The question of making life more affordable for Canadians hit the campaign trail on Wednesday with party leaders defending why their spending plan would ease pressure as inflation hit a nearly two-decade high. But had arrived.
On Wednesday morning, Statistics Canada reported that prices rose 4.1 percent in August compared to the same month a year ago, due to increased consumer demand and supply-chain constraints for many items.
NDP leader Jagmeet Singh and Conservative leader Erin O’Toole blamed Liberal leader Justin Trudeau’s inaction on several fronts, including the country’s hot housing sector, for rising prices.
Each party’s spending plans could put more pressure on prices and interest rates, and they could hurt voters’ pocketbooks, rather than help, according to a Scotiabank analysis of platform commitments.
The federal government has pumped billions of dollars to aid hard-hit families, laying a financial floor under them, while also boosting demand for goods and services. But the supply of those goods and services is yet to catch on.
Despite the improvement in the economy, no party is promising to turn off the tap in the near future.
Measures aimed at adding stimulus to the household budget, if enacted, would encourage more spending, spur demand and drive prices further up, Scotiabank’s director of financial and provincial economics Rebekah Young said on Wednesday.
“Platforms are going to cost more over the next year or so, right at a time when we’re already warming to inflation,” she said in an interview. “We are calling for all (inflation) to be temporary and come back in the next two years. Sure, platforms don’t make it that easy. “
During a morning stop in Essex, Ont., Singh said lowering housing prices is one way to address affordability concerns, arguing that wages do not keep pace with the cost of ownership.
But he stuck to his party’s spending plans, which call for $214 billion in new social programs like pharmacare and dental care to help those hurt by the pandemic-induced recession.
“A working class person, middle class person, when you go through an economic crisis, and there is no support in place, things get worse,” Singh said.
“If we don’t invest in people, if we don’t spend on our health care, if we don’t make life more affordable, then they are the ones who are going to pay the price.”
According to the Canadian Real Estate Association, the national median home price is expected to reach $680,000 this year, up 20 percent from last year.
Speaking in Halifax, Trudeau said his platform zeroed in on affordability with heavy housing and child care measures.
He argued that O’Toole’s housing plan, which encourages investors to put money in rental housing by changing rules around capital gains taxes, would not reduce costs. And the Conservative child-care plan, Trudeau said, “is a tax break that doesn’t create space” or address affordability concerns.
O’Toole pointed to his party’s pledge to tackle price-fixing in grocery chains as a way to create more competition in the telecom market and ease price pressures.
The Conservative platform generates new spending of $52.5 billion over the next five years, up from $78 billion under the Liberal platform in the same period. O’Toole argued that his spending would not add to price pressures, pointing to his promise to balance the books over the next decade.
“We have a plan to get Mr Trudeau’s spending under control. He never wants to get it under control,” O’Toole said.
Speaking in Quebec’s Saguenay region, O’Toole also suggested he would not open competition to the country’s supply-managed dairy sector, calling the policy “pro-farm family” and “pro-food security”.
The arguments formed the backdrop of the parties’ push to secure the final support needed ahead of Monday’s vote, encouraging their supporters to contest and enticing voters who are undecided or may change support.
A recent poll by Leger in collaboration with The Canadian Press indicated that Liberals and Tories were tied with the support of 32 percent of the electorate ahead of the September 20 election, with the NDP holding 20 percent.
Trudeau made a renewed argument for progressive voters that they could only hand their party to prevent the election of a Conservative government. Singh counters that Trudeau considers himself a progressive, but has failed to use the example of an unfulfilled pledge to eliminate fossil fuel subsidies.
O’Toole said his party had disappointed voters in the past, but he called on centrists to reconsider Conservative voting, arguing that his party was more progressive than before.