As hope for the end of the COVID-19 pandemic grows with encouraging news about vaccines, the Liberal government will increasingly turn its attention to recovery, and its promise to make climate change a central focus of the economy’s rebuilding.
Last month, Environment Minister Jonathan Wilkinson tabled legislation that will enshrine the government’s goal of making Canada a net-zero emitter of greenhouse gases (GHGs) by 2050. However, while setting an ambitious target is one thing, meeting it is quite another.
Prime Minister Justin Trudeau’s government is now at a critical juncture, even as he’s hemmed in by Conservative premiers who resist his climate-change agenda.
The Liberals can either continue the slow march with targeted and modest actions, or implement a far-reaching climate plan that will transform the Canadian economy and position it to prosper in a zero-carbon world.
To reach that more ambitious goal, the government will have to kickstart the effort with a stimulus plan that plows tens of billions of dollars into clean-energy programs. But the Trudeau government will also have to go far beyond the frequently heard calls for public spending on high-profile energy projects.
It will need the entire government to adopt a climate lens, as opposed to its current practice of creating boutique programs in departments such as Agriculture; Natural Resources; or Innovation, Science and Economic Development, while the rest of the bureaucracy carries on with business as usual.
The prime minister is unlikely to get much help from key provinces, as he did in 2016, when federal, provincial and territorial governments hammered out the Pan-Canadian Framework on Clean Growth and Climate Change. However, Ottawa can forge partnerships with municipalities — and with the private sector, which is far more committed to action than it was four years ago.
The enormous impact of capital markets could dwarf the public-sector effort to effect a zero-carbon transformation. To harness it, the government must step up and lead the effort to enshrine the principles of sustainable finance that properly value the risks and opportunities arising from the growing climate crisis and the global response to it.
In responding to the pandemic this year, the federal government delayed much of its climate-change agenda. It focused instead on providing financial support to individuals and businesses, including the oil industry, which was struggling before the pandemic and has been clobbered by the resulting global drop in demand for crude.
In a November report, the Winnipeg-based International Institute for Sustainable Development said Canada, along with other Group of 20 industrialized countries, “doubled down” on its fossil-fuel subsidies this year, despite long-standing promises to end them. It rated Canada’s record of fossil-fuel subsidies between 2016 and 2019 “very poor.”
EnergyPolicyTracker.org, which is produced by two European non-government organizations, calculated that, as of Nov. 18, Canada had provided some $18.6 billion in conditional and unconditional support to the fossil-fuel sector, and only $14.6 billion to support clean energy. It characterized as “conditional support” the $2.4 billion that Ottawa spent on cleaning up abandoned oil wells and helping industry reduce methane emissions.
Meanwhile, the Liberal government’s lobbying of president-elect Joe Biden to approve the Keystone XL pipeline sends a clear message that, despite its public promise of net-zero emissions by 2050, Ottawa remains committed to building fossil-fuel infrastructure whose normal lifespan is around 30 years.
So what would an ambitious, climate-focused recovery plan look like?
For starters, it would be securely anchored in the government’s commitment to exceed its existing target under the Paris Agreement to reduce GHGs by 30 per cent below 2005 levels by 2030, and to reach net-zero emissions by 2050. It must also be rooted in a “just transition,” with education, training, and other support to ensure individual Canadians — oil-industry workers, Indigenous people, and others who are already disadvantaged in the current economy — don’t fall further behind.
It would allocate billions of dollars annually over several years on a range of clean-energy programs. The Task Force for a Resilient Recovery — a group largely drawn from think tanks, with some business members — says $55.4 billion should be spent over five years on clean-energy infrastructure, building retrofits, electric-vehicle infrastructure, nature-based programs, and the production and adoption of clean technology across the economy.
A bold plan would involve the federal government spending its vast procurement budget on incentives for companies to adopt clean-tech solutions to lower their own GHG emissions, and, just as important, to commercialize and drive down the cost of innovative technologies.
As mentioned, it would embrace principles of sustainable finance, and make it clear to corporate directors, and managers of public-sector pension plans, that they have a fiduciary duty — that is, a legal obligation — to ensure their organizations are part of the solution, rather than part of the problem in the climate emergency.
The response to the COVID pandemic around the world demonstrates the power of collective action when governments and the private sector collaborate. Witness the unprecedented speed of vaccine development. It also shows the tragic results that occur when leaders ignore the science and refuse to take tough action in the face of a crisis.
The Liberal government’s actions over the next several months will tell whether it has the guts to lead, or will content itself with lofty promises unmatched by bold action.
The views, opinions and positions expressed by all iPolitics columnists and contributors are the author’s alone. They do not inherently or expressly reflect the views, opinions and/or positions of iPolitics.
This article originally appeared in the iPolitics Holiday Magazine published earlier this month.
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.
