The party most serious about easing your cost-of-living woes is also the least likely to win power in this federal election. The front-runners should be eyeing their ideas.
While inflation and interest rates are down over the past year, the pain of higher prices is far from over. Many prices are still rising and there’s worse to come.
The biggest, most consistent price increases have been for housing. Mortgage interest payments rose 7.9 per cent over the past year (March to March), and a whopping 58 per cent since the pre-pandemic comparison point in 2019. Rents are up 29 per cent since then, and 5.1 per cent over the past year. Your income likely didn’t keep pace.
Groceries are up 29.9 per cent since before COVID and have been rising faster than headline inflation all year. Over the past year, they’re up 3.2 per cent.
The big surprise is the rise in the cost of out-of-pocket health-care services. They’re up 5.3 per cent over the past year, and up 27 per cent since March 2019. For almost a year, costs of purchased health services have been in the top five drivers of inflation. Despite a crisis in publicly funded care driving people to paid services, there’s been little reference to health care during the election.
Meanwhile, some prices are falling dramatically. The most notable is child care, which has fallen by 28.4 per cent since March 2019, and is down five per cent since last year. These costs were rising until 2022, when the tide turned with the implementation of Canada’s first national program for child care.
Fact: When governments decide to shape markets, they can.
So how are the parties courting your vote on April 28 proposing to make your life easier and offset the price spikes that lie ahead?
All parties would cut taxes, tackle the housing crisis and address costs for care. The differences emerge in the details.
Tax cuts
• While everyone would axe the carbon tax, few admit this includes ending the carbon tax rebate, which redirects money to low-income Canadians.
• Both the Liberals and the Conservatives would cut the income-tax rate for the bottom tax bracket (for taxable incomes up to $57,375), the Liberals by one percentage point from the current 15 per cent rate, the Conservatives by 2.25 percentage points. All taxpayers, including millionaires, will get “money in their pockets,” but not people whose taxable income is zero after deductions (a stunning 31 per cent of Canada’s 30.9 million tax filers). These tax cuts are of no help for the genuinely poor.
• The NDP would increase the basic personal amount of income before income taxes kick in, to $19,500 from $16,129. This helps everyone now paying taxes and exempts a few more low-income Canadians from taxation.
• Both Liberals and Conservatives would cut the GST for people buying a new home (though only if you are a first-time buyer, for the Liberals). The Conservatives and the NDP promise to also cut the GST on purchases of new Canadian-made cars, and the NDP also adds everyday needs like diapers, home heating and internet bills to the tax-free list.
Housing
• The Conservatives would require municipalities to build 15 per cent more housing a year or lose federal funding for transit, and sell 15 per cent of the 37,000 buildings currently owned by the federal government, requiring them to be turned into affordable housing; they would do so, “if needed,” by “firing the gatekeepers” who block housing construction.
• The Liberals would double new housing construction to 500,000 units a year by building affordable housing on public land, providing low-cost loans to builders of affordable housing, and offering $25 billion to spur innovative prefab builders of affordable housing. They’d also cut red tape and municipal development charges.
• The NDP would add 600,000 units a year (three million new homes over five years) using a $16-billion housing strategy fund; train 100,000 more skilled-trades workers; prohibit corporate landlords from buying existing affordable housing and introduce a national rent-control program.
• None of the parties define “affordability.” The NDP commits to “20 per cent nonmarket housing in every neighbourhood.” (Non-profit and co-op housing was 25 per cent of the market in the 1970s. It’s about 5.5 per cent now.)
Access to care
• Everyone says they’ll at least maintain some recent improvements to access to care.
• The Conservatives say no one will lose access to dental care (currently for children, seniors and adults with disabilities), and that existing agreements with the provinces for child care will be “honoured.” They are mum on next steps for pharmacare. They would fund a recovery program, treating 50,000 addicted adults per year.
• The Liberals say they would extend access to dental care to 18- to 64-year-olds, as promised under the Trudeau administration, expand child care and mental health services for the Canadian Armed Forces, and provide up to $15,000 to train or upskill workers in health care (among other “priority” sectors, like manufacturing, construction, AI and technology). There has been no commitment to pharmacare thus far.
• The NDP say their comprehensive health-care plan would increase the number of doctors and nurses, improve access to care in the north, address growing privatization, ban American firms from buying up health assets, and create a full public pharmacare program in four years.
There you have their affordability plans. How realistic are they? At the time of writing, not a single party had released a costed platform.
Given where the NDP stands in the polls, it will not come close to forming or even influencing the next government. But it’s also true that, without it, there would have been no federal medicare, pharmacare or dental-care programs. Today’s NDP has advanced the most wide-ranging platform to reduce your costs and improve your well-being.
The winning party should adopt some of these winning ideas. Because right now we need all the wins we can get.
