OTTAWA — Facing dismal economic data at home, Canada’s finance minister is pointing out that the global growth outlook has been downgraded about seven times since the federal Liberals took office last year.
Speaking in Sudbury, Ont., on Tuesday, Bill Morneau made his first public comments since Statistics Canada released grim numbers last week about the country’s labour force and its international trade performance.
The federal agency said Canada lost 31,200 jobs in July, while its trade deficit with the world swelled to a record level of $3.6 billion in June.
The Canadian economy also contracted 0.6 per cent in May—the country’s worst one-month performance since the depths of the Great Recession seven years ago.
Morneau did not mention any of these figures to his small audience of business people in Sudbury, but he did note that weak growth has been a serious challenge for the world economy and that it has fed into Canada’s economic issues.
“Global growth has been marked down a number of times—I think seven times—since we’ve come into office, believe it or not,” Morneau said during the event, which was also broadcast live on Facebook.
“We recognize that growth is a real challenge and something that we need to think about.”
The finance minister said the Liberals have made efforts to address economic concerns by boosting child benefits, enhancing the Canada Pension Plan and making income-tax bracket changes to provide relief for middle earners.
“So, that really was the frame of reference for our (election) campaign,” said Morneau, who recently attended a meeting of G20 finance ministers and central bankers in China.
“It’s certainly the global frame of reference now.”
To generate growth, the Liberal government also hopes the economy will gradually get a lift from the tens of billions of dollars it has committed to spend on infrastructure.
Last Friday, Statistics Canada’s latest labour force survey said the country shed 71,400 net full-time jobs last month—the category’s biggest one-month hit since it lost 80,300 positions in October 2011.
The national unemployment rate for July crept up to 6.9 per cent from 6.8 per cent the previous month.
On trade, Statistics Canada said exports slid 4.7 per cent in the second quarter to $124 billion, the steepest drop since the second quarter of 2009 during the recession.
Most of the questions Morneau fielded at the Sudbury event were focused on Ottawa’s agreement-in-principle with the provinces and territories to expand the CPP.
The deal, if ratified, would gradually increase contributions and retirement benefits through the public pension plan.
Morneau was asked Tuesday if the enhanced portion of the CPP would be the same as the existing plan, particularly when it comes to the rules indicating when someone may begin making withdrawals.
He acknowledged there are still details to work out when it comes to CPP reform.
“The agreement with the provinces was that the enhanced CPP would broadly be similar to the core CPP, but we haven’t dotted all the Is and crossed all the Ts yet,” Morneau said.
“So, given that we have to co-govern the plan with the provinces, I would say that we need to work with them to make sure that we get to agreement on those issues. And I’m optimistic that we will.”
In June, every province except Quebec supported the tentative agreement and the signatories had agreed to ratify it by July 15.
But Morneau’s push to conclude the deal quickly came to a halt when British Columbia declined to put its pivotal signature on the agreement before the deadline. The province said it needed more time to explain the deal to its residents and stakeholders, such as business owners.
Looking for more?
Get the best of Maclean's sent straight to your inbox. Sign up for news, commentary and analysis.