Mr. Speaker, the rise in food prices in recent years has been a global phenomenon, driven primarily by supply constraints and shortages faced during the pandemic, compounded by commodity price increases due to the Russian invasion of Ukraine and subsequent global geopolitical events. Indeed, the peak rise in food price inflation in Canada, at 10.6 percent in January 2023, was the second lowest in the G7 next to Japan. Moreover, food price inflation has moderated significantly since that peak, averaging just 1.8 percent on average over the first four months of 2025, again, second lowest in the G7.
The Government of Canada is committed to a policy of low, stable and predictable total inflation. This policy is achieved through a joint agreement between the Government of Canada and the Bank of Canada, the latter of which has as its central objective for monetary policy to target an annual rate of 2 percent for All-Items Consumer Price Index inflation. This has contributed to a more stable economic environment relative to previous decades and allowed households and businesses to make better long-term financial plans.
The government has taken several steps to address food price inflation and affordability, including implementing a middle-class tax cut by reducing the first personal income tax rate from 15 percent to 14 percent, effective July 1, 2025, which will provide tax relief for nearly 22 million Canadians and save families up to $840 annually starting in 2026, the first full year when the tax rate will be 14 percent; launching the National School Food Program, which will save the average participating family with two children up to $800 per year; together with provinces and territories, establishing Canada’s first-ever industry-led Grocery Sector Code of Conduct, which came into effect on June 1, 2025; creating a Food Price Data Hub, to provide Canadians a centralized location to view detailed information on food prices and help consumers make informed decisions about their food purchases; and amending the Competition Act to enhance competition and gave the Competition Bureau more power to crack down on unfair practices.
Food price inflation is influenced by many complex factors, such as extreme weather events, global supply chain disruptions, exchange rate, energy and transportation costs, and competitive environment to name just a few. Therefore, several federal government portfolios contribute to lowering food price inflation, including Innovation, Science and Economic Development Canada, Agriculture and Agri-Food Canada, and Crown-Indigenous Relations and Northern Affairs Canada, which specifically addresses food costs in remote northern communities through the Nutrition North Canada program.