A report by the Certified General Accountants Association of Canada today concludes that Canadians are the most indebted people living in advanced countries. Here’s what the report found:
• Canadians have an average debt of $41,740 each – which is the worst among 20 advanced countries in the OECD – with household debt reaching at total $1.41 trillion in December 2009.
• The report also warns that with higher interest rates expected, Canadians will need to tighten their belts if mortgage rates rise even by just two percentage points.
• That means mid-income and higher-income households would have to cut their budgets on discretionary expenses by between nine and 11 per cent to maintain the same levels of spending on the necessities of shelter, food and transportation.
Rising debt will also make it harder for Canadian families to invest in their kids’ education or look after their ageing parents. While the Harper Conservatives’ number one priority is to cut corporate taxes by $6 billion a year, Liberals would freeze corporate taxes in order to reduce Canada’s deficit and make investments that will help middle class families that are being squeezed.
In a speech today, Michael Ignatieff committed a future Liberal government to three main priorities to help families face the challenges of today, while preparing us for the pressures of tomorrow:
• Learning – we will invest in our people to build the best-educated, most highly-skilled workforce in the world.
• Care – we will help Canadian families shoulder the burden of care for loved ones at home and respond to the crisis in our pensions.
• Canadian leadership – we will restore Canadian leadership with a plan that will create a new generation of clean energy jobs and can be emulated throughout the world.