MP expresses concern about recent fall economic statement

Troubling numbers

The last several weeks have seen widespread reaction to the Liberal government’s fall economic statement.

Fall economic statements, occasionally called “mini budgets,” serve as mid-fiscal year report cards to update Canadians on the current and future state of the federal government’s finances, priorities, and the projected state of the Canadian economy.

The finance minister tried to present the course of her government as “fiscally responsible.” Still, an actual reading of the published numbers shows many worrying trends as we enter the new year. The two most significant “elephants in the room” are the statements concerning numbers projected for the growth in unemployment and servicing costs on the national debt.

On unemployment, the statement projects the federal unemployment rate will rise to 6.5% by the second quarter of next year because of a projected slowdown in the economy. Such a slowdown in our economy is a uniquely homegrown problem. While U.S. GDP grew by 5.2% in the third quarter of 2023, Canada’s GDP shrunk by 1.1%. The statement shows rising unemployment and a slowdown in the economy.

Working families will feel the pinch with the government’s plan to raise Employment Insurance (E.I.) premiums in January, clawing more out of every worker’s paycheque. This increase is also in direct contradiction to a commitment the government made to workers in its budget passed just last spring to not increase E.I. premiums in 2024.

When such specific commitments cannot be trusted to be upheld after just six months, it makes it harder to trust any of the promises made in this newest statement.

Where we can have confidence, sadly, is in the rapidly increasing cost that Canadians are bearing when it comes to servicing the federal government’s debt load. As announced by the finance minister, the federal government’s $1.2 trillion debt will require $326 billion spent over the next six years in service costs – that means paying debt interest payments.

Those billions in interest payments on an increasing debt will mean more tax dollars will go towards debt interest payments than healthcare or infrastructure and will instead go to bankers and bondholders.

The government is still committed to raising the floor at which the (federal) carbon tax is set by a trajectory of quadrupling it, increasing the cost of basic necessities such as food, gas, and heating. That increase will come even though the Parliamentary commissioner for the environment confirmed the government is on track to miss its emissions reduction targets and the Parliamentary budget officer showing the carbon tax leaves most Canadian households at a net loss.

One hundred and thirty First Nations communities in Ontario collectively recently filed suit against the federal government over the carbon tax (claiming it’s) grossly unfair and discriminatory.

Rising unemployment, high-interest rates and tax hikes are all the lingering effects of eight years of inflationary deficits run by the government. They have merged to create a severe and widespread affordability crisis in Canada.

In Kelowna-Lake Country, we are seeing the effects, with a reported 38% increase year over year at local food banks and stated projections at a shocking 100% additional increase over the next three to four months. It was reported that one (food bank) saw a 91-year-old as a client there for the first time in their life. The United Way B.C. recently released a report about how more B.C. seniors are facing the potential for homelessness than ever before.

While the fall economic statement may have created photo opportunities for government ministers, it was grim reading looking ahead to 2024. Rising prices, rent, debt and taxes will only worsen a severe affordability crisis.

Unless the government offers a significant change in direction from its proposed course, my “common-sense” Conservative colleagues and I will vote no-confidence on the fall economic statement.

If you need assistance with federal programs or have any thoughts to share, feel free to reach out, at 250-470-5075 or at [email protected].

Tracy Gray is the Conservative MP for Kelowna-Lake Country.

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

MP calling for break on federal taxes to help Canadians

Axe taxes for fiscal relief

Statistics Canada's most recent data reveals inflation remains high and serves as a stark reminder of the cost-of-living and affordability crisis facing Canadian households.

I’ll outline some solutions the Conservative party has recently put forward to address taxes, which are some of the causes of inflation and higher prices.

We have to remember inflation is compounding or adding on top of the previous year. With the current inflation rate (as of October) at 3.1%, this is calculated on top October 2022, which was 6.9% (over 2021 numbers). Therefore, you can see how quickly this directly increases costs on essential expenses such as food, gas and heating placing incredible strains on families.

A resident from Kelowna reached out to my office to share his shock and anger about his most recent gas bill, where the carbon tax was nearly 1.5 times higher than the cost of gas itself.

With the federal government introducing its second carbon tax this year through fuel regulations, and still pushing forward on continuing to raise carbon taxes every year, residents will only continue to feel the financial pain with little positive environmental gain.

The most recent report from the Parliamentary Environment Commissioner showed the federal government is on track to miss its stated 2030 emissions reduction targets. I’ve stated many times that carbon taxes are a tax plan, not an environmental plan and we are seeing the results of this carbon tax regime.

Despite eight years of government announcements and promises, the fiscal landscape remains turbulent, hitting families with less money at the end of the month due to soaring inflation, generational high interest rates and increasing taxes.

Here are just a few common-sense solutions the Conservatives recently put forth to help bring down inflation and prices affecting pocketbooks through tax reductions.

First, we brought forward a motion to pause the federal carbon tax on all types of home heating. That was in response to the government’s announced temporary carbon tax pause on only home heating oil for three years until after the next federal election when they will increase it again.

The government tax pause won’t apply to 97% of Canadian home heating systems, including almost everyone in Kelowna-Lake Country. Unfortunately, our motion was defeated in the House of Commons.

Second, we put forward Private Members Bill C-234, which would broaden the carbon tax exemption for farmers and in turn work to bring down food inflation. The legislation is currently in the Senate and is being held up by Senators appointed by the current prime minister. We’ve heard government Ministers have called Senators, trying to convince them to shut the bill down and the environment minister has stated there will be no more carbon tax “carveouts.”

Finally, Conservatives introduced Bill C-358, which aims to remove the Goods and Services Tax (GST) from the carbon tax. I seconded that bill.

Currently, in Canada, the carbon tax is subject to the GST, which is effectively a tax on a tax. I often receive home heating bill screenshots, emailed to me from local residents, questioning this practice and showing how much taxes are part of the bill.

These common-sense Conservative solutions are receiving roadblocks either in the House of Commons or the Senate, which will only prolong inflation and higher prices and the financial strain for people.

I will continue to work hard to advocate for our local residents and with my Conservative colleagues for all Canadians so we can bring home affordability and lower prices.

If you need assistance with federal programs or have any thoughts to share, feel free to reach out, at 250-470-5075 or at [email protected].

Tracy Gray is the Conservative MP for Kelowna-Lake Country.

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

Rising interest rates making it harder for homeowners to pay mortgages

Mortgages in crisis

Bank of Canada governor Tiff Macklem recently provided a stark message to Canadians—the federal government's current and projected spending is not helping the bank's efforts to bring down high inflation and high interest rates.

This position has significant implications for our economy, particularly with mortgages. As Macklem explained: “It’s going to be easier to get inflation down if monetary and fiscal policy are rowing in the same direction”.

The implications of that affirmation are substantial, raising questions about the viability of the current government's economic path, which directly affects the ability of Canadians to secure affordable mortgages and, for many, keep their homes.

In its effort to combat inflation, the Bank of Canada has increased interest rates 10 times in just 19 months, which has raised many mortgage holders’ payments. Since 2015, monthly mortgage payments have increased by 150% for a typical family home.

I recently sent out a mortgage survey to all households across our community and the responses are just starting to come in. So far, the vast majority of responses received from those who have mortgages indicate it has become more difficult and expensive to pay off their mortgages. Some say their mortgages have become so unaffordable, they may lose their homes.

In 2015, the prime minister promised to boost the availability of affordable housing in Canada. However, since then, rents, mortgage payments and the down payment required to buy a home have all doubled. Before 2015, it took 25 years to pay off a mortgage. It now takes 25 years to save for a down payment.

We increasingly see stories across British Columbia about people returning to the rental market because they can't afford their mortgages. A recent Edward Jones Canada survey stated, "Canadians are stuck in a chaotic whirlwind of personal financial stress”.

Many indicators show the extent to which people are struggling. Those include reports of increases in mortgage defaults, forced sales and high-interest alternative lending for those who no longer meet mortgage stress tests but desperately want to keep their homes.

All of this is made worse by a housing crisis that is failing to add new homes. According to the Canada Mortgage and Housing Corporation, housing starts are dropping nationwide, including 26% down in B.C. and 33% down in Kelowna since last year.

I speak to many people involved in construction who say the cost of debt financing due to high interest rates, increasing costs for materials and supplies due to inflation and cost increases with the continuing low Canadian dollar is making it more difficult to go forward with projects.

Macklem did affirm that by focusing on the inflationary consequences of its spending decisions, the federal government would significantly contribute to reducing inflation and the need for high interest rates, providing a way out of our worsening mortgage crisis.

•••

This Remembrance Day, I hope everyone in Kelowna-Lake Country will join me in taking a moment to recognize those who bravely served Canada in times of war, conflict and peace.

We do this to honour and pay tribute to Canadians who made the ultimate sacrifice defending democracy and human rights around the world.

Kelowna’s City Park features the multi-partner community service memorial project, the Field of Crosses. I hope everyone who is able takes the opportunity to honour those fallen soldiers and purchases a poppy, which helps support local veterans and their families.

You can view my Remembrance Day video tribute on my social media platforms as I paid respect at the National War Memorial in Ottawa.

Lest we forget.

If you need assistance with federal programs or have any thoughts to share, feel free to reach out, at 250-470-5075 or at [email protected].

Tracy Gray is the Conservative MP for Kelowna-Lake Country.

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

MP concerned about government censorship online

New rules for podcasters