Politics Briefing: Bank of Canada hikes interest rates by another half percentage point, says it is ready 'to act more forcefully' – The Globe and Mail
The Bank of Canada announced another oversized interest rate hike on Wednesday and said that it is “prepared to act more forcefully” if needed to bring inflation back under control.
The central bank’s governing council voted to raise the policy rate by half a percentage point – its third interest rate hike this year. That brings the benchmark rate to 1.5 per cent, just a quarter point below the prepandemic level.
The bank said that more interest rate hikes will be needed to cool Canada’s overheating economy and to slow the pace of consumer price growth, which hit a three-decade high of 6.8 per cent in April.
Economics Reporter Mark Rendell reports here and also offers a Reporter’s Comment on Wednesday’s development: “The Bank of Canada’s 50-basis-point move today was widely expected by analysts and investors. What was striking was the central bank’s hawkish tone. It warned that inflation will likely keep rising in the coming months, led by a jump in oil and food prices, and said that it was “prepared to act more forcefully if needed” to get consumer price growth under control. That’s code for a 75 basis point rate hike, something the bank has not done since the 1970s.
“Whether or not the bank goes for an even larger rate hike at its next meeting in July, it’s clearly signalling that borrowing costs need to keep rising quickly. Higher interest rates won’t do much to deal with international sources of inflation, which include persistent supply-chain bottlenecks, COVID-19 lockdowns in China, and surging commodity prices following Russia’s invasion of Ukraine. But they will dampen demand in Canada’s overheated economy. Keep your eyes on the housing market, which tends to be the most rate-sensitive sector of the economy.”
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TODAY’S HEADLINES
BREAKING – Stéphane Dion has been appointed Canada’s ambassador to France. The former foreign affairs minister for Prime Minister Justin Trudeau has been Canada’s ambassador to Germany and a special envoy to the European Union and Europe since 2017. He will continue his envoy duties. Mr. Dion, who was formerly a leader of the federal Liberal Party, replaces Isabelle Hudon, who was the ambassador to France from 2017 to 2021. The announcement is here.
RESIST HALF MEASURES: ARBOUR – The federal government should resist half-measures and act immediately to implement the latest set of advice to ensure the safety of women in the Canadian Armed Forces, says former Supreme Court justice Louise Arbour. Story here. Meanwhile, The future of Canada’s military colleges is under scrutiny after Ms. Arbour asked, in her review, whether they should remain degree-granting institutions and recommended a review of their operations. Story here.
TIM’S TRACKED CUSTOMERS THROUGH APP – Canada’s largest fast-food chain violated privacy laws by tracking people who used its app, gathering their location data hundreds of times a day – even when the app was not in use. Story here.
HARD DRUGS DECRIMINALIZED IN B.C.; KENNEY CONCERNED – British Columbia will become the first province in Canada to decriminalize possession of small amounts of hard drugs such as illicit fentanyl, heroin, cocaine and methamphetamine after receiving an exemption from Ottawa to federal drug laws. Story here. Meanwhile, Alberta Premier Jason Kenney says here that he has concerns about the federal government’s decision to decriminalize possession of small amounts of illegal drugs in British Columbia.
MENDICINO NOT RULING OUT HANDGUN BANS – Public Safety Minister Marco Mendicino is not ruling out the use of handgun bans to deal with firearms violence, a tool endorsed by several big-city mayors in Canada. Story here.
MPS APPROVE MINOR CHANGE TO LUXURY TAX – Members of Parliament on the House of Commons finance committee approved a minor change to the budget bill’s luxury tax Tuesday related to its implementation date, but voted down more substantial proposals that had been recommended by Canadian businesses in the auto, aviation and boating sectors. Story here.
LEGAULT’S IMMIGRATION POLICY DRAWS IRE – Quebec’s Premier is being accused of stoking fears about newcomers after he gave a recent speech warning Quebec risks turning into Louisiana if the province doesn’t have more control over immigration. Story here. Meanwhile, Bill 96 overhauling the Charter of the French Language, is now the law of the province. Story here from The Montreal Gazette.
TRUDEAU GOVERNMENT HAS USED SECRET ORDERS-IN-COUNCIL – Prime Minister Justin Trudeau’s government has adopted 72 secret orders-in-council – hidden from Parliament and Canadians – since coming to office. Story here from the CBC.
SAUDI ARABIA GETS CANADIAN-MADE MILITARY GOODS DESPITE RUPTURE WITH CANADA – Massive amounts of Canadian-made military goods continue to flow to Saudi Arabia, a new government report shows, despite an unresolved diplomatic rupture between Ottawa and Riyadh as well as criticism of the kingdom’s role in the deadly war in Yemen. Story here.
ALBERTA FINANCE MINISTER ENTERS UCP LEADERSHIP RACE -Travis Toews has resigned as Alberta’s finance minister and launched his campaign in the race to replace Jason Kenney as United Conservative Party leader and premier. Story here.
FIRST FEMALE JUSTICE MINSTER IN SASKATCHEWAN – Saskatchewan has its first female justice minister and attorney-general after Premier Scott Moe shuffled his cabinet this week. Story here.
DONNER PRIZE WINNER NAMED – Munk School professor Dan Breznitz has won this year’s Donner Prize for the best public policy book. Story here.
ONTARIO ELECTION – Ontario NDP Leader Andrea Horwath wouldn’t say if she’ll stay on in her post if she fails to become premier, telling reporters on Tuesday she will wait for voters to make their decision in this week’s election before she makes hers on her political future. Story here. Meanwhile, ONTARIO ELECTION TODAY: The party leaders are making a final push ahead of Thursday’s election. And Vote of Confidence, The Globe’s Ontario election newsletter is here.
CONSERVATIVE LEADERSHIP RACE
CAMPAIGN TRAIL – Scott Aitchison is campaigning across Ontario. Roman Baber holds a rally in Toronto. Jean Charest is in Montreal. Leslyn Lewis is campaigning in the Newfoundland and Labrador communities of Clarenville and St. John’s. Pierre Poilievre was in Saskatchewan on Wednesday, with stops in Moose JawWyburn and Regina. No word on the campaign whereabouts of Patrick Brown.
MEMBERSHIP DEADLINE – It’s worth noting that Friday is the deadline for membership sales in the continuing leadership race. To date, the campaigns have been recruiting new members they presumably hope will support them leading to the Sept. 10 announcement of the new party leader.
BROWN ON CHINA AND CHAREST ON FIREARMS – Conservative leadership candidate Patrick Brown says he believes Canada can advance its trade relationship with China while at the same time take a stand against its human rights abuses. Story here. Meanwhile, rival Jean Charest promised Tuesday to subject a national ban on so-called assault-style firearms to a classification review by a panel of experts. Story here.
THIS AND THAT
TODAY IN THE COMMONS – Projected Order of Business at the House of Commons, June. 1, accessible here.
CHRETIEN LEFT IN THE DARK – Not even ex-prime ministers are immune from the lack of household power that has been a reality in the Ottawa region since a devastating storm on May 21 that hammered Ontario and Quebec. Tens of thousands were left in the dark as a result of the storm. Ottawa Bureau Chief Robert Fife ran into Jean Chrétien in downtown Ottawa on Wednesday. Canada’s prime minister from 1993 to 2003, said that he hasn’t had power at his Ottawa home since the storm so is staying in a downtown hotel. Hydro Ottawa has described the impact of the storm as being worse than both the ice storm of 1998 and tornadoes of 2018. As of Wednesday, Hydro Ottawa says 1,100 customers are still without power. One of them is Canada’s 20th prime minister.
PAGES PERFORMANCE – For the first time since 2019, the House of Commons Pages had an opportunity on Wednesday to sing O’Canada in the House of Commons chamber. They sang from the Speaker’s Gallery reserved for guests of the speaker. It’s a tradition for the Pages to sing the national anthem on the first Wednesday in June, but they have been unable to do so since 2019 because of the pandemic. Pages are first-year students attending one of three postsecondary institutions in the Ottawa region that work in the Commons chamber and Parliament Hill providing support services to MPs such as delivering notes among MPs, or from the Speaker to MPs, delivering documents and providing water. Each year, 40 students are selected as Pages from across Canada.
JOLY MEETS BALTIC COUNTERPARTS – Foreign Affairs Minister Mélanie Joly is meeting with her Baltic Region counterparts in Quebec City on Thursday. Ms. Joly will be holding talks with Estonia’s Foreign Affairs Minister Eva-Maria Liimets, Lithuania’s Foreign Affairs Minister Gabrielius Landsbergis and Zanda Kalniņa-Lukaševica, Latvia’s Parliamentary Secretary of the Ministry of Foreign Affairs. The agenda includes discussions on co-ordinated efforts in light of Russia’s invasion of Ukraine, a joint news conference, and the ministers, joined by Defence Minister Anita Anand, touring Canadian Forces Base Valcartier.
ROTA RETURNS TO SPEAKERS CHAIR – Anthony Rota, the Speaker of the House of Commons, returned to his regular chair Tuesday after being away for more than two months because of heart surgery. “It’s great to see you all again and it is great to be back. Please don’t let me regret saying that,” the Nipissing MP told the House. “While I was away, I just want to thank you all for the texts. the calls, the e-mails, the fruit baskets, the flowers, the plants. It really made the time go faster knowing that someone was thinking of me and that is something I really do appreciate from each and every one of you.”
NO INTEREST – “We’re just not interested in her opinion.” – Foreign Affairs Minister Mélanie Joly, commenting on Parliament Hill on Wednesday, on claims by Republican Congresswoman Marjorie Taylor Greene of Georgia that Canada’s new gun control could allow for a Russian invasion.
NEW CP ECONOMICS REPORTER – Nojoud Al Mallees, who has been a reporter and producer at CBC’s business unit based in Toronto, is joining the Ottawa Bureau of The Canadian Press as an economics reporter, starting on July. 4.
MP WITH COVID-19 – Stéphane Bergeron, the Bloc Québécois MP for the South Shore riding Montarville, has tested positive for COVID-19 with a rapid test, and placed himself in isolation.
THE DECIBEL
On Wednesday’s edition of The Globe and Mail podcast, following the announcement that the Liberal government plans to retable the Canada Disability Benefit before the end of June, Michelle Hewitt, the co-chair of Disability with Poverty, explains what supports are currently available to disabled Canadians, why this benefit is needed now, and the importance of including disabled voices in its creation. The Decibel is here
PRIME MINISTER’S DAY
The Prime Minister attended private meetings, and was scheduled to attend the Liberal caucus meeting, Question Period, and a flag-raising ceremony on Parliament Hill for Pride Month.
LEADERS
NDP Leader Jagmeet Singh attended the NDP caucus meeting, was scheduled to hold a news conference with B.C. MP Gord Johns on a health-based approach to substance use and participate in Question Period.
PUBLIC OPINION
ONTARIANS SUPPORT HANDGUN BAN: POLL – A large majority of Ontarians support a ban on handguns, according to a new election poll released Tuesday, just a day after the federal government tabled new gun-control legislation. Story here.
OPINION
The Globe and Mail Editorial Boardon why it’s time for a ban on the sale of handguns: “Canadians own 1.1 million legal handguns. That’s three times as many as just a decade and a half ago. New sales in recent years have been running at an average of 55,000 annually. As this page has repeatedly pointed out, none of the above makes any sense. Hunting is a legal activity practised by millions of Canadians, but handguns aren’t legal as hunting tools, in part because they’re highly ineffective hunting tools. They’re too inaccurate to be useful for much besides shooting other human beings at close range. Their main value is as concealed weapons, and carrying a concealed weapon is, of course, illegal in Canada. So while many Canadians have good reasons for owning a hunting rifle, almost nobody has a good reason for owning a handgun.”
Andrew Coyne (The Globe and Mail)on how we can no more force a prisoner to serve 150 years than we can execute him six times: “The ruling affects a tiny sliver of the prison population – perhaps a dozen cases, total. It remains open to the government to rewrite the law, within the limits set out by the court. Even if you disagree with the ruling, then, it clearly implies no emergency or crisis. The public is not one whit less safe after the ruling than it was before. And yet several candidates for Conservative leader – Pierre Poilievre, Patrick Brown, and Jean Charest – reacted with a vow to invoke the notwithstanding clause: the first time any federal government would have done so, were anyone to hold them to it. Has it come to this?”
Elaine Craig (Contributed to The Globe and Mail)on why are Canadian police chiefs refusing to accept military sexual assaults cases:“Imagine that police forces across Canada got to pick and choose which criminal offences they would be willing to investigate. This would seem unconscionable. And yet, when it comes to alleged sexual assaults by members of the Canadian military, some police chiefs in Canada apparently believe they do have that choice.”
Tom Mulcair (CTV)on Prime Minister Justin Trudeau sleepwalking us all toward making Quebec a de facto separate state:“[Quebec Premier Francois] Legault is getting a free pass. His desire for full jurisdiction over language, culture and immigration is being met with a whimper by Justin Trudeau and his hapless Attorney-General, David Lametti. They both know that this is a battle that Legault wants with Ottawa. Unfortunately for all of us, Trudeau is so terrified of Legault, that Ottawa is left play acting. Don’t expect to see the same thing we saw after previous attacks on minority language rights: a strong federal government doing its job. Trudeau and Lametti are hiding under their desks.”
Paul Wells (TVO)on how the Ontario election could have used more political polarization:“The biggest surprise of 2022 has been how many voters don’t mind having Doug Ford as premier. I think I’m reading the mood of this crucial Don’t Mind Doug voting bloc correctly: they don’t go to bed at night thanking the stars that Ford watches over them. But neither are they prepared to do anything untoward, to break a sweat or chip a nail to be done with him. This will be hard for some people I know to comprehend.”
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HALIFAX – Nova Scotia Premier Tim Houston says it’s “disgraceful and demeaning” that a Halifax-area school would request that service members not wear military uniforms to its Remembrance Day ceremony.
Houston’s comments were part of a chorus of criticism levelled at the school — Sackville Heights Elementary — whose administration decided to back away from the plan after the outcry.
A November newsletter from the school in Middle Sackville, N.S., invited Armed Forces members to attend its ceremony but asked that all attendees arrive in civilian attire to “maintain a welcoming environment for all.”
Houston, who is currently running for re-election, accused the school’s leaders of “disgracing themselves while demeaning the people who protect our country” in a post on the social media platform X Thursday night.
“If the people behind this decision had a shred of the courage that our veterans have, this cowardly and insulting idea would have been rejected immediately,” Houston’s post read. There were also several calls for resignations within the school’s administration attached to Houston’s post.
In an email to families Thursday night, the school’s principal, Rachael Webster, apologized and welcomed military family members to attend “in the attire that makes them most comfortable.”
“I recognize this request has caused harm and I am deeply sorry,” Webster’s email read, adding later that the school has the “utmost respect for what the uniform represents.”
Webster said the initial request was out of concern for some students who come from countries experiencing conflict and who she said expressed discomfort with images of war, including military uniforms.
Her email said any students who have concerns about seeing Armed Forces members in uniform can be accommodated in a way that makes them feel safe, but she provided no further details in the message.
Webster did not immediately respond to a request for comment.
At a news conference Friday, Houston said he’s glad the initial request was reversed but said he is still concerned.
“I can’t actually fathom how a decision like that was made,” Houston told reporters Friday, adding that he grew up moving between military bases around the country while his father was in the Armed Forces.
“My story of growing up in a military family is not unique in our province. The tradition of service is something so many of us share,” he said.
“Saying ‘lest we forget’ is a solemn promise to the fallen. It’s our commitment to those that continue to serve and our commitment that we will pass on our respects to the next generation.”
Liberal Leader Zach Churchill also said he’s happy with the school’s decision to allow uniformed Armed Forces members to attend the ceremony, but he said he didn’t think it was fair to question the intentions of those behind the original decision.
“We need to have them (uniforms) on display at Remembrance Day,” he said. “Not only are we celebrating (veterans) … we’re also commemorating our dead who gave the greatest sacrifice for our country and for the freedoms we have.”
NDP Leader Claudia Chender said that while Remembrance Day is an important occasion to honour veterans and current service members’ sacrifices, she said she hopes Houston wasn’t taking advantage of the decision to “play politics with this solemn occasion for his own political gain.”
“I hope Tim Houston reached out to the principal of the school before making a public statement,” she said in a statement.
This report by The Canadian Press was first published Nov. 8, 2024.
REGINA – Saskatchewan Opposition NDP Leader Carla Beck says she wants to prove to residents her party is the government in waiting as she heads into the incoming legislative session.
Beck held her first caucus meeting with 27 members, nearly double than what she had before the Oct. 28 election but short of the 31 required to form a majority in the 61-seat legislature.
She says her priorities will be health care and cost-of-living issues.
Beck says people need affordability help right now and will press Premier Scott Moe’s Saskatchewan Party government to cut the gas tax and the provincial sales tax on children’s clothing and some grocery items.
Beck’s NDP is Saskatchewan’s largest Opposition in nearly two decades after sweeping Regina and winning all but one seat in Saskatoon.
The Saskatchewan Party won 34 seats, retaining its hold on all of the rural ridings and smaller cities.
This report by The Canadian Press was first published Nov. 8, 2024.
HALIFAX – Nova Scotia‘s growing population was the subject of debate on Day 12 of the provincial election campaign, with Liberal Leader Zach Churchill arguing immigration levels must be reduced until the province can provide enough housing and health-care services.
Churchill said Thursday a plan by the incumbent Progressive Conservatives to double the province’s population to two million people by the year 2060 is unrealistic and unsustainable.
“That’s a big leap and it’s making life harder for people who live here, (including ) young people looking for a place to live and seniors looking to downsize,” he told a news conference at his campaign headquarters in Halifax.
Anticipating that his call for less immigration might provoke protests from the immigrant community, Churchill was careful to note that he is among the third generation of a family that moved to Nova Scotia from Lebanon.
“I know the value of immigration, the importance of it to our province. We have been built on the backs of an immigrant population. But we just need to do it in a responsible way.”
The Liberal leader said Tim Houston’s Tories, who are seeking a second term in office, have made a mistake by exceeding immigration targets set by the province’s Department of Labour and Immigration. Churchill said a Liberal government would abide by the department’s targets.
In the most recent fiscal year, the government welcomed almost 12,000 immigrants through its nominee program, exceeding the department’s limit by more than 4,000, he said. The numbers aren’t huge, but the increase won’t help ease the province’s shortages in housing and doctors, and the increased strain on its infrastructure, including roads, schools and cellphone networks, Churchill said.
“(The Immigration Department) has done the hard work on this,” he said. “They know where the labour gaps are, and they know what growth is sustainable.”
In response, Houston said his commitment to double the population was a “stretch goal.” And he said the province had long struggled with a declining population before that trend was recently reversed.
“The only immigration that can come into this province at this time is if they are a skilled trade worker or a health-care worker,” Houston said. “The population has grown by two per cent a year, actually quite similar growth to what we experienced under the Liberal government before us.”
Still, Houston said he’s heard Nova Scotians’ concerns about population growth, and he then pivoted to criticize Prime Minister Justin Trudeau for trying to send 6,000 asylum seekers to Nova Scotia, an assertion the federal government has denied.
Churchill said Houston’s claim about asylum seekers was shameful.
“It’s smoke and mirrors,” the Liberal leader said. “He is overshooting his own department’s numbers for sustainable population growth and yet he is trying to blame this on asylum seekers … who aren’t even here.”
In September, federal Immigration Minister Marc Miller said there is no plan to send any asylum seekers to the province without compensation or the consent of the premier. He said the 6,000 number was an “aspirational” figure based on models that reflect each province’s population.
In Halifax, NDP Leader Claudia Chender said it’s clear Nova Scotia needs more doctors, nurses and skilled trades people.
“Immigration has been and always will be a part of the Nova Scotia story, but we need to build as we grow,” Chender said. “This is why we have been pushing the Houston government to build more affordable housing.”
Chender was in a Halifax cafe on Thursday when she promised her party would remove the province’s portion of the harmonized sales tax from all grocery, cellphone and internet bills if elected to govern on Nov. 26. The tax would also be removed from the sale and installation of heat pumps.
“Our focus is on helping people to afford their lives,” Chender told reporters. “We know there are certain things that you can’t live without: food, internet and a phone …. So we know this will have the single biggest impact.”
The party estimates the measure would save the average Nova Scotia family about $1,300 a year.
“That’s a lot more than a one or two per cent HST cut,” Chender said, referring to the Progressive Conservative pledge to reduce the tax by one percentage point and the Liberal promise to trim it by two percentage points.
Elsewhere on the campaign trail, Houston announced that a Progressive Conservative government would make parking free at all Nova Scotia hospitals and health-care centres. The promise was also made by the Liberals in their election platform released Monday.
“Free parking may not seem like a big deal to some, but … the parking, especially for people working at the facilities, can add up to hundreds of dollars,” the premier told a news conference at his campaign headquarters in Halifax.
This report by The Canadian Press was first published Nov. 7, 2024.
