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Interest Costs on Federal Debt

April 17, 2024

Hon. Donald Neil Plett (Leader of the Opposition)

Leader, yesterday morning Statistics Canada reported that inflation had gone up again last month. The rise was driven by increases to the cost of gas, rent and mortgage interest payments, which went up 25.4% in just one year.

Just a few hours later, leader, instead of putting an end to the inflationary deficits and spending, the Trudeau government brought forward a budget that introduced almost $40 billion in new spending, and they had the audacity to call it “responsible.”

Leader, is it responsible to spend more this year to pay the interest on your debt than on health care? Is it responsible to create the equivalent of $2,400 of debt for every single family in new government debt and new inflationary spending?

Hon. Marc Gold (Government Representative in the Senate) [ - ]

Thank you for your question. The budget that was introduced and tabled today, in the opinion of the government, represents a responsible and prudent approach to managing both our economy and investing in the future.

In that regard, there are a number of points that need to be underlined. I’m not going to run through the budget, obviously. I look forward, as I think you all do, to the Senate’s study of it, which we will undertake as we always do.

The fact remains, colleagues, that the investments that the government announced in the budget are designed to help Canadians manage well going forward with regard to housing, health care, child care and other measures that are necessary for Canadians to continue to flourish. It is also the case that our economy is doing well. In that regard, it is responsible.

The NDP-Liberal budget projects they will collect $54.1 billion from the GST this fiscal year. That’s the exact same amount the Trudeau government will pay out to the banks and bond holders this year to service the interest on their debt. This isn’t responsible, leader. It’s not worth the cost, is it?

Senator Gold [ - ]

The question, really, before the Senate and before Canadians is whether or not the government’s approach to managing the economy, which continues to be one of the strongest-performing economies in the G7 — only one of two countries with a AAA rating — includes measures to provide intergenerational justice, which are long overdue. In that regard, my answer is that this is a responsible budget.

Hon. Leo Housakos [ - ]

Senator Gold, your government can hardly talk about generations. You have a whole generation of Canadians who are being held hostage in their parents’ basements, and that’s a reality. The truth of the matter is, Senator Gold, the only thing your government has done really well is set records when it comes to deficits and debt. That’s what you excel at. You’ve set records when it comes to creating enormous inflation.

As my colleague Senator Plett pointed out, there’s $40 billion of new spending, whereas over the last eight years you’ve struggled to balance a budget that has created the inflation we see in this country. You’re spending $54 billion alone just to service the debt that your government has created over the last eight and a half years.

The question is very simple: Why is it so difficult for the Trudeau government to understand the basic principle that millions of Canadians across the country understand; you can’t keep spending more money than you’re earning? When will you finally understand that principle and put it into action, like all the other Canadians do across this country? You can’t spend more than you make.

Senator Gold [ - ]

This budget keeps the deficit within the forecast as projected in the fall economic statement. That is point 1.

Point 2: Very targeted measures to increase the tax contribution of 0.1% of Canadians will bring in sufficient revenue to offset many of the costs and additional investments that are being made to assist Canadians, whether it’s in housing, child care, health care, pharmacare or dental care — all of the programs that will benefit Canadians — because that’s the responsible thing for governments to do.

There are other ideological approaches to budgets; we hear them regularly here. I’m not going to indulge in partisanship. The government has introduced a budget that is a responsible and prudent one. We will study it. The other house will debate it and will ultimately vote on the budget, as it does, as a confidence motion.

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