Liberals to back off on broad spending powers without oversight in emergency funding bill

OTTAWA —
The federal Liberals appear to backing away from a proposal to grant themselves sweeping power to spend money, borrow, and change taxes without parliamentary approval through to Dec. 31, 2021 as part of legislation the government is expected to table Tuesday, as it passes COVID-19 emergency economic measures.

According to a draft copy of the bill obtained by CTV News, it would — if passed as worded — allow the cabinet “temporary” powers related to borrowing fund and imposing and repealing taxes as well as increasing or decreasing a tax rate by regulation, without seeking parliamentary approval, “before 2022.”

Though, within minutes of the details becoming public the draft proposal caused considerable friction amid what has been a collegial unified effort to pass economic assistance measures for Canadians.

It was viewed by some as legislative overreach amid a global pandemic, and muddying the waters on a bill to pass urgently needed financial assistance.

Sources indicated to CTV News late Monday that the version being tabled on Tuesday will walk back some aspects of the bill that were included in the draft version leaked to various outlets.

The sources said that while certain aspects of future assistance related to COVID-19 could still pass without needing a vote, some of the wording about tax changes being made without oversight would be amended, though the details on how remain to be seen.

“We consulted with the opposition and will bring changes to the draft legislation. We will always work collaboratively and respect the fundamental role of Parliament,” tweeted Government House Leader Pablo Rodriguez Monday night.

The government and opposition parties were engaged in backroom negotiations over amendments to the text on the eve of the historic special sitting to boost government spending targeting the novel coronavirus outbreak.

The proposed legislation also spells out how much more money each province is getting, and creates a 16-week window where eligible Canadian workers can be absent from work on account of the novel coronavirus. These aspects and others that are directly related to COVID-19 economic relief are not expected to change.

In a statement sent late Monday, Conservative Leader Andrew Scheer indicated that while his caucus is ready to support the promised economic relief measures, “we will not give the government unlimited power to raise taxes without a parliamentary vote.”

“We will authorize whatever spending measures are justified to respond to the situation, but we will not sign a blank cheque,” Scheer said, setting the stage for some level of parliamentary showdown amid the global pandemic.

In a minority parliament the Liberals will be required to get the backing of at least one other major opposition party to see this spending measure passed.

The bill summary states that this measure is “as part of the response to COVID-19,” but would, if passed as drafted, allow money to flow without MPs scrutinizing it for a period of time considerably extended beyond current estimates of when Canadian society may return to some sense of normalcy, amid the novel coronavirus pandemic.

In addition to making the needed legislative changes to implement the promised financial assistance measures for Canadians and businesses, the “advance copy” proposes to create a new “Public Health Events of National Concern Payments Act” which would grant Finance Minister Bill Morneau the ability to spend “all money required to do anything, including making payments to provinces and territories,” in relation to public health events of national concern. 

‘Up to 16 weeks’ absence

The bill also proposes to amend the Canada Labour Code to state that “every employee is entitled to and shall be granted a medical leave of absence from employment of up to 16 weeks as a result of quarantine,” or if “the employee is unable or unavailable to work” on account for COVID-19.

The Liberals are suggesting the bill be cited as the “COVID-19 Emergency Response Act.” The draft version spans 44 pages and includes 20 sections.

The legislation would also give the finance minister a range of new powers related to procuring, loaning to, merging, selling, winding-up or dissolving corporations.

Among the other acts it makes amendments to— largely related to measures committed by Trudeau and Morneau last week—include the Canada Mortgage and Housing Corporation Act; the Export Development Act; the Federal-Provincial Fiscal Arrangements Act; and the Patent Act.

Under the Patent Act the draft bill proposes to allow for, on the authorization of the health minister, to “make, construct, use and sell a patented invention to the extent necessary to respond to the public health emergency.”

Another key element in the text of the bill is a breakdown of the amount of money each province would get as a top-up as part of the 2019-20 fiscal year.

The federal government has committed an additional $500 million to the provinces to ready their health systems and other institutions for the surge of patients. Here’s how this bill proposes to dole those funds out:

  • Ontario: $193,721,000;
  • Quebec: $112,871,000;
  • British Columbia: $67,464,000;
  • Alberta: $58,141,000;
  • Manitoba: $18,216,000;
  • Saskatchewan: $15,627,000;
  • Nova Scotia: $12,922,000;
  • New Brunswick: $10,340,000;
  • Newfoundland and Labrador: $6,952,000;
  • Prince Edward Island: $2,089,000;
  • Northwest Territories: $598,000;
  • Yukon: $543,000, and
  • Nunavut: $516,000.

The special bill has been put on notice by Morneau, and it is the only item of business on Tuesday’s agenda. 

Copies of the bill were provided to members of the opposition under embargo until it is tabled in the House of Commons.

Asked to comment on the contents of the leaked bill, Rodriguez’s office told CTVNews.ca: “We can’t comment on the contents of a bill before it is introduced in the House of Commons. All parties are working together collaboratively to ensure Canadians get rapid access to the financial measures they need.”

Emergency Tuesday sitting

On Sunday, Prime Minister Justin Trudeau announced that the House of Commons will resume for a special hours-long sitting to pass the aspects of the $82-billion financial aid and economic stimulus package that require legislation, such as changes to employment benefits for Canadians who are out of work and enhancing the Canada Child Benefit. 

These measures are the first in what the government says will be more to come, with the Conference Board of Canada forecasting that the global outbreak could result in the loss of over 330,000 jobs in Canada, should the public health measures remain in place for several months.

The House and Senate had both been suspended to limit the spread of the virus and were not set to resume until the week of April 20, though now it’s likely to stand adjourned for longer once these measures pass. 

There has been considerable talk of cross-aisle collaboration on this bill, prior to its contents being known.

All parties had agreed to a plan to have 32 members in the House on Tuesday, when the bill will be fast-tracked through all stages and sent to the Senate by day’s end. There will be 14 Liberals, 11 Conservatives, three members apiece of the Bloc Quebecois and NDP, and one Green MP. 

The government will be flying in some key opposition members from Western Canada to take part in the historic sitting, which is scheduled to begin at noon EDT.

The Senate will then reconvene on Wednesday with a similarly limited roster of senators and staff to scrutinize and pass the bill, and the final step — a royal assent ceremony — is expected that day.

“During the recall, steps will be taken to ensure the health and safety of senators and staff involved in Chamber operations,” said the Senate in a statement.

Already in Ottawa, NDP Leader Jagmeet Singh called on the federal government to amend the aid package that will be debated on Tuesday. The New Democrats are proposing to send $2,000 to every Canadian, and $250 for every child, “to give people the help they need now,” saying that some families will come to the end of the month without enough money to pay their bills or rent and that’s “simply not tenable.”

Singh also wants the 10 per cent wage subsidy increased to 75 per cent, calling these suggestions bold measures but proportionate to the situation Canadians are facing.

Scheer, who will be in Ottawa for the special sitting, said earlier Monday that he also wants to see the wage subsidy “significantly” increased, among other increases in the support for small businesses and their employees.

In an interview on CTV’s Power Play, Liberal MP Kevin Lamoureux, who is the parliamentary secretary to the government house leader, said he anticipates that despite the pushes to go further the “high sense of co-operation” will result in the financial assistance being passed into law “within 24 hours.”

“I think that if we agree that the health and safety of Canadians will be put first and foremost and we recognize that all things need to be on the table, that we will weather this situation through time and things will get better,” he said.

With files from CTV News’ Glen McGregor and Evan Solomon 

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