Finance committee  We haven't done any research on that. It is not for me to comment on that.

Finance committee  Sure.

Finance committee  They were certainly very consistent with the futures prices at the time when we did our last projection, which were certainly much higher than what we have right now. Futures prices were much higher at that time, given that the oil prices had not declined yet.

Finance committee  Again, sir, in these studies that we do, we don't really judge the validity of the policy. We just provide the consequences of these policies. I'm not going to comment on whether it's a good policy or a bad policy.

Finance committee  No, it's absolutely not. But the counterfactual argument is that if it weren't for the TFSA, those savings would have been in instruments that were taxable, and those taxes would have gone to the government. Because the TFSA protects those investments from taxes, that forgone revenue is the cost of the program.

Finance committee  That's correct, but again, that's compared with what the current tax law is. The cost to the treasury is relative to what the current tax law is. The current tax law is that you pay the taxes according to your income, but under the family tax cut, you can have that exemption or the tax savings by making that allocation.

Finance committee  I have to be very careful how I answer that question, sir. I could get into all kinds of trouble. In the study we did on the universal child care benefit, we looked at which groups of families would receive the benefits from that, and that was the result. The way the program is structured, certainly a large part of the new money added to that program will go to families who typically don't have any paid child care expenses.

Finance committee  If it leads to higher savings. Higher savings typically in principle are good for the economy in terms of the long-term productive capacity of the economy. But as I mentioned earlier, we had to go with some of the studies that have been done and the literature. Our conclusion from reading and reviewing those studies was that there isn't really strong evidence to suggest that.

Finance committee  Savings in general will help increase the productive capacity of the economy, yes.

Finance committee  According to the current tax law, if you invest money in a savings account, in equities, or in bonds, the interest and the dividends you get from them are taxable. If you provide another instrument such as the TFSA, which will allow you to transfer the money you had in a regular savings account or equities into it, the revenue you get from that investment is exempt from taxes.

Finance committee  You are absolutely right; surprises can always happen. Some of us who have been in the forecasting business for a long time learn very early on that you never try to forecast oil prices. It's extremely difficult, for some of the reasons that you mentioned. There are geopolitical impacts and other impacts that make it extremely hard to project.

Finance committee  In general, sir, economists believe that freer trade is better than not freer trade. Certainly in principle those free trade agreements should help to increase the productive capacity of the economy, in general. How big they are...and that depends on their marginal impact. We already have free trade with the United States, which is our main trading partner.

Finance committee  My understanding is that—

Finance committee  Yes. My understanding is that the total impact of the 2% decline in that tax rate over the five years would be about $1.2 billion. Right now, that is about 1/20th of a percent of GDP. In an overall context, that amount is not very large in terms of the impact on the Canadian activity.

Finance committee  We can certainly look at that specific measure and provide an estimate to the committee, if you wish.