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Senator Plett on Bill C-19: The Liberal Government’s COVID-19 economic measures don’t help the Canadians who need it most.

June 26, 2020 (Ottawa, ON) - The Honourable Don Plett, Leader of the Opposition in the Senate, issued the following statement:

Honourable senators, we have before us Bill C-19, Appropriation Act No. 3, 2020-21, which seeks approval for an additional $6 billion of financing for the government’s operations.

Aside from the fact that this figure includes $1.3 billion of COVID-related spending, there is nothing unusual about adding $6 billion in votable spending to the government’s bottom line. Last year, Supplementary Estimates (A) requested an additional $4.9 billion, and the year before that it was $8.1 billion. This request falls within the same range. So if we stopped right here, everything might appear normal, but this is far from the reality.

Over the last 10 years, the median amount of statutory spending included in the Supplementary Estimates (A) was $16 million. This year, that amount is 160 times greater, coming in at $80.9 billion. Of that, $80.8 billion is for COVID-19 measures.

This is a staggering amount of statutory spending for the supplementary estimates. It is almost one third of our annual budget and is only half of what the government has committed for COVID relief. It is a clear reflection of the devastating impact that the pandemic has had, and continues to have, on our country.

Even though most provinces are well into their recovery phase, Canada is still reeling under the impact of COVID-19. More than 100,000 people have contracted the virus in Canada and over 8,400 people have died because of it.

Our mortality rate has been steadily climbing and currently sits at 8.3%, the ninth highest in the world and much higher than the United States’, which has been declining and currently sits at 5%.

The nationwide lockdowns have blunted the health impacts of the pandemic, but they have also resulted in a national economic crisis. From February to April of this year, 3 million jobs were lost nationwide, causing our unemployment rate to spike to 13%. Another 2.5 million Canadians managed to keep their jobs but saw their hours drop by more than 50%. That’s 5.5 million Canadians who have seen their employment significantly impacted by COVID-19.

The impact of this has not been uniform. Some people and some sectors have been hit harder than others. Between February and April, employment among lower-wage workers fell by 38.1%, compared to 12.7% for all other employees.

Employment losses for women have been greater than those experienced by men, and now men are returning to work at a rate twice that of women.

In April, merchandise exports fell by 30% and imports dropped by 25%. Imports of motor vehicles and parts are down almost 80% and accounted for more than one half of the overall decline in Canadian imports. Energy exports fell by over 40%, while energy imports fell by more than 50%.

Although the employment numbers started to improve last month, we are far from being out of the woods. In spite of some people getting back to work, our unemployment rate actually rose even higher in May, from 13.0% to 13.7% because more Canadians are now looking for work.

Amongst returning students, unemployment rose to 40.3% last month. And over 1 in 5 Canadians were part of a household reporting difficulty meeting their immediate financial obligations, an increase from the previous month.

Colleagues, the International Monetary Fund has warned that Canada’s economy will retract by 6.2% this year, and the OECD tells us that the world economy is on track for the worst recession in a century.

It is clear that although the health impacts of this pandemic have been only a fraction of what we were told they would be, the economic and fiscal challenges have been much greater and have only just begun. We find ourselves in a time which is far from normal. But it is not just the COVID pandemic that makes these times unusual. Our country has experienced blow after blow over the last few months, ranging from the senseless, murderous rampage in Nova Scotia, to the outcry heard across the country over the murder of George Floyd, to the widespread call for action on systemic racism.

Yet alarmingly, in the midst of this, Canada finds itself with a government which refuses to get back to work even when it is safe to do so. Like Senator Marshall said in her speech on Monday, “. . . it seems like the government wants everybody back in their workplaces except parliamentarians.”

I’m not talking about returning to a full slate of MPs and senators. I’m talking about a refusal to return to regular sittings, which could take place in a safe and responsible manner that respected public health guidelines, much like we are doing right here today.

It is absurd that the Prime Minister can gather with thousands of people on the lawn of Parliament Hill to protest his own government’s inaction on racism, but cannot bring himself to sit in the House of Commons in order to steer the nation through some of the most troubled waters it has seen in a century.

For three months, Canadians have been subjected to the Prime Minister’s daily scolding sessions from the front of his cottage, admonishing us that the science clearly shows we need to stay home to protect the most vulnerable. But then suddenly, all that science is thrown out the nearest window to make room for a protest.

I’m not questioning the significance of the protest. I’m challenging the Prime Minister to give the same priority to Parliament that he gives to a photo op. Canadians do not appreciate this kind of hypocrisy.

I cannot begin to describe to you the number of families who were robbed of the opportunity to properly grieve the loss of a loved one during this pandemic. Mothers, fathers, grandparents, siblings, friends, sons and daughters have been laid to rest without a final farewell. The hearts of those who loved them were broken twice, once from the loss and again when they were forbidden the opportunity to say goodbye. And yet after chiding Canadians for weeks not to break with social distancing rules, because beating this pandemic requires all of us to work together, the Prime Minister unapologetically broke those very rules himself, with his photographer in tow to capture the moment.

Colleagues, even an esteemed member of this chamber boasted recently about breaking social distancing rules in order to attend a memorial on the East Coast. She said, “It was an emotional few hours where, notwithstanding the virus distancing requirement, I could not resist hugging ... I will pay whatever fine.”

Colleagues, I’m sure it was emotional and rightly so. We have seen too many tragedies unfold in the midst of this pandemic and they have all been very emotional. But what gives certain parliamentarians the right to preach one set of rules and then live by another?

No one had forgotten about the terrible incident in Nova Scotia only a few weeks earlier, where 22 people were murdered. In spite of this devastating tragedy, social distancing rules were not lifted to allow for funeral gatherings. Instead, people could only attend an online vigil streamed live across the country.

Grieving is hard at the best of times. It is even harder when there is no one to hold you. Make no mistake, this kind of hypocrisy is how grief turns to anger, and anger to cynicism.

How can we wink at this behaviour and pretend it’s okay and then act surprised when people become distrustful of government and those in authority? I find it preposterous.

These are not normal times. We are in the midst of a pandemic and the economic devastation that resulted from the lockdown. We have a Prime Minister who believes there’s one set of rules for himself and another set for everyone else. He refuses to give the same priority to Parliament that he gives to a photo op. He insists that we must carry on indefinitely without proper parliamentary oversight, accountability and scrutiny, and is doing his best to dial Parliament down to one giant rubber-stamping machine. And when the giant rubber-stamping machine refuses to rubber stamp, he simply looks for a way to go around it and then blame the opposition.

Consider what happened just a few weeks ago. The government introduced a four-part omnibus bill which sought to amend four acts of Parliament, limit the reach of another and enact a new one. It would have revised the eligibility criteria of a $45-billion government program, granted sweeping powers to ministers of the Crown to revise judicial time limits; permitted the cross-platform sharing of personal information from one agency of government to unspecified others; modified the application criteria for another $60-billion government program; and instituted criminal penalties for offences which were brushed off only a few weeks earlier.

Yet, when Pablo Rodriguez introduced this bill in the House of Commons, here’s what he said:

Mr. Speaker, there have been discussions among the parties and I hope there is agreement to proceed in the following manner. I move: That, pursuant to the order adopted on April 20, 2020, Bill C-17, an act respecting additional COVID-19 measures, be disposed of as follows: a. the bill be ordered for consideration at the second reading later this day; b. when the house begins debates on the motion for second reading of the bill, two members of each recognized party and a member of the Green Party may speak to the said motion for not more than 20 minutes, followed by 10 minutes for questions and comments, provided that members may be permitted to split their time with another member; and, at the conclusion of the time provided for the debate or when no member rises to speak, whichever is earlier, all questions necessary to dispose of the second reading stage of the bill shall be put without further debate or amendment, provided that, if a recorded division is requested, it shall not be deferred; and c. if the bill is adopted at second reading, it shall be referred to a committee of the whole, deemed considered in committee of the whole, deemed reported without amendment, deemed concurred in at report stage [on division], and deemed read a third time and passed [on division].

Colleagues, this is unbelievable. He basically wanted to deem Parliament out of existence. All of this was supposed to breeze through Parliament with a wink and a nod. So Andrew Scheer said no, we will not just rubber stamp this. But because we recognize it is important, we are prepared to sit tomorrow and the next day and the next day, in order to get the work done. The government refused and then blamed the opposition for obstructing their plans. Instead, they decided to abandon Bill C-17 on the Order Paper and are now telling us that they are going to find another way to accomplish what the bill was going to do.

Colleagues, this is nothing but arrogance on the part of the government. Bill C-17 would have been law today if the government would have been willing to get back to work. Instead, Canadians wait to see what creative scheme the government will dream up in order to sidestep accountability and parliamentary procedure.

This is unacceptable. Many of the changes introduced in Bill C-17 are critically needed, starting with the amendments to the Income Tax Act that would have revised the eligibility criteria for the Canada Emergency Wage Subsidy. The problem is they don’t go far enough. And by cutting Parliament out of the process, the government is eliminating the essential role that debate plays in the formulation of public policy, where problems are uncovered and rectified prior to implementation, rather than shutting the gate after the horses have left the barn.

This leaves us with policy where the government has made a few changes but left the biggest problems unresolved. For example, with the Canada Emergency Wage Subsidy, businesses that pay their employees in dividends have been shut out of the program. This is a major problem for small, family-run businesses and needs to be changed.

Second, if a business has not had a 30% drop in revenue, they don’t qualify for the program. It doesn’t matter if their revenue dropped 29.995%. Until they hit the magic 30% number, there is no help for them. This is a significant shortcoming, because although it may surprise some people, businesses don’t typically have a 30% profit margin to work with. I know all the socialists in the world think that business owners are just stealing money from the working class and stuffing it all in their pockets, but the economic reality is quite different.

In 2012, the average net profit margin for small businesses was 7.1%. For medium-sized businesses it was only 3.7%. So what the government is saying to businesses which have less than a 30% decline in revenue is, we may just have eliminated your customer base for 90 days, but we’d like you still to keep paying your employees and keep your business running, even though you’re digging a deeper and deeper debt hole every month.

How many small- and medium-sized businesses can afford that? Especially when they know that once the pandemic is over, business is not necessarily going to bounce back overnight. They could very well be running losses for months — possibly years — as volumes ramp back up and the economy gets back on its feet.

If the government was willing to listen to Canadians and to their fellow parliamentarians, it would quickly find that the necessary fixes are not complicated. But for some reason the government has a tin ear when it comes to economic realities.

The program is clearly not performing like it was expected to, and the fact that the government had to scale back the anticipated cost from $73 billion to $45 billion is proof of this.

Colleagues, this is the only government I have ever seen that is so incompetent that it has a problem giving money away. Bill C-17 was supposed to amend the Income Tax Act and the Children’s Special Allowances Act so that the Canada Revenue Agency could share information with other government departments in order to facilitate a one-time payment to persons with disabilities. Nobody was opposed to that. The government could have split it off into separate legislation, and it would have sailed through both houses of Parliament with unanimous support. But here’s the thing: If you had a chance to look at the bill before it was shelved by the government, you may have noticed that nowhere was it asking for Parliament to approve this payment to persons with disabilities; it was only asking for approval to allow the CRA to share the information about who would receive the payment.

That meant Parliament would have no opportunity to scrutinize it. If Parliament had been given the opportunity to do so, it might have questioned why the government is not being a little more targeted in their spending to make sure the money is received by those who need it and not by those who don’t need it.

As it currently stands, the plan will give everyone who qualifies for a disability tax credit a one-time tax-free payment of up to $600, regardless of their annual income; it doesn’t matter if you are living on $18,000 or $218,000 a year, you will get the tax-free payment if you are a certificate holder of a disability tax credit.

It gets worse. There are 2.7 million people with severe or very severe disabilities in Canada, and less than half of them will qualify for the tax credit. So this payment will send $600 cheques to wealthy people who don’t need it, while not sending support to the poorest and most vulnerable in our society. Something is wrong with this picture, but there’s nothing we can do about it because the government has decided to circumvent Parliament and find another way to make it happen.

This is the same mind-boggling approach that the government is using to provide a tax-free payment to everyone who qualifies for Old Age Security. Normally, the Old Age Security program is income-tested so that high-income earners don’t benefit from it, but government has decided that we are going to ignore the income test and give a $300 tax-free payment to 6.5 million seniors, regardless of their annual income.

According to the Canada Revenue Agency’s income statistics, this means that over $166 million will be sent to Canadians earning more than $80,000 a year, and more than $41 million will be sent to seniors earning more than that $150,000 a year.

Am I the only one who has a problem with that?

We’re in the midst of an economic crisis, and the government is tossing millions of dollars around indiscriminately to people who don’t need it. Yet, they only gave $8 million to support the Kids Help Phone; $29 million to help Indigenous women and girls fleeing violence; and $50 million to support women’s shelters and sexual assault centres.

It defies logic, but this is the way the Liberal government works.

Colleagues, Bill C-17 would have created penalties for anyone who defrauded the CERB program. This makes sense. Taxpayers should never be asked to subsidize someone who is able to work and yet, when work is available, they refuse to accept it. Anyone who cheats in order to receive a benefit they are not entitled to should be held accountable. There’s nothing peculiar about that, but what is peculiar is why the government didn’t realize that in the first place.

Only a few weeks ago, federal employees working on CERB applications were instructed to ignore potential cases of cheating. This was despite the fact that there were already widespread reports of fraud.

When he was asked about it, the Prime Minister simply brushed it off, suggesting that they would catch up with the cheats when it was more convenient. It’s a bit like announcing you’ve left the doors open to the bank vault and then trying to reassure your shareholders that if anyone steals something, you’ll follow up on it later. It’s not very smart or reassuring.

There are certain kinds of people who will take advantage of a situation like that, and some of these people may be smart enough to cover their tracks so that the government will not be able to track them down later and will not be able to recover the money.

So now the Prime Minister suddenly wants to slam the door shut that he insisted earlier had to be left open. It’s like he just found out there is a threat from organized crime, so now he has to act quickly.

And yet, the Canada Revenue Agency has been aware of this threat for some time. In May, CRA officials told the Standing Senate Committee on National Finance that they had put systems in place to flag signs of potentially fraudulent activity, including numeric bank accounts with consecutive numbering. Apparently, consecutive-numbered bank accounts are a red flag for everyone except the Prime Minister. Instead of taking early action to insist that such fraud would not be tolerated, he just shrugged it off, saying the following:

Getting that help to the 99 per cent of Canadians who needed it quickly and rapidly — even if it meant accepting that one or two per cent might make fraudulent claims — was the choice that we gladly made.

Mr. Prime Minister, 2% of $60 billion is $1.2 billion, and if you are ambivalent about that, then perhaps it’s time for you to find a different calling in life.

Colleagues, make no mistake about it; Parliament has been sidelined by this government, and the bill before us gives ample evidence of that fact by what is not in the bill rather than what is in the bill. The payment to disabled persons is not in it, so Parliament does not get to examine the disability payment. The payment to seniors is not in it, so Parliament does not get to examine that either.

The government has promised $453 million in support for Canada’s farmers, food businesses and food supply, yet only $15 million is included in Bill C-19. There’s another $113 million that was in the supplementary estimates as a statutory expenditure, so that leaves $326 million still missing in action.

The government promised $29 million for protecting and supporting Indigenous women and girls fleeing violence. None of it is included in this supply bill. The total amount is still outstanding.

The government promised $3 billion to the provinces in order to top-up the wages of essential workers during the pandemic. Once again, the Parliamentary Budget Officer has noted that the total amount remains outstanding; not a single dollar has been appropriated to date.

On Tuesday, the Minister of Finance was here in the chamber, and he refused to give us any information on the state of the nation’s finances. Yesterday, I wrote to him, as he suggested I do, and asked again for the information, noting that we should be provided that information before we voted on this bill today. I sent him the same questions I asked in this chamber: How much is the debt of the Government of Canada, including Crown corporations? Please provide us with a breakdown, in percentage, of the creditors: Bank of Canada, Canadian entities and individuals, and foreign entities and individuals. For foreign creditors, please provide breakdown by country or region, if available.

The minister’s reply was the same as it was in this chamber: It was the sound of crickets.

Colleagues, it is the height of arrogance for the Minister of Finance to ask parliamentarians to approve additional spending that will undoubtedly increase our national debt when he is either unable or unwilling to provide us with information necessary to make that decision in an informed and responsible manner. If a board of directors of any large corporation made financial decisions in this manner, I have no doubt they would be in breach of their fiduciary duties. And yet, this is exactly what the government expects of this chamber.

Colleagues, this is not acceptable. I find it difficult to understand those who suggest we should just give the government a pass.

Yesterday, our colleague Senator Woo asked Senator Martin what level of deficit the Conservative opposition would be comfortable with. He seemed to be suggesting that we were being a bit too hard on the government.

Well, Senator Woo, when the Finance Minister won’t give us the basic information about the state of the nation’s finances, how on earth is anyone supposed to be able to determine what is an acceptable level of overspending?

It’s too bad the senator was not as enthusiastic about asking Minister Morneau about the deficit as he was in asking Senator Martin.

Colleagues, the Conservative caucus in the Senate will not attempt to defeat Bill C-19, even though it is far from perfect. The funding that it provides is necessary to continue the uninterrupted delivery of the government programs and services that Canadians rely on.

However, we remain deeply concerned about the Prime Minister’s dismissive attitude toward the role of Parliament and the indifference he displays about the need for proper oversight and accountability.

He refuses to provide critical information on where we are, and he clearly has no roadmap on how to navigate the nation out of the debt he is racking up.

We are concerned not just for the state of the nation today but also for the fiscal challenges that will be inherited by our children, grandchildren and great-grandchildren.

I need not remind this chamber that, even before the pandemic, the Parliamentary Budget Officer warned repeatedly that provincial and territorial debt was already unsustainable.

It doesn’t matter what level of government we are talking about — there is only one taxpayer. And those taxpayers are currently carrying record levels of household debt along with alarming levels of ballooning government debt.

Factor into this the disturbing reality that the size of the workforce is diminishing relative to the size of our growing senior population and you are only beginning to get a glimpse of the fiscal challenges that lie ahead.

Colleagues, we are in the midst of a national crisis unlike any we have seen in our lifetime, and the decisions that are being made by the government during this time will reverberate for decades.

Today, I am calling on the Prime Minister to put aside his petty politics and start working collegially with his fellow parliamentarians.

This is not the time to restrict the sitting of Parliament and strip it of its power to consider debate and amend legislation proposed by a minority government. This, colleagues, is the time to work together to ensure a bright and sustainable future, not only for our generation, but for generations to come.

Senator Plett's speech on this issue can also be found here.

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