Measures could be financed through a one-time windfall tax on corporate profits, MPs say

New Democrat parliamentarians are urging the federal Liberals to address what they say is corporate greed driving a cost-of-living crisis for northern and Indigenous communities.

As record-high prices for food, fuel and heat ripple across the North, Ottawa can lighten the financial load by reforming its Nutrition North subsidy and cutting the GST from home heating, according to northern Manitoba MP Niki Asthon and Nunavut MP Lori Idlout.

They told reporters in Ottawa on Wednesday the Liberals could pay for program reform and offset tax cuts by hitting oil and gas companies, grocery chains and big-box retailers with a windfall tax: a one-time fee levied on unexpectedly large or unforeseen corporate profits.

“Canada doesn’t just have an inflation crisis, we have an inequality crisis and nowhere is that more obvious than in northern and Indigenous communities,” Ashton said.

The MPs held up pictures of eye-popping sticker prices to illustrate their point. Idlout showed a picture of tomatoes selling for $8.19 a bag in Nunavut versus $1.77 in Ottawa.

“Canned tuna is $9.77 in Nunavut versus $2.29 in Ottawa,” she said.

Ashton, holding a receipt for a $346 tank of gas purchased in Pukatawagan, Man., said First Nations in Manitoba are wrestling with fuel prices topping $3 per litre.

“Here, in so many communities where clean drinking water is not available, we have a one-litre bottle of water in Shamattawa First Nation for $7.09. Here in Ottawa, a four-litre bottle of clean drinking water is sold for $1.99,” Ashton said, calling the numbers shocking and unacceptable.

“But unfortunately, they are the reality in many of the communities we represent and many Indigenous and northern communities across our country, and this demands federal action,” she said.

Nutrition North questioned

The Nutrition North program aims to make healthy food and basic goods cheaper for 116 eligible northern communities. The subsidy goes to retailers for a list of eligible products with the expectation stores will pass on savings to buyers.

Idlout suggested the subsidy benefits the retailers but not customers. Inuit Tapiriit Kanatami, in a plan to tackle food insecurity tabled last year, criticized the program and called for its reform, urging Ottawa to implement more rigorous cost-of-living relief measures.

Nutrition North suffers from a lack of transparency and absence of evaluation, making it impossible to say if it achieves its intended goals, despite Ottawa’s claims of success, the national advocacy organization said.

The subsidy applies to everyone, regardless of income, and should instead be targeted to people who need it most, ITK President Natan Obed told CBC News on Wednesday.

“We believe — considering the high rates of food insecurity, the high rates of poverty, and the general disparity in income — that this program could be a more focused social program,” Obed said.

According to Idlout and Ashton, high prices tied to inflation have translated to sky-high profits for fuel and food providers. Canada’s inflation rate, which tracks the rise in prices year over year, hit a 39-year high of 8.1 per cent in July and dipped to 6.9 per cent by last month.

The NDP has accused retailers countrywide of using inflation as an excuse to unnecessarily hike prices and line their own pockets, which the party has dubbed “greedflation.”

This allegation has not been proven. The House of Commons agriculture committee has agreed to probe the issue.

The MPs said NorthMart, the only grocer in some communities, has seen an increase in net earning of nearly 10 per cent from 2020. Critics have suggested a lack of competition has given NorthMart and its parent company a near-monopolistic hold in the North.

Its operations also lack oversight, according to Idlout.

“When I’ve asked questions to the minister of Northern Affairs about when the last audit happened, how the audits happen, it was apparent that NorthMart self-monitors,” she said.

“It is clear that there needs to be a better way to ensure that NorthMart is being held accountable for the program that it’s delivering on behalf of the government of Canada.”

CBC News contacted the North West Company, which owns Giant Tiger, NorthMart and other retailers, but has not received a response.

CBC News also reached out to a spokesperson for Northern Affairs Minister Dan Vandal, who was not made available. Instead, his office supplied a statement saying Ottawa has expanded Nutrition North with $163.4 million, which includes money for new community food programs and a traditional harvesting grant.

“These new measures were co-developed in full partnership and reflect the priorities of Northerners. Our government is also investing in local food production in the North including through community greenhouses,” wrote press secretary Kyle Allen.

Heavy diesel reliance

Meanwhile, high prices have translated to more tax money flowing into government coffers. Coupled with a reduction in pandemic-relief spending, it netted the Liberals $81 billion in “new fiscal room” this fall, according to the parliamentary budget office (PBO).

The NDP wants a proposed five per cent GST cut on home heating costs to apply across Canada, which the MPs said would benefit the North due to heavy reliance on diesel.

“There are almost 300 First Nations, Inuit and Métis living in remote communities that solely rely on diesel power,” Idlout said.

“Nunavut’s power needs are almost entirely met through diesel, which must be delivered in bulk into the community.”

The party could not provide an immediate estimation of how much money the cut would save consumers.

The PBO, which offers non-partisan costing analysis, said a one-time tax of 15 per cent levied on big-box chains and petroleum firms could net Ottawa $4.4 billion over five years.