Pierre Poilievre pledges to audit Bank of Canada and ban its state-backed digital currency

Conservative Party of Canada leadership candidate Pierre Poilievre has announced he would ban a proposed “central bank digital currency” (CBDC) as well as audit the Bank of Canada if elected prime minister. 

“Justin Trudeau has threatened the Bank of Canada’s independence with a half-trillion dollars of deficits that required the central bank to print money and cause inflation,” said Poilievre. 

Poilievre says that ​​“(m)oney-printing deficits have sent more dollars bidding up the price of goods. Inflationary taxes have made it more expensive for businesses to produce those goods,” 

He added that “(t)he more Liberals spend, the more things cost. That is JustinFlation. I will end it, by restoring central bank independence, mandating an independent audit of all the money printing.”

The Bank of Canada is looking at potentially developing a digital currency, although it would be up to the Minister of Finance whether Canada adopts it or not. According to the bank, private digital currencies such as bitcoin could hurt its ability to “control inflation and act as the lender of last resort.”

Poilievre said he does not believe a central bank digital currency is necessary, citing risks that come with adopting one. 

The bank’s discussion paper says that a “retail CBDC is defined as a liability of the Bank of Canada denominated in Canadian dollars that can be held and transferred in electronic form by the general public.” Electronic money that is held in a bank by retail consumers can be described as a deposit, reads Poilievre’s news release.

According to him, a CBDC would lead to nationalized bank deposits and other banking activities enabled by those deposits. 

His news release also said the Bank of Canada “contradicts itself on whether a Central Bank Digital Currency would pay interest on those deposits.”

Poilievre added that the Bank of Canada would have an advantage over commercial banks because it would have the ability to print money to pay customers better interest rates.

This would lead to customers being forced to switch from a commercial bank to the central bank to receive “free money,” he says in a news release on Wednesday, on top of causing runaway inflation.

Furthermore, Poilievre says that “a central bank would not need to worry about running losses because, as Governor Macklem…