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Former Tory MP Del Mastro turns on government over monetary policy

Dean Del Mastro, then a Conservative MP, speaks during Question Period in the House of Commons on March 7, 2012.

CHRIS WATTIE/REUTERS

Prime Minister Stephen Harper's former parliamentary secretary is criticizing the government and the Bank of Canada over monetary policy.

Dean Del Mastro says Prime Minister Stephen Harper, Finance Minister Jim Flaherty and the central bank have encouraged a devaluation of the dollar.

Del Mastro told Peterborough radio station CKRU that recent comments by Flaherty and Bank of Canada Governor Stephen Poloz have had the effect of reducing the currency's value by about five per cent.

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Del Mastro was one of the most fiercely partisan Conservatives in the caucus and was a vocal defender of the government in the House of Commons.

But last year he was charged under the Elections Act accused of improper election spending and resigned from the Conservative caucus.

Del Mastro has said he has done nothing wrong.

In an interview with CKRU over the weekend, Del Mastro said a devalued dollar means higher costs for Canadians.

"The effect of the Prime Minister, the Finance Minister and the Governor of the Bank of Canada coming out and attacking the Canadian dollar was to reduce its value by about 5 per cent over the last two weeks," Del Mastro told the radio station in an interview.

"That means the price of goods everyone has to buy … these things will, over time, go up in price."

The dollar closed out last week at 90.31 cents US.

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The central bank said last week that despite depreciating in recent months, the Canadian dollar remains strong and will continue to pose "competitiveness challenges for Canada's non-commodity exports."

It was seen by some experts as a strong statement that suggested the dollar remains overvalued and further depreciation is welcome.

Flaherty has also noted a weak dollar can spur economic growth by boosting exports, a comment that drew criticism from the Liberals, who expressed similar concerns to those of Del Mastro.

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