Facing spending attacks, federal minister Catherine McKenna doubles down on 'social infrastructure' aims

As Canada's gloomy economy hits new and historic lows due to the pandemic, the country's infrastructure and communities minister is doubling down on her government's equality and environmental agenda — despite opponents' accusations the Liberals are trying to "use this pandemic as an excuse to evade accountability" to ram through unprecedented spending.

Far from tightening the fiscal belt during a fiscal crisis, Catherine McKenna said her government is not going far enough, particularly in a moment when the continent is laser-focused on racial discrimination, inequality, and the health threat to the most vulnerable.

That's why the minister of Infrastructure and Communities is looking to a new way of viewing what, exactly, infrastructure is: Not merely bridges, buildings and buses, but also the social institutions that have become essential during the pandemic. She called it Canada's "social infrastructure."

It could include those sectors at the pandemic front lines, for instance in health, transit and the food chain, but also the many community services most shaken by COVID-19 — from deadly outbreaks in long-term care homes, or the education and child-care tasks that have fallen mainly on women because of the economic shutdown.

McKenna spoke Tuesday to Canada's National Observer editor-in-chief Linda Solomon Wood in a wide-ranging online conversation where she spelled out why rebuilding the country's economy after the pandemic must make this "social infrastructure" a priority — initiatives that must include at their centre women, racialized communities, Indigenous people, and the environment.

Minister of Infrastructure and Communities, Catherine McKenna speaks with Canada's National Observer editor-in-chief, Linda Solomon Wood.

One key aspect of what McKenna is reflecting on is equity, particularly around racial discrimination, she said. Specifically citing the current Black Lives Matter uprising sparked by the latest in a string of racist police killings of unarmed Black civilians, the cabinet minister and Ottawa MP said she met Tuesday night with Black leaders and advocates to learn more about how she can be part of addressing systemic racism after she signed on to a letter acknowledging its persistence in the country's institutions.

"Social infrastructure has to be part of our reflection," she explained. "And we need to make sure everyone is succeeding, that we're not leaving behind Indigenous people, we need to talk to the Black community ... I've certainly been reflecting about Black Lives Matter, and systemic racism, which absolutely exists in Canada.

"We are not necessarily putting that at the fore. Whether it's racialized communities or Indigenous peoples, my team and I are now doing a lot more thinking about social determinants of infrastructure. It's not just what we build, but where we build and who we are building for."

It's a different way of thinking about her task as minister, she admitted. But that's because she did not fully grasp the reason her post includes responsibility for communities, she said. And particularly those communities that have seen the worst shocks from the health crisis, historic unemployment, and racial inequality.

"When the economy is going south," she said, sometimes people can be tempted to throw such priorities “out the window."

She told Solomon Wood, “I’ve been heartened that just has not been the case in Canada.”

It’s certainly hardly a heartening economic picture facing her government. According to Statistics Canada, unemployment has nearly tripled to 13.7 per cent (surpassing even the 2008 financial crisis and the 1982 recession), $360 billion has been lost from our global market investments, our stock market has seen a 22 per cent drop, and there's been a 29 per cent collapse in manufacturing sales.

On Tuesday, the minority Liberals' nearly $90-billion COVID-19 spending plan barely squeaked through Parliament with the backing of the NDP, with billions earmarked for infrastructure across the country. But McKenna’s government has repeatedly refused Opposition pressure to release a budget update since March. On Wednesday, Prime Minister Justin Trudeau instead promised a fiscal “snapshot ... a picture of where our economy is right now," and where it might go in coming months. But the "snapshot" won't come for another three weeks.

The Conservatives have seized on the lack of a fiscal update and opacity of pandemic spending to single out McKenna, alleging she and her government are trying to "use this pandemic as an excuse to evade accountability," in a June 8 letter to the Standing Committee on Transport, Infrastructure and Communities.

"The minister of Infrastructure and Communities would be accelerating infrastructure funding to municipalities in response to the financial impacts of COVID-19 on local governments," the Opposition MPs wrote. "Meanwhile, the parliamentary budget officer has said that his office has only been able to account for 33,000 of the 52,000 projects that the government claims to be funding.

"The minister continues to commit enormous sums of money to new projects while there is no accounting for the projects that have been previously announced."

Frequently a lightning rod for Conservative criticism in her previous environment cabinet post, McKenna appears to not be letting concerns about pandemic relief spending temper her resolve. In fact, she said the health crisis has offered a new perspective on shortfalls in Canada's status quo she hopes to address through her infrastructure ministry.

"After all this time through COVID, where we've seen the real challenges in the system, that makes us better placed to build this future," McKenna noted, "as we figure out what investments we want to be making, and what future we want to be building."

With Canadians "really worried" about their health and their loved ones, about seniors and the vulnerable, about whether "businesses down the street are going to survive," or even having a job, "You get a little more focused on what's really important," McKenna mused. "The big thing is really the future we want ... We have to keep that focus."

That lesson, for her, is key after a massive global crisis such as the coronavirus pandemic and its likely years-long shadow. But while acknowledging such "challenges in the system" in the past may have worsened the crisis for many Canadians, what exactly does the McKenna "social infrastructure" future look like to her?

The minister suggests the pandemic did not simply teach Canadians what we shouldn't do. It also revealed to her what government could, and should, do.

With the $90-billion COVID-19 relief package now passed, her government needs to "do more" to seize the societal opportunity, and the lessons of the pandemic, which she confessed have exposed weaknesses in the country's fabric for the most vulnerable.

"That's come to the forefront in COVID, the vulnerable populations. I think we have to do better in terms of that piece," she admitted. "We need to really step back and say, 'Are we getting all these other outcomes? Are we making sure we're building for a more sustainable, more resilient future? Are we making sure those investments are being spread equally so every child or community has an opportunity to succeed?'"

She called the new line of thinking the "social determinants of infrastructure," which refers to long-accepted public health research on the "social determinants of health" — how social and economic inequalities harm different populations' well-being and health.

"There's so much inequality in Canada," she said. "It was clear that we need to work at home (in Canada) because so many Indigenous communities are still living in Third World conditions ... What do we need to do to address systemic racism?"

McKenna garnered some support from the Zoom conversation's audience for that acknowledgement, although one commenter expressed some concerns about how the government would ensure the economic recovery did not merely pay lip service to equity and the environment — but measurably address "historic harms" without "additional burdens" on marginalized communities.

'We cannot be subsidizing (fossil fuels) if we're trying to move to a cleaner future'

Attendees at the virtual event raised numerous questions — and criticisms — of the federal government's climate change strategy. One participant thanked McKenna for "saying lots of nice things" on climate change, and committing to sustainability in infrastructure funding recipients. But many observers in the Zoom conversation were dismayed by some of her government's measures, most notably its contentious purchase of the Trans Mountain pipeline, which McKenna herself has described as "vital infrastructure in Canada’s national interest."

Several asked about Ottawa's purchase of the Trans Mountain Pipeline expansion project (TMX), which has faced environmental and Indigenous opposition, collapsed oil prices, and last weekend, a 190,000-litre spill near Sumas, B.C. The Crown corporation says the release did not damage the environment and was contained to its own private property, but the nearby Semá:th First Nation expressed "serious concerns" for "water quality for Semá:th reserve residents."

Asked about how McKenna squared her oft-stated climate promises with owning and operating national pipeline infrastructure and other reported financial assistance to the country's oil and gas sector, the minister insisted her government has ended all its direct oil industry subsidies as promised, and that the tax incentives that remain are provincial.

"The TMX, I know that was a flashpoint, for some voters a really important point, in the election," she said.

"All of the revenues we've committed to go to the clean transition. I know that many people would love to just have it happen right away, that we would transition immediately. We're working extremely hard, we've got more work to do, but we do need to figure this out — and it's going to be a bit messy. We're not starting from zero here ... a lot of people are worried about jobs."

She said her government eliminated oil subsidies in the federal tax system, but needs provinces "to also be part of the solution," because "we cannot be subsidizing if we're trying to move to a cleaner future. That's not going to get us there."

But she reminded viewers that "whole communities are built around the industry," so making the transition away from fossil fuels is about more than jobs. "If we forget that, I don't know that we'll be able to make the transition," she said.

And while she pressed provincial leaders to act on several issues, from submitting diversity-conscious infrastructure applications to curbing their own fossil fuel tax subsidies, McKenna suggested that a major focus in her efforts has moved to another level of government, away from her previous — and sometimes fraught — relationships with the provinces.

In her previous role as climate minister, she acknowledged there had been significant tensions. During her tenure, with the exception of B.C., conservative-leaning premiers took office from Alberta all the way east to Quebec. McKenna became a lightning rod for conservatives over everything from carbon pricing, to the cost of her travels to international climate negotiations, to the long-standing federal equalization payment system.

McKenna said she had "sadly" faced "a lot of fights ... with certain provinces" in her previous role, lamenting that instead of outcomes that too often "gets you showdowns." After her cabinet shuffle to her current job, McKenna said she's still eager to work with the provinces, but is hopeful she can make progress in her portfolio thanks to the fact that municipalities are often major drivers of infrastructure projects.

Asked if she had advice for where citizens could best apply pressure to ensure governments live up to, or exceed, their climate and social pledges, McKenna didn't hesitate in suggesting the lowest level of government in the country: municipalities, which under the Constitution are subsumed under provincial powers.

"I don't meet a lot of mayors who say climate change isn't real," she quipped. "They're all dealing with floods, coastal erosion, forest fires, and extreme heat. They're all worried about this. But we have to translate that into something real.

"We want the local governments to be coming up with the projects. So you need to push local governments: What are the projects that are going to deliver the outcomes you want?"

After months of social distancing, working from home, and going out only for essentials like groceries and exercise in nature, McKenna said the COVID-19 crisis has truly illuminated much more than the societal gaps and inequities. It has also shown Canadians what is most essential.

"You recognize how important local community really is," she said.

This interview is part of Conversations, with Linda Solomon Wood, sponsored by Canada's National Observer. The segment with Minister McKenna was co-sponsored by the Trottier Foundation. Conversations features topics around COVID-19, the economy, politics and climate change. To see more Conversations, head to our YouTube channel.