MNI POLICY: Enough Covid Data to Target Relief: Ex-BOC Jenkins

By Greg Quinn

     OTTAWA (MNI) - Global policy makers will begin shifting their focus from

broad stimulus to more narrowly-targeted measures that better align messages

about controlling Covid-19 and restoring the economy, former top Bank of Canada

deputy Paul Jenkins told MNI.

     "It's still 'all hands on deck,' if you like, but the difference today

versus four months ago is you've got four months of data and understanding,"

Jenkins said. "And as things evolve, we should be in a better position to make

calculated judgments and therefore evolve the policy side of it."

     The recovery is too complex and uncertain for policymakers to attempt

social engineering beyond a virtuous cycle of better health and restored jobs,

said Jenkins, who was BOC Senior Deputy Governor from 2003-2010. The IMF and

Canadian Prime Minister Justin Trudeau have viewed the recovery as a chance to

rebuild economies that are fairer to low-income workers and resilient to climate

change.

     "If people are confident about their employment and income levels coming

in, that's going to strengthen their resolve to continue to act in a responsible

way" in the pandemic, Jenkins said. "If you begin to overlay on top of that

issues of restructuring... I think these are longer-term issues."

     Canada may be able to ease emergency measures late this year, Jenkins wrote

in a recent paper for the CD Howe think tank where he is a Senior Fellow. Canada

in the next few weeks may announce rules on scaling back its most expensive

program, CAD2,000-a-month checks for people who lost income and were unable to

claim traditional jobless benefits.

     "You can think about it in terms of modifying or scaling programs back

commensurate with the evolution of health risks," Jenkins said. "But in

modifying the programs, you also don't want to dis-incentivize people."

     Jenkins expressed confidence in new BOC Governor Tiff Macklem, who began a

seven-year term on June 3, saying he expected the Bank to continue to enjoy

"wonderful leadership."

--MNI Ottawa Bureau; +1 613-314-9647; email: greg.quinn@marketnews.com

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