Spiking cost of living on P.E.I. takes centre stage in legislature

The rising cost of living for Prince Edward Islanders topped the agenda during question period in the legislature Friday, as MLAs looked for ways to help make sure Islanders 'are being fed and cared for.'

More funding for social programs on way as short-term measure, premier says  

Filling up your vehicle suddenly cost a lot more on Prince Edward Island Friday. (Shane Hennessey/CBC)

The rising cost of living for Prince Edward Islanders topped the agenda during question period in the province's legislature Friday, as MLAs looked for ways to help make sure Islanders "are being fed and cared for."

"We have the highest inflation rate in the country, the lowest wages in the country, we have a worsening housing crisis," Official Opposition leader Peter Bevan-Baker said during an exchange with Premier Dennis King, who had told him just the day before that he needed no lessons in economics from the Green Party. 

"We have widening inequality and more Islanders — especially after the rise in gas prices yesterday — are struggling to put food on the table. Do you think that maybe you do need some economic advice?"

King said his government would immediately increase payments through social security programs in light of spiking prices, and double the funds put toward the home heating program offered in partnership with the Salvation Army while making more people eligible for help. 

He told the legislature he is looking for ways to help beyond those measures. 

"We're open to any idea that we can implement as quickly as we can, to be as nimble as we can, to cushion the blows [that this] will have on Islanders." 

Russian invasion, post-COVID demand

The price of gasoline, diesel and home heating fuel all rose by a maximum allowable amount of 12 cents per litre overnight, with Islanders spending nearly 14 cents more per litre once taxes are added. 

Analysts blamed the jump on the invasion of Ukraine eight days ago, along with widespread sanctions placed on oil-rich Russia. Pent-up demand for travel and manufactured goods as COVID-19 restrictions ease around the world is also cutting into supply and pushing up prices. 

The cost of 40 litres of gasoline at an Island gas station topped $63 by Friday morning, after a taxes-included hike of nearly 14 cents a litre. (Shane Hennessey/CBC)

Finance Minister Darlene Compton said provincial officials worked late Thursday to brainstorm on ideas for helping cushion the blow. 

She said the government will be "helping seniors in whatever way we can. As far as maybe food vouchers? We're not quite sure. We've already increased some of the social services programs, making sure the food bank has plenty of food." 

Compton said those are "just a number of ways of making sure that Islanders are being fed and cared for."

Gas tax holiday? 

The Liberals had a suggestion. 

In a motion that will be voted upon as soon as Tuesday, they're calling on King to suspend the provincial gas tax to offset the rising fuel costs, especially since gas and diesel prices can have a snowball effect on the economy. 

"It's going to affect our food prices, which are going up drastically," said interim Liberal Leader Sonny Gallant.

Sonny Gallant, the interim leader of the P.E.I. Liberal Party, is calling on the provincial government to suspend collecting the provincial gas tax to offset the rising fuel costs. (Legislative Assembly of P.E.I.)

"We've heard from taxi drivers this morning that taxi prices are going to go up. The bus services, everything is going to go up … this provincial tax, they can do.

"Today the premier asked us for ideas. This is one of our ideas." 

Federal OK would be needed

The province replied to that idea late in the day Friday with a written statement.

"The provincial gas tax is an important source of revenue for P.E.I., as it helps pay for a variety of developments and initiatives in communities across the Island," the statement read in part.

"It is part of a framework that is agreed upon by provincial and federal governments and therefore, any change would need consultation from the federal government."

In the meantime, the statement said, "Government is committed to assist in mitigating the impact of rising costs through various channels across government departments including looking at increased social assistance payments, increased funding to public transit, expanding the criteria to home heating programs, and continuing to work with post-secondary student unions to assess needs."

Guaranteed basic income urged

Down the road, Bevan-Baker said the only ways of really insulating Islanders from sudden price shocks are bringing in a basic guaranteed income and funding more affordable housing. 

"We don't need governing by knee-jerk reactions to things happening on the other side of the world," he said. "We need to provide affordability for Islanders today, tomorrow, the week after, the month after and for years to come." 

Compton responded to that by saying bringing in a basic guaranteed income is not something the province can afford to do right now.

She added that such a move would also need support from the federal government.

With files from Brittany Spencer