Madam Speaker, I will be sharing my time with my colleague from Mission—Matsqui—Abbotsford.
Like most members, I spent the summer talking with folks in my riding. One of the issues that keep coming back to us as parliamentarians is the cost of living, the fact that everything is more expensive and the fact that businesses and families are indeed having trouble meeting their needs. At the same time, Canadians, at least in my riding, expressed their confidence in the government's action, in the government's plan and in the government's attempts to assist the Canadian economy.
What those folks in my riding told me, and I think it is quite right, is that difficulties and the impact on the cost of living, on the overall price levels, have come from a series of shocks that have hit our economy, shocks that have come from abroad. In fact, affordability and the cost of living are issues in Canada, in the United States, in France, in the U.K., in Germany, in Japan, in Brazil and all over the world. They come from the same source, and that source is the supply shocks we have had since 2022, ever since the invasion of Ukraine, followed by the very uneven recovery from the pandemic, which was happening at the same time. Later on, more recently, there are the very significant price shocks we have had as a result of the war in the Middle East.
These are global issues that have a real impact on pocketbooks and on Canadians' ability to face difficulties. We as a government have put in place a number of measures that help their bottom line and at the same time will contribute significantly to diversifying our economy, diversifying our markets, finding new markets and continuing to grow.
As an example, the World Bank, which I do not think can be confused with any sort of Liberal-friendly outfit, has stated:
Attacks on energy infrastructure and shipping disruptions in the Strait of Hormuz, which handles about 35% of global seaborne crude oil trade, have triggered the largest oil supply shock on record, with an initial reduction in global oil supply of about 10 million barrels per day. Even after moderating from their recent peak, Brent oil prices [remain very high, at around the $100 per barrel mark].
Energy prices will continue to remain high throughout the world, at least until the situation is addressed in the Middle East.
The chief economist of the World Bank added, “Governments must resist the temptation of broad, untargeted fiscal support measures that could distort markets and erode fiscal buffers. Instead, they should focus on rapid, temporary support targeted to the most vulnerable households.”
This is what we have been doing. This is what we are doing with Bill C-38, and this is what we will continue to do. We will be there to continue to support Canadian families with targeted and temporary support.
When we announced the fuel excise tax break back in the spring, it was to come to an end on September 7. Of course, by September 7, the situation was far from resolved in the Middle East. In fact, it is getting worse. Therefore, it is entirely appropriate that we extend this program for a few more months, until the end of January 2027. I think there is broad support in the House for us to do that.
On that, we have said that it will extend after January 31 for two extra months, so it will be a gradual withdrawal. The 10¢-a-litre excise tax relief would not be removed in one shot. It would be removed by 50% until March 31, and then the other 50% would be after March 31. There would be a gradual removal of this support, because as the World Bank and the IMF have pointed out, support for families has to be temporary and has to be targeted to the most vulnerable households.
This, in essence, is what we did with the groceries and essentials benefit. It is very targeted. In this case, it is support for five years, but it is very targeted to those most in need. As members will recall, the groceries and essentials benefit is modelled on the old GST rebate, which by definition is targeted to families at the lowest end of the scale.
Once again, it is important to resist the temptation to have broad, untargeted fiscal measures because we need to avoid distorting markets. We need to make sure that fiscal buffers remain. We do have the fiscal capacity now to do this, and that is why we are doing it, but it has to be temporary and it has to be targeted.
This support would reduce the pressure on prices at the pump. It may seem insignificant, but it is not. At 10¢ a litre, it is significant. The other issue we need to continue to monitor is that the industry itself does not adjust its margins and that this 10¢-a-litre reduction is fully passed on to the final consumer. We will continue to monitor markets very closely to make sure that there is no attempt to sidestep this measure.
Going back to the Canada groceries and essentials benefit, a family of four will receive $1,890 this year and about $1,400 a year for the next four years. Again, this is targeted to the families most in need. We are putting more money in the pockets of those who need it most, and we are also leaving more money in the pockets of the middle class with the middle-class tax cut that was implemented right off the bat when we came into power.
There are other measures we put in place with the last budget, and there is nothing to say that we will not be doing that again if need be. As long as support is targeted and temporary, I think we should do that. For the time being, in Canada anyway, we are not noticing any shortages of products. It is really a question of affordability that is caused by events completely beyond our control. These are global events that are affecting the same issue in all developed and developing nations.
The crucial point here is for the Canadian government to retain its fiscal buffers, its fiscal capacity to intervene, because we must continue to protect families. We will still have that fiscal capacity if we continue to be prudent.