Former Bank of Canada senior deputy governor Carolyn Wilkins is among a group of experts set to brief Prime Minister Justin Trudeau and his cabinet as they chart their government’s economic agenda for 2023.
Mr. Trudeau and his ministers gathered in Hamilton, Ont. on Monday for a three-day cabinet retreat ahead of Parliament’s return next week. On Tuesday, the cabinet’s first full day of meetings, experts will brief the group on inflation, recession threats and increases to Canadians’ costs of living, according to a source who was not permitted to discuss the private meetings publicly. The goal is to prepare the government’s responses to the biggest issues Canadians are facing, the source said.
None of the people briefing the ministers on economic matters will be unfamiliar to them. In addition to Ms. Wilkins, who left the central bank in 2020 and is now a senior research scholar at Princeton University, the cabinet members will be receiving confidential presentations from Canada’s chief statistician, Anil Arora, and University of British Columbia economics professor Kevin Milligan.
Mr. Milligan has previously done consulting work for two federal government departments, and in 2021 he acted as a special advisor on economic recovery in the Privy Council Office – the bureaucratic arm of the Prime Minister’s Office. Contacted on Monday, Mr. Milligan declined to comment on his presentation to cabinet.
The government has already launched some programs in response to economic concerns. In September, Mr. Trudeau announced $4.6-billion in new spending intended to help Canadians struggling with higher costs of living. The spending was income tested, and it included new payments to uninsured parents to cover their young children’s dental costs, a doubling of the GST credit and a boost in rent supports.
Last year, the Bank of Canada increased interest rates seven consecutive times in an effort to tamp down inflation. Consumer price increases have cooled since then, hitting an annual rate of 6.3 per cent in December, from a peak of 8.1 per cent in June. But inflation remains well above the Bank of Canada’s 2-per-cent target. The central bank will make its next rate announcement on Wednesday.
Also on the agenda at the cabinet retreat is a potential 10-year health care funding deal with the provinces and territories. The Globe reported on Friday that Canada’s premiers and the Prime Minister are inching closer to such a deal. It would include a significant increase in the billions that the federal government sends provincial and territorial governments in health transfers, as well as bilateral agreements in specific areas such as long-term care.
The federal government has said that it is willing to increase the health transfers, but only if premiers agree to accountability measures, including the creation of a national health data system.
Health Minister Jean-Yves Duclos and Intergovernmental Affairs Minister Dominic LeBlanc are leading the talks with premiers. On his way into the meetings in Hamilton on Monday, Mr. LeBlanc said he was optimistic a deal would be struck.
The talks will lead to “an important agreement that will improve the health care system for the long term,” he said. He added that it is possible Mr. Trudeau will meet with the premiers personally at some point, to hammer out a final deal.
Polling from Nanos Research that was updated as of Friday shows the Liberals slipping behind the Official Opposition Conservatives. Thirty per cent of respondents said they intended to vote for Mr. Trudeau’s party, while the Tories, led by Pierre Poilievre, were at 35 per cent. The NDP were at 18 per cent, and the Bloc Quebecois were at nine per cent.
Asked on Monday what the Liberals need to do, considering the polling and the economic indicators, Agriculture Minister Marie-Claude Bibeau told reporters: “We’re the government and we’ll keep doing good things.”
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