MP complains about continuing federal deficits

Troubling spending trend

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Conservative MP for Central Okanagan-Similkameen-Nicola Dan Albas

This week, the government presented the 2023 federal budget.

Before I continue, let's recap last year's budget. The government called it the "return to fiscal responsibility" budget. Why? Although it had a deficit of $53 billion, the Liberals said it was "affordable." They based that on their claim the government would restrain spending to less than GDP growth.

As I pointed out last year, Prime Minister Justin Trudeau always spends more than planned, increasing our federal deficit. The 2023 budget follows that pattern of excess spending.

Last fall, the government predicted a fiscal plan that would balance in 2027. However, the new budget has a revised $14 billion deficit in 2027. The budget also promises five more years of deficits, all larger than it promised last fall.

This year, the deficit will hit $43 billion. Over the next three years, Canada's debt-to-GDP ratio is expected to increase.

The budget proposes about $43 billion in net new spending over the next six years, which includes a one-time grocery rebate, a 40% increase in Canada student grants, a $13-billion plan to expand dental care to families earning less than $90,000 a year, a new 15% refundable tax credit for clean electricity investments, and a refundable 30% tax credit for investments in clean tech manufacturing.

The NDP’s finance critic took credit for many of those new spending measures, saying they stemmed from an agreement between the government and the NDP to support the government on confidence matters.

The government also said it would cut discretionary spending. Still, it's unclear if this will make a big enough difference to its finances. Things will be even more tricky if it doesn't get enough money from cutting discretionary spending or if revenues drop.

The problem with ongoing deficit spending is Canada's interest charges on the debt will hit $43.9 billion this year, an 80% increase from pre-pandemic 2020 levels.

Debt servicing is now higher than our annual budget for the military. By fiscal 2027/2028, interest charges on our debt will exceed $50 billion annually.

Considering these interest costs, the federal Canada Health Transfer to the provinces will be $49.4 billion this year.

From my perspective, there is a pattern emerging.

In 2015, the government promised three years of "modest" deficit spending before a "cast in stone" promise to return to a balanced budget in 2019. It didn't deliver on that promise.

Last year, the government submitted a "return to fiscal responsibility" budget with a balanced budget promised. One year later, it abandoned this promise.

My question for you this week:

Do you think the Liberal government, supported by the NDP, is doing a good job with the country's finances?

Contact me at [email protected] or call toll-free 1-800-665-8711.

Dan Albas is the Conservative MP for Central Okanagan-Similkameen-Nicola.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

Carbon Tax hike increasing the price of groceries

Tax hikes and food bills

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Central Okanagan-Similkameen-Nicola MP Dan Albas

A headline about inflation this week was, “Inflation rate drops to 5.2% in February”.

However, a closer inspection reveals that prices for food purchased from stores in February were up 10.6% compared with a year ago, the seventh consecutive month of double-digit increases.

Anyone buying groceries will know that food prices continue to increase. This can be even more significant for those who live in rural communities, where there may be less local grocery store competition.

Recently, a local business owner who produces food products found in many local grocery stores, brought to my attention one of the reasons why this occurs. As we all know, the trucking of goods is significant in our grocery store food chain. The business owner I met mentioned shipping charges have increased dramatically due to the rising fuel cost. Now, the shipping company adds a surcharge solely for the carbon tax.

Given that the carbon tax in B.C. is set to increase on April 1, to $65 per tonne, this small business owner is very concerned his company will again have to raise prices, as the costs must be passed along.

Unfortunately, this is all part of (the current) “made-in-Canada” food inflation and does not end there. Also occurring on April 1 the federal government is set to increase the excise tax on wine, beer and spirits by more than 6%. Remember, increased trucking costs apply to those industries as well.

Canadian consumers will be asked to pay more when many can no longer afford to pay all their bills at the end of the month. And, there is also the compounding effect. For the business owner I mentioned, who is facing higher costs due to the carbon tax surcharge for the raw goods his company receives, the results will be higher prices as those finished goods are shipped to local grocery stores.

The carbon tax surcharge must be passed to consumers at local grocery stores, particularly those in rural areas with higher shipping costs. For more wealthy residents, higher grocery prices are not a problem. However, this is a massive financial burden for many families with variable rate mortgages who may now pay $1,000 more monthly just in added interest charges (on their mortgage).

Likewise, higher grocery prices have created significant additional hardship for those on fixed incomes.

In every region of Central Okanagan-Similkameen-Nicola riding, I have spoken with staff or volunteers at local food banks who have told me the uptick of demand, coupled with record-high inflation, is incredibly challenging for their operations.

While most of those now receiving support at food banks are seniors, many are also families where, despite the parents working one or more jobs, higher housing and rising grocery bills are forcing these families to rely on food banks to supplement their budgets.

My question this week:

How does food inflation personally impact you or your family?

I can be reached at [email protected] or call toll-free at 1-800-665-8711.

Dan Albas is the Conservative MP for Central Okanagan-Similkameen-Nicola.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

Questioning why grocery prices are so high

Rising grocery bills

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Central Okanagan-Similkameen-Nicola MP Dan Albas

Why does Canada have such runaway food inflation when we grow so much food?

It’s a common question. There are a couple of main reasons, such as rising fuel costs increase farmers' production costs and the cost of transportation. Because we import many different foods, exchange rates also matter and a weaker Canadian dollar means imported goods cost more for consumers.

Sylvain Charlebois, a food researcher from Dalhousie University, has said a lack of competition in the grocery space also contributes to higher food costs.

"All these discount stores are connected to just a handful of grocers controlling the Canadian market. They are essentially co-operative arms of the mainstream supermarkets, rather than competitors,” says Charlebois.

Speaking of mainstream supermarkets, at the Standing Committee on Agriculture and Agri-Food (AGRI) last week, parliamentarians questioned the CEOs of some of Canada's largest grocery store chains about food inflation.

At one point, Galen Weston, CEO of Canadian grocery store giant Loblaws, was asked, how much profit is too much profit?.

"We're a big company, and the numbers are very large, but it still translates right down to the bottom line at $1 [of profit] per $25 of groceries,” he replied.

There is no question companies such as Loblaws have always been profitable and continue to see increased revenue as inflation and population rise. In February 2023, Loblaws reported a fourth quarter profit of $529 million. That fourth-quarter profit was roughly 10% higher than last year's fourth quarter.

While on the topic of Loblaws, in 2019 the the government gave this extremely profitable company $12 million to purchase new, more energy-efficient, refrigerators.

I will continue to follow this subject closely and look forward to reading the final report on this crucial topic from the AGRI committee.

The government recently announced Volkswagen would build a "gigafactory" to produce electric vehicle batteries in St. Thomas, Ontario.

While undeniably goods news on many levels, it raises the critical question of how much this new Volkswagen battery factory will cost Canadian taxpayers.

The answer to that is we don't know. The government has refused to disclose how much taxpayers must pay Volkswagen to build this factory. Volkswagen, like Loblaws, is also a highly profitable company.

The same can be said for tire manufacturer Michelin. This week, Prime Minister Justin Trudeau announced Michelin would receive $44.3 million in federal funding to modernize a tire manufacturing plant in Bridgewater, Nova Scotia.

Selective taxpayer-financed subsidies to wealthy corporations are not a new topic here in Canada, provincially or federally. What is new is the amounts are becoming staggeringly high. This most recent announcement regarding the Volkswagen gigafactory sets a new standard for secrecy.

My question this week:

Are you concerned by the lack of disclosure about taxpayer funds by the government with corporate subsidies like this?

I can be reached at [email protected] or call toll-free 1-800-665-8711.

Dan Albas is the Conservative MPfor Central Okanagan-Similkameen-Nicola

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

Are we losing citizenship ceremonies in Canada?

Citizenship ceremonies

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Central Okanagan-Similkameen-Nicola MP Dan Albas

From my experience as a Member of Parliament, one of the most rewarding roles is the great honour of attending a citizenship ceremony.

Participating in a ceremony where new Canadians take their oath of citizenship is a very special moment and a reminder of how truly fortunate we all are to call Canada home.

The oath of citizenship ceremony has been a proud Canadian tradition since 1947. I suspect the vast majority who have had the opportunity to participate in, or observe, such a ceremony would agree what a heartwarming and unforgettable event it is.

I mention this because it was with great sadness that I have recently discovered the government may soon provide an option for new Canadians to skip the citizenship ceremony and instead click a box online over the Internet, potentially without the presence of a citizenship judge, family members, elected officials, guests or anyone else.

Why?

According to the government, the answer is speed. For reasons unknown, the immigration process has become so backlogged there are now 358,000 citizenship applications waiting more than two years or more.

Eliminating the citizenship ceremony could potentially increase the speed of an application by as much as 90 days, according to the government. This is also what I find troubling. If one is in a two-year lineup and can shorten the wait by 90 days, many would likely elect to do so.

The bigger question is why has this backlog become so severe? The COVID pandemic is partly to blame, however, the Parliamentary Budget Officer (PBO) recently investigated the Express Entry immigration process.

The PBO, who released a report earlier this week, revealed some eyebrow-raising information. While governments often cite a lack of staffing as a common reason for failures in program delivery, the PBO determined in the case of this specific immigration program, the current staffing is “more than sufficient to meet the processing time” requirements of this program.

The PBO stated Immigration, Refugees and Citizenship Canada (IRCC) is, and I quote directly, “estimated to have 65% more staff than would be required to meet the goal.”

When the PBO asked further questions of IRCC, the department, and again I quote directly, “declined to provide information about the resources that would have been required to meet processing time goals in past years, citing that this information represents cabinet confidences.”

In other words, the department is hiding behind cabinet confidentiality, which suggests the cabinet ultimately has the information and does not want it released publicly so that it cannot be held accountable for these severe delays in immigration processing times.

In my view, this is a case where instead of fixing the problem at the top, firing the minister and appointing a new minister, the proposed fix is to undercut, if not potentially eliminate, citizenship ceremonies. I say “potentially” because it is unknown how many would still opt for an in-person citizenship ceremony if they were told that could increase the wait time by up to another three months.

As a counterpoint, perhaps some may view a traditional, in-person citizenship ceremony in today’s environment as a waste of time and would support an online oath process done over the Internet.

My question to you this week:

Do you believe an in-person citizenship ceremony is still essential?

I can be reached at [email protected] or call toll-free 1-800-665-8711.

Dan Albas is the Conservative MP for Central Okanagan-Similkameen-Nicola.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.