Senate QP: Morneau talks growth

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After a length delay owing to a snap vote in the Commons, Senate QP finally got underway with special guest star, finance minister Bill Morneau. Senator Smith led off, worrying that for an “innovation budget,” it wasn’t doing enough for promoting business investment I order to promote innovation. Morneau responded by reminding Smith that the fundamental challenge they were trying to address was slow growth, and noted that the reduction of unemployment was a sign that their plan was working, creating a level of optimism that would attract future growth. Smith insisted that they should be lowering taxes and giving an EI break for hiring younger people, but Morneau wasn’t sold on Smith’s logic, pointing out flaws with this argument around corporate tax rates and said that they were on track for a higher level of growth.

Senator Mockler was up next, looking for the construction of a second nuclear power plant and Energy East as means of growing New Brunswick’s economy. Morneau first went on about their talks with the US to ensure continued trade, and then moved onto being “positively disposed” to pipelines, but didn’t make any promises.

Senator Eggleton was up next, worrying about housing prices in Toronto, and Morneau talked about the meetings he has had with mayors and provincial governments, and that they have been taking measures to ensure that there were stress tests in place, and noted that there were other areas of concern so they needed to ensure coordinated action.

Senator Black wanted Calgary to be the head office of the new Canada Infrastructure Bank, and wanted to know what process would be used to select that head office. Morneau rattled through an explanation of the purpose of the Bank as being separate from the location of the headquarters, but said that they have come to no conclusions regarding where it would be located and that they had hired an advisor to assist them.

Senator McPhedran asked about financial resources that could be used for foreign aid, since we’re well below the 0.7 percent of GDP target. Morneau said that they looked at restoring funding, but they wanted to find ways to have a bigger impact for the money they already had, which included tapping into the private sector, including on things like microfinance and getting buy-in from other countries on projects.

Senator Neufeld worried about the impacts of carbon pricing and that document that the government won’t release. Morneau noted that such a document predates him, and went on about the importance of the investments they were making, and extolled the virtues of pricing carbon as an effective mechanism that could stimulate economic growth like it did in BC.

Senator Patterson asked about employment strategies for the North with an assets program that was only available to those currently unemployed. Morneau said that he would take the part about training for managerial positions under advisement, and then went on about their skills focus in the budget.

Senator Massicotte worried about rising pension costs in the face of inadequate population growth outside of three major cities, and now he could justify returning the OAS eligibility to 65 as a result. Morneau talked about trying to increase the number of women and Aboriginals in the work force, and the policy of raising it to 67 didn’t take poor seniors into account.

Senator Woo asked about the lack of a deficit strategy in the budget, and the reliance on debt-to-GDP over dollar amounts. Morneau reminded him that Canada has the best balance sheet in the G7 and we are facing the challenges of slow growth and demographics, so investments in higher growth at the same debt levels that it would put the country on a better foot overall.

Overall, it was fairly standard in terms of responses from Morneau, and he did take a few digressions here and there, but largely stuck to his message about the need for more robust growth rather than fixating on the deficit, and he didn’t just talk out the clock as some of his cabinet colleagues have. I will also mention that a financial journalist messaged me afterward to say that he found the questions asked far better than any that were asked of Morneau from the Commons finance committee, which again gives you a bit of insight as to the value of the good work of the Senate.

Sartorially speaking, snaps go out to Senator Lucie Moncion for a pink collared shirt with a black jacket and slacks, and to Senator Yuen Pau Woo for a tailored grey suit with a light grey shirt and navy tie. Style citations go out to Senator Larry Smith for a taupe suit with a dull yellow shirt and blue striped tie, and to Senator Marilou McPhedran for a long boxy white jacket with a foliage panel  along the sides.