reason I reference government spending is that it is something within our control to deal with.
Let me provide another example of something we can control. We have all watched skyrocketing gas prices dramatically increase inflation. Of course, with so many of our goods being delivered to market through our supply chains, which are burning gasoline to do that, there is a serious compounding of higher gas prices. That makes everything more expensive. This is one lesson we learned clearly over these past months. That is precisely what a carbon tax does: It drives up the cost of fuel and, by extension, inflation.
I know some members will say that there are rebates. Here is the thing. For those like the Minister of Finance who live in a city like Toronto and do not own a car, I have no doubt they would come out ahead with the carbon tax rebates, but if they lived in a place like Hedley, B.C., in my riding, largely because it is the only place where you can find affordable housing, they would not come out ahead. Why? It is because Hedley has no hospital. It has no high school. It has no major grocery store or insurance agent. To access these services, they would need to either drive to Princeton, Keremeos or in some cases Penticton. That is true for so many rural municipalities across Canada. For them, carbon taxes are devastating. They do not treat people equally and they favour those who live in larger urban areas.
Why should Canadians be discriminated against because of their postal code? No one living in a rural community pays less income tax than a person living in Vancouver or Toronto, yet the federal Liberal government does not treat them equally. That is why our official opposition caucus will continue to call on this Liberal government to scrap the carbon tax. None of our major trading partners has it. It is time to recognize that.
We will also see an increase in payroll taxes in the new year. Both CPP and EI premiums will increase. This will result in more money coming to Ottawa and less money staying in the household incomes of Canadians. At a time of higher inflation, with crushing interest payments, this makes things worse, not better. That is why our opposition caucus has called on the current government to stop all tax increases. We know the Liberal government likes to say that it is not its fault, but there are other countries that did precisely as Canada did and have similar problems. In some cases, it is even worse.
None of this changes the fact that we have a serious affordability crisis here in Canada. We would not be here debating this small band-aid of a bill were that not the case. That is ultimately the problem. In this case, providing some of the GST they have paid back to them at such a challenging time is something we, as the official opposition, would support, no differently than we would have supported GST relief on gas and diesel. Unfortunately, that measure failed to win support, as it is ideologically against the NDP and Liberal desire to see higher gas prices here in Canada, regardless of what the benefits would be for the general population.
Earlier this week, Bank of Canada deputy governor Paul Beaudry said, in hindsight, governments and central banks should have withdrawn stimulus measures much earlier, as their economies recovered from the COVID-19 pandemic, which likely would have put a lid on inflation. They, of course, did not do this, but it is a clear admission from the Bank of Canada that the “always be spending” approach favoured by the Liberal government has played a huge role in how we got here. If we listen to most of the major banks, inflation is not something the Liberal government can simply spend its way out of, and I worry about that, because unlike previous Liberal governments, the present Liberal government and the Prime Minister seem to have no understanding that we cannot spend Canadians out of inflation.
We are told that we may be in this situation for potentially the next two years and that interest rates may have to go even higher, if the Liberal government continues to spend. That is a point I made earlier to the Minister of Tourism. Why did they not use the summer to actually do the hard work that was in the budget, where they said they had identified billions of dollars in potential savings through a policy review? Why did they not pare back that spending over the summer and then produce this bill, having done the hard work of trying to reduce inflation while helping Canadians?
However, they did not do that. They do not, like our leader, the member for Carleton, have a pay-as-we-go rule, where we are trying to make sure Canadians are getting maximum value for every dollar that is used and that it is to their benefit. Unfortunately, the government seems to only know one lever, and that is to spend.
There are Canadian households that are barely hanging on, and they cannot afford any higher interest rates, nor can they afford two years of more pain and suffering. I am certain that every member of this House has likely heard from citizens in dire straits right now. Do we listen to them? Do we listen to experts and central bankers who say to stop the spending, or do we continue to have the Prime Minister's Office dictate more never-ending spending to help fuel this inflationary fire?
Let us not forget that just two years ago the Bank of Canada Governor Tiff Macklem said, “If you have got a mortgage or if you are considering making a major purchase...you can be confident as rates will be low for a long time.”
Some of the people who followed that advice in good faith are now in a dire financial situation. I do not say that to point fingers of blame, because that helps no one in this situation, and likely no one in this situation will be helped by the bill we are here debating today. I point this out because we need to recognize that many of the Canadians who worked hard, who followed the rules and did all of the right things are suffering right now, and the government needs to recognize that.
The latest headlines are saying that home ownership is on the decline. Many young Canadians I have spoken to have largely given up on home ownership. Their hope is not to own, but just to keep their heads above water. Paying down student debt, finding a safe rental and trying to raise a family while putting gas in their car and food on their table is difficult enough. They know the hard work, but under the current government they have lost hope. This crisis is real, and it affects some households all across Canada.
Before I close, I would like to share a thought. First of all, Canada's Conservatives, under the member for Carleton's leadership, will be supporting this bill. However, as we all know, while this bill would help some, a great many will be left behind. This is one of the challenges with government bills like this one. Inevitably the government picks the winners and the losers. In voting to support this bill we recognize that we will be helping some. However, I know in my riding for some of those who are most adversely impacted right now, not just by inflation but by crippling interest rates that will be increased by this bill, this bill would do nothing to help them. I think we all need to be critically aware of those who are still suffering and will not be helped by this bill.
Let us also bear in mind that those this bill intends to help will not receive help until November or December at the soonest. However, many people live in fear of higher interest rates for their mortgage or going to the grocery store and walking out with less and less, because they just cannot afford it. Who can blame them for these fears? The affordability crisis is real, and I am hopeful that all members in this place realize that it is more than a talking point.
Also, as people see less and less of themselves reflected in the government, they are looking more and more to my party to step up, to continue to be their voice, to remind the Liberals that more is not always better. A government that cannot do things like issue passports or resolve lineups at airports should stick to its knitting instead of constantly seeking to expand government. It needs to be reminded that government office is a duty where those around the cabinet table are there to serve Canadians and not the other way around, which is why Conservatives will support the bill: to offer tax relief, to serve Canadians who are hurting and to advocate for the ones who were left out by Bill C-30. It is a reality.
