The increase in baseline federal government spending—up about 2.5 percentage points of GDP since 2015—means the private sector is relatively smaller, contributing to lower productivity and lower investment activity, said former Bank of Canada governor Stephen Poloz during a panel discussion with Bennett Jones adviser and former deputy prime minister John Manley at an Economic Club of Canada event in Toronto Thursday. (The Logic)

Talking point: Increasing investments in Canadian companies is top of mind for Poloz, whom the federal government tapped this spring to lead a working group on the topic. He’s specifically exploring the role Canada’s pension funds ought to play in stimulating business investment in Canada—a polarizing topic that could lead to rethinking of the mandates of funds like the Canada Pension Plan Investment Board, which focuses only on maximizing returns for pensioners. Addressing Canada’s low productivity will be a key consideration for the working group. On the panel Thursday, Manley said Canada’s “failure to really grow companies” is one reason for low productivity. “We’re really good at starting companies,” he said, “we’re not so good at scaling them up.”