October 24, 2017
Progress for the Middle Class
Fall Economic Statement—Remarks by the Honourable Bill Morneau, Minister of Finance
Check Against Delivery
Mr. Speaker, middle class Canadians expect their Government and the economy to work for them—not the other way around.
It's why two years ago they asked for real change.
They asked us to invest in them, in their communities and in the economy to create jobs now, and build a better future for our children and grandchildren.
They asked us to protect the air we breathe, and to make sure every child has access to clean drinking water.
They asked us to help their family make ends meet, and to provide equal opportunities for women and men.
Canadians asked us to invest in their future and to put more money in their pockets, to give them a little more breathing room at the end of the month.
When I was door knocking in my riding of Toronto Centre before being elected, one of my volunteers—a little girl—handed me a note.
On it was a list of her family members—all of whom needed to find permanent housing: a safe place to call home.
This little girl had been helping me all day, and was now placing her faith in me, and asking me to help her and her family.
She, like millions of other Canadians, asked us to keep our focus on them, so that they have the tools and resources they need to succeed.
And when Canadians succeed, they grow our economy. They create jobs. And together we build a better future.
And so we came to office with a plan to help those working to be successful, not just those who already are.
We came to office knowing that growing the middle class is how we grow the economy.
Today, Mr. Speaker, we're doubling down on that strategy—because it's working.
In just two years, over 450,000 jobs have been created, and youth unemployment is the lowest on record.
Economic growth has spiked from just 0.9 per cent to the highest we've seen in over a decade.
The Canadian economy is performing well; in fact, jobs are being created at the fastest pace in over a decade.
In just two years, we've lifted 26 long-term boil-water advisories on reserve.
Over 350,000 more students get help each year to afford books, tuition and earn their degree.
We've effectively doubled the Canada Summer Jobs program, helping 65,000 students find work in the summer months.
We've given 9 million Canadians a tax cut.
With the Canada Child Benefit (CCB), we're lifting 300,000 children out of poverty, and we've put more money in the pockets of 9 out of 10 families.
These families contribute to their community and the Canadian economy, by in turn investing in their family through new skates, piano lessons or through healthier food.
In just two years we've secured better retirements for Canadian workers today and for future generations with a stronger Canada Pension Plan.
And for that little girl and her family in Toronto and 1.6 million other families across the country, we've invested in the National Housing Strategy to help make sure they have a safe and affordable place to live.
We've put more money in the pockets of 900,000 seniors living on a fixed income with increases in the Guaranteed Income Supplement, allowing them more freedom, and less worry.
What it boils down to, Mr. Speaker, is that in just two years we've built up confidence in our economy and in our middle class.
We know that when we make these investments in Canadians, they grow our economy.
That's the fundamental difference, Mr. Speaker, between our plan, and what happened in the previous decade.
And in just two years, we are seeing results.
Thanks to the hard work of Canadians, our country leads the G7 in growth this year, and is positioned to lead it again next year.
As our economy grows, the bottom line improves—in this Fall Economic Statement Canada's fiscal outlook has improved by over $8.5 billion per year compared to what we were expecting in March.
In fact, Canada's net debt-to-GDP (gross domestic product) ratio—the size of our debt, relative to the economy—will continue to decline.
Mr. Speaker, not only is our plan working, it's working better than expected.
Our strong fiscal position allows us to do what other countries would like to do, but can't afford to do.
We're investing in ourselves and in our future.
It allows us to take full advantage of the kind of strong economic performance we're seeing now by reinvesting in the middle class, while maintaining the flexibility needed to manage global uncertainty.
But Mr. Speaker, as Members on this side of the House know, a thriving economy and a solid bottom line are only half the answer.
As the economy grows we need to make sure the benefits are shared with the middle class, and those working hard to join it.
And as we invest directly in Canadians and their families, we have an immediate impact on the economy.
On July 20, 2016, nine out of 10 Canadian families began receiving more money, tax-free, from the Canada Child Benefit.
When families like mine stopped receiving benefit cheques, our Government was able to put more money directly into the pockets of the moms and dads who needed it most.
Right away, they—in turn—invested in their families.
They paid off debts, sent the kids to summer camp, bought healthier food, and maybe a few more children's books.
Right away, we saw a spike in consumer confidence, and a rise in household spending that underpins our economic growth to this day.
It's no wonder the International Monetary Fund's Christine Lagarde hopes our approach will "go viral".
So now, with a little more wind in our sails, we're doubling down on a plan with proven results and reinvesting in the middle class.
Our Government will strengthen the Canada Child Benefit, by making sure it keeps pace with the cost of living.
Starting next July—two years ahead of schedule—tax-free CCB amounts for families with two children will go up by approximately $200. The year after that, families can count on $500 more.
And for those working hard to join the middle class—many of whom are living alone—we will offer even more help, with an increase to the Working Income Tax Benefit.
This increase will give a needed boost to over one and a half million low-income workers, by allowing them to keep more of their pay as they work long hours, sometimes in more than one job, to advance their careers and support themselves and their families.
For young single workers just getting a foothold, shouldering the rising cost of living alone can be a crushing responsibility.
For someone living alone—now the most common type of household in Canada, according to the latest census—this could mean not having to make the choice between paying the rent or buying groceries this week.
For a single mom, a stronger CCB and a more generous Working Income Tax Benefit means more peace of mind when the bills come due.
Finally, Mr. Speaker, we are investing directly in Canada's small businesses by proposing to lower the small business tax rate from 11 per cent in 2015 to 9 per cent in 2019.
I greatly appreciate the frank discussions I've had with Canadian entrepreneurs over the past few weeks.
If the last few months have taught me anything, it's the strength and resilience of entrepreneurs and small business owners.
It's been humbling, and inspiring, to meet with so many passionate business owners from coast to coast over the past few weeks.
I called a woman in St. John's who was concerned about the changes. She had told the Premier about it, who told me.
So I picked up the phone the very next day.
Our caucus heard from a town hall in Kelowna, including personal stories from young woman physicians who needed added flexibility.
Just last week I met with John, Lori and their son Angus in Erinsville.
Angus wants to take over the farm someday—he'll be the seventh generation to have that honour.
I met Brittany and Rebecca in a cafe in Hampton, New Brunswick.
We sat with the Rampulla family in their restaurant in Markham.
I told Cathy and Joey I'd be back.
These are the people who drive me to do better, and to get things right.
Through you, Mr. Speaker, I say to them: I heard you. We hear you.
We held a consultation to fix a tax system that's not working the way it was intended.
Before we could lower taxes for small businesses, I had to be sure this investment would be going to help the Cerrelli family in Montréal design and build their dream kitchens, rather than giving tax advantages to the wealthiest.
As the Prime Minister said last week, "Canada is a country where we celebrate our collective contributions rather than protect the interests of a privileged few."
It's in that spirit that we are moving forward to fix a system that currently allows someone making hundreds of thousands of dollars a year to pay a lower tax rate than someone making far less, just because they are incorporated and have children over 18.
For incorporated professionals and business owners, we will preserve the flexibility to save up for a rainy day, for parental leave, or for retirement—while not allowing individuals to have unlimited tax-advantaged savings accounts over and above what is available to everyone else.
And we will work with farmers, fishers and business owners to make sure they can pass down the family business to the next generation.
Our approach is to give all Canadians a real chance at success.
In everything we do, our Government knows that when Canadians are given a real and fair chance at success they will make the most of it.
That's how you grow an economy, sustainably.
That's how you manage finances, responsibly.
As we continue with our plan, we will do what is hard.
We will do what is right. Our ultimate goal is nothing short of an economy that rewards the very people who contribute to its success.
As we look to Budget 2018 we will continue our work to build on the gains we have made over the last two years, always with the middle class and those working hard to join it as our focus.
We will make sure Canadians have the skills, training and learning opportunities they need to compete and thrive in the rapidly changing global economy.
We will drive forward our Innovation and Skills Plan, making big bets on the most competitive sectors of our economy, making Canada a world leader in industries like agri-food, clean tech and digital.
We will continue investments in our transit, our roads and in clean water—to keep our cities moving, and our children safe.
And always, Mr. Speaker, we will invest in Canadians, and give them the tools, skills and resources to create jobs and grow the economy.
Mr. Speaker, in just two years we've done a lot together.
And there is much more to do.
Working together, we will make sure Canadians have every opportunity to succeed, and to build their future and a country we can all be proud of.
Thank you, Mr. Speaker.