Canada must continue investing in its economy to exit pandemic more quickly: Duclos
There’s a tendency to underreact to health and economic crises, Treasury Board head says
Treasury Board President Jean-Yves Duclos says one lesson learned from recessions and depressions past is to veer away from under-investing in the economy as a crisis comes to an end.
While the COVID-19 pandemic continues to grip much of the country — something Duclos himself didn't expect to see more than one year on — it's advice he's backing as the federal government maps out its economic recovery from the global public health emergency.
"There is unfortunately … a tendency to under react, to be under prepared and to be under reactive … to the challenges posed either by the health or economic crisis," the former economics professor said in an interview on Rosemary Barton Live.
"That is a very unfortunate outcome because it means that we are then faced with higher unemployment, lower growth, lower living standards for Canadians and therefore lower taxes and greater deficits over the longer term."
When the first federal budget in two years is presented later this month, it's expected to include details of Ottawa's three-year stimulus plan, which is valued between $70 billion and $100 billion and is intended to spark the country's post-pandemic recovery.
In a pre-budget outlook published last week, Canada's Parliamentary Budget Officer Yves Giroux said the temporary package could provide a "significant boost" to Canada's economy, but cautioned it could potentially result in "materially larger budget deficits."
Feds will support Canadians for 'as long as it takes'
The stimulus plan was not factored into the PBO's overall report due to a lack of details about the package. The spending watchdog projected the government would run a $363.4 billion deficit in the 2020-21 fiscal year — lower than the $381 billion figure Ottawa predicted last fall.
But the PBO noted the deficit should decrease in the years ahead — and projected employment would return to pre-pandemic levels by the end of 2021.
We are facing a third wave, which was both unexpected and certainly not the outcome we were hoping for...- Treasury Board President Jean-Yves Duclos
When asked by CBC chief political correspondent Rosemary Barton whether pandemic support for Canadians should continue to be extended, Duclos said the government plans to help "for as long as it takes."
"Obviously, we are facing a third wave, which was both unexpected and certainly not the outcome we were hoping for at this time of the year. I think we all look forward to seeing the budget on the 19th of April," he said.
Variant-driven surge in cases
The PBO estimate was crafted with the assumption that a so-called "third wave" of COVID-19 cases and infections of coronavirus variants would not be severe, particularly as more Canadians get vaccinated.
In recent days, parts of Quebec have shut down amid a rise in cases, while Ontario imposed an "emergency brake" Saturday to curb the rapid spread of the virus. British Columbia, meanwhile, implemented three weeks of its own sweeping restrictions as variants of concern drive transmission of COVID-19.
The country surpassed one million confirmed cases of COVID-19 this weekend.
"I think we're going to see a rapidly increasing number of cases because of the variants' increased transmissibility," Dr. Jennifer Russell, New Brunswick's chief medical officer of health, said in a separate interview. "I think that's very concerning."
Russell cited "variants, vaccines and vigilance" as the three most critical factors that will determine how quickly Canada finds its way out of the pandemic.
"I would say go below the headlines and the sound bites to understand the numbers. The risks right now in every province is higher to get infected with COVID-19 and one of the variants," she said. "That risk is higher than any kind of a problem that you could have with any of the vaccines at this point in time."
WATCH | Critical time for vigilance, says Russell:
Vaccinations alone not enough, Duclos says
Duclos also appealed to Canadians to be "mindful and focus on the work that each of us needs to do in the next few critical weeks."
That includes refraining from any non-essential travel, regardless of someone's vaccination status.
"It's not the time to travel now and it's not the time to consider opening up our borders with any country, including the United States," Duclos said.
The U.S. Centers for Disease Control declared last week that people who are fully vaccinated can travel within the country without requiring a COVID-19 test or needing to quarantine.
"Even in the United States, where vaccination is more advanced … we're currently speaking of a fourth wave," Duclos said. "So that tells us that vaccination is not enough."
You can watch full episodes of Rosemary Barton Live on CBC Gem, the CBC's streaming service.
With files from Philip Ling
