With Parliament getting ready for the return of MPs, the Liberal cabinet is kicking off three days of meetings in Vancouver today to hash out the government’s fall playbook, with the rising cost of living and the state of the economy expected to top the agenda.
“The tone going into this is getting down to business, getting the work done and delivering for Canadians on these big things that they expect from us and also are our priorities,” a senior government official told CBC News on background.
“We’ve got these commitments and we are going to deliver on them.”
Delivering on those commitments once Parliament resumes on Sept. 19 will involve balancing the priorities of both Liberal supporters and the party’s parliamentary partners in the NDP.
Earlier this year, the Liberals and New Democrats struck a deal committing the NDP to voting with the minority Liberal government in the House of Commons on confidence votes until June of 2025, in exchange for the government meeting a number of benchmarks along the way.
The New Democrats say that at least two of those commitments must be met before the Christmas break if the Liberals want the deal to stay intact.
The NDP wants to see the first stage of a universal dental care plan roll out, initially covering families with kids under 12 that earn a family income of less than $90,000. The party also wants a one-time top-up to bring the Canada Housing Benefit up to $500, and says it wants that increase renewed in coming years if cost of living challenges remain.
The Canada Housing Benefit, developed by the federal government and the provinces, was launched in 2020 with joint funding of $4 billion over eight years. The benefit is meant to provide direct financial support to Canadians who are struggling with housing needs.
An NDP official speaking on background said that up to two million Canadians could benefit from the means-tested payments, with the federal government having earmarked $475 million in the budget for the initiative.
A floor, not a ceiling
The deal between the NDP and the Liberals set the end of this year as the deadline for both initiatives. New Democrats say that, so far, it appears those commitments will be fulfilled in time.
“On both those components, we are pretty close to where we want to go in negotiations,” a senior NDP official told CBC news on background. “I am confident that we will have something to tell media by the end of the month.”
The NDP regards the phase one dental care commitment as only a first step. If the Liberals want their deal with the NDP to remain in place, New Democrats say, they must extend dental care to under 18s, seniors and people with disabilities by the end of 2023, before full implementation of the program by 2025.
NDP Leader Jagmeet Singh meets with Prime Minister Justin Trudeau on Parliament Hill in Ottawa in 2019. The deal struck between the two parties earlier this year will see the NDP support the Liberal government on parliamentary votes, providing the Liberals meet certain commitments. (The Canadian Press/Sean Kilpatrick)
The NDP says that these two commitments are a floor, not a ceiling and they will be using opposition days, in-person meetings and private members bills to push for other measures this fall to help Canadians deal with the rising cost of living.
Among those initiatives, the party says, will be a push to help families with one-time boosts to the GST rebate and the Canada Child Benefit, a call for more funding to help workers transition into green jobs, and a demand for further climate action.
Helping Canadians cope with inflation
While it’s not clear which approaches the Liberal cabinet might discuss beyond boosting the housing benefit, Prime Minister Justin Trudeau said last week that his government is always looking for ways to ease the burden of inflation.
“We have historic low unemployment right now, lots of people have jobs, but there is still real challenges and we are going to continue to do what is necessary to support vulnerable Canadians as we move forward,” Trudeau said.
The prime minister added that, whatever his government does next to address the cost of living, it will be “careful not to do things that will accelerate or exacerbate the inflation crisis we’re facing.”
One proposal in the NDP/Liberal deal would re-focus the Rental Construction Financing Initiative (RCFI) on affordable units.
The RCFI is a government program that provides low-cost financing to developers to help them build rental units in areas where the supply is low.
The government official said that Canadians should expect some announcements on housing and the cost of living focusing on British Columbia before, during and after the caucus retreat.
Building a green future
In the media release announcing the cabinet retreat, the PMO said that ministers also will discuss how the government can build “a green, healthy future for everyone.”
The government official said that this discussion will stretch across ministries as the government looks to ensure there are well-paid jobs in both the electric vehicle industry and the oilpatch.
New Democrats said they have been meeting with workers in the oilpatch who fear for their children’s economic futures as the economy moves away from fossil fuels.
The NDP said that while it will continue to press the Liberal government to act in that area, it won’t threaten the deal — even though there are some 2022 timelines requiring action in the agreement’s text.
The deal requires that the Liberals “move forward” on creating a Clean Jobs Training Centre to support, retrain and redeploy workers by this year, but the text of the deal is not specific on what has to happen for the deal to survive.
OTTAWA – Canada’s unemployment rate held steady at 6.5 per cent last month as hiring remained weak across the economy.
Statistics Canada’s labour force survey on Friday said employment rose by a modest 15,000 jobs in October.
Business, building and support services saw the largest gain in employment.
Meanwhile, finance, insurance, real estate, rental and leasing experienced the largest decline.
Many economists see weakness in the job market continuing in the short term, before the Bank of Canada’s interest rate cuts spark a rebound in economic growth next year.
Despite ongoing softness in the labour market, however, strong wage growth has raged on in Canada. Average hourly wages in October grew 4.9 per cent from a year ago, reaching $35.76.
Friday’s report also shed some light on the financial health of households.
According to the agency, 28.8 per cent of Canadians aged 15 or older were living in a household that had difficulty meeting financial needs – like food and housing – in the previous four weeks.
That was down from 33.1 per cent in October 2023 and 35.5 per cent in October 2022, but still above the 20.4 per cent figure recorded in October 2020.
People living in a rented home were more likely to report difficulty meeting financial needs, with nearly four in 10 reporting that was the case.
That compares with just under a quarter of those living in an owned home by a household member.
Immigrants were also more likely to report facing financial strain last month, with about four out of 10 immigrants who landed in the last year doing so.
That compares with about three in 10 more established immigrants and one in four of people born in Canada.
This report by The Canadian Press was first published Nov. 8, 2024.
The Canadian Institute for Health Information says health-care spending in Canada is projected to reach a new high in 2024.
The annual report released Thursday says total health spending is expected to hit $372 billion, or $9,054 per Canadian.
CIHI’s national analysis predicts expenditures will rise by 5.7 per cent in 2024, compared to 4.5 per cent in 2023 and 1.7 per cent in 2022.
This year’s health spending is estimated to represent 12.4 per cent of Canada’s gross domestic product. Excluding two years of the pandemic, it would be the highest ratio in the country’s history.
While it’s not unusual for health expenditures to outpace economic growth, the report says this could be the case for the next several years due to Canada’s growing population and its aging demographic.
Canada’s per capita spending on health care in 2022 was among the highest in the world, but still less than countries such as the United States and Sweden.
The report notes that the Canadian dental and pharmacare plans could push health-care spending even further as more people who previously couldn’t afford these services start using them.
This report by The Canadian Press was first published Nov. 7, 2024.
Canadian Press health coverage receives support through a partnership with the Canadian Medical Association. CP is solely responsible for this content.
As Canadians wake up to news that Donald Trump will return to the White House, the president-elect’s protectionist stance is casting a spotlight on what effect his second term will have on Canada-U.S. economic ties.
Some Canadian business leaders have expressed worry over Trump’s promise to introduce a universal 10 per cent tariff on all American imports.
A Canadian Chamber of Commerce report released last month suggested those tariffs would shrink the Canadian economy, resulting in around $30 billion per year in economic costs.
More than 77 per cent of Canadian exports go to the U.S.
Canada’s manufacturing sector faces the biggest risk should Trump push forward on imposing broad tariffs, said Canadian Manufacturers and Exporters president and CEO Dennis Darby. He said the sector is the “most trade-exposed” within Canada.
“It’s in the U.S.’s best interest, it’s in our best interest, but most importantly for consumers across North America, that we’re able to trade goods, materials, ingredients, as we have under the trade agreements,” Darby said in an interview.
“It’s a more complex or complicated outcome than it would have been with the Democrats, but we’ve had to deal with this before and we’re going to do our best to deal with it again.”
American economists have also warned Trump’s plan could cause inflation and possibly a recession, which could have ripple effects in Canada.
It’s consumers who will ultimately feel the burden of any inflationary effect caused by broad tariffs, said Darby.
“A tariff tends to raise costs, and it ultimately raises prices, so that’s something that we have to be prepared for,” he said.
“It could tilt production mandates. A tariff makes goods more expensive, but on the same token, it also will make inputs for the U.S. more expensive.”
A report last month by TD economist Marc Ercolao said research shows a full-scale implementation of Trump’s tariff plan could lead to a near-five per cent reduction in Canadian export volumes to the U.S. by early-2027, relative to current baseline forecasts.
Retaliation by Canada would also increase costs for domestic producers, and push import volumes lower in the process.
“Slowing import activity mitigates some of the negative net trade impact on total GDP enough to avoid a technical recession, but still produces a period of extended stagnation through 2025 and 2026,” Ercolao said.
Since the Canada-United States-Mexico Agreement came into effect in 2020, trade between Canada and the U.S. has surged by 46 per cent, according to the Toronto Region Board of Trade.
With that deal is up for review in 2026, Canadian Chamber of Commerce president and CEO Candace Laing said the Canadian government “must collaborate effectively with the Trump administration to preserve and strengthen our bilateral economic partnership.”
“With an impressive $3.6 billion in daily trade, Canada and the United States are each other’s closest international partners. The secure and efficient flow of goods and people across our border … remains essential for the economies of both countries,” she said in a statement.
“By resisting tariffs and trade barriers that will only raise prices and hurt consumers in both countries, Canada and the United States can strengthen resilient cross-border supply chains that enhance our shared economic security.”
This report by The Canadian Press was first published Nov. 6, 2024.
