Appropriation Bill No. 1, 2026-27
Third Reading
March 26, 2026
Moved third reading of Bill C-24, An Act for granting to His Majesty certain sums of money for the federal public administration for the fiscal year ending March 31, 2027.
She said: I am delighted to be here today to speak to the appropriation bill for interim supply 2026-27.
I know you’re thinking, “Oh my God, she is up again.”
I just want to say this before I begin: I was sworn in to the Senate in May, and it took me a little while — and I can’t say I have this down pat — to understand the flow of these money bills. If you don’t come from finance — if you’re an engineer, if you’re an architect or if you’re a doctor — I’m not sure you have seen books like this before coming into this place. It’s a tsunami of paper.
I wanted to share what I’ve learned in my short stint here so far. It starts with the budget bill. This is for my own edification. I am number 105 of 105 senators, so I really was the last one in, but there was a group coming in with me. The budget bill is first. It is the idea book; it is what the new government and those new leaders decide upon to show “We are about this.” They put it all in a budget book, which sends bureaucrats flying to understand this because they have so many bills that they now need to change or they have to make those new ideas into law. That’s why it takes weeks before we actually receive a budget bill that goes with the budget book.
They make all their announcements, and bureaucrats finally write the bill. Then the bill arrives. They were kind enough to put it in several binders for me, and that’s what we just finished voting on a minute ago. But what happens throughout the year is those bureaucrats have no idea how much money it is going to cost to implement that budget book. They have a grand idea, and they have a notion, but then they have to do the hard work of figuring out how much money, in what quarter that money will be spent and how that money will be spent, as well as to what level and what number.
Then we start getting into the estimates, and we receive the estimate for the year, but we don’t approve a whole year of estimates. We only do quarters at a time, so every quarter or so, they come back and say they’re refining their numbers. How about that fleet of tankers they wanted to buy? They’re off by a couple billion dollars or under or over.
Every quarter, we end up with these documents that are constantly refining the numbers, which gives us another opportunity to get our eyes on the lines and say, “How are they doing in implementing their ideas?”
From a flow perspective, that was a huge learning curve for me to understand. For my colleagues who were sworn in with me, Senator Henkel and Senator Wilson, you probably understood all that already, but that took me a bit of time to sort out. Now we know how we can hold the government to account, and we understand that senators are in the baseball field with three bases loaded and we’re the last batter up. Everyone else is in the auditorium watching what is going to happen. Are we going to get the last kick after we’ve studied it to let those bills pass, let the money flow and let the government continue?
After figuring that out, I now understand these money bills are really important, so I want to thank our Government Representative’s Office for giving me the opportunity to speak about these things and to understand how this moment with these senators is the crux of moving government forward in this country. To me, that is what supply bills are all about.
Now I will go back to what I’m going to talk about today.
As you know, interim supply bills are an integral part of the normal appropriations cycle. In order for federal government departments and agencies to carry out their activities, they must obtain parliamentary authorization to spend public funds.
If you look through the document that arrived, it’s called the Main Estimates. In it, you see that for each department or agency, there’s a line item called “Voted.” There’s another line called “Statutory.” When it reads “Voted,” that means the other place has voted to spend. Those change as priorities change. The other line “Statutory” represents the line items that people agreed to years ago — you don’t vote on it every time — like the Canada Pension Plan, or CPP, and Old Age Security. They don’t come back every year and ask, “Will we have CPP?” That is an automatic payment, so it goes on the “Statutory” line, which includes amounts approved in other acts and are ongoing, and it also includes acts that identify how that money is spent. The rules are set out, and if you meet them, you’re paid. When you hit 65, you just might collect CPP. We don’t approve those items every year.
Before this bill for the upcoming first quarter was tabled, you saw the government table each department’s plan. It’s also online for each department, each agency and each Crown corporation that is funded by the federal government. That is important because it aligns with the money they are seeking approval to spend, and it tells us what we’ll do with it.
The other day, Senator LaBoucane-Benson tabled a box of all of those plans, and each of us, with our areas of interest, could delve into them to see what they’re doing. How are we funding all of the services that we are chasing?
In the Main Estimates, the government sets out the amounts it needs to fund its activities for the coming fiscal year, which begins on April 1. While the Main Estimates provide an overview of expenditures for the whole year, the interim supply bill we are debating today covers the first three months of these estimated annual expenditures.
The government tables the Main Estimates. Then the government introduces an interim supply bill to authorize funding for those first three months of the fiscal year until parliamentarians adequately study and give final approval to the Main Estimates in June. Those Main Estimates are going to be back here before the summer break, for sure.
That spending requested through this interim supply is already included in those Main Estimates, but we don’t vote on the whole of the year. An important detail about interim supply is that the amount requested is typically based on twelfths of the amount, so notionally, they correspond to monthly cash requirements.
For most departmental votes, the requested interim supply represents one quarter or three months of the total voted authorities in the Main Estimates for the fiscal year. Some departments ask for more in the interim than the standard of the three twelfths, and that is because they already know that in a specific quarter, they are going to require more. That could be adjusted again in the next quarter. And the Treasury Board must approve that before it lands here in front of us.
Honourable senators, transparency is important here. The government uses the estimates and associated documents to show how it plans to spend taxpayers’ money. Along with the Main Estimates, Departmental Plans reflect the government’s base spending plans.
Departmental Plans are one component of the series of budgetary documents, which also includes Departmental Results Reports, the Main Estimates and the supplementary estimates. All these documents are available online.
These plans outline the federal government’s objectives, responsibilities and top priorities over the course of the next three years. They provide details on resource requirements found in the Main Estimates based on each organization’s mandate, priorities and operations. They also allow parliamentarians and Canadians to track — that’s our job — the progress of these priorities and better hold the government to account.
For increased transparency and accessibility, Canadians and parliamentarians can access these estimates and the government’s other financial, personnel and performance data online, including within the interactive GC InfoBase application. Apparently, it’s getting stellar reviews around the world.
Let me turn to the Main Estimates for 2026-27. The Main Estimates are a snapshot of planned spending taken before the beginning of the fiscal year, which is April 1.
Part I provides a summary of planned spending across the federal government for the whole of the 2026-27 fiscal year. It’s a historical year-over-year comparison showing you what it was last year and what their planned spending is into the transfer payments, operating and capital expenditures and public debt charges.
Part II provides estimates by organization and offers more details on the planned expenditures, so if you flip to the back, you will see a breakdown of the 20 to 50 lines within that one department, Crown corporation or outside agency.
An annex to Parts I and II provides more details on the inclusion of the proposed schedules to the appropriation bill. I will note the amounts shown in the annex represent the full supply for the Main Estimates. Again, it shows the whole year of which the interim supply that we’re considering today is only a portion.
It is only that first quarter.
Honourable senators, this year, the President of the Treasury Board tabled the Main Estimates in the other place on February 26. The interim supply bill was introduced on March 23.
Over the coming months, MPs will have the opportunity to scrutinize all the government’s spending plans. This will take place prior to the approval of the other voted expenditures set out in the Main Estimates by means of another appropriation bill scheduled for June.
The Main Estimates for the fiscal year 2026-27 represent $502.8 billion in planned budgetary spending, of which $230.4 billion is subject to Parliament’s approval through the first two appropriation acts. That is what they could foresee at this point. They can look at this one in front of us now and look ahead to what the next quarter will be, which they mention we’ll likely see by the end of June.
As the government makes investments in priority areas, it’s decreasing spending on day-to-day government operations. Through the Comprehensive Expenditure Review, or CER, $9 billion in savings will be realized in 2026-27. This will reach $13 billion annually by 2028-29, with a goal of $60 billion in savings over five years.
The Main Estimates, of which these provisional appropriations form part, reflect the government’s ongoing commitment to addressing Canadians’ priorities.
Allow me to highlight some of the organizations that are seeking more than $10 billion in voted budgetary expenditures.
One of those departments asking for more than $10 billion is the Department of National Defence, which is no surprise. It is seeking Parliament’s authority to spend $48.4 billion. Esteemed colleagues, Canada finds itself in an era shaped by significant global uncertainty. As I mentioned Tuesday, the world is giving us universal headaches over this, with state and non-state actors who don’t follow international rules and, in general, a global order in flux.
It’s clear that Canada must take stronger steps to protect itself and become more self-sufficient while remaining engaged with partners across the globe. I can confirm a response to a question that was asked on Tuesday around Canada’s NATO commitment: We have met our 2% commitment and are on track to meet NATO’s 5% Defence Investment Pledge by 2025, which is exciting.
Another critical issue is Canada’s relationship with Indigenous peoples. True reconciliation is not limited to symbolic gestures. Concrete measures must be taken in the areas of education, health care, governance and economic development opportunities. That is why the proposed spending for the Department of Indigenous Services totals $23.9 billion.
With this funding, the department will support and improve Indigenous health and well-being and ensure Indigenous children get the care and support they need to thrive. The department will also work with Inuit partners to eliminate tuberculosis across Inuit Nunangat by 2030.
Another critical area of work is closing the infrastructure gap by 2030 by supporting community-led decision-making on First Nations infrastructure projects, including high-priority repairs and renovation, multi-year capital projects, education facilities and housing.
We heard Tuesday that the government has resolved 97.5% of the drinking water issues in those communities and across our Native communities since committing to eradicating this issue. I think that is impressive.
The Department of Crown-Indigenous Relations and Northern Affairs is seeking $11.8 billion to carry out its objectives. These include acknowledging and redressing past harms with respect to items like land claim resolutions; affirming and respecting Indigenous rights and supporting self-determination; and leading the Government of Canada’s work in the North and Arctic, among other things.
The Department of Employment and Social Development is seeking $13.6 billion. It will use this funding to support the government’s commitment to making housing more affordable by creating new careers in the skilled trades. It will do this by helping workers gain skills needed for jobs in residential construction to build both traditional and modular housing through initiatives such as the Sustainable Jobs Training Fund, the Sectoral Workforce Solutions Program and the Canadian Apprenticeship Strategy.
The department will also contribute to the government’s efforts to attract the best talent in the world to help build our economy while also returning our overall immigration rates to sustainable levels. It will support this by ensuring that genuine employers with real labour-market needs can access the Temporary Foreign Worker Program.
Another key focus area for the department is to keep working with its partners to build and maintain a Canada-wide early learning and child care system, as well as continuing its work in implementing the National School Food Program in collaboration with provinces, territories and Indigenous partners.
The department also prioritizes helping seniors afford retirement through delivering the Old Age Security program and the Canada Pension Plan.
Health Canada, meanwhile, is seeking $10.4 billion in funding to achieve a number of objectives. These include improving mental health and addiction supports, helping Canadians age with dignity and supporting and improving access to oral health care services. Health Canada is also working to improve affordable access to pharmaceuticals, reduce the harms associated with substance use and tackle the overdose crisis.
Honourable colleagues, the 2026-27 Main Estimates also contain $272.4 billion in statutory expenditures. As mentioned before, we’re spending that no matter what as of April 1. It is spending that has been previously approved in legislation, including $88.8 billion in elderly benefits, $57.4 billion for the Canada Health Transfer, $53.7 billion in public debt charges, $27.2 billion for fiscal equalization and $17.9 billion for the Canada Social Transfer.
I invite honourable senators to explore the Main Estimates, department plans and other government financial reports on Canada.ca and the GC InfoBase to see how this public money is being used.
Honourable colleagues, the government continues to invest transparently, efficiently and prudently in programs and services that Canadians rely on while ensuring resources go to priorities that matter the most to Canadians.
This supply bill and the Main Estimates not only provide important insight into how public funds will be used but also show that the government is responding to immediate needs while continuing to make that long-term investment to benefit all Canadians.
In short, I hope you’ll support this bill. Let us be that last one up to bat. We’re going to bring it home. Thank you.
Will Senator Pupatello take a few questions?
Yes.
Thank you. First, you indicated early in your remarks that there was apparently $9 billion in savings that the government has claimed to have found in this budgetary cycle. However, in your speech, you didn’t list any of the specific cost savings that the Liberal government says it has found in your speech. What are the savings or cuts that total $9 billion?
Thank you. If you breeze through the document entitled Main Estimates and compare the 2024-25 and 2025-26 lines, you see, in almost every instance, the current year’s spending is lower. That is part of where the money is found for that Comprehensive Expenditure Review exercise.
It’s not completed; not every ministry was assigned the same amount of spending savings to find. For example, some ministries — or the lion’s share — are looking for 15% in savings, but there is a distinct list, which includes Indigenous Affairs, assigned 2%. Each quarter, we will see how much of the savings are being implemented. However, the mere passage of the bill a moment ago in Bill C-15 — which allows the government to, for example, offer buyout packages for the workforce — contributes to what they need to do to reach $9 billion.
We are all sitting here right now, and you expect us to vote on this soon, so I don’t have the ability to flip through and compare last year’s and this year’s amounts. Can you give us concrete examples of some of the biggest cost savings amounts they have found for some of these departments? You mentioned public service cuts. What is that total figure out of the $9 billion that they are estimating will be saved by public service cuts?
Thank you.
Rather than just picking one — as you can see, I have little tabs all over my paper — this document was actually public quite a long time ago so we could look at these details. All of us had that opportunity, certainly, at the Standing Senate Committee on National Finance as well.
I will tell you that the $9 billion is over the course of this year. When we look at what their plan is, you can see that the numbers are declining, each one at various levels. Over the course of every amount of supplementary estimates, those numbers will be clearer and clearer.
But every ministry, agency, and Crown corporation is assigned an amount to have to find. There are very few exceptions.
That is not really a great way to have to look at things. Didn’t we just get this bill a few days ago? I recall you saying that the departmental plan was actually just tabled on Tuesday, I think, when Senator LaBoucane-Benson brought in that box of documents.
Anyway, I will move on to another one, since I don’t seem to be making headway here.
You mentioned Health Canada at $10.4 billion. You said that that includes improvements on mental health care and substance abuse care. What types of specifics are there for those two important items: mental health care and substance abuse care?
Thank you.
I will endeavour to get a complete list of them, because I think they are all in that.
I want to go back to your previous question. The actual table of documents has been available to the public and to senators for weeks. You have been here longer than I have, so you probably know that process a lot better than I do. I, as well as committee members and all members of the House, have had access to it for weeks so that we could go into that level of detail and leave our tab marks, et cetera.
Every ministry is looking for ways to save as well as to prioritize the focus of this government. When it comes to funding the $23 billion, for example, assigned to Indigenous Services Canada, there are various levels of related amounts. For Health Canada, there are amounts related to drug and substantial abuse. All of those have been identified.
I will send you the pages that will give you as much of a breakdown as I have.
On mental health care and substance abuse, can you give us any examples of what the government is spending that on? Frankly, I didn’t hear a lot about that when the minister was here yesterday in terms of specifics. This is a lot of money. It would be nice if we had some actual specifics before we are asked to vote on this.
Thank you.
I wasn’t sure what the question was in that commentary, but, again, I will endeavour to show you that for the Department of Health, for example, in Part 2 on page 82, the bill identifies the complete amount of operating expenditures of over $4 billion, capital expenditures of $22 million, grants and contributions, the amount voted and the statutory amount. It actually gives those.
Then, in the second part, it breaks it down completely. Rather than me flipping through the pages here, I will find them and send them to your office. Thank you.
I have one final question, then, while I wait for all the page flipping.
On the public debt charges, when you were whipping through all of these massive amounts, many billions of dollars, at the end there you were listing what this amount was and this amount was. What amount did you state was for public debt charges this year?
Again, that amount and the details are in the budget document we received last November, the budget bill that was then tabled weeks later and also in all of the data we have had for some time. I think it is fair to say that all of these are estimates, even the program expenditures planned for $502 billion; that may be the number that eventually lands. We know that is why they are called estimates: They estimate what they are likely to spend; they do not know. Priorities could change, as they have in the area of defence, which I know has been a focus for you in looking at those numbers. Clearly, we are spending more in that area.
Senator, I am just asking you to repeat the public debt charges amount. You said it in your speech, and I said that it was at a time in your speech when you were ripping through a number of many multi-billion-dollar amounts. I’m just wondering what the amount is that you stated near the end of your speech for public debt charges.
I am trying to flip through on my Mac to give you all of those numbers again. That said, I could begin at the very beginning and go through my speech again, if you would prefer. I’m afraid I can’t, but I will send it to you in a moment rather than to keep the whole house waiting.
Honourable senators, I am happy to rise and speak to Bill C-24, the appropriation bill associated with the Main Estimates for 2026-27.
Only a Liberal can say to us that decreasing spending while increasing investments at the same time is a wonderful thing when, at the end of the bottom line of that exercise, we end up with billions and billions of dollars of deficit and debt such that we have never seen before in this place. Those of us who have been here a long time have never seen estimates where you are spending close to $90 billion for a few months.
Three months.
It is really staggering when you think about it, colleagues.
This is the second supply bill we are considering this week, and as with the supplementary estimates, this bill was also preceded by an estimates document called the Government Expenditure Plan and Main Estimates (Parts I and II). The estimates are the government’s projection of its spending for the entire year. They set out the spending authorities being sought and the details that support those requests. They lay out the government’s expected spending needs for the coming fiscal year, and they are the starting point for parliamentary supply in each fiscal year.
The 2026-27 Main Estimates present a total of $502-plus billion in budgetary spending, which reflects $230.4 billion to be voted and $272.4 billion in forecasted statutory expenditures. Non-budgetary expenditures of $2.9 billion are also reported. Six organizations are each seeking more than $10 billion in voted budgetary expenditures. They include the Department of National Defence at $48.4 billion, Indigenous Services Canada at $23.9 billion, Employment and Social Development Canada at $13.6 billion, Crown-Indigenous Relations and Northern Affairs Canada at $11.8 billion, the Treasury Board of Canada Secretariat at $11.8 billion and Health Canada at $10.4 billion.
When you look at where the money is going, the largest component of total spending is simply transfer payments, which account for $300.5 billion, or about 60% of expenditures. These are payments made to other levels of government, other organizations and individuals. It is not very complicated; even a simple guy like me can understand that. Operating and capital expenditures account for another $148.6 billion, which is about 30% of total expenditures. However, it is important to note that references to “capital” expenditures in the Main Estimates do not mean the same thing as when the government uses the word. In the Main Estimates, the usage is based on Canadian public sector accounting standards and matches reporting in Volume II of the Public Accounts of Canada. When the government uses the words “capital” or “capital budgeting framework,” their use doesn’t match anything other than their own made-up definition, honourable colleagues.
If their objective is to create confusion, they are off to a fantastic start.
It is interesting to note that out of the $502.8 billion in total expenditures, only $14.7 billion are related to Budget 2025. In other words, the overwhelming majority of what Parliament is being asked to finance in these Main Estimates does not arise from new budget announcements at all but from the government’s existing spending commitments. They have been unrolling now for a very long time. That is significant because it reminds us that the real story in the Main Estimates is not simply what is new but what has already become embedded, normalized and built into the ongoing machinery of government.
However, to get the complete picture of anticipated expenditures for this coming fiscal year, we need to add in the items that are not included in the estimates, most notably Employment Insurance benefits at $31.9 billion, the Canada Child Benefit at $31 billion, and other tax credits and repayments at $14.3 billion. In addition, there is $15.9 billion in net revenue and a $7.6-billion adjustment for accrual and other accounting differences.
Altogether, after incorporating the reductions from the government’s comprehensive expenditure review, which, as confirmed by the sponsor of the bill, they are still looking for, and we know how good this government has been at finding savings, it comes to a projected expenditure of $588.3 billion for this fiscal year, and it includes a deficit. The number is $63.5 billion. That is the number.
To fund the voted spending set out in these estimates, the president of the Treasury Board will bring forward two supply bills. In March, Parliament was asked to grant an interim supply, which gives the government authority to draw part of the voted amounts from the Consolidated Revenue Fund so that it can continue operating during the opening months of the fiscal year. This is the bill before us, colleagues.
Three months.
Three months. All of that money.
Actually, four months.
Then, in June, Parliament was asked to grant full supply, which provides the balance of the voted authorities set out in the Main Estimates.
It is important to understand, however, that Parliament does not approve the Main Estimates with this vote today. The Main Estimates are tabled as the government’s detailed spending plan and are referred for study. Parliament votes on the appropriation bills that are based on those estimates. In other words, the estimates are the explanatory document; the appropriation acts are the legal instruments that actually provide the authority to spend.
This distinction matters because interim supply should not be confused with full parliamentary endorsement of everything contained in the Main Estimates. Rather, interim supply is, first and foremost, a practical mechanism to keep government functioning while Parliament continues its examination of the estimates. It is a partial and time-limited authority to spend, not a final judgment on the whole spending plan.
God knows what else is coming. Colleagues, need I remind you that there is not an economist in Canada who is saying right now — for a variety of reasons, it doesn’t matter what they are — that the economy is on solid footing? They are all saying that we are living through precarious economic times. If you do not have the guardrails and if the shelves and the cabinet are not ready for possible storms that can arise, these numbers are just the beginning of what could be facing us in a few months, six months or a year.
This year, the Main Estimates consist of 258 pages detailing $230 billion in voted spending and $272 billion in statutory spending spread over 130 different government organizations.
It is a nearly impossible task to properly scrutinize this. We partially compensate for this by authorizing our Standing Senate Committee on National Finance to study the Main Estimates up to the end of the calendar year, but even that timeframe is inadequate because the Main Estimates are large, sprawling and difficult to examine in any truly comprehensive way.
Even Senator Marshall acknowledged to me over the last few weeks that this has gotten so out of hand that it is impossible for any senator, their office or any one of our groups to be able, in a proper way, to scrutinize this. Although our Finance Committee does a standup job under difficult circumstances, the sheer size and complexity of the estimates mean that even diligent committee work cannot produce anything resembling an exhaustive examination of every line item.
This challenge becomes greater with each passing year as government spending continues to grow at levels that are unprecedented. This year, the 2026-27 Main Estimates present a total of $502.8 billion in budgetary spending. Less than a decade ago, in 2017-18, eight years ago, the Main Estimates total was roughly $258 billion. Most of you were here in 2017-18. You should be just as concerned as I am with what is happening in just a short period of seven or eight years.
In other words, the government’s opening spending plan has nearly doubled in less than 10 years. Whatever the explanation for that growth, it is not a trivial development. It tells us that the scale of the federal state is changing in a way that Parliament should not simply accept without deep and considerable reflection.
Colleagues, earlier I said that 60% of spending goes to transfers and 30% to operating expenses and investment. However, I want to finish with the remaining 10%, which is the most important portion. What do Canadians get for that 10%? The answer is: nothing.
For that $54 billion, Canadians get nothing. No programs, no services, no infrastructure. That money does not go to health — contrary to what Senator Pupatello said — to defence, to housing or to investment. It is not transferred to the provinces, territories or municipalities. Why is that? It’s because that final 10% is the cost of interest on the national debt. It’s the money we pay to borrow money. That is the reality.
I’ve said it before, but it bears repeating: This is no small expense. At $54 billion, it is more than we spend on National Defence, more than we spend on Indigenous Services and, unfortunately, more than we spend on Health Canada.
If that doesn’t concern you, colleagues — and it is not a laughing matter — it should and it will. It is just a matter of time.
Over the last 10 years, from 2017 to 2026, we have paid out $327 billion in interest.
Oh, my goodness.
That’s $327 billion in interest in only 10 years.
A lost decade.
Over the last 40 years, from 1987 to 2026, the total we have paid in interest on our national debt has come to $1.4 trillion. In today’s dollars, that is the equivalent of $2.2 trillion. That is money we’ll never see again. That is money that could have been used in other investments that would have had a return on investment.
That is money we could have spent on health care and transfer payments to make sure that 7 million Canadians are not having a hard time finding a doctor.
We’re senators. It is easy to say that health is not in our jurisdiction, but how many friends and family have called you looking for a family doctor? I receive calls all the time.
Too many.
But, colleagues, to make things worse, this government has made it clear that it has no intention of balancing the budget. At this point, they have only committed to keeping the deficit-to-GDP ratio on a declining level, which means that, 40 years from now, depending on whether the deficit declines at the rate shown in the Budget 2025 projections, or if it falls just enough to stay within the parameters of the fiscal anchor — I’m not exaggerating this; it is within the parameters of what the government leader says to me every day when he answers questions — we will have paid out an additional $3.5 trillion to $5.7 trillion in interest payments. Do you know how many James Bay Projects that could be? Do you know how many pipelines that could build? Do you know how many hospitals that could build across this country?
What that means, colleagues, is that we are no longer talking about debt as some abstract accounting concept. We are talking about a growing claim on public resources that produces nothing new for Canadians but steadily reduces the room available for everything else. Every year that we choose to run these humongous deficits, we are not simply shifting costs forward in the most abstract way. We are committing future taxpayers to pay for today’s excess with interest, whilst narrowing the government’s ability to respond to crises and priorities that have yet to arrive, which invariably will.
Today, I expect this chamber will approve Bill C-24, which grants an interim supply of $86.4 billion to the government, but I sincerely hope that we do not mistake that limited approval for an endorsement of the broader fiscal direction set out in these Main Estimates, which is coming, colleagues. It is incumbent on all of us to take a step back and reflect before the catastrophe arrives.
To do so would be failing future generations and leaving them with a diminished inheritance rather than a country with fiscal room to meet the challenges that they will face. It is our responsibility as legislators to meet tomorrow’s challenges today. If we don’t do that, we fail in our duty to the Canadians that put us here and pay us to be here.
For all those reasons that I highlighted, that is why His Majesty’s official opposition is compelled to put it on record — because we want future generations to see that we were here — that we said no to this type of irresponsible spending.
Thank you, colleagues.
I wonder if Senator Housakos would take a question.
With pleasure.
Senator Housakos, do you know where the interest goes? Who benefits from the billions that this country pays in interest?
We know it is not Canadians, and we know it is creditors. Senator McPhedran, we also do know — I have a basic knowledge of economics — most of those creditors are foreign bondholders. They are not Canadian institutions.
Would Senator Housakos take a question?
With pleasure.
Thank you. When I was speaking a moment earlier and I listed several figures — $88.8 billion in elderly benefits, $53.7 billion in public debt, $27.2 billion in equalization payments, $17.9 billion in the Canada Social Transfer — I wonder which of those you would agree not to spend in this current climate.
Senator Pupatello, you weren’t listening to my speech. Those are statutory expenditures that have nothing to do with the Main Estimates.
You can get that on the record.
No, but you can get it on the record all you want. The problem is that it is not increases — not for Indigenous communities, and it is not increases to the transfer for health payments whatsoever.
The increases of what we’re putting into place here in this bill are for the three months to cover, basically, debt. That’s what we’re doing. All the monies you have talked about that have been allocated for all of those important things were not allocated by these estimates. They have been in the budget now for a while. It is operational money that has already been put in place in the past. That is what I’m talking about. After the smoke and mirrors is all done, we’re not increasing spending on health care. Just ask your colleagues at Queen’s Park.
Just on the debt servicing.
Quite the contrary — we’re not increasing spending for Indigenous, First Nations people, not at all. We’re increasing by $84 billion-$85 billion in spending where more than three quarters of that or two thirds of that will go to pay the interest on the debt that this irresponsible government has run up over 10 years. I’m happy to answer.
Would Senator Housakos take a question?
With pleasure. You know that I have unlimited time. I could really stop this bill from passing.
I do not know if you agree with me, but two thirds of the Canadian debt is held domestically, and one third by foreign investors. Would you agree with that? Where is your research from?
First of all, most of the bondholders of our debt are foreign, from what I understand, Senator Loffreda. Obviously, we have some domestic debt that we carry here, but, with all due respect, most of those that hold Canadian bonds when we print our money, my understanding has always been that they are foreign debt bondholders. I do not know where you are getting your information. Can you share it with us?
I will send it to you.
Domestic holders include the Bank of Canada, and that is 17%; pension funds and insurance account for 15%; banks, mutual funds and other financial institutions are the remaining portion, and the Canadian chartered banks are only a subset of that domestic 65%. When we do talk about interest, it is important to know that there is a cost to money. That interest isn’t going fully as profits to the bondholders or to the banks, right? There is a cost to funds.
But two thirds of Canadian debt is held by Canadians. That is the research. And I can share it with you.
Was there a question? Senator Loffreda, do you have a question?
Just a fact. Maybe you could share that with me, and I am very interested in that.
Honourable senators, I want to make sure that only one person speaks at a time. Senator Loffreda, could you repeat your question?
Based on what I’m saying, would you agree that the majority of our debt is domestically held?
I will do some research on that. But on the numbers you just threw at me in terms of what debt is being held by Canadian banks and the Bank of Canada, you are at 42%. With all due respect, you said 11% for the Bank of Canada and you quoted something like 30-some per cent that is held by Canadian financial institutions. Senator Loffreda, that is 42%.
I did say —
Senator Loffreda, are you on debate?
No, no. I am on a question.
Are you asking a question?
Yes. Okay, I will ask a question.
I don’t know if you heard it properly, but I did say banks, mutual funds and other financial institutions hold the remaining portion. So it doesn’t add up, but the remaining portion —
What you were saying —
The Bank of Canada is 17%, right? Pension funds and insurance is 15%. That’s 32%. And the remaining part is banks, mutual funds and other financial institutions. That’s the remaining portion. That adds up to 100%. Would you agree that does add up to 100%?
I don’t know how you are counting that. But I’ve heard for the Bank of Canada and the Canadian banks you came up with a number that’s around 35%. Then you’re saying the remaining part is being held by a bunch of institutions, and you want me to believe in what you are putting on the floor here, without telling me which ones hold the remaining portion that brings you to two thirds. I would be happy to do that research if you’d like and have that debate, but you did not come up with two thirds there that I can quantify as Canadian institutions.
Furthermore, you also know, as a former banker, that there is a debt load that banks hold that is also in partnership with foreign entities, correct?
Correct, Senator Loffreda.
So that is very hard to determine, as you come out of the blue saying the Royal Bank holds X amount and Canadian financial institutions — where Canadian banks themselves are leveraged, very often, by international investors.
Pension funds — the FTQ is leveraged, very often, by international investors and foreign bondholders, right? That is a reality as well.
So, no, I completely disagree. When you take into account all of those realities on investments, bondholders — of even some of the Canadian pension funds and Canadian institutions — no way will that add up that Canada and Canadians have the capacity to hold three quarters of the debt we’re carrying right now.
We are a country, Senator Loffreda, that a few years ago, when we rebuilt the Champlain Bridge, we did not have financial institutions in Canada that were able to finance a $10-billion project, including yours, the Royal Bank. We had to go to foreign investors in Europe, in Spain, to build a simple bridge at $10 billion, and you think that two thirds of the Canadian debt right now is being carried by Canadian institutions? We will have that debate. There will be an opportunity.
Senator Gignac, do you have a question?
It would be a point of order.
As I listen to this debate, it seems to have no bearing on Bill C-24. If we start talking about statistics I’ll join the debate too, because I think I know the issue fairly well.
I would ask that the discussion be limited to Bill C-24, and that we not debate numbers, in which case we would lose a few people and I’d have to intervene to correct certain facts.
Concerning the point of order, I gave Senator Loffreda some time to ask questions.
However, we do allow some latitude when it comes to questions and answers.
If there are no further questions or if no one else wishes to speak, I’ll ask the usual question. Are there any other questions or does anyone else wish to participate in the debate?
Are senators ready for the question?
Is it your pleasure, honourable senators, to adopt the motion?
All those in favour of the motion will please say “yea.”
Some Hon. Senators: Yea.
The Hon. the Speaker: All those opposed to the motion will please say “nay.”
Some Hon. Senators: Nay.
The Hon. the Speaker: In my opinion the “yeas” have it.
I see two senators rising. Is there an agreement on the length of a bell?
I wish to remind senators there has to be an agreement; otherwise, it is an hour.
I will ask the question again. Is there an agreement on the length of a bell?
Is leave granted, honourable senators?
Leave is granted. The vote will take place at 6:14 p.m. Call in the senators.
