Debates of June 8th, 2026

Opposition Motion—The Government's Fiscal Policies

[The Assistant Deputy Speaker, John Nater]

No, talking about the absence or presence of members is not permitted. Members of Parliament are not allowed to do that.

I will give the hon. parliamentary secretary the opportunity to answer the question.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I appreciate the question very much. If we look at what has been achieved over the last 13 or 14 months since Canadians elected our current Prime Minister, it has been a great deal.

Someone brought up the analogy of a marathon runner in terms of how the government, and the Prime Minister in particular, is responding to the Canadian economy and society as a whole, bringing in good legislative measures and financial measures to support Canadians. Canadians are seeing it, and they are encouraging us to continue to move forward. Only the Conservatives seem to be the naysayers.

[Rhonda Kirkland, Conservative, Oshawa, ON]

Mr. Speaker, I find it rather appalling the way the member stands up here and talks about how everything is so wonderful. I will ask him what I asked earlier this morning. Is he talking to folks in his riding? People are struggling.

We Conservatives are fighting for those people, and we are talking to them every day. I spoke with one of my constituents, who talked about the groceries and essentials benefit. I should correct the record because the Liberals keep saying that we voted against it, which is patently untrue. Since that is not the case, I did ask how the groceries and essentials benefit was helping her. My constituent said that it is giving her $1.31 per week, which might help her buy another package of ramen noodles.

I wonder if the member would recognize that having all of these programs is really just a recognition of the government's failure.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I wonder if the member opposite would recognize that the average wage has actually increased more than the inflation rate every month since we had that last federal election.

At the end of the day, there are individuals who are having some financial difficulties, and that has always been the case. Obviously, we all want to try to assist where we can, and that is where I would challenge the member opposite. A good program is the national school food program, which was made permanent by this Prime Minister, by this government. There are members of the Conservative Party who have called it garbage and said that it does not exist. It feeds 400,000 young children, yet they oppose it.

At times, one begins to question just how much hypocrisy is oozing from the other side.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

Mr. Speaker, how does the member perceive the reaction in trade negotiations when the opposition is proposing that Canada is in a gloomy position, while most economists and experts are not positioning it that way at all? The Conservatives are positioning this as though Canada is in the midst of a tremendous downfall, when in fact it is the opposite, but that is giving leverage and strength to the United States in trade discussions.

Can the member comment, please?

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I appreciate the question because there is so much truth in what the member said. If we go around and tell the world that Canada's economy is bad, we cannot trust it, everything is broken and so forth, which is what we hear from Conservative member after Conservative member talking negatively about Canada, that ultimately assists the U.S. over Canada.

I would cite the member for Bowmanville—Oshawa North, who went down to the United States, and his report, after meeting with President Trump and the Vice-President, was that Canadians are just having a “hissy fit”—

[The Assistant Deputy Speaker, John Nater]

We have time for a brief question from the hon. member for London—Fanshawe.

[Kurt Holman, Conservative, London—Fanshawe, ON]

Mr. Speaker, to address what the parliamentary secretary is implying, which is that the economy here in Canada is good, I would ask him to come down to the London region. It is not just the increased food bank usage but the other organizations that support the food bank. I was talking to a representative from Urban Roots, which grows natural food to be donated to various organizations, including the local London Food Bank. The usage has increased in the last year.

I would ask the member to comment on that.

[Kevin Lamoureux, Liberal, Winnipeg North, MB]

Mr. Speaker, I can assure the member that different regions of the country have different impacts in the community. The government continues to look at all the regions of the country, and we do what we can, such as the national school food program for children, which the member opposite voted against. We also financially support food banks.

We are, as a government, a whole lot more compassionate than what we have seen from the Conservatives over the last number of—

[The Assistant Deputy Speaker, John Nater]

Resuming debate, the hon. member for Wellington—Halton Hills North.

[Michael Chong, Conservative, Wellington—Halton Hills North, ON]

Mr. Speaker, a recession can be defined as two consecutive quarters of flat or negative GDP growth. By that definition, Canada is in a recession. The government has downplayed the seriousness of these two consecutive flat to negative quarters of growth and painted a picture of an economy with underlying strength. However, that fails to take into account the bigger picture. Here is the bigger picture: In three of the last four quarters, aggregate GDP shrank. That comes on the heels of years of shrinking per capita GDP.

Per capita GDP is a more important measure than aggregate GDP. Here is why. Decades from now, it would be far better to live in a country of 40 million Canadians making double what they make now than to live in a country with 100 million Canadians making the same as they make now. The first country would have a smaller economy than the latter, but it would be more cohesive, more prosperous and more environmentally sustainable, with higher levels of individual income. Many corporate CEOs would prefer the latter country, because the total accessible market would be larger, but the average Canadian would be poorer for it.

Looking at the last three years, the picture of per capita GDP is grim. Canada was effectively in a per capita recession in 2023 and 2024. In 2022, per capita GDP stood at $60,735. In 2023, it shrank by $458. In 2024, it shrank, yet again, by $539. Over a two-year period, per capita GDP dropped by almost $1,000 per person, a drop of about 1.6%.

Looking at the last six years, the picture is not much better. Before the pandemic began, per capita GDP stood at $59,681 in 2019. Last year, it stood at $60,073, an increase of only $392 over six years. This is a compound annual growth rate of 0.1% per year, effectively zero. All the while, the cost of living skyrocketed.

The picture is just as bad when we look at last year. While per capita GDP edged up slightly in the last quarter, the first quarter of 2026, by 0.2% quarter over quarter, the fact is that per capita GDP shrank in Q2 and Q4 last year. As a result, per capita GDP last quarter was up only 0.2% year over year, effectively zero. In other words, per capita GDP in the first year of the new Liberal government follows the same trajectory as it had under the old Liberal government.

Part of the bigger picture is not only declining GDP, but productivity. As a Nobel Prize-winning economist once said, “Productivity isn't everything, but, in the long run, it is almost everything. A country’s ability to improve its standard of living over time depends almost entirely on its ability to raise its output per worker.”

The picture of productivity looks grim. When we look at Statistics Canada's annual measures, labour productivity has declined in each and every one of the last four years for which we have full-year data. Productivity dropped from $67.70 an hour worked in 2020 to $63.20 in 2024, a decline of almost 7%. Two years ago, on March 26, 2024, the senior deputy governor of the Bank of Canada, Carolyn Rogers, called Canada's lagging productivity an “emergency”. Since then, productivity appears to have flatlined, if not declined. The emergency appears to have become even more dire.

When we look at Statistics Canada's quarterly measures, business sector labour productivity declined over the last year. In the first quarter of 2025, it measured on an index of 100 at 104.7. Last quarter, it stood at 104.074, a decline of 0.5% in just one year. Under the new Liberal government, the productivity emergency has gotten worse than it was under the old Liberal government.

At this point, I will remind the House that I will be splitting my time.

When the Bank of Canada rang the alarm bells on productivity, it cited low levels of business investment as one of the root causes. Business investment has plummeted over the past decade. According to a recent analysis by Steven Globerman of the Fraser Institute, business investment in plants, capital, equipment and IP, expressed as a percentage of GDP, dropped from 13.8% in 2014 to 11.1% last year, and under the new Liberal government, the decline has continued. According to Statistics Canada's release of May 29, “Business capital investment fell 0.7% in the first quarter of 2026, the fifth consecutive quarterly decline.” Steven Globerman has called this a “business investment emergency”. We have not only a productivity emergency but a business investment emergency. The word “emergency” is not my word. This is the word of the Bank of Canada and a reputable research organization.

The fundamentals have not gotten better in the past 12 months under the new Liberal government: not on per capita GDP, not on productivity growth and not on business capital investment. In fact, in many cases, it has gotten worse. The data I cite in this speech is taken from Statistics Canada, including tables 36-10-0706-01, 36-10-0480-01 and 36-10-0206-01, unless I have specified otherwise.

In my assessment, nothing the new Liberal government has done with the new Prime Minister in the past year fundamentally changes the trajectory of the economy, and the early data that has come in over the past four quarters confirms that assessment. Canada's per capita GDP continues to flatline, if not decline. Canada's productivity continues to flatline, if not decline. Canada's business capital investment continues to flatline, if not outright decline.

That is because the government has failed to introduce the fundamental reforms necessary to turn the economy around. It has failed to introduce wholesale tax reform to our personal and corporate income tax systems. We need tax reform of the scale and ambition that we saw in 1971 or in the 1980s under the government of Brian Mulroney. It has failed to introduce fiscal reform of the scale and ambition of former prime minister Chrétien and finance minister Martin, who, in 1995, introduced a revolutionary budget that refocused the federal government and balanced the budget in 36 months.

It has failed to introduce desperately needed competition reform to address the oligopolies and the uncompetitiveness of our economy, which are making our goods unattractive for export to global markets. Export expressed as a percentage of our GDP has plummeted, from about 43% of GDP in the year 2000 to about 33% today.

The government has also failed to introduce the regulatory reform needed. We need to reduce the regulation that is strangling business investment and growth. The government implicitly acknowledged that its regulatory approach is not working. Not only has the government not used the national interest designation under Bill C-5, but it is engaged in yet more consultations to introduce yet more legislation to change its regulatory approach.

Until early April, the government could argue that it did not have the power to enact these fundamental reforms because it did not have a majority. That excuse no longer holds. The early data coming in over the past 12 months is that the new Liberal government is on the same course as the old Liberal government on per capita GDP, productivity and business capital investment. The government has a choice: to acknowledge how bad things are, reverse course and introduce fundamental reforms in taxation, competition, and regulatory and fiscal policies, or to continue to preside over Canada's continued economic decline. If the government does not acknowledge the very real and serious fundamental challenges our economy is facing, it will not fix the problem.

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

I have two quick points, Mr. Speaker. The member gives the impression that it is an issue of foreign investment. Foreign investment today is at a 20-year high. I do not quite understand how he sees that as a decrease. On exports, we are at least 17% higher internationally, outside of the United States, but also exports to the United States are up from last year.

Where is the member really drawing his numbers and conclusions from?

[Michael Chong, Conservative, Wellington—Halton Hills North, ON]

Mr. Speaker, the member opposite is making the mistake of looking at flows, in other words at the P&L, rather than at the balance sheet. The balance sheet is clear. Business capital investment has declined in each and every one of the last five consecutive quarters. That is the more important measurement, because as capital is deployed, it depreciates, and the fact that business capital investment has failed to keep up with the capital depreciation in this country and has declined over the last five quarters is a much more alarming statistic than the flows he is citing.

[Mario Beaulieu, Bloc, La Pointe-de-l'Île, QC]

Mr. Speaker, it is true that the Canadian economy is not doing well. It is also true that certain Liberal policies have contributed to the fact that we are in a technical recession.

However, by painting an overly dire and one-sided picture, are the Conservatives not discrediting themselves? What does my colleague think?

[Michael Chong, Conservative, Wellington—Halton Hills North, ON]

Mr. Speaker, I would like to thank my colleague for his question.

It was not me who used the word “emergency”; it was the deputy governor of the Bank of Canada. It was a central banker who used the word “emergency”, which is strong language for someone who is normally quite opaque about the direction of the economy.

It was not me who used the word “emergency”; it was Steven Globerman at the Fraser Institute, a reputable research organization and one of the largest economic research organizations in the country.

The fact is that nothing has addressed the fundamental problems facing our economy, and that is why Canadians continue to struggle with the cost of day-to-day living and other essentials.

[Helena Konanz, Conservative, Similkameen—South Okanagan—West Kootenay, BC]

Mr. Speaker, I always learn so much whenever my colleague stands in the House.

I am hearing constantly from the people in my riding that they are struggling with basic needs, like putting food on the table. I know I am not the only one. I am sure every MP in this room right now, every MP who was elected in the last year, feels the same thing. We know from the data that there is a recession. We know there are issues in Canada, but the Liberals keep denying that anything is wrong. What does my colleague think is the danger of denying issues like this when they are so blatant? I know the Liberals are hearing the same things we are hearing. What is the danger of denial?

[Michael Chong, Conservative, Wellington—Halton Hills North, ON]

Mr. Speaker, one of the dangers of denial is that we are going to see a brain drain from this country to our neighbour to the south. According to the TD Bank study that was released on May 21, Canada's top-skilled workers are leaving for the United States in droves for lower taxes and higher pay. It says, “Canada is not hollowing out; it is spilling out at the top” and “Absent progress on this front, Canada will continue to be a feeder system for the U.S. innovation economy.”

Statistics Canada confirms that in 2023 alone, 18,590 Canadian residents immigrated to the U.S. permanently, and a 2024 Bank of Canada study found that 40% of Canadians who would rank in the top 1% of earners have already left Canada for the United States. It also found that up to half of the top 2% to 10% of income earners have also already left.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

Mr. Speaker, I am participating in today's debate to speak about the government's plan to maintain fiscal stability and provide a bit more clarity on Canada's economy.

The government's fiscal plan remains rooted in fiscal responsibility. This is not for its own sake, but to create capacity and invest in long-term economic strength and greater self-reliance. Consistent with this approach, the recent spring economic update of 2026 is the government's next step in building a stronger, more independent and more resilient Canada. It advances the building of more affordable housing and houses. It talks about major infrastructure that transforms and connects our economy while bringing down costs to help Canadians get ahead.

It is absolutely important to give a clear and transparent account of Canada's economy and its performance in an increasingly uncertain world, and to not promote fear. We are advancing major projects that connect and transform our nation, supercharging our housing construction and forging new economic partnerships. We are acting decisively to protect our economic sovereignty and position Canada for greater long-term growth. It is a principled and pragmatic approach. However, some long-term payoffs will take time.

To ensure that Canadians have the support they need right now, the government is providing bridging supports. For over a year, Canada's government has been focused on making life more affordable. Nearly 22 million Canadians are keeping more of what they earn with the middle-income tax cut. First-time homebuyers are saving up to $50,000 with the removal or reduction of the goods and services tax on new homes. The removal of the consumer carbon price has lowered gas prices by 18¢ per litre. The government has temporarily suspended the federal fuel excise tax. Last week, more than 12 million Canadians began receiving hundreds of dollars more through the new Canada groceries and essentials benefit. These are important measures.

In a world of geopolitical instability, governments need to rethink how they respond to the headwinds. From a fiscal perspective, especially in light of these challenges, we are delivering up to $11.5 billion in improvements to our project deficit going forward in our budgetary balance. This strength carries into future years, providing the budgetary balance relative to that of budget 2025 by an average of $10.7 billion per year from 2026-27 to 2029-30 before those new measures. This fiscal room allows the government to improve affordability and raise the Canadian standard of living through targeted policy measures.

The recent budget marked a strategic shift in the government's management of public finances. It is focused on expanding federal capital spending to mobilize investments while maintaining those critical programs that so many Canadians rely on. With significant investments in infrastructure, innovation and industrial capabilities, budget 2025 set out a clear plan to build the strongest economy in the G7.

The government also remains committed to being disciplined. This includes the comprehensive expenditure review, which now totals over $60 billion in savings and revenues over the next five years. The focus is targeted, beginning with efforts to rein in spending on external management and other consulting services. These challenging actions are necessary. They have the objective of spending less so that we can invest more in Canadians.

Canadians are navigating a rapidly changing and increasingly fragmented world. Economic security, industrial policy and geopolitical competition are increasingly shaping investment, trade and financial decisions. The conflict in the Middle East, of course, has disrupted key shipping routes, and damaged energy infrastructure has pushed energy prices higher, underscoring the fragility of global supply chains and adding to an already elevated level of uncertainty.

Despite this environment, Canada's economy continued to expand, growing by 1.9% in 2025. Domestic activity remained solid, even with the elevated tariffs and the impacts they have on our trade tensions. North American supply chains withstood disruptions more effectively than expected, with the Canada-U.S.-Mexico Agreement, the CUSMA, protecting approximately 85% of Canadian goods exports from these recent U.S. measures.

Businesses and workers have shown remarkable resilience in the face of significant uncertainty. Contrary to the naysayers, firms continue to invest, diversify suppliers and expand into new markets. Canada continues to attract significant global capital, leading the G7 in per capita direct investment inflows. A Statistics Canada survey of planned capital expenditures for 2026 indicates that businesses plan to step up capital spending this year. Reflecting on Canadian adaptability, the International Monetary Fund, the IMF, expects Canada to post the second-fastest growth in the G7 over 2026 and 2027.

Labour market conditions have also remained resilient. Since 2024, Canada has added more jobs per capita than the U.S. In May alone, the Canadian economy added 88,000 jobs, which has already been mentioned a number of times today. These jobs are mainly in the private sector, and all of them are full-time. The unemployment rate has fallen to 6.6%. Wage growth has now outpaced inflation for more than three consecutive years, supporting continued gains in real incomes.

Overall, the Canadian economy has shown resilience in the face of significant trade tensions and geopolitical uncertainty, and most respected economists and experts agree.

Let me remind the hon. members in the House that even with all of the global challenges, Canada starts from a position of strength. Canada's net debt burden today is lower than any other G7 country's. It is even below the levels of those countries' prior to the pandemic. Canada also has one of the smallest deficits in the G7 as a share of its economy. This fiscal challenge gives the government the capacity and responsibility to act to build a stronger economy, make life more affordable, create high-paying jobs, take care of each other and determine our future.

Canada's fiscal position also stands well among 30 other advanced economies. We are one of only two G7 economies, alongside Germany, to maintain a AAA credit rating with most global credit rating agencies. This AAA rating supports investor confidence and keeps us borrowing at lower costs than would otherwise be possible.

We know some of the payoffs will take time. That is why our government is standing with Canadians through uncertain and rapidly changing times by acting responsibly to provide supports today and making smart, long-term investments that strengthen Canada's economy. This means creating the mechanisms to ensure that Canadians thrive today and tomorrow, supporting workers and young people, enhancing the housing sector, combatting financial crimes and investing in strong communities.

We need to be on the right track. All members of the House should be collaborating effectively to promote Canada, not creating fearmongering and not giving enough sway and support to the likes of those who are leveraging to downplay the Canadian economy and its strength and the unifying effect that we are seeing.

We will stand strong for Canadians, and Canadians will stand strong by continuing to do what they do well.

[The Assistant Deputy Speaker, John Nater]

It is my duty pursuant to Standing Order 38 to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Riding Mountain, Health; the hon. member for Kitchener South—Hespeler, Health.

[Carol Anstey, Conservative, Long Range Mountains, NL]

Mr. Speaker, when the member opposite is in his riding and he is talking to the Canadians standing in food bank lineups, facing consumer insolvency and struggling to afford groceries, I wonder if the response he gives Canadians is that we are 100% on the right track. Are these the statistics he gives them?

Is this acceptable to the Canadians who live in his riding? It is sure not acceptable in my riding, when I talk to people who are struggling.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

Mr. Speaker, the member opposite brings up a very important point, which is that during these moments of challenge, it is important for the government to stand by Canadian citizens, especially those who are most vulnerable.

What has the government done? We have made middle-income tax cuts, which the opposition member did not approve. We provided the groceries and essentials benefit program. We eliminated the GST for first-time homebuyers. We are putting a pause on the fuel excise tax. We have also launched the automatic federal benefits program to provide more support for those very individuals. The member opposite did not support those measures to help her constituents.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Mr. Speaker, I rather like my colleague from Mississauga—Lakeshore. We should hear from him more often in the House.

I would like him to talk about the budgetary projections and fiscal anchors the Parliamentary Budget Officer mentioned. She projects that the deficit will be $6.5 billion higher, reaching a total of $71.8 billion, compared to the economic update released just a month ago.

I found that interesting. The Liberals were telling us how much smaller the deficit was than expected and that the situation was better. It is a bit like me giving my teenager $100 to go buy pizza and him being proud to hand me back $5 afterwards. We do not know what he did with the rest, but that is not good management. I would like to hear my colleague's thoughts on that.

Given the current circumstances, where is the deficit headed?

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

Mr. Speaker, the hon. member is bringing the question to me by way of what economists are saying. Let me tell the House what some of the economists are saying.

According to Desjardins, “real GDP has contracted for two consecutive quarters”, but according to its analysis, “More than half of the industries in Canada have been expanding over the past six months, and consumers have continued to increase their purchases of good and services.”

According to RBC, “we continue to think underlying details in both the labour market and GDP data are better than” what is being headlined and stated in the growth of numbers.

According to TD Bank, “Looking to Q2, some bounce-back should be expected.”

According to the National Bank, “Two consecutive quarters of negative GDP growth can mean very different things depending on what’s happening to the population. Canada’s economy registered a tiny contraction in Q1, following a decline in Q4. Yet real GDP per capita rose nearly 1% in Q1”—

[The Assistant Deputy Speaker, John Nater]

The hon. member for Sarnia—Lambton—Bkejwanong.

[Marilyn Gladu, Liberal, Sarnia—Lambton—Bkejwanong, ON]

Mr. Speaker, obviously, as a former finance minister for Ontario, the hon. member understands very well the turbulent impacts that can happen to economies. Can he talk a bit about how our government's approach is stabilizing and growing the Canadian economy?