Public and private sectors ‘have the opportunity to work together to rebuild even better,’ shareholders told
The chief executive of Toronto-Dominion Bank on Thursday suggested that policymakers should take steps to try to boost the spending of Canadian consumers, who have built up billions of dollars in added savings during the COVID-19 pandemic.
TD president and CEO Bharat Masrani said the public and private sectors “have the opportunity to work together to rebuild even better,” on such things as spurring the growth of vaccine manufacturing and other critical domestic industries.
“Second, with economies showing strong signs of recovery, we should adopt policies to encourage consumers to spend pent-up demand in local economies and support small and mid-sized businesses as they rebuild,” Masrani told shareholders during TD’s virtual annual meeting.
The comments from the leader of one of the country’s biggest banks comes as the pandemic has prevented Canadians from spending money on many of the things they did before COVID-19 arrived. The turbulence caused by the pandemic has also prompted caution among consumers about their finances, which in some cases have been bolstered by the federal government’s income-support programs.
These factors have led to an overall surge in the level of household savings in 2020, estimated by the Bank of Canada to be about $180 billion, or roughly $5,800 per person. While much of that money is held by higher-income households, it is being closely watched by policymakers, as it could be a major driver of the economy’s growth depending on how, or if, it is used.
Finance Minister Chrystia Freeland’s fall economic statement called the increased household savings “a preloaded stimulus” that could be deployed by Canadians. The federal government is also preparing to table a budget on April 19 that could have more to say on its economic stimulus plans.
A survey done in March by audit firm KPMG found that 77 per cent of those polled believed the government should conduct a major economic stimulus program, which was down from 82 per cent in January. Of those surveyed, 93 per cent also said they wanted the government to put in place incentives to “buy Canadian,” which was up one per cent.
Another thing Masrani suggested could be considered as part of the rebuild efforts was working together on training workers and investing in talent.
“Key sectors such as the environment, technology, digital and artificial intelligence are going to create many opportunities, and we must work together to seize them and equip our people to thrive,” Masrani said. “After all, highly skilled talent is the competitive advantage of any economy, and this is true for TD as well.”
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