Canada’s economy is facing a “turbulent” year, but the federal government still has some spending room for big priorities including a new health-care deal with the provinces, Associate Finance Minister Randy Boissonnault said Tuesday.
Boissonnault’s remarks came as the federal Liberal cabinet was meeting on the second day of a three-day retreat in Hamilton, Ont., where the economy and the next federal budget were high on the agenda.
Finance Minister Chrystia Freeland delivered an economic update to the cabinet Tuesday, and economists and Canada’s chief statistician also briefed the ministers on the situation facing Canada and the world.
That came the day after a joint report from the Business Council of Canada and Bennett Jones warned that the fiscal forecast laid out in the last federal budget and the fall economic statement was likely too rosy.
The report, written by former Bank of Canada governor David Dodge and former Liberal finance policy adviser Robert Asselin, said the government’s forecast was based on a “plausible but optimistic” set of economic and interest-rate assumptions that are unlikely to come true.
They warn that there is a “high likelihood of a more severe recession” this year, and that the Liberal promises on everything from health-care funding and enhanced national defence spending to infrastructure improvements and climate change are going to cost a lot more than was projected.
Boissonnault said the report is one of many the government will look to as it makes its economic forecast ahead of the next budget. He said he thinks the fiscal reality will fall somewhere between the best- and worst-case scenarios laid out in the fall economic statement.
“There’s lots of uncertainty,” Boissonnault said. “So we’re going to be watching this every step of the way as we get ready for budget (2023). We still have fiscal room to be able to do the things we need to do, but the fiscal room has tightened.”
Freeland said it’s not clear yet how the COVID-19 recession will “finally play out,” and the reopening of China following years of pandemic closures is also a bit of an unknown.
“That means we do need to continue to take a fiscally prudent approach,” she said.
At the same time, Freeland said health care and the green economic transition are “real fiscal pressures” that the government has to address.
She said Canadians are looking to governments to solve health-care woes, and the green transition is something Canada can’t push off, because if it doesn’t move now, it will miss the chance.
Ongoing talks with the provinces for a new health funding deal have made some progress in recent days, though a conclusion to those talks does not appear imminent.
The provinces have asked for billions over the next decade to bring their health systems back from the brink of collapse. Ottawa is insisting on accountability for any new health funding, and Trudeau has not publicly committed to meet the premiers’ demands.
Kevin Milligan, a University of British Columbia economist who was among those asked to brief the cabinet Tuesday, said it is unlikely that any new health deal would include a lot of up-front funding, so it is unlikely to put pressure on the government’s spending immediately.
Both he and Carolyn Wilkins, a former deputy governor at the Bank of Canada and now an economics research scholar at Princeton University, said the government needs to be careful that whatever it does on the fiscal side doesn’t nudge the Bank of Canada to push interest rates up even further.
Canadians are so heavily in debt that every interest rate hike now has a bigger impact on the economy and on individuals than it would have in the past.
“And so it may seem difficult now to go through this period of slower growth (during which) we’re expecting to see higher unemployment,” Wilkins said. “But at the same time, on the other side, we’ll then be in much better shape than if we’re impatient.”
Trudeau started his day Tuesday meeting with Hamilton Mayor Andrea Horwath, the former leader of the Ontario NDP. The two tackled another spending pressure and big concern for Canadians: housing.
Horwath thanked Trudeau for bringing the cabinet meeting to her city, but not everyone in Hamilton was as warmly welcoming.
“Freedom Convoy” demonstrators have made their presence known in small numbers over the first two days. On Monday evening, about three dozen people waved flags, yelled and set off fireworks — including some they appeared to aim at the building where cabinet ministers were meeting.
Most of them disbanded by 11 p.m., but at least one protester spent most of the night honking a vehicle’s horn off and on. It was reminiscent of the noise caused by protesters’ big rig truck horns as demonstrators blocked much of downtown Ottawa almost a year ago.
This coming weekend will mark the one-year anniversary of the convoy’s arrival in the capital. The weeks-long demonstration and accompanying blockades at several border crossings prompted Trudeau to invoke the Emergencies Act for the first time since it replaced the War Measures Act in 1988.
The final report from the public inquiry into that decision is due in February.
VANCOUVER – Contract negotiations resume today in Vancouver in a labour dispute that has paralyzed container cargo shipping at British Columbia’s ports since Monday.
The BC Maritime Employers Association and International Longshore and Warehouse Union Local 514 are scheduled to meet for the next three days in mediated talks to try to break a deadlock in negotiations.
The union, which represents more than 700 longshore supervisors at ports, including Vancouver, Prince Rupert and Nanaimo, has been without a contract since March last year.
The latest talks come after employers locked out workers in response to what it said was “strike activity” by union members.
The start of the lockout was then followed by several days of no engagement between the two parties, prompting federal Labour Minister Steven MacKinnon to speak with leaders on both sides, asking them to restart talks.
MacKinnon had said that the talks were “progressing at an insufficient pace, indicating a concerning absence of urgency from the parties involved” — a sentiment echoed by several business groups across Canada.
In a joint letter, more than 100 organizations, including the Canadian Chamber of Commerce, Business Council of Canada and associations representing industries from automotive and fertilizer to retail and mining, urged the government to do whatever it takes to end the work stoppage.
“While we acknowledge efforts to continue with mediation, parties have not been able to come to a negotiated agreement,” the letter says. “So, the federal government must take decisive action, using every tool at its disposal to resolve this dispute and limit the damage caused by this disruption.
“We simply cannot afford to once again put Canadian businesses at risk, which in turn puts Canadian livelihoods at risk.”
In the meantime, the union says it has filed a complaint to the Canada Industrial Relations Board against the employers, alleging the association threatened to pull existing conditions out of the last contract in direct contact with its members.
“The BCMEA is trying to undermine the union by attempting to turn members against its democratically elected leadership and bargaining committee — despite the fact that the BCMEA knows full well we received a 96 per cent mandate to take job action if needed,” union president Frank Morena said in a statement.
The employers have responded by calling the complaint “another meritless claim,” adding the final offer to the union that includes a 19.2 per cent wage increase over a four-year term remains on the table.
“The final offer has been on the table for over a week and represents a fair and balanced proposal for employees, and if accepted would end this dispute,” the employers’ statement says. “The offer does not require any concessions from the union.”
The union says the offer does not address the key issue of staffing requirement at the terminals as the port introduces more automation to cargo loading and unloading, which could potentially require fewer workers to operate than older systems.
The Port of Vancouver is the largest in Canada and has seen a number of labour disruptions, including two instances involving the rail and grain storage sectors earlier this year.
A 13-day strike by another group of workers at the port last year resulted in the disruption of a significant amount of shipping and trade.
This report by The Canadian Press was first published Nov. 9, 2024.
The Royal Canadian Legion says a new partnership with e-commerce giant Amazon is helping boost its veterans’ fund, and will hopefully expand its donor base in the digital world.
Since the Oct. 25 launch of its Amazon.ca storefront, the legion says it has received nearly 10,000 orders for poppies.
Online shoppers can order lapel poppies on Amazon in exchange for donations or buy items such as “We Remember” lawn signs, Remembrance Day pins and other accessories, with all proceeds going to the legion’s Poppy Trust Fund for Canadian veterans and their families.
Nujma Bond, the legion’s national spokesperson, said the organization sees this move as keeping up with modern purchasing habits.
“As the world around us evolves we have been looking at different ways to distribute poppies and to make it easier for people to access them,” she said in an interview.
“This is definitely a way to reach a wider number of Canadians of all ages. And certainly younger Canadians are much more active on the web, on social media in general, so we’re also engaging in that way.”
Al Plume, a member of a legion branch in Trenton, Ont., said the online store can also help with outreach to veterans who are far from home.
“For veterans that are overseas and are away, (or) can’t get to a store they can order them online, it’s Amazon.” Plume said.
Plume spent 35 years in the military with the Royal Engineers, and retired eight years ago. He said making sure veterans are looked after is his passion.
“I’ve seen the struggles that our veterans have had with Veterans Affairs … and that’s why I got involved, with making sure that the people get to them and help the veterans with their paperwork.”
But the message about the Amazon storefront didn’t appear to reach all of the legion’s locations, with volunteers at Branch 179 on Vancouver’s Commercial Drive saying they hadn’t heard about the online push.
Holly Paddon, the branch’s poppy campaign co-ordinator and bartender, said the Amazon partnership never came up in meetings with other legion volunteers and officials.
“I work at the legion, I work with the Vancouver poppy office and I go to the meetings for the Vancouver poppy campaign — which includes all the legions in Vancouver — and not once has this been mentioned,” she said.
Paddon said the initiative is a great idea, but she would like to have known more about it.
The legion also sells a larger collection of items at poppystore.ca.
This report by The Canadian Press was first published Nov. 9, 2024.
