Pre-Budget Consultations 2020 – Appearance of the Deputy Minister of Finance and Minister of Middle Class Prosperity and Associate Minister of Finance before the House of Commons Standing Committee on Finance

Table of Contents

FINA

Opening remarks
Finance House Cards for PCO

Fact Sheets/Quick Facts

Average Retail Prices

FINA

Standing Committee Members

LIBERAL

CONSERVATIVE

BLOC QUÉBÉCOIS

NDP

Wayne Easter

Liberal – Malpeque (Prince Edward Island)

Wayne Easter

Biography

Wayne Easter entered politics in 1993 when he was officially elected as the Member of Parliament for the riding of Malpeque, P.E.I. He was re-elected in 1997, 2000, 2004, 2006, 2008, 2011, 2015 and 2019.

In Parliament, Wayne has served as Solicitor General of Canada, Parliamentary Secretary for Fisheries and Oceans, Parliamentary Secretary for Agriculture and Agri-Food with special responsibilities for the Rural Secretariat. Wayne has also had the pleasure of being the former author of the Easter Report and serving as Co-Chair of the Liberal Party Task Force on Agriculture

On the national and international fronts, Wayne was National President and CEO of the National Farmers Union for 11 years, he was advisor to the Trudeau administration for the federal export agency, Canagrex, and was an advisor to the Minister of Agriculture at the FAO Conference in Rome in 1983. He was an invited participant under the European Community’s Visitors Program examining Common Agricultural Policy and International Agricultural Trade Issues in 1987 and toured New Zealand examining the impact of Farm Policy and Free Trade Issues in 1988.

In 1990, Wayne was an advisor and list-group-itemist for the Tri-national Exchange on Agriculture, the environment and Free Trade Agreements with Canada, the United States and Mexico. In 1991, with the Ontario Minister of Agriculture and Food, Wayne was an advisor and delegate to GATT discussions in Geneva and Brussels. He also served as list-group-itemist to a Congressional briefing on NAFTA in Washington in March 1993. In Wayne’s role as Parliamentary Secretary to Agriculture and Rural Development, he traveled across Canada conducting round table discussions on the farm income crisis. This resulted in his report, “Empowering Canadian Farmers in the Marketplace”.

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Julie Dzerowicz

Liberal – Davenport (Ontario)

Julie Dzerowicz

Biography

Prior to being elected to the House of Commons, Julie had spent over 20 years in the private sector in senior level positions, in banking, investment banking, and biotech. Spending over 5 years at BMO in progressively senior positions – culminating in an executive role – she was instrumental in the introduction of e-mail money transfer as an innovative money transfer option in Canada, among other accomplishments. She also has broad public service experience, having served as a senior staff member to an Ontario Cabinet Minister. In 2011, she was the Vice-Chair of the Ontario Liberal Platform Committee where she was instrumental in developing the 2011 provincial Liberal campaign platform.

Julie is passionate about issues of immigration, in particular, she is a strong advocate for increasing the number of skilled trade workers with a clear pathway to citizenship, finding solutions to the skilled non-status / undocumented workers in Canada, increasing the number of privately sponsored refugees (i.e. changing government policy that government moves away from publicly sponsored refugees to private and/or hybrid), and resolving the long-standing claims of legacy refugees.

She is a strong proponent of social justice issues and a passionate environmentalist. Among her highest priorities, for which she strongly advocates in the House, include immigration, gender equality, education and environment. Julie co-founded Project Neutral and was a founding board member of JUMP Math.

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Peter Fragiskatos

Liberal – London North Centre (Ontario)

Peter Fragiskatos

Biography

A former political scientist at King’s University College, Peter is now combining his passion for politics with a drive to serve his community.

Prior to being elected, Peter also served as a media commentator. His works have been published by major Canadian and international news organizations including Maclean’s Magazine, The Globe and Mail, The Toronto Star, BBC News, and CNN. Very active in London’s Greek community, Peter ran a youth mentorship program and assisted with the organization of the annual Greek summer festival for several years. Peter served on the Board of Directors of Anago Resources and the Heritage London Foundation. He is an active volunteer who has worked with many local not-for- profit groups such as the London Food Bank, the Cross Cultural Learner Centre and Literacy London – a charity dedicated to helping adults improve their reading and writing skills.

Peter has a Political Science degree from Western University, a Master’s degree in International Relations from Queen’s University, and holds a PhD in International Relations from Cambridge University.

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Sean Fraser – Parliamentary Secretary

Liberal – Central Nova (Nova Scotia)

Sean Fraser

Biography

Prior to running for office, Sean had a successful legal career with one of Canada’s top-ranked law firms. Sean is a long-time volunteer, having served as the Vice-President of a local branch of the United Nations Association of Canada, acted as a Research Fellow with the Centre for International Sustainable Development Law, and provided pro bono legal services to the Boys and Girls Club and underprivileged community members.

Sean is dedicated in his service to the constituents of Central Nova with priorities around economic development and job creation, social justice, a healthy environment and ensuring that Canada does right by the world.

As Parliamentary Secretary to the Minister of Environment and Climate Change, Sean lends his voice and thoughtful consideration to the Government’s efforts on federal environmental policy.

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Annie Koutrakis

Liberal – Vimy (Québec)

Annie Koutrakis

Biography

Daughter of immigrants who arrived in Canada in the 1950s, she built her career in finance and succeeded brilliantly, stood out enough to become Vice-President of a Fortune 500 investment firm.

Annie wants to serve her fellow citizens and to inspire young women to build great careers. She has tirelessly proven her commitment as board member of many charities, whether related to public health in Laval or within the community.

Annie was the first woman to be elected president of the Hellenic Community of Montreal.

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Michael V. McLeod

Liberal – Northwest Territories

Michael V. McLeod

Biography

Michael McLeod earned his diploma in Management Studies from Arctic College and began his career as a self-employed contractor. This experience provided Michael with an understanding of the needs of small business owners and their families.

He has also worked as Tourism Development Officer for the Government of the Northwest Territories. He was a member of the Northwest Territories Tourism, NWT Public Utilities and Mackenzie Valley Environment Impact Review Boards. The latter’s mission, conducting fair and timely environmental assessments remains a key interest.

Michael is active in his community and prior to the election served as a Master Corporal in the Canadian Junior Rangers. He enjoys spending his free time outdoors hunting and fishing.

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Michael Cooper

Conservative – St. Albert-Edmonton (Alberta)

Michael Cooper

Biography

Michael serves as the Official Opposition Deputy Shadow Minister for Justice. He also served as Vice-Chair of the Standing Committee on Justice and Human Rights and Vice-Chair of the Special Joint Committee on Physician-Assisted Dying.

Early in his term, Michael was tasked by Conservative Interim Leader Rona Ambrose with leading the complex issue of physician-assisted dying within the Conservative MP caucus. As Vice-Chair of the Special Joint Committee on Physician-Assisted Dying, Michael helped author a dissenting report to provide protections for vulnerable persons, improved palliative care, and conscience protections for medical practitioners. Some of the recommendations in the Conservative dissenting report were adopted by the government in Bill C-14, the government’s legislative response to the Supreme Court of Canada’s Carter decision that struck down the blanket Criminal Code prohibition on physician-assisted dying.

Since his election, Michael has been a strong advocate for victims and strengthening Canada’s criminal justice system. Michael sponsored Bill S-217, known as Wynn’s Law, in honour of the late Constable David Wynn who was shot and killed by a career criminal who was out on bail, because his extensive criminal history was not disclosed at the bail hearing. Wynn’s Law would amend the Criminal Code to make it mandatory for the criminal history of bail applicants to be introduced at bail hearings to help prevent what happened to Constable Wynn.

Michael has also worked closely with victims of impaired driving. He has advocated for mandatory sentences for impaired driving offences, and vocally opposed efforts by the Liberal government to water-down sentences for impaired driving offences and other serious offences in the government’s Bill C-75.

Michael successfully passed his Private Members’ Bill C-417 through all stages of the House of Commons with unanimous all-party support. Bill C-417 seeks to amend the Criminal Code to carve out a narrow exception to the jury secrecy rule so that former jurors can disclose all aspects of their jury service with a mental health professional. This legislation would protect the integrity of the jury secrecy rule while ensuring that former jurors who are suffering from mental health issues arising from their jury service can get the help they need and deserve. Michael’s Bill would implement a key recommendation of the unanimous report of the Justice Committee on Juror Supports.

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James Cumming

Conservative – Edmonton Centre (Alberta)

James Cumming

Biography

The former President & CEO of the Edmonton Chamber of Commerce, the largest urban chamber in Canada, James is an active leader in Edmonton’s business and non-profit volunteer communities.

He actively supports non-profit organizations such as Junior Achievement, Northlands Park, Edmonton Construction Association, Alberta Art Stabilization Fund, Norlien Foundation, Alberta Opportunity Corporation, and the Muscular Dystrophy Association of Canada, to name a few. A recipient of NAIT’s Alumni Award of Distinction and Top 50 Alumni, James is a current member of the World Presidents’ Organization and the Harvard University Alumni OPM 27.

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Pierre Poilievre – Official Opposition Critic for Finance

Conservative – Carleton (Ontario)

Pierre Poilievre

Biography

Prior to the 2015 election, Pierre served as Minister of Employment and Social Development where he oversaw the rollout of the increased Universal Child Care Benefit.

In 2013, Pierre became Minister of Democratic Reform responsible for drafting the Fair Elections Act and stickhandling it through Parliament. The bill contained measures aimed at cracking-down on the undue influence of money in politics, made it easier for people to vote, and require they show identification before doing so.

That law built on his work as Parliamentary Secretary to the Treasury Board President, wherein he helped then-Minister John Baird pass the Federal Accountability Act through Parliament. Later, he served as the Prime Minister’s Parliamentary Secretary (2008-2011), during which he co-authored the Conservative 2011 election platform, which helped the party win a majority government.

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Marty Morantz

Conservative – St. James-Assiniboia-Headingley (Manitoba)

Marty Morantz

Biography

Marty served as Finance Chair for the City of Winnipeg where he delivered three straight balanced budgets and spent nearly four years on the Executive Policy Committee and his dedication, as Chair of Infrastructure, to making record investments in streets and infrastructure.

In Charleswood, where he has served as City Councillor since 2014, he fought for and delivered many important projects like the brand-new sports courts at LaFleche Park and the re-crowning of the football field at Oak Park High School.

Marty has also served on the boards of Shalom Residences Assisted Living, the Refit Centre Foundation, Community Respite Services, Manitoba Families for Effective Autism Treatment (MFEAT), the Jewish National Fund, Young Adult Division, the Jewish Federation (CJA) Charitable Allocations Committee, and the Special Needs Steering Committee at the Gray Academy.

Marty has a B.A. in political studies from the University of Manitoba, and received his law degree from Osgoode Hall Law School. For 23 years, he practiced law as a partner at Levene Tadman LLP in Winnipeg in the areas of real estate, corporate, commercial, and wills and estates. During his tenure, he acted as senior counsel to several large financial institutions and real estate management firms.

In 2009, Morantz became President of Jernat Investments Ltd., a property investment and financial services firm with holdings primarily in multi-unit apartment buildings. Marty has also had a very active political career having served on the Winnipeg South-Centre EDA as well as the Tuxedo and River Heights PC Associations. In 2011, he ran provincially for the PC Party of Manitoba in River Heights after which he was elected to Winnipeg’s City Council in 2014.

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Gabriel Ste-Marie – Finance Critic

Bloc Québécois – Joliette (Québec)

Gabriel Ste-Marie

Biography

An economist by training, Gabriel Ste-Marie is the Bloc Québécois critic for finance and international trade. He made the fight against tax havens his first workhorse by tabling motion M-42 as soon as he arrived in Ottawa to close Barbados' tax loophole, by far the largest travel destination for large corporate money Canadian. The work of Mr. Ste-Marie in this file had also been noted by France Inter in 2017. The member for Joliette also stood out by going to Washington to join forces with the Quebec steel and aluminum industries in the United States, in addition to being published in American media.

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Peter Julian – Finance Critic

NDP – Burnaby–New Westminster (British Columbia)

Peter Julian

Biography

First elected Member of Parliament for Burnaby–New Westminster in 2004, re-elected in 2006 (by 4,000 votes), in 2008, in 2011 (by 6,000 and 7, 000 votes) and for New Westminster-Burnaby in 2015 (by 8,000 votes).

Served as the Official Opposition House Leader and the NDP House Leader until October 19, 2016.

Served as NDP Caucus Chair, NDP Critic on Energy & Natural Resources, International Trade, Finance, Industry, Transport, Persons with Disabilities, Gateways Treasury Board, Western Fisheries Critic and the Vancouver 2010 Olympics.

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House of Commons Standing Committee on Finance Mandate

Mandate

The mandate of the House of Commons Standing Committee on Finance, which is established under Standing Order 108 of the House of Commons, is to examine and enquire into all matters referred to it by the House of Commons, to report from time to time and, except when the House otherwise orders, to send for persons, papers and records, as it operates in accordance with its mandate.

Certain standing committees, including the Standing Committee on Finance, are empowered to study and report on all matters relating to the mandate, management and operation of the department or departments of government that are assigned to them from time to time by the House. For the Standing Committee on Finance, these departments include the Department of Finance and the Canada Revenue Agency.

Finally, the Standing Committee on Finance also has the responsibility to consider budgetary policy, as outlined in Standing Order 83.1. In particular, commencing on the first sitting day in September of each year, the Committee is authorized to consider and report on proposals regarding the budgetary policy of the government. The Committee normally presents its pre-budget report no later than the third sitting day before the last normal sitting day in December, as outlined in Standing Order 28(2).

In each parliamentary session, the Committee’s work may include:

History

2000 – Present

Over the 2000 to 2019 period, in addition to the report on its annual pre-budget consultations and reports on legislation and the estimates, the Standing Committee on Finance prepared reports on

Staff assigned to the Committee

In the execution of its functions, each committee is normally assisted by a committee clerk, one or more analysts and a committee assistant. Occasional assistance is also provided by legislative clerks and lawyers from the Office of the Law Clerk and Parliamentary Counsel. These individuals are non-partisan and serve all members of the committee and representatives of all parties equally.

Committee Clerk

The clerk performs his duties and responsibilities under the direction of the committee and its Chair. As an expert in the rules of the House of Commons, the clerk may be requested to give advice to the Chair and members of the committee should a question of procedure arise. The clerk is the coordinator, organizer and liaison officer for the committee, and as such, will be in frequent contact with members’ staff. He is also responsible for inviting witnesses and dealing with all the details regarding their appearance before the committee.

Committee Assistant

The committee assistant provides a wide range of specialized administrative services for the organization of committee meetings and the publishing of documents on the committees’ Website. The committee assistant works with the clerk to meet the needs of committees.

Committee Analyst

The Library of Parliament’s analysts, who are subject-matter experts, provide authoritative, substantive, and timely research, analysis and information to all members of the committee. They are part of the committee’s institutional memory and are a unique resource for parliamentarians. Supported by research librarians, the analysts work individually or in multidisciplinary teams.

Analysts can prepare: briefing notes on the subjects being examined; detailed study plans; lists of proposed witnesses; analyses of an issue with a list of suggested questions; background papers; draft reports; news releases; and/or formal correspondence. Analysts with legal training can assist the committee regarding any substantive issues that may arise during the consideration of bills.

OTHER RESOURCES AVAILABLE AS REQUIRED

Parliamentary Counsel

Within the Office of the Law Clerk and Parliamentary Counsel, parliamentary counsel (Legislation) are available to assist members who are not in Cabinet with the preparation of private members’ bills or of amendments to government bills or others.

At various stages of the legislative process, members may propose amendments to bills. Amendments may first be proposed at the committee stage, during a committee’s clause-by-clause review of a bill. Amendments may also be proposed at the report stage, once a bill returns to the House.

Once a bill is sent to committee, the clerk of the committee provides the name of the parliamentary counsel (Legislation) responsible for the drafting of the amendments for a particular bill to the members.

Legislative Clerk

The legislative clerk serves all members of the committee as a specialist of the process by which a bill becomes law. They are available to give, upon request from members and their staff, advice on the admissibility of amendments when bills are referred to committee. The legislative clerk organizes the amendments into packages for committee stage, reviews all the committee amendments for procedural admissibility and prepares draft rulings for the Chair. During clause-by-clause consideration of bills in committee, a legislative clerk is in attendance to assist the committee with any procedural issues that may arise. The legislative clerk can also provide members with advice regarding the procedural admissibility of report stage amendments. When a bill is sent to committee, the clerk of the committee provides to the members the name of the legislative clerk assigned to the bill.

The Parliamentary Budget Officer (PBO)

The Parliamentary Budget Officer (PBO) is an officer of Parliament created by the Parliament of Canada Act who supports Parliament by providing analysis, including analysis of macroeconomic and fiscal policy, for the purposes of raising the quality of parliamentary debate and promoting greater budget transparency and accountability.

The Parliament of Canada Act also provides the PBO with a mandate to, if requested by a committee, estimate the financial cost of any proposal over which Parliament has jurisdiction. Certain committees can also request research and analyses of the nation’s finances or economy, or of the estimates.

Further information on the PBO may be found at: http://www.pbo-dpb.gc.ca/en/

Past Work

In recent years, in addition to its studies and reports on proposed legislation and estimates, the Standing Committee on Finance produced reports on a range of topics relating to its mandate, including:

42nd Parliament, 1st Session (3 December 2015 to 11 September 2019)

41st Parliament, 2nd Session (16 October 2013 to 2 August 2015)

41st Parliament, 1st Session (2 June 2011 to 13 September 2013)

Opening remarks

Speaking Notes
Minister of Middle Class Prosperity and Associate Finance Minister Mona Fortier
Standing Committee on Finance
February 3, 2020
Pre-Budget Consultations

Thank you very much, Mr. Chairman, and thank you to the Standing Committee on Finance for inviting me here to discuss the pre-budget consultations that we launched on January 13, 2020.

Before I get started, I would like to talk about a very important measure we put forward late last year.

Our Government introduced a proposal that would lower taxes for the middle class and people working hard to join it.

We would do that by letting people keep more of what they earn – up to $15,000 – before they have to pay any federal income tax.

We made this proposal because we know that a lot of people are feeling the squeeze at the end of the month, and need a little more help to make ends meet.

All told, it’s a change that would mean lower taxes for close to 20 million Canadians.

At the same time, we’ve also taken steps to ensure that this help goes to people who need it the most. The wealthiest people in Canada – those in the top 1% of income earners – wouldn’t benefit from this change.

This brings me to our work as we prepare Budget 2020.

To create policies that work for everyone and ensure that we can build a country based on inclusive growth, we must know more about the needs of Canadians.

As you know, we are in a process of pre-budget consultations to speak with Canadians across the country to find out their priorities for Budget 2020. We are meeting with several key players in rural, urban and remote communities to find out what matters most to Canadians.

We know that we have a lot of work to do to continue strengthening the middle class. That is why we are asking specific questions to stakeholders and Canadians, so they can inform us of their priorities. We want to know what will help the most to improve the quality of life of Canadians – whether issues related to the cost of living, or well-being.

To fully understand the realities of Canadians and the issues they face, our meetings and round tables looked at four important themes:

These four themes show that we are continuing the work we began in our last term, in which we grew the economy while protecting our environment.

These four themes are also related to my mandate of developing growth indicators that will provide a complete picture of the quality of life of Canadians and of the economy.

Budget 2020 will take into account the findings that have emerged from these pre-budget consultations.

Understanding the priorities of Canadians living in different realities, whether it be in Vancouver, Napanee or in Montreal, has been very informative to us as we develop the next budget. Because we know that a strong economy is one that works for everyone.

Now, I would like to highlight some key ways in which we have helped strengthen the middle class over the last four years.

Since 2015, through government investment and the hard work of Canadians, our economy has added over one million new jobs.

The unemployment rate is at its lowest levels in over 40 years.

Our policies have lifted almost 900,000 Canadians out of poverty, including 300,000 children and almost 60,000 seniors.

Our investments in people have also strengthened our economy.

We have continually reduced our debt-to-GDP ratio, which is the lowest in the G7. Canada continues to have the best balance sheet in the G7, which gives us a real competitive advantage.

Canada is predicted to have continued growth through 2020.

Wages are on the rise. Business profits are solid. We maintain a triple-A credit rating.

Thanks to the Canada Child Benefit, nine out of 10 families with children now receive more money than they did previously.

With the enhancements to the Guaranteed Income Supplement and the Canada Pension Plan, seniors have – and will continue to have – a more secure and dignified retirement.

We created the Canada Workers Benefit – a strengthened, more generous and more accessible benefit to help low-income workers keep more of their hard-earned money.

We have put gender at the heart of Government decision making. Today, more women are employed and contributing to our shared economic success than at any point in Canada’s history.

We’ve made a lot of progress these past years. However, we recognize that far too many families still feel that they are struggling to make ends meet. We know that we still have work to do.

During the pre-budget consultations in Hamilton, I heard that parents see real value in the Canada Child Benefit, but there is still more work to do to help those caring for young children find available, flexible and affordable childcare.

In Montréal, participants at our meetings and round tables highlighted the important role that entrepreneurs play in strengthening our competitiveness.

And, in every city, we have heard about the importance of skilled trades for our workforce.

Another theme at the heart of our conversations with Canadians has been fighting climate change and protecting the environment.

We all know that one of the most important issues of our time is the effects on climate change on our communities, our lives and our economy. From forest fires, to floods and droughts, to the extreme temperatures and intensifying storms, we are feeling the impacts of climate change everywhere in the country and around the world.

Canadians have been clear, Mr. Chair. They expect their governments to take action on climate change and to protect the environment. This is why over the past 4 years we’ve taken serious action to fight climate change and to protect our communities from its impacts.

Since last year, it is no longer free to pollute anywhere in Canada. We have put a price on pollution to protect the environment, while putting more money in the pockets of Canadian families.

We are phasing out coal-fired electricity and switching to 90% clean electricity, for cleaner air and healthier communities.

Canadians know that we can no longer wait to act. As a government, we know it too. We must be ambitious in our plans to grow our economy while fighting climate change. By finding solutions that address both issues, we can make a real difference in the lives of middle-class Canadians.

We know that in order for Canadians to thrive, they need to be healthy and safe. This is why, in our pre-budget consultations, we have focused discussions on how we can better meet the needs of Canadians when it comes to health care and pharmacare.

We also discuss the needs of communities and people to feel safer. What does a safer community mean to Canadians? How can we protect our communities to ensure the overall wellbeing of Canadians?

This is a vital point of focus as we move forward to better understand what contributes to the quality of life of Canadians and how we can build stronger, healthier and safer communities.

Budget 2020 will also continue to walk the path towards reconciliation with Indigenous Peoples. Real progress has been made over the last four years but much more work remains to be done.

We are delivering on a renewed relationship with Indigenous peoples; working together to improve quality of life and advance self-determination.

We know we have a long way to go and we will continue to work in partnership with Indigenous peoples towards closing the socio-economic gaps that exist today.

Our pre-budget consultations are therefore useful. They are an opportunity to hear ideas and proposals from Canadians on a number of topics and issues that affect their daily lives. We want to know what more we can do to make their lives more affordable. We want to know what other measures could be put in place to help them find good jobs.

In short, what can be done to strengthen the middle class and continue growing our economy? Because what we want is an economy that works for everyone.

That said, Mr. Chairman, as we have heard at our round tables and online, to improve the lives of Canadians, helping them have good salaries or keep more money in their pockets is not enough.

These are very important aspects, but to make a real difference in the lives of middle-class Canadians, we must also ensure that they remain safe and healthy, that their environment is protected and that our progress on the road to reconciliation continues.

Whether by strengthening our public health system, improving access to medication, fighting gun crime, protecting the environment or fighting climate change, we know that these are things that matter to Canadians.

The issues that are raised by participants at our meetings with Canadians are complemented by the submissions that we have received online.

Not only have we been meeting with Canadians in-person, our Pre-Budget Consultation process has spread a wide net using the Finance’s online consultations website. Since the start of the consultations, more than 16 000 Canadians have submitted their ideas on how Budget 2020 can best meet their needs.

This engagement is very valuable and will be used as we develop this important budget.

While I have the opportunity, I would like to talk about a bit more about my mandate as Minister of Middle Class Prosperity and Associate Minister of Finance and the importance of it in the Pre-Budget Consultations as well as within our government.

Mr. Chair, while the economy is strong and growing, we know that families are struggling to make ends meet. My role is to work alongside my Cabinet colleagues to ensure that economic growth is shared fairly and that opportunities are created for all. This is what the OECD and other countries worldwide have identified as inclusive growth.

By factoring inclusive growth as the baseline of our government decisions, we are ensuring that our policies address the gap between economic growth and the financial squeeze felt by too many Canadians.

We will work using a whole-of-government approach to ensure that the prosperity of the middle class is at the heart of policy decisions.

Through these pre-budget consultations and within my mandate, we want to know how we can best help Canadians have a safe and affordable place to call home, a good well-paying job to support their family, a secure retirement, access to healthcare, and the ability to build a better future for themselves and their families.

It is by understanding the full scope of the well-being of Canadians that we can build a framework that informs how we grow the economy in ways that works for everyone.

On that note, Mr. Chairman, I am available to answer questions from the members of this committee about the preparations for Budget 2020.

Thank you. Thank you.

Finance House Cards for PCO

Asian Infrastructure Investment Bank (AIIB)

Background

Department
DEPARTMENT PCO SECRETARIAT
PCO POLICY ANALYST CONTACT INFO
Finance FDP Jeremy.Adler@pco-bcp.gc.ca

Fossil fuel subsidies

Background

Department
DEPARTMENT PCO SECRETARIAT
PCO POLICY ANALYST CONTACT INFO
Finance Shane Baddeley (LSMP) 613-948-6507

General economy

Background

Table 1: Forecasts of Canadian Real GDP Growth (%)
Forecast 2019 2020 2021
OECD Economic Outlook – November 2019 1.5 1.6 1.7
IMF World Economic Outlook – October 2019 1.5 1.8 1.8
Bank of Canada MPR – October 2019 1.5 1.7 1.8
Budget 2019 – Finance February 2019 survey 1.8 1.6 1.7
Department
DEPARTMENT PCO SECRETARIAT
PCO POLICY ANALYST CONTACT INFO
Finance Julien Bourély (LSMP) 613-957-5335

Canada Health Transfer

Background

The Canada Health Transfer (CHT) is the largest major federal transfer program and provides provinces and territories with long-term, predictable funding to assist them in the provision of health care. The Canada Health Transfer is a conditional block transfer, which supports the five principles of the Canada Health Act: universality, comprehensiveness, portability, accessibility and public administration.

The CHT funds are transferred on an equal per capita basis. Provincial and territorial governments are fully responsible for the design and delivery of the related programs and are accountable to their citizens and legislatures for outcomes achieved and dollars spent.

Beginning in 2017-18, the Canada Health Transfer was legislated to grow annually in line with a three-year moving average of nominal gross domestic product (GDP), with funding guaranteed to increase by at least 3 percent per year. The legislation does not have an expiry date.

Since growth was tied to GDP, the CHT has seen yearly increases of 3.8 per cent, on average, largely in line with recent provincial and territorial health expenditure growth (pending 2019-20 expenditure data). See Table 1 for historical growth rates compared to Provincial and Territorial health expenditure growth (using Canadian Institute for Health Information data).

Table 1. CHT growth as compared to PT health expenditure growth
CHT Growth (%) PT Health Expenditures growth (%)
2010-11 4.9 6.2
2011-12 5.0 3.8
2012-13 6.0 3.0
2013-14 6.0 2.3
2014-15 6.0 2.6
2015-16 6.0 4.5
2016-17 6.0 2.3
2017-18 3.0 3.7
2018-19 3.9 3.8
2019-20 4.6 TBD

In 2019-20, under the CHT, the Government will provide $40.4 billion to the provinces and territories. This is an increase of approximately $1.8 billion from the previous year.

In addition to the growing CHT amounts, the Government is providing the provinces and territories with an additional $11 billion over 10 years, which started in 2017-18, to support better home care and mental health initiatives. Specifically, as indicated in Budget 2017, the Government will invest $6 billion over 10 years for home care and $5 billion over 10 years to support mental health initiatives.

Council of the Federation Request

At the December 2, 2019 meeting of the Council of the Federation, Premiers unanimously reiterated previous calls for the escalator of the Canada Health Transfer to be increased to 5.2 per cent, “consistent with independent analysis by the Conference Board of Canada of budget pressures”. Premiers also requested that Federal transfers should include opportunities to opt out with full financial compensation. Further, the federal government must respect provincial/territorial jurisdiction and authority.

In addition to COF itself, the Council of Atlantic Premiers called on the federal government in July 2019 to increase health care funding to address the impact of the region’s aging population on Atlantic Canada’s health care systems.

Provincial Requests

Alberta

Alberta’s Premier, Jason Kenney has previously called on the federal government to transfer tax points instead of the CHT cash transfer (as well as for amounts transferred through the Canada Social Transfer (CST)). Alberta’s Fair Deal list-group-item, created in November 2019, will examine whether the province should seek a transfer of tax points in exchange for foregoing the federal cash transfer under the CHT and CST, building on these previous requests from the Premier.

As the value of tax points each jurisdiction receives depends on the amount of taxable income in that jurisdiction, rather than population size, provinces and territories with relatively stronger economies would receive greater support, creating inequities across the country.

Quebec

In recent provincial Budgets, most recently in 2019, Quebec has specifically called on the federal government to increase the CHT envelope gradually to 25 per cent of provincial health spending by 2021-22, and then kept at that level thereafter by indexing growth to the annual provincial health spending growth rate of 5.1 per cent.

In recent years, the CHT has accounted for approximately 24 per cent of provincial health expenditures.

Department
DEPARTMENT PCO SECRETARIAT
PCO POLICY ANALYST CONTACT INFO
Finance Julien Bourély (LSMP) 613-957-5335

Housing

Background

Canada’s first-ever National Housing Strategy was introduced in 2017 and expanded in Budget 2019. The Strategy is a $55+ billion, 10-year plan that will strengthen the middle class, cut chronic homelessness in half and fuel our economy.

Budget 2019 introduced measures to reduce barriers to homeownership for first-time home buyers, boost housing supply, and increase fairness in the sector, while also maintaining the prudent safeguards that protect consumers and promote responsible home purchase decisions:

The Minister of Finance and the Office of the Superintendent of Financial Institutions are monitoring and safeguarding financial stability. The impacts of the mortgage rules are reducing the number of highly indebted households, which also strengths the stability of the financial system.

Department
DEPARTMENT PCO SECRETARIAT
PCO POLICY ANALYST CONTACT INFO
Finance Paula Bolyea 613-948-6569

Equalization and fiscal stabilization

Fiscal Stabilization

Equalization

Background

Department
DEPARTMENT PCO SECRETARIAT
PCO POLICY ANALYST CONTACT INFO
Finance Julien Bourély (LSMP) 613-957-5335

Lower taxes for the middle class

Background

Department
DEPARTMENT PCO SECRETARIAT
PCO POLICY ANALYST CONTACT INFO
Finance Shane Baddeley (LSMP) 613-948-6507

Lower taxes for the middle class – PBO report

Background

Department
DEPARTMENT PCO SECRETARIAT
PCO POLICY ANALYST CONTACT INFO
Finance Shane Baddeley (LSMP) 613-948-6507

Tax treatment of digital platforms

Background

Corporate Income Tax

Application of GST to Internet Sales

Department
DEPARTMENT PCO SECRETARIAT
PCO POLICY ANALYST CONTACT INFO
Finance Shane Baddeley (LSMP) 613-948-6507

First-time home buyer incentive

Background

The First-Time Home Buyer Incentive was announced in Budget 2019 and launched on September 2, 2019, with the goal of helping to make homeownership more affordable for first-time home buyers. It is a shared equity mortgage provided by the Canada Mortgage and Housing Corporation that gives eligible first-time home buyers the ability to lower their borrowing costs by sharing the cost of buying a home.

The program is capped at $1.25 billion over three years. The Incentive is limited to first-time home buyers with a maximum qualifying income of $120,000 and total borrowing is limit to four times income.

The Minister of Families, Children and Social Development’s mandate letter includes direction to “ensure the effective implementation of the new First-Time Home Buyer Incentive and to increase the qualifying value in places where houses cost more like the Greater Toronto, Vancouver, and Victoria regions.” Under the National Housing Act, the Minister of Finance is responsible for approving the program’s terms and conditions.

Fact Sheets/Quick Facts

Deficit track

Ministerial Speaking Points

Key Facts, Statistics and Data

Fiscal Outlook
2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Debt-to-GDP ratio (%GDP) 30.8 31.0 31.0 30.8 30.4 29.8 29.1
Budgetary Balance ($B) -14 -26.6 -28.1 -22.1 -18.4 -16.3 -11.6
Source: Economic and Fiscal Update 2019

Debt to GDP track

Ministerial Speaking Points

Key Facts, Statistics and Data

Fiscal Outlook
2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25
Debt-to-GDP ratio (%GDP) 30.8 31.0 31.0 30.8 30.4 29.8 29.1
Budgetary Balance ($B) -14 -26.6 -28.1 -22.1 -18.4 -16.3 -11.6
Source: Economic and Fiscal Update 2019

Consumer confidence

Ministerial Speaking Points

Key Facts, Statistics and Data

Wages

Ministerial Speaking Points

Key Facts, Statistics and Data

Unemployment and jobs

Ministerial Speaking Points

Key Facts, Statistics and Data

Business investment

Ministerial Speaking Points

Key Facts, Statistics and Data

Marginal effective tax rate

Backgrounder

The METR is an estimate of the level of taxation on a new business investment, and takes into account federal, provincial and territorial statutory corporate income tax rates, as well as other features of the corporate tax system. These other features include investment tax credits and key deductions, such as capital cost allowances. The METR also takes into account other taxes paid by corporations, such as capital taxes and unrecoverable sales taxes paid on capital purchases.

The METR is particularly useful for making comparisons among nations and sectors of the economy. Since the METR takes many factors into account, it provides a broad indication of overall tax competitiveness that is an important supplement to comparisons of statutory tax rates. METRs also provide a valuable historical perspective.

METRs are particularly useful to examine Canada's business tax competitiveness relative to the U.S. and other countries of the Organisation for Economic Co-operation and Development (OECD) as a result of tax changes announced in the 2018 Fall Economic Statement and the important tax changes announced by the United States in December 2017. The main findings are:

Middle class tax relief

Ministerial Speaking Points

Key Facts, Statistics and Data

Climate action incentive payments

Ministerial Speaking Points

Key Facts, Statistics and Data

Climate Action Incentive Payment Amounts, as Specified by the Minister of Finance, for 2020 (Delivered Through 2019 Personal Income Tax Returns)
Ontario Manitoba Saskatchewan Alberta
Single adult, or first adult in a couple $224 $243 $405 $444
Second adult in a couple, or first child of a single parent $112 $121 $202 $222
Each child under 18 (starting with the second child for single parents) $56 $61 $101 $111
Example: Baseline amount for a family of four $448 $486 $809 $888
Note: Exceptionally, the 2020 Climate Action Incentive payment claimed by eligible Albertans will reflect fuel charge proceeds generated over a 15-month period. This consists of three months (January–March 2020) with a carbon price of $20, plus 12 months (April 2020–March 2021) with a carbon price of $30.

Carbon pricing – grain drying

Ministerial Speaking Points

Key Facts, Statistics and Data

Taxation of digital enterprises

Ministerial Speaking Points

Key Facts, Statistics and Data

Mortgage stress test

Ministerial Speaking Points

Key Facts, Statistics and Data

Consumer protection in banking

Ministerial Speaking Points

Key Facts, Statistics and Data

Infrastructure

Ministerial Speaking Points

Key Facts, Statistics and Data

Frontier oil sands mine

Ministerial Speaking Points

Key Facts, Statistics and Data

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