Liberals’ Throne Speech Failed to Quell Inflation, Cost of Living Concerns: Critics

Gov. Gen. Mary Simon delivers the throne speech as Prime Minister Justin Trudeau looks on, in the Senate in Ottawa on Nov. 23, 2021. ( Canadian Press/Adrian Wyld)

News Analysis

Progressive policies were at the top of the agenda as the governor general delivered the speech from the throne on Nov. 23, but critics say not enough was forthcoming on inflation and cost-of-living issues.

Gov. Gen. Mary Simon outlined the government’s focus on defeating the pandemic, fighting climate change, and advancing reconciliation with First Nations, diversity and inclusion, and economic recovery. speech also made mention of rising living costs, but only two areas were included as a focus to address: housing and child care.

“This is a government that is caught between what it wants to be focusing on and what it’s being forced to focus on by circumstances,” says Aaron Wudrick, domestic policy program director at the Macdonald-Laurier Institute (MLI).

Wudrick told Pezou that the speech represents what the government wants and is “dreaming about,” but some issues are “annoyingly getting in the way—things like inflation, supply chain [problems], and the flooding of British Columbia.”

“y don’t really propose concrete solutions to those things,” he says.

Canadians have experienced higher fuel and food costs in recent months as inflation continues to rise. consumer price index rose 4.7 percent in October on a year-over-year basis, according to Statistics Canada, the largest gain since 2003, with prices for meat products up 9.9 percent and gasoline prices up 41.7 percent. national statistical agency had earlier reported that shelter rose 4.8 percent on a year-over-year basis in September.

“Inflation is a challenge that countries around the world are facing. And while Canada’s economic performance is better than many of our partners, we must keep tackling the rising cost of living,” the throne speech reads.

“To do that, the government’s plan includes two major priorities: housing and child care.”

This involves, among other things, a fund to help municipalities “build more and better, faster,” incentives for first-time homebuyers, and instituting a national child-care system. “Families will save thousands of dollars,” the speech said.

Wudrick says adding more programs that cost money may not help ease inflation. Having more supply of money but the same amount of goods to buy decreases purchasing power and generates inflation, he explains, and current supply chain issues are reducing the amount of goods typically available.

“re’s a fairly strong argument that more spending contributes to inflation,” he says. “More dollars chasing the same amount of things is going to see prices rise.”

Ken Coates, an MLI fellow and the Canada research chair in regional innovation at the University of Saskatchewan’s Johnson-Shoyama Graduate School of Public Policy, says inflation is a “much more serious problem” than was portrayed in the throne speech.

“It’s very worrisome that in the statement from the throne it was largely absent,” Coates told Pezou.

“I think [inflation is] also part of the government’s creation, where the massive spending we’ve seen going on in the country has really added to a whole series of economic challenges that are much greater,” he said.

“At this point we’re going off in another series of directions, particularly the criticism of the oil and gas industry that is going to actually reduce economic activity. … We’re not slowing down our spending at all in any significant way, and inflation is going to continue to go up.”

According to Darrell Bricker, global CEO of polling firm Ipsos Public Affairs, inflation is “coming up like a bullet as a concern for Canadians. It’s personal and intense.”

“COVID, climate, other issues dropping. Rearranging of public priorities has potential to sideswipe best laid plans of governments and businesses,” Bricker wrote on Twitter.

In response to the throne speech, the Canadian Chamber of Commerce said that although “we applaud continued support for those industries hardest-hit by COVID-19, we are still missing key measures that will move us from recovery mode and into economic growth.”

“Supply chain disruptions and inflationary spikes remain top priorities for the business community, and although they were mentioned in the Throne Speech, specific actions are missing,” the chamber in a statement.

Conservative MP Pierre Poilievre, the Official Opposition’s finance critic, blames inflation on the printing of money by the Liberal government to fund various programs.

“What causes inflation, the same thing every time: too many dollars chasing too few goods,” Poilievre said at a press conference on Nov. 23.

Poilievre outlined some of the measures the Conservatives want the government to take to reduce inflation, such as scaling back proposed spending, reducing the deficit, and cease having the Bank of Canada print money.

“And we want assurances that the government will no longer pay people not to work when we have a half a million vacant jobs and businesses can’t find workers to operate their facilities,” he said.

Poilievre said it’s too soon to say “exactly how we’ll vote on the legislation, but that is an indication of the lens through which we will analyze it.”

Pezou : Liberals’ Throne Speech Failed to Quell Inflation, Cost of Living Concerns: Critics