I'm optimistic about the Feds clean infrastructure plan but there are lot of caveats: Lisa Raitt
The federal government needs to start placing a bigger focus on long-term growth for Canada, according to a former deputy leader of the Conservative Party of Canada.
In an interview with BNN Bloomberg on Wednesday, Lisa Raitt, co-chair of Coalition for a Better Future, vice-chair of global investment banking at CIBC Capital Markets and former natural resources minister, said she’s concerned about Ottawa’s plans for long-term growth in Canada.
“There's a lot of concern in Ottawa, we came together in something called the Coalition for a Better Future, 143 members saying exactly that, which is ‘Come on governments, get your eye on the ball on long-term growth,’ because it's not looking good from our perspectives,” Raitt said.
“So I do have concerns, but one of the things that I found very interesting in the budget is looking out in terms of what the expenses are of the government.”
Raitt flagged that this year the price tag for Old Age Security and government-guaranteed income is about $60 billion, and by 2027 it will increase by about 50 per cent to $90 billion.
She said this number is rapidly increasing as “boomers go through the cycle” and “there’s no special trust set up for that, that’s just coming right out of taxation.”
In the 2023 federal budget released on Tuesday, it projected program spending will be about $491 billion in the coming fiscal year, with the deficit now set to reach $40 billion.
It reiterated its 10 per cent increase in Old Age Security (OAS) payments for seniors and also said there would be a new review with the goal of cutting spending by about three per cent across all federal departments and agencies, with a few exceptions.
'WE’RE NOT HAVING A MATURE CONVERSATION'
Raitt said the topic of long-term care is going to become a more pressing issue, and there needs to be a conversation about it.
“Long-term care has a big chunk of the health system and it will continue to do so either because people are not accessing long-term care, so they're still in the hospital system which drives up costs, or the fact that there's more people who are going to long-term care paid for by the province, i.e. the federal government,” she said.
“We're not having a mature conversation in this country about whether or not we need to put in a payroll type tax that they have in Germany, that they have in several states in the U.S., to make sure that long-term care needs are taken care of in the future.”
Raitt emphasized that she’s not advocating for it, but she thinks this issue has to be recognized and there needs to start being conversations about how it will be paid for.
“It's just recognizing, we're going to have to have a separate fund to pay for that, and it can't always compete with people who want to have more money for the provision of services within a hospital,” she said.
'IT'S HAND-TO-HAND COMBAT IN GETTING STUFF DONE'
The federal budget included a mix of incentives to help aid Canada’s green transition, while trying to keep up with the Inflation Reduction Act south of the border.
Raitt said she thinks the budget takes a step in the right direction and she’s not completely disappointed in it, but it will really come down to what these tax credits will look like and whether it actually eases the process of doing business in Canada.
“I don't think you're going to see that kind of concern [about getting projects built in Canada] be alleviated until projects start actually going up,” she explained.
“It's one thing to say in the budget that we will undergo a process, to determine if our process is to process-y, and they'll do that by the end of the year. We've seen that promise before.”
She added that “it's hand-to-hand combat and getting stuff done, approved and built in Ottawa.”
WATCHING FOR CEDAR LNG
One of the areas that the former deputy leader of the Conservative Party of Canada wanted to see in the budget was equity support for Indigenous groups looking to get involved in energy projects, but it wasn’t there.
She said a concrete example that will show whether the federal government is actually trying to make it easier for companies to do business in Canada’s clean energy sector will be Cedar LNG, which is a proposed floating liquefied natural gas facility in Kitimat, B.C.
“We just saw with great fanfare, environmental approvals are all given. There's a lot of work that needs to be done, the least of which isn't the fact that Indigenous support needs to be there,” she said.
“I was disappointed, there wasn't Indigenous support for equity, of these kinds of projects, in the budget. It was not in there, there was a promise to look at it, but it wasn't specifically said.”
She flagged Alberta Indigenous Opportunities Corporation as an example, which allows Indigenous groups to access loan guarantees to invest in natural resources, agriculture, telecommunication, and transportation projects.
“That’s missing, that’s an important missing [in the budget], so let's see how Cedar LNG goes over the summer,” Raitt said.
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