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Government’s response to soaring inflation must reflect the burden it is placing on Island families and include direct relief and new policy measures
Opposition Green Caucus
February 7, 2022

Government’s response to soaring inflation must reflect the burden it is placing on Island families and include direct relief and new policy measures

Hannah Bell, MLA Charlottetown-Belvedere
Official Opposition Critic for Finance

*Originally published in The Guardian

In the Statistics Canada Consumer Price Index report for December 2021, the news for PEI isn’t good. PEI experienced the highest rate of inflation in the country. Our inflation is 5.1% while for the rest of Canada it is 3.4%. PEI has the highest increases in the country from fuel oil costs to housing prices where rental cost increases are four times the national average.

These numbers represent something Islanders already know. They are feeling the real impact of these inflation numbers, especially when it comes to housing, transportation, heating, and food.

And it is not just fuel and housing prices. Household bills and debt are higher across the board. Almost half of Canadian households are only a few hundred dollars away from becoming bankrupt. Most families can barely keep their heads above water. This means an emergency fund is not a real option for most. Many Islanders simply do not have the extra dollars to save for a rainy day after the bills are paid. If COVID has taught us anything, it is that we are only one unexpected event away from crisis.

Inflation is complicated and what causes it is sometimes outside our provincial boundaries. It can be the result of available supply, demands for goods, market conditions, supply chain pressures, the pandemic, and so much more. However, there are things that the PEI government could and should do to help Island households tackle these rising costs.

The recent increase to the basic PEI tax exemption to $12,500 – as part of a platform promise of the King government that cost $4.6 million – resulted in taxpayers keeping an extra $78 per year.

What is not said by government is the fact that this exemption doesn’t help people who earn too little to receive any benefit from this increase in the basic tax exemption. Islanders in this category include many seniors, students, and some employees in seasonal industries like tourism and hospitality. With some experts projecting that food costs may increase by nearly $1,000 next year for some families, this kind of ‘refund’ is not going to help.

That $4.6 million cost could have been better spent to directly help Island families and households cope with the cost of groceries.

Government can no longer kick its response to the rising cost of living down the road. The 2022 budget must reflect the burden inflation is placing on Island families and include direct relief and new policy measures.

Among the measures government must take are:

  • introducing and passing the strongest possible tenancy legislation to protect Island tenants and preserve whatever remains of affordable housing on PEI;
  • delivering targeted financial assistance to those experiencing and those at risk of experiencing poverty and food insecurity, especially in light of our newly legislated poverty elimination targets;
  • scaling up programs that deliver healthy and affordable food options.

Government must also continue to expand access to programs that support Islanders in transitioning to cleaner, greener and more affordable forms of heating and energy. Finally, it must invest in the social programs that provide services directly to Islanders, including childcare, after-school programs, and home care for seniors.

Islanders literally cannot afford to wait for this government to help them. I call on government to act decisively to ensure all Islanders are able to thrive despite our inflationary pressures.

The Opposition Green Caucus of Prince Edward Island provides a crucial role in the governing of our province. The caucus is made up of Green Party MLAs elected by Islanders.

We strive to offer informed and intelligent debate and proposals that are evidence-based and data-informed. Through respect and integrity, we seek to improve the work and efforts of government on behalf of all Islanders.

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