Budget 2017: Working for the Middle Class

The Empire Club Presents

The Honourable Bill Morneau, Minister of Finance

On

Budget 2017: Working for the Middle Class

April 8, 2016

Welcome Address by Dany Assaf, President, Canadian Club of Toronto

Once again, good morning. Good morning to everyone. It is always great to see such a broad group of Canadians come out early in the morning to hear about things that are important to us all. And, today, we are particularly lucky to have Minister Morneau with us to talk about a very important budget that was recently released. My name is Dany Assaf, and I have the pleasure this year of serving as the President of the Canadian Club of Toronto, and I am delighted and honoured to be your co-host today, along with our partners and our friends at the Empire Club of Canada, represented by my colleague and cohort, Gordon McIvor, from whom you will hear very shortly as well.

It is an impressive crowd that I look out across today. It was mentioned to me earlier that now, 2016, there is a lot of flexibility in how people can dress to work—often casual—and not many people can get this many people on a Friday to come out in formal business wear and the guys, especially, wearing their ties. That is an extraordinary accomplishment, Minister, to show the respect that everybody has for you.

We were going to hold this at the SkyDome, but, apparently, there is some kind of home opener and a baseball team or something. It was a little hard to displace. We are lucky to be here today. Here, at the Canadian Club, we and the Empire Club of Canada are extremely proud of our rich history of being able to attract influential leaders and decision-makers who make important policy and decisions on behalf of us all on things that are near and dear to our hearts. Both of our Clubs have provided Canadians for decades, closely guarded, nonpartisan platforms where we can freely and openly exchange ideas on these things that do impact our lives. Through our programs, many like today, joint programs, including often youth and young leaders’ programs, diversity partnerships and media and social media initiatives, we are able to bring these things to our audiences and our members. We are always committed to bringing a diverse set of speakers on a range of topics who will address things in thoughtful, even sometimes provocative ways, but always provide us with important insights.

Today’s topic is obviously no exception: To hear, to listen about this very important budget. And a budget, of course, in many ways is a reflection of our collective investment in our future and how we want to see our country. Periodically, whether you are a person, whether you are a company or whether you are a country, you want to think about it because it is important to renew an investment in yourself. This government and our recent election offered that vision to Canadians and the majority of Canadians chose that.

Today, we are going to hear form the Minister about this inaugural budget. Of course, the best investment plans and the best initiatives mean nothing without great people to implement them. We will get a chance to learn a little bit more about our dear guest speaker and his track record and the hands that our future is in.

Now, it is my pleasure and my honour to take an opportunity to introduce our head table guests.

Head Table:

Dany Assaf, President, The Canadian Club of Toronto; Co-Chair, Competitionv& Foreign Investment Group, Torys LLP

Dr. Gordon McIvor, President, Empire Club of Canada; Executive Director, National Forum on Public Property

Hon. Bill Morneau, Federal Minister of Finance Hon. Charles Sousa – Ontario Minister of Finance

Gillian Riley Executive Vice-President, Canadian Commercial Banking, Scotiabank

Richard Talbot Chief Operating Officer, RBC Capital Markets

Darryl White Chief Executive Officer and Group Head, BMO Capital MarketsvTD

Howard Cohen, Senior Vice President, TD Business Banking

Nikki Holland, Director, Public Affairs, Carpenters’ District Council of Ontario

Sean Weir National Managing Partner & CEO, Borden Ladner Gervais LLP

Mark Wiseman President & CEO, CPP Investment Board

Michael Latimer resident & CEO, OMERS

Mohammad Al Zaibak President & CEO, Canadian Development & Marketing Corp.; Co-Founder & Board Member, Lifeline Syria

Helen Reeves Vice President, Marketing & Communications, Morneau Shepell

Jennifer M. Sloan Vice President, Public Policy, Canada, MasterCard; Immediate Past President, The Canadian Club of Toronto

Andrea Wood Senior Vice President, Legal Services, Telus; Immediate Past President, Empire Club of Canada

John Campion Partner, Fasken Martineau; Past President, Empire Club of Canada

Ladies and gentlemen, I present you your head table guests. Thank you. Now, I would like to take an opportunity as well to thank today’s event sponsors, and they include BMO Financial Group; Borden Ladner Gervais LLP; Carpenters’ District Council of Ontario; RBC Capital Markets; Scotiabank and TD Bank Group. Thank you all for your generous support of today’s event. Greatly appreciated.

Before I formally introduce today’s speaker, I want to let our live audience know you can join the conversation via Twitter. Yes, we have joined the modern age, and you can follow us @cdnclbto and @Empire_Club.

Now, it is my pleasure to head to the main event and introduce our main speaker. Now, of course, every generation probably feels that it lives in decisive times. Our generation feels no less. As I mentioned earlier, this budget is something that we have all been anticipating and looking forward to hearing more specifically from our guest speaker. Again, without capable, experienced and well-intentioned people, these plans mean nothing. Today, it is a pleasure to welcome and honour our new Finance Minister, Bill Morneau, and hear from him.

Introduction

On March 22nd, the Honourable Bill Morneau, who has called Parliament Hill his political home for the past five months, delivered in fact his first budget. It has been the talk of the land ever since. The government, by its own account, has big plans to recapture hope and optimism by injecting billions into our economy and investing in our future. Over the next decade there are plans that include things such as spending $120 billion on infrastructure.

Prior to this role, he served in the business world, as Executive Chair of Canada’s largest HR services organization, Morneau Shepell. He was a pension investment advisor to the Ontario Minster of Finance for two years beginning in 2012. He was later appointed to the Expert Panel to recommend on Ontario Pension Plan Supplement to the CPP, and he has demonstrated throughout his life and his career also a commitment to community and his intention to better our community. He is the past Chair of St. Michael’s Hospital, Covenant House and, as well, the C. D. Howe Institute.

He has also offered his expertise to educational institutions, including the Canadian Merit Scholarship Foundation, The Learning Partnership and the Canadian INSEAD Foundation. He was also instrumental in founding a special school for Somali and Sudanese youth in an African refugee camp.

Ladies and gentlemen, we are delighted. Again, we are honoured that he has taken the time to join us today, and would you, please, join me in a warm welcome to our Federal Finance Minister, Mr. Bill Morneau.

The Honourable Bill Morneau

Well, thank you very much, to all of you for coming out, and I guess I need to start with an apology for all of those of you who are wearing ties this Friday morning because of this. It is a pretty incredible room we have here this morning. It has vastly exceeded my expectations for 7:00 a.m. on a Friday morning. Thank you to all of you for coming out.

I guess I would like to start by saying it is a great honour to be representing all of you here as Canada’s Finance Minister, but, as many of you know, I am first and foremost the Member of Parliament for Toronto Centre. For me, it feels particularly good to be addressing a hometown crowd this morning. As you may know, I have been travelling to many places far and wide, so it is nice to be here among so many friends. Sincere thanks for coming out so early in the morning. Before I begin this morning, I would like to thank the Empire Club of Canada and the Canadian Club of Toronto for hosting this breakfast this morning, and I guess I would like to thank Dany for that very kind introduction. I would also like to acknowledge several of my colleagues who are here with me this morning. We have Majid Jowhari, Francesco Sorbara, Rob Oliphant, Nathaniel Erskine-Smith, Salma Zahid and Marco Mendicino. We have been very successful as the Liberal Party in having such a large number of Toronto Members of Parliament, and I am delighted so many of you could come out to join us this morning.

I would also like to thank my friend Charles Sousa, the Minister of Finance for Ontario and all of our colleagues at Queen’s Park for being here, as well as anybody from the City of Toronto. I know there are some people from the City of Toronto who are here with us today. I can say that their ongoing collaboration and support is hugely appreciated and a very important issue for us as we try to make a real difference for Canadians.

I want to reiterate how important it is for us as a federal government to be a reliable partner with the province and with the city to be of service to people in the City of Toronto. For those of you who did not hear, you are probably in the wrong room by now, I did release the budget on March 22nd. We believe that this is a first and critically important step in telling Canadians what we are about as a government. And since March 22nd, I have had the opportunity, along with Prime Minister Trudeau and my Cabinet colleagues, to tell our budget story both here at home and around the world.

Earlier this week, I was travelling in Atlantic Canada. I was in Fredericton and Charlottetown and Cape Breton. Yes, Fredericton, Charlottetown and Cape Breton. And, yesterday, I headed to Southwestern Ontario to talk about our budget. Before that, I was in Ottawa and Montréal and the South Shore of Montréal. I have also had the chance to take our message to international audiences.

Last week, I was in New York and in Paris and in London. I can tell you, I have met with economists; I have met with representatives of the financial sector, and I have met with investors from around the world. And I can tell you and I am very happy to report that the reviews on our budget are in, and they have been very, very strong. We are finding that people are telling us— especially, those people from abroad—pretty much all the same thing. They really like what we are doing either over here or up there in Canada. They are telling us that they like what we have chosen to do with our budget.

People are taking note of Canada’s new government. You have seen it, and you have heard about it—and of our fundamentally new approach to fiscal policy in this country. I can tell you from Wall Street to the IMF to the OECD and the G20—and even to the little rural village I visited last week in Saint-Valentin in Québec’s Eastern Township—people really do believe that we are onto something. I will just give you a few insights of what we are hearing. The Financial Times calls Canada a “glimmer of light” for our wise use of fiscal policy in our investments in the economy. They say it is a clear sign of our understanding of exactly what we need to do in these economic times. For those of you who might have been watching, this week, Christine Lagarde, of the IMF, praised Canada’s approach by saying that using the fiscal space available to us, but in a manner that is credible, targeted and realistic is the right decision at this point in time.

I believe these people are saying this because our government is focused on doing exactly the right things for our economy and for Canadians at this stage. First and foremost, as I think you have seen, we are focused on people. Budget 2016 is first and foremost about restoring hope for the middle class in Canada. It is about revitalizing the economy and providing support for Canadian families. Even before taking office, Canadians told us to do two things: They told us to invest in people and in families, and they told us to grow the economy for the long term, so that is what we set out to do. But, for me, the first thing we did was we set out to listen.

In January, I crisscrossed the country speaking to as many people as possible across the country about how we could work together to grow our economy. And I can tell you, we heard from about a quarter of a million Canadians, and we believe it really worked. In places like the Eastern Townships and rural Manitoba, people told us about the importance of high-speed internet in rural communities for small businesses that are trying to compete locally and globally. From Dalhousie University, where we held a town hall for students to the University of Calgary, students told us about their struggles with debt and the opportunities—they are concerned about their opportunities after their graduation. We addressed much of what we heard in those consultations in our budget. Solutions to many of these problems are now part of our government’s plan. We like to think that we heard Canadians, and we followed through with this, our first budget.

But, more broadly, in all parts of the country, Canadians talked to us with passion about their livelihoods and their concerns for their communities. Most of all, they talked about their kids, and they talked about the future that they hoped to provide for them.

At the core of our plan is the notion that, when you have an economy that works for the middle class, you have a country that works for everyone. That is why in December, at our very first opportunity, we cut taxes for nearly nine million Canadians. With our budget, you will have seen that we took even bigger steps to put more money directly back in the pockets of families with children through the new Canada Child Benefit. It is a plan to help families more than any other social program since the introduction of universal healthcare. It will give 9/10 families with children more money every month to spend on everything from school supplies for their children or healthier food for their families.

We believe that by targeting our actions to those who need it most, we not only strengthen the middle class in our country, but we know with this new benefit that we are going to lift hundreds of thousands of Canadian children out of poverty. And, for us, we believe that that is real change for Canada. But, in addition to providing direct help to families, we need to make strategic investments in order to grow the economy for the long term, and we know that we need to better position Canada for the global economy of tomorrow. That is why we have to look at all of the investments we make today in the context of how they will help us to build Canada’s future.

We have committed that over the next ten years, as Dany mentioned, our government will implement a $120 billion infrastructure plan that will help reshape Canada in the 21st century for our children and our grandchildren. As an immediate first step, we announced in the budget that the first phase of our infrastructure plan invests $11.9 billion over the next five years. These investments will accelerate our transition to a low-carbon, clean-growth economy. They will help us to make traffic flow more smoothly, to create and repair affordable housing and so much more. I know you are here at 7:00 a.m. in the morning to hear also what this means for the City of Toronto, so I want to say to start that I am willing to bet that, not this morning, because you got here so early, but during the past week, probably virtually everyone in this room has been stuck in a traffic jam at least once. We want to try and do something about that together with our partners in the City of Toronto and the province.

Mayor John Tory has made a compelling case for keeping public transit as a top priority for Canada’s biggest city, and, by extension, we can see the same for all cities that are coping with fast-growing populations and what we see as aging transit systems. So, to start, Toronto will be eligible for a portion of the $3.4 billion Public Transit Infrastructure Fund, and $1.49 billion of that will be invested right here in Ontario.

We have also committed to tying our funding levels to ridership. This is significant, obviously, for a province that accounts for 44% of all public transit ridership in Canada and where over 1.5 million people take some form of public transit every single day. We know that the money is going to help Toronto make needed upgrades, which could include purchase of new subway cars, low-floor busses and streetcars. We are also taking a first step on a new high-frequency rail service linking Windsor and Québec City. Over the coming months, we are going to evaluate a VIA Rail proposal that could one day build a dedicated track that will make it easier and faster to get to where you are going from Toronto—whether you are going east or west from our city.

And Toronto will remain eligible for a share of the annual $3 billion for infrastructure projects that have been committed through the Gas Tax Fund in the incremental GST Rebate for Municipalities.

By now, you know that people and infrastructure are at the heart of the plan that we have put forward to Canadians. Perhaps, the greatest untold story of our budget 2016 is that it takes a huge leap in positioning Canada in the global economy of tomorrow, an area where Ontario is leading the way in many respects.

In my budget speech in the House of Commons, I use the example of Waterloo as a model that Canada can and must build on. Yesterday, I was in Kitchener-Waterloo to meet with Communitech. Many of you will know Communitech. It is an industry-led innovation centre that is dedicated to fostering and supporting tech communities in the Kitchener-Waterloo region. The ideas generated from there will inform future investments and programs that support startups, small- and medium-sized enterprises and, in particular, women in technology.

Even closer to home, we have another centre doing similar work, the Ryerson Digital Media Zone or the DMZ, which is another shining example of a successful incubator working to support entrepreneurs in our city. The leaders of these organizations can see what is coming in the future economy, and they know, as we know, that making Canada more innovative will truly require all hands on deck. Communitech and the Ryerson DMZ have tapped into a basic truth that we need to face in our country: We all need to be better partners with each other across sectors and disciplines so that together we can build a stronger economy for today and for tomorrow.

We believe that in our budget 2016, we told Canadians that the federal government is ready to do its part in that partnership. In the next year, we are going to define a bold, new innovation agenda that will position Canada as a centre for global innovation. We want to be at the leading edge of the changes happening in the global economy, not just because it is good for tomorrow, but because it is good for today, for people living here and working here.

To get things started, our budget 2016 really covers the Waterfront in support of post-secondary education and institutions. We have targeted students as well as the places where they study. One of the important measures we put in our budget is it will increase Canada’s student grant amounts by 50% for students from low- and middle-income families and for part-time students, and we committed to investing $2 billion over three years for a new Post-Secondary Institutions Strategic Investment Fund to modernize on- campus research, commercialization and training facilities. We have also committed to investing an additional $95 million in discovery research through the granting councils, the highest amount of new annual funding for discovery research in more than a decade in this country.

Finally, we take a page from Communitech and MaRS here in Toronto and Ryerson DMZ by working with stakeholders to identify and build on regional strengths in our country. We have committed to providing $800 million to support innovation networks and clusters across our country. We believe this is a good start on a new agenda. We know that we need fresher, broader and more collaborative efforts to embrace the innovation opportunities that change brings. We know that working together is the Canadian way.

The public sector needs to work together with the private sector to help to create the conditions for success for all. I know that many of you know this and that your organizations are already actively engaged and involved in the research and development space, but I will say here that we need to do more. Business investment and research and development are absolutely paramount to our success. I am calling on you as well as business leaders from across the country to work with us as we take on this challenge. With your help, we know that we can put Canadian-made ideas, products and solutions in the storefront of the new global economy. We are confident that this approach will bring around economic growth now and for the years to come, but a big part of our budget is we know that this will all be for naught if all Canadians and if, especially, those Canadians in the middle class do not benefit from our shared success as a nation. After all, how we treat our most vulnerable people in our society is really a measure of what kind of society we choose to be.

In our budget, perhaps, the best example I can give you of our renewed efforts to ensure that we are helping the most vulnerable is our efforts to ensure that Indigenous peoples share in Canada’s prosperity.

I will start by saying what we all know: It is simply unconscionable that we live in a country where children live without access to clean drinking water.

In addition to very significant investments in education, both on and off-reserve, we are going to take important steps to put an end, finally, to boil water advisories on reserves by investing nearly $2 billion in water and waste water infrastructure.

We know that we have some other communities that desperately need our help. We have committed to doing more for veterans in our country, the men and women who have dedicated their lives in service of our country. They have earned our gratitude, our respect and our support, so we are working to make sure that we take care of them when they need it most.

We are also providing significant support for affordable housing. This is an issue of critical importance in my riding of Toronto Centre, but really across the GTA. I can tell you that when I was Chair at St. Michael’s Hospital, I was continually struck by the link between proper housing and health outcomes. Doctors would tell me point-blank that the road to healthier communities, especially, for our most challenged citizens, would always be through affordable housing. I can tell you that that made a real impact on me. Some numbers are probably helpful in this situation for all of us to understand. Right now in Toronto, about 265,000 people live in social housing of some kind, including shelters. You may not know it, but there are nearly 95,000 people on a waiting list for affordable housing in our city. That is equal to the population of Belleville. The number, unfortunately, is rapidly rising, and it is rapidly rising especially amongst seniors in our city. So, you understand, the average family is waiting up to four years to access affordable housing and, of course, that is an average, so, in many cases, it is actually much longer.

Well, in our budget, in budget 2016, we have committed to investing $2.3 billion over two years in support of affordable housing. This includes doubling our support for the investment in affordable housing initiative with an additional funding of about $504 million over the next two years. The funding will help to support low-income families as well as the construction of new affordable housing units and will also be renovating and repairing existing units across the country.

We are also providing $200 million in dedicated funding specifically targeting seniors in our country. Finally, and very importantly, through partners at the Canada Mortgage and Housing Corporation, we are going to establish an Affordable Rental Innovation Fund, providing over $200 million over five years to test new ways to encourage more construction of affordable rental housing in our country.

This investment is expected to support the construction of up to 4,000 additional affordable rental units in our country. Beyond that, we are going to work together towards developing a long-term solution that aims to help the social housing sector be more self-reliant. We look forward to consulting with Canadians on a new national housing strategy.

I can tell you that I am personally committed to this initiative as I know my colleagues are from across the country. As people in Toronto know better than anyone, our commitment to the most vulnerable is critically important. What I can say is that our commitment to the most vulnerable does not stop at our borders, and it truly has not over the last year. I am proud of the fact that our community has emerged as a shining example of a welcoming nation to nations around the world.

Over the past few months, we have all been touched by the outpouring of support that this community has shown to Syrian refugees. The efforts of people like my friend here, Mohammad Al Zaibak, who has co-founded Lifeline Syria and countless others, represent the very best of our country, and I want to thank so many people in this room for all that you have done in this area.

In our budget, in the spirit, we have taken additional steps to welcome newcomers to our country, which we know are also vital to the Canadian economy. In fact, we intend to welcome 300,000 new permanent residents to Canada in 2016, which is the largest number in a century, and many we know will choose to make Toronto their home. We are also going to step up our efforts at family reunification, which we know is so important for families. And, through that, we expect to see 20,000 admissions this year under the Parents and Grandparents Program.

Budget 2016 is really just the beginning of our new government. I want to conclude by reminding all of you why we are doing all of this: When I was in London, in Paris, in New York over the last week, and when I had the opportunity to represent Canada at the G20 meetings in Turkey and Shanghai, I realized that the global consensus is almost exactly what Canadians are telling us right here at home: Investments in the economy are needed now more than ever. We find ourselves in a very lucky position because we are at a time in our history where we have both the capacity and the willingness to act to make the future better for our children and for our grandchildren. We believe that we need to seize this opportunity. We cannot afford to let it go.

Thanks to leadership in our federal government in the 1990s and the 2000s, Canada now has a very manageable debt situation. Our federal debt to GDP is low. It is the lowest in the G7 countries, and we have committed that, by the end of our mandate, it will be even lower than it is today. Combined with very low interest rates, this means that we can make the necessary investments to strengthen our economy with confidence and in a responsible way.

I will say that having the capacity is not enough. We need to have the resolve to follow through on sustained and strategic investments guided by a vision of a future in which all Canadians have a real and a fair chance at success. This is our government’s central mission. We are choosing to take advantage of an historic opportunity to invest in people, to invest in our economy and to prepare Canada for a brighter future. Of course, we recognize that this is only the beginning of our work. We have so much more to do together, but we know that there is no limit to what we can achieve as a country together.

I want to say that I am so happy to be here this morning and that I look forward to working with all of you to make sure that Toronto and Ontario and Canada live up to our enormous potential. Thank you very much for coming out so early this morning, and thank you very much for being part of this new effort to make Canada better. Thank you.

Questions & Answers

Q: Please, expand on the rationale for going into deficit. That is something, obviously, that is at the top of everybody’s mind. What, ultimately, is the government trying to achieve by taking on these deficits in these times and running deficits in the context of what you have proposed? How are we all going to see that return on our investment sooner rather than later?

BM: This morning I found out that you have only 35 seconds to answer your questions. I suspect you will indulge me for longer than 35 seconds. I would like to reiterate, really, what I just said. We look at an era that we have been in. We have been in an era where growth has been relatively weak. We look at the demographic challenge that we are facing as a nation. We are in the challenging situation where the number of retirees versus workers is changing dramatically, and that will present a challenge for us. We recognize that Canada, as a country, is not as productive as it should be. When you compare us to other countries, we are not as productive as the United States or a number of other G7 countries.

We also look at the environment that we are in: As I mentioned, we have the lowest interest rates in history and the fiscal capacity of Canada, which is very well understood outside our borders or by rating agencies, is very strong. We have the lowest net debt to GDP. It provides us with a fiscal capacity to do something about this low growth environment. We are committed to making investments that will help us to grow the economy. We know that these investments need to do two things for us: They need to ensure that we are actually going to create a more productive economy over the long run, so they actually need to enhance our growth rate, and we really hope that what they will do is they will help us to, in the shorter- and medium-term, get more and more Canadians working at a time where we can afford to spend on those things.

Our commitment is to making investments that will do just that. We believe that making these investments in infrastructure will make the base of a society that will allow us to get people and goods and services to market more rapidly, creating more productivity. They will help people’s lives along the way. We believe that by investing in innovation, in students, in research, it will help us to create a more productive economy for the long run. As I said, there is consensus that this is the right thing to do in this economic environment. What we will commit to do is remain fiscally prudent along the way. We are going to be carefully focused on ensuring that net debt to GDP, which is a very important measure, declines over the term of our mandate, and our expectations will be able to generate a rate of growth that is stronger than would have been otherwise by making these investments.

Q: You touched on, again, some critical factors there, which are productivity and growing the economy. A key to that, obviously, in the experience of these people in this room and, for many of us, is the investment in cities. You talked a little about the investment in Toronto public transit, but can you tell us a little bit more about the role of cities, productivity and that investment? Can you give some more specifics on what you are thinking on that front?

BM: Well, I can tell you two things. First of all, our efforts to work together with cities and provinces will be exactly that, to work together. We are going to be collaborative in our efforts across the country. We recognize that the federal government should not be in the business of choosing the projects to work on. It needs to work together with partners that actually are on the ground and close. The goal is to ensure that the places where Canadians choose to live are increasingly more and more productive. We recognize that in a city like Toronto, the investments in public transit, as an example, have not kept up with the pace of population. We are stepping forward to say that investment is required, and it needs to be collaborative, and then we are going to work together to make sure that we have not just a federal investment, but it is a federal investment combined with provincial investments, combined with city, municipality investments and, hopefully, combined with investments of institutional investors, so we can find a way to amplify our investments over the course of time. That is our goal. That is the base from which we want to create a more productive society, so, as a foundation, people need to be able to get to work on time; as a foundation, we need enough affordable housing, so people who are working in these cities have the capacities to find a place to live.

From there, we do need to think about what is the way that we build more productive environments. We identified Waterloo for a reason: The nexus of the University of Waterloo and the University of Wilfred Laurier—Waterloo with its co-op program, together with research institutes like the Perimeter Institute doing basic science, together with really great firms that have been built there and have helped to create really great jobs, firms like BlackBerry and OpenText. These firms have really made a real difference there, so we want to, on purpose, go out to try and find a way to encourage that to happen across the country in a way that may have happened organically in Waterloo, but we want to make sure that we have the opportunity to do this in other parts of the country, using federal activity to stimulate that opportunity around the country. We think that is going to help Canadians to have the kind of exciting and innovative jobs in the future that we know will be important if we want to be a country that is at the leading edge of technological change.

Q: We have got some great institutions here that maybe could partner with you, so if we could help facilitate any of that this morning, let us know. Again, just to elaborate a little more on this as you have kind of taken us through your remarks from broad to more specific and you have talked about housing. There does seem to be an emphasis on this basic building block of the family here in your budget and the overall vision of the government. What is it that brought you to that sort of mindset and that framework when you are looking ahead to this budget and the future?

BM: Well, we believe that as we went around Canada in our campaign, we had Canadians on side with us in recognizing that we have to have a society that, as we get more wealthy collectively, ensures that that goes to all parts of our society. If we look at what has happened over the last generation, we have had a situation where as society has gotten wealthier, it has not gone to all cohorts of society. We have focused on middle-class Canadians that have not seen the same income growth over the last generation as other parts of society, and we have asked how can we help out. Changing tax rates for the middle class was focused on that. Rethinking our Canada Child Benefit so that, to put it bluntly, I was getting a universal child benefit for my children that were under 18. In my estimation, I am probably not a good target for that child benefit, so we rethought that child benefit, so that we could take the money that we were spending and spend it on Canadians that really needed it—so Canadians that were earning less income and that had more of a challenge. That is what we have done.

We are looking at things like housing in our country. It is just a recognition that the housing stock for affordable housing in our cities have not kept up. Not only has the renovation and the rebuilding of those structures not kept up, but the new, affordable housing is just not there. The statistics that I just mentioned in my speech, the 95,000 people on a waiting list in Toronto, are not good enough. We have people across our city who are struggling to find places to live. We think that finding ways to encourage people to build more affordable housing and finding ways to ensure that the affordable housing we have is acceptable for people to live in are an important building block, because people are not going to be effective, productive members of our economy if they do not have a place to live and if they cannot get to work. These are the starting points. From there, we are going to work on helping the students of today become the innovators of tomorrow by thinking about how we can ensure they stay in school and how we ensure that we are innovative in building research organizations that can really take on the global challenges that we need to take on to be the country that we want to be in the future.

Concluding Remarks by Dr. Gordon McIvor

Minister, it is a rare occasion, like Dany mentioned, to have this many hundreds of people gathered so enthusiastically this early in the morning to hear any speaker. And it is a tribute to you and the message that you bring to this room that it is so full today. Canadians, we would agree, have reacted really favourably to this first budget with its commitment to increased investment in innovation and technology; to the new emphasis on clean energy initiatives and reduced carbon footprint and to the realization of large infrastructure projects in areas like transit, water, waste management and housing. All of these are fundamentally important to the well-being of our economy. And I was particularly so pleased to see a commitment to a finally take seriously the many issues associated with living conditions in Aboriginal communities. Some of these issues are not always considered to be politically sexy, but most Canadians understand that they are extremely important, and that is why we believe they have lauded this budget’s unwavering commitment to ensuring that these areas are tended to, and that gives us a strong base for future growth.

Minister, I think that you probably are quite aware that these are two really old Clubs. I think they might, in fact, be among the oldest clubs in the country. They both existed for well over a century, and, throughout the years, have served an important role in Canada’s national dialogue. The Canadian Club states, for example, on its home page that before instantaneous news coverage, prime ministers used the Club to reach out to Canadians, particularly, in times of crises like war, for example. Our records at the Empire Club, show exactly the same thing, and we even, actually, recently discovered that in times of old, all new Members of Parliament were given copies of all the speeches from our Club to help orient them in the new job and help them deal with the myriad of issues that they would be called on to deal with in their day-to-day activities.

Over the past decades, our two Clubs have come together on numerous occasions, but, especially, the co- present finance ministers. That has been a real tradition, and I think that is a clear recognition of the fundamental importance that both of our Clubs attach to this particular document. It is, in many ways, a blueprint for many of the new initiatives and renewed commitments that the country will make over the coming years.

Today’s presentation, we believe, is a testament to the continuing importance of these presentations and the fact that the government still sees a role for us in helping to reach all Canadians across the country. Dany talked about instantaneous communication and social media. Certainly, that gives people a wider choice on how they receive their news and social media, and it has allowed our Club to bring the messages that we have not only to people across this great country of ours, but right now we know that there are hundreds of thousands of people that listen to most of these speeches around the world through our global webcasts and podcasts. It is an important reach out. For this to happen, of course, though, the content must have three things: It must be critically important, interesting and relevant. Your presentation today scores extremely high in all three of those categories.

On behalf of our two Clubs, it is, therefore, my great pleasure and honour to sincerely thank you for your visit here this morning. And we wish you much continued success as you take this message to our fellow citizens across the country. Thank you, Mr. Minister.

It is unusual to do the toast at the end of a speech, but we are about to begin breakfast now, so, ladies and gentlemen, would you, please, join me and raise your glass and perhaps even stand for five seconds, and could we have a toast to our great country, to Canada.

Please, be seated. I would like now to also do a draw for the Empire Club. The winner today will receive a one-year membership to the Empire Club, which is our tradition. It is Robert Deluce! Congratulations!

Ladies and gentlemen, this ends the formal part of our proceedings this morning. On behalf of my colleagues at the Empire Club of Canada and the Directors at the Canadian Club of Toronto, we want to thank you for coming out so early this morning on a cold, spring morning. Please, enjoy your breakfast, and have a wonderful day. Thank you very much.