The Liberals begin a three-day cabinet retreat focused on the cost of living and the economy

The Liberal Cabinet today began three-day meetings in Vancouver to flesh out the government’s autumn playbook, with the rising cost of living and the state of the economy high on the agenda as Parliament prepares for MPs’ return.

“Our focus this week, at the start of a busy and important autumn of parliamentary work, is on the economy, hearing from Canadians and working with Canadians to solve the very real pressures they are facing,” Prime Minister Justin Trudeau said on Tuesday Tuesday at an event in Squamish, BC

“Whether it’s making sure we grow the economy, making sure we create good jobs now and in the future, or directly supporting people and the challenges they face around the cost of living, that’s our focus .”

Trudeau said his cabinet will use this week’s meetings in Vancouver to find ways to bring relief to Canadians struggling with the rising cost of living.

Achieving that relief once parliament resumes on September 19 will require balancing the priorities of both the party’s Liberal supporters and parliamentary partners in the NDP.

Earlier this year, the Liberals and New Democrats reached an agreement that commits the NDP to holding votes of confidence with the minority Liberal government in the lower house by June 2025, in exchange for the government meeting a series of benchmarks.

The New Democrats say at least two of those commitments must be met before the Christmas break if the Liberals want the deal to remain intact.

The NDP would like to see the introduction of the first tier of a universal dental care plan that will initially cover families with children under the age of 12 who earn family incomes of less than $90,000. The party also wants a one-time top-up to increase Canada’s housing benefit to $500 and says it wants that increase to be renewed in years to come if the cost of living persists.

Canada’s housing benefit, developed by the federal and provincial governments, launched in 2020 with $4 billion in combined funding over eight years. The benefit is intended to provide direct financial assistance to Canadians struggling with housing shortages.

An NDP official who spoke on background said up to two million Canadians could benefit from the means-tested payments, with the federal government budgeting $475 million for the initiative.

A floor, no ceiling

The deal between the NDP and the Liberals set the end of this year as the deadline for both initiatives. The New Democrats say that so far it looks like those commitments will be fulfilled in a timely manner.

“On those two components, we’re pretty close to where we want to go in negotiations,” a senior NDP official told CBC News by way of background. “I am confident that we will have something to say to the media by the end of the month.”

The NDP views the phase one dental coverage commitment as only a first step. If the Liberals want their deal with the NDP to remain in place, they must extend dental coverage to under-18s, seniors and people with disabilities by the end of 2023, before the program is fully implemented by 2025, according to New Democrats.

NDP leader Jagmeet Singh meets with Prime Minister Justin Trudeau on Parliament Hill in Ottawa in 2019. The agreement, reached between the two parties earlier this year, stipulates that the NDP will support the Liberal government in parliamentary votes, provided the Liberals meet certain obligations. (The Canadian Press/Sean Kilpatrick)

The NDP says those two commitments are a floor, not a ceiling, and they will use opposition days, face-to-face meetings and bills from private members to urge other measures this fall to help Canadians deal with the rising cost of living.

Those initiatives, the party said, include a push to support families with one-off increases in the GST rebate and Canada’s child benefit, a call for more funding to help workers transition to green jobs, and a call for more climate action.

Helping Canadians deal with inflation

While it’s not clear what approaches the Liberal cabinet might discuss beyond raising housing benefits, Prime Minister Trudeau said last week that his government is always looking at ways to ease the burden of inflation.

“We currently have historically low unemployment, many people are employed, but there are still real challenges and we will continue to do what is necessary to support vulnerable Canadians as we move forward,” Trudeau said.

The Prime Minister added that whatever his government does next to address the cost of living, they will be “careful not to do things that will accelerate or exacerbate the inflationary crisis we are facing”.

A proposal in the NDP/Liberal deal would refocus the Rental Construction Financing Initiative (RCFI) on affordable units.

The RCFI is a government program that provides developers with low-cost financing to help them build rental units in areas where supply is low.

The government official said that before, during and after the caucus retreat, Canadians should expect some housing and cost-of-living announcements focused on British Columbia.

Building a green future

In the media release announcing the cabinet’s departure, the PMO said ministers will also discuss how the government can build “a green, healthy future for all”.

The government official said that this discussion will stretch across ministries as the government is keen to ensure that there are good-paying jobs in both the electric vehicle industry and the oilfield.

New Democrats said they met with oilfield workers who fear for their children’s economic future as the economy moves away from fossil fuels.

The NDP said that while it will continue to urge the Liberal government to act on the issue, it will not threaten the deal – although there are some 2022 deadlines in the text of the deal that require action.

The deal requires the Liberals to create a clean jobs training center by this year to support, reskill and redeploy workers, but the text of the deal is silent on what needs to happen for the deal to survive.