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The high cost of living

MHA Tony Wakeham (Stephenville – Port au Port) takes aim at skyrocketing prices

MHA Tony Wakeham is advocating for the province to take more steps to help taxpayers cope with price hikes. – Submitted photo

By Jaymie L. White

Special to the Appalachian

STEPHENVILLE — As the cost of living continues to increase dramatically across the province, there are people forced to choose between necessities to be able to make ends meet. Currently, gas prices stand at a record high 174.9 cents per litre in the region, and food prices have been on a steady incline as well. Being able to manage groceries, heat and lights, and gas for a vehicle is becoming more difficult, especially for those on low/fixed incomes.

MHA Tony Wakeham (Stephenville — Port au Port) has been speaking out publicly for quite some time about the rising cost of living and the effect it is having on the more vulnerable segments of the province’s population.

“There’s a significant problem here that needs to be recognized by government because there are people in our province who are on fixed incomes. There are a lot of people, certainly our seniors and people who are retired on fixed incomes, who generally find it extremely difficult. The prices that are now being charged for food and everything else in this province, partly as a result of higher gas prices and supply chain issues, those are things that government needs to step up with. If they need to target certain groups to do that, then let’s do that.”

Wakeham has been asking for a home rebate energy program to help offset the costs.

“There was such a program. It existed for a number of years and it did work. It did help those who needed it the most and we’ve been calling for that to be re-introduced. Government should know how it works. They’ve had it in the past and I don’t know why the Liberal government hasn’t re-implemented it. That’s something we’ve been asking about.”

Wakeham said that while gas prices are primarily controlled by the price of oil, there are still ways the provincial government can help people out.

“We pay a tax on a tax. I mean, the HST is applied to the taxes that we pay on gasoline, so is that something that government should be looking at? We’ve called for them to actually review their whole gas tax structure. We know that there are more increases coming in taxes because the carbon tax is due to go up again and that is new revenues to the government. And we’ve been talking to them about how, if the carbon tax has to come on, then government needs to find a way to maybe reduce their gasoline tax to keep everybody in our province whole.”

Wakeham said increasing taxes to the point that people have no disposable income doesn’t have a positive impact on the economy.

“If you ever want to shrink an economy, tax it. Every time you take money out of people’s pockets it stifles the economy. People have less money to spend, and if you have less money to spend you start to prioritize more. And unfortunately right now we’ve gotten to a situation now where seniors and others on lower incomes are prioritizing paying a heat bill or buying groceries, and that shouldn’t be the case.”

In response to e-mail inquiries, Victoria Barbour, Media Relations Manager with the Department of Finance issued the following statements on behalf of Minister Siobhan Coady.

“These are challenging times for individuals and families throughout the province, which have been heightened during the ongoing pandemic. We are aware of the impacts the cost of living has on Newfoundlanders and Labradorians and we continue to offer supports to lower income residents. Budget 2021 investments include:

• Over $66 million for the Newfoundland and Labrador Income Supplement, which supports approximately 158,000 individuals and their families annually;

• Approximately $500,000 in new funding for the Mother Baby Nutrition Supplement, which will increase the monthly support for nutritional food during pregnancy and up to the child’s first birthday to $100 – up from $60 per month.

• More than $1 million for continued support of the Kids Eat Smart Foundation, which supports the education, health, and well-being of school-aged children through nutrition;

• More than $11 million is being contributed to NLHC’s Rent Supplement Program, which will be expanded this year;

• Over $220 million on income support payments, and

• $57 million for the Seniors’ Benefit, which supports approximately 49,000 seniors and their families annually.”

Barbour stated there is a program for property owners making upgrades, but that doesn’t offer help for renters.

“As well, government recently increased eligibility for the Home Energy Savings Program – Oil Heat. The household income limit was raised from $32,500 to $52,500. Delivered by the NL Housing Corporation, this program allows eligible homeowners of single, row and semi-detached housing who heat their homes with oil, to receive non-repayable grants of up to $5,000 to make energy efficient upgrades.”

When it comes to gasoline, the department maintains that the provincial tax rate is competitive compared to the rest of the country, and cited the carbon tax as a factor.

“We recognize the cost of gasoline has increased for residents, primarily because of the global price of oil. The provincial gasoline tax has been reduced over the past few years and is currently 14.5 cents per litre which is competitive with the Canadian average. The current carbon tax rate is 8.84 cents per litre on gasoline which is a federal benchmark stringency requirement intended to reduce greenhouse gas emissions. The federal government is encouraging people to think about the environmental impacts of driving gas-powered vehicles; we all share the goal of tackling climate change.”

There also appears to be a plan in the works to deal with poverty.

“To address poverty, food security and the overall well-being of people, it is essential that we consider both economic recovery and poverty reduction together as they are intricately linked. This year, in collaboration with community partners, individuals with lived experience of poverty and the public, we will launch initial steps towards developing a renewed approach to poverty reduction.”

While the prices of many goods and services continue to rise, there may be hope when it comes to heat and light. On Monday, Feb. 14 the province announced that they had signed term sheets for the $1 billion federal loan guarantee and capital restructuring for Muskrat Falls and the Labrador Transmission Assets. The federal government will also be investing $1 billion in the Labrador Island Link.

“This is a historic deal for the people of Newfoundland and Labrador and for all Canadians. It represents the strength of our federation and the important things we can achieve by working together. We can all breathe a sigh of relief knowing our province will now have affordable power rates once Muskrat Falls comes online,” said Premier Andrew Furey.

MP Gudie Hutchings (Long Range Mountains) also praised the deal, saying that it will mean economic stability for residents.

“Supporting the Lower Churchill Projects will provide a reliable and long term source of clean power for people in Atlantic Canada. By working together, both governments of Canada and Newfoundland and Labrador are helping to promote our province’s economic resiliency. Supporting this project and others like it will not only contribute to Canada’s plan to address climate change and affordability, but it will also have a positive impact and a lasting effect for Newfoundlanders and Labradorians for generations to come.”

The Premier said that ever increasing power bills had been a concern for many in the province, even before he was elected.

“Muskrat Falls and the looming worry of doubling power bills has been a top concern of almost every single citizen in our province. ‘How can my bill go from $300 to over $500 a month? I can’t afford it.’ I’ve heard it echoed in every town, bay, and community all over our beautiful province. I’ve seen that worry, in the faces of both young and old, entrepreneurs, corporate citizens, everyday homeowners.”

He added that the pandemic had negatively impacted the financial well being of residents.

“My friends, as we slowly make our way out of the pandemic, many of us feel that we are not out from under the weight of it yet. The economy has taken over two years of punches, and inflation and uncertainty that followed has been brutal. Crippling power bills on top of that would simply be too much for anyone to bear. But if there’s one thing as Newfoundlander and Labradorians that we know about the darker moments is that there is always light. Always, that little beam of hope in the distance, may be faint at times, but is growing brighter every single day in our province. What we sign here today is a big step towards that hope. It’s a big step forward for the people of Newfoundland and Labrador.”

Through this agreement with the federal government, the Premier was confident that power rates would not double.

“Today’s signatures represent the agreement for the $1 billion federal loan guarantee and capital restructuring for Muskrat Falls, in addition to the billion-dollar investment by Canada in our province’s portion of the Labrador Island link. Combined with the annual commitment for NPI on Hibernia, this deal totals $5.2 billion – $5.2 billion to help with the burden and to lighten the load for all of Newfoundland and Labrador. This, of course, is a key part of our government rate mitigation plan that will ensure electricity rates will not double as a result of Muskrat Falls.”

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