FINA Committee Meeting

STANDING COMMITTEE ON FINANCE

COMITÉ PERMANENT DES FINANCES

EVIDENCE

[Recorded by Electronic Apparatus]

Monday, October 27, 1997

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[English]

The Chairman (Mr. Maurizio Bevilacqua (Vaughan—King—Aurora, Lib.)): I would like to call the meeting to order and welcome everyone. Pursuant to Standing Order 83.1, the finance committee is holding pre-budget consultation hearings to get input for the coming budget. This afternoon we have the pleasure to have with us representatives from a number of organizations. From the Canadian Association of National Voluntary Organizations we have Mr. Al Hatton; from the Child Welfare League of Canada, Mr. Mel Gill; from the Canadian Teachers' Federation, Harvey Weiner, deputy secretary general; from the Canadian Policy Research Network, Suzanne Peters; from the Child Poverty Action Group, Christa Freiler; and from the Learning Disabilities Association of Canada, Roy Cooper.

I understand you have set up a special way to make this presentation. We will start with the Canadian Association of National Voluntary Organizations. Each group should have no more than five minutes, so give us an overview and then we will enter into a question and answer session.

Welcome.

You may begin, Mr. Hatton.

Mr. Al Hatton (Canadian Association of National Voluntary Organizations): Thank you. Thank you also for having a special session on children.

I want to begin where Minister Martin ended in his economic and fiscal update on October 15 in Vancouver. Towards the end of his talk I thought he made a very interesting point, which will lead into how we want to cast our presentation today. He said:

It is for this reason that I stated at the beginning of these remarks that the debate on how the fiscal dividend should be allocated should not be limited to dealing with new investment, debt reduction and tax cuts only as if they were ends in themselves. The decision should be made with the nation's priorities very much at the forefront of our considerations.

A little later on he said:

Some see the discussion ahead as a fiscal debate only. It isn't. It's a debate about values.

And later on he says:

A strong economy is dependent on a strong society.

So we want to talk about the strong society.

Also, in the Speech from the Throne there's a pithy statement at the beginning talking about a “well-performing” civil society. What does that mean?

If we see society as a three-legged stool, one the private sector and business, the second the public and para-public sector or government, and the third the voluntary sector or everything else, then in a sense our concern is that probably for the last ten years we have been devoting the majority of our energy to supporting the private sector. That's fine, but we think it has been at the expense of both the government and the para-governmental sector, and certainly at the expense of the voluntary sector.

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So we would say that the priorities and values of the private sector are paramount, the public sector is receding, and the community is peripheral.

In a sense we've been caught in a political debate where the right is pressing for less government, not necessarily good government, and the left is pressing for more government, not necessarily good government.

We believe it is now time for the federal government to fulfil and go beyond the promises it has made in red book 2, the Speech from the Throne, and the economic update. It's really about reinvesting in community, reinvesting in citizens, and in a sense enhancing citizen participation, and strengthening, if you will, the voluntary sector. That would support 76,000 charities, 1.3 million staff working in this sector, two-thirds of which are full-time, and igniting the volunteerism of over 6 million volunteers a year producing 1 billion hours of volunteer time.

For the record, the majority in our sector did not want 34¢ on the dollar going to debt service. We supported the move towards reducing the indebtedness in terms of the deficit of the federal government, but we did not see the effects of a war on the poor instead of a war on poverty, with massive cuts to welfare, social services, health, and education.

What are the priorities? In looking at the three questions you have asked us to address, we would generally support the idea of some portion of that—you said 50%—going towards reinvestment; some portion going towards targeted tax cuts, which we'll come back to; and some towards reducing the long-term debt very slowly, not aggressively.

In areas like reducing unemployment, why not have targets of reducing unemployment from 10% to 5%? Nobody believed five years ago that we'd get to zero in terms of the deficit. Nobody believes we can reduce unemployment significantly. We would argue that is possible with some very strategic investments.

We would also say that resources should be restored to the CHST so the provinces can carry out some of the specific programs they've been supporting over time.

We need tax incentives to help modest and moderate donations. We applauded the finance committee's last two proposals to encourage large donations and encourage philanthropy in giving through large donations, but we have not yet finished the job in terms of moderate and modest donations.

My colleagues will talk about investments for children. I have three or four other ideas, and then I'll stop.

One of the first areas to be cut when people are looking at cuts to social services is volunteer co-ordination—the people who actually stimulate and encourage volunteers in terms of recruitment, training, and organization. People think volunteers just sort of magically carry out fantastic things with no organization behind them. That's not true. So that would be one area where the government could look at incentives.

Support of pilot projects in community economic development: There is a variety of exciting things going on in small rural communities and urban areas where people have banded together to do all kinds of activity related to community economic development. We have no public policy in this area.

Community organizations want to work in partnership with the federal government and the provinces for a whole series of new job creation ideas. Obviously if our sector has been cut 15% or 20%—and we don't have the numbers, we're gathering them, and it will probably take a few more months or a year. But let's face it, everybody knows about the effects of the cuts. Why can't you reinvest, as you did with the private sector, in the community?

The province of Quebec has some very exciting things going on under the rubric of the social economy. That experience should be parleyed across Canada so we can look at a similar strategy for the rest of Canada.

We are not against being measured in terms of results. We just want to know what the rules are. We can deliver. We can ignite a lot more voluntary action and a lot more community staff working for Canadians in the areas that I think are important in keeping this country together. Thank you.

The Chairman: Thank you very much, Mr. Hatton.

Now we'll move to Mr. Gill from the Child Welfare League of Canada. Welcome.

Mr. Mel Gill (Child Welfare League of Canada): Thank you, Mr. Chair.

I also welcome the opportunity on behalf of the Child Welfare League of Canada to make this presentation.

I wear two hats in this regard. I'm also executive director of the Children's Aid Society of Ottawa-Carleton, and I want to talk a bit about the way in which federal financial decisions have impacted on the front-line services.

Before I do that, I refer you to a document that I provided to the clerk, called “Investing in Children: A Framework for Action”. This is what a comprehensive national agenda for children might look like, and we offer it to you for consideration.

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We commend the federal government and the provinces for their commitment to developing a national agenda for children. I understand there's considerable work going on at the bureaucratic level, at the officials level, in that regard.

This document emanated from a conference in late 1996 that had some 1,200 participants from across the country, from all sectors of the economy and the social and health services sector. It has been endorsed by some 24 or 25 national organizations, and other endorsements continue to come in. It provides a guidepost for federal, provincial, and municipal decision-makers.

The first one is that the well-being of children and youth should be a key focus of legislative and policy decision-making. The second is that investing in children makes good economic, social, and business sense, and is essential to economic prosperity and social stability. The third is that even the strongest economic and employment performance will need to be supplemented by income support and taxation programs that provide for the unemployed and redistribute income.

The next is that income-based measures designed to alleviate poverty will not in and of themselves solve all of the problems of children. Access to well-co-ordinated, community-based services, such as early childhood education, adequate child care, and recreation, is essential for all children. Early investing in children has been demonstrated to provide significant returns on investment through savings in future social health, educational, and justice costs.

Finally, recognizing that government can't do everything, we've suggested a number of things that communities, businesses, individuals, people in media, and labour unions can do at the community level to enhance the well-being of children.

With that broad outline, one of the things those of us in the voluntary sector and the human services sector have often been criticized for is not offering ways of financing the programs we suggest—that we're always talking about spending without identifying ways we might in fact raise some of the revenue necessary.

I'm going out on a bit of a limb with this, because I'm not an economist and I don't pretend to have all of the answers here, but the first premise has to be that when you're looking at spending on children, you need to look at it as an investment, not as sunk money that doesn't have a return. There are, throughout this document and in footnotes, examples of how dollars invested for children's services in fact have an economic, let alone a social, return for the country. We contend as well that addressing the social deficit in this country is as important as addressing the fiscal deficit and debt.

With respect to economic policy, we're proposing an economic policy that would develop a government deficit and debt reduction strategy incorporating low real interest rates and moderate inflation and wage growth, more than 0% to 3% inflation growth. There is substantial evidence in other OECD countries that those countries with inflation in the area of 3% to 4% generally perform better than countries with lower inflation rates.

It also would incorporate a minimum tax on wealth and a progressive tax on wealth transfers in excess of $1 million. This country has something in the order of $1 trillion that will pass from one generation to the next within the next 20 or 30 years. There is some onus on the part of those who have benefited the most from this country's enormous wealth to contribute back to the country. If you simply took 50% of that $1 trillion and applied it against the debt through a wealth tax, the federal debt would be virtually eliminated.

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We recognize that there's a flight of capital issue here, and we're proposing that there be some increased protection for that.

Clearly there should be a correction of tax inequities of modest- and middle-income families with children. Again, those countries with less disparity between rich and poor have tended to fare better on economic growth than those without.

Also, there should be a substantial commitment to physical and social infrastructure projects for job creation. There is a note at the back of this document in explanation of that, but let me say three other things.

At the front line of services, the decision to eliminate $7 billion from transfer payments to the provinces, and the decision before that to put a 5% ceiling on growth for the three richest provinces, has had an enormously deleterious effect on front-line services. All of you will have an appreciation for the difficulties that child protection services are in across this country. There have been inquiries in B.C., Ontario, New Brunswick, and Manitoba into child deaths.

As a result of those decisions, front-line services have been cut back drastically. You can't pretend the provinces have more spending discretion by transferring tax points if the total amount of money they have coming into their operating revenues is going down. In fact their discretion is narrowed, not broadened, by that kind of approach.

We've suggested very specifically that as a first priority, the government look at reinvesting the $7 billion into targeted rather than universal programs—early childhood education, prevention, and early intervention programs—and that that amount of reinvestment at the very outset should be an additional 0.75% of combined federal-provincial revenues.

Another area that is grossly underfunded, particularly in the broader children's sector, and in child welfare even more particularly, is research. We need a national research strategy around children's issues. We're suggesting a very modest 0.01%, which is $35 million, of additional spending on research in this area. We commend the government again for its decision to establish centres of excellence for children, but that's $20 million over five years—not nearly enough.

I'll give you one further example where there's tremendous support across the sector, and that is the reallocation to crime prevention of 1% additional of the total expenditures on criminal justice across the country per year until you reach 5%. Again, if you look at some of the explanatory notes here, you'll see that the Quebec model of implementation of the Young Offenders Act has produced substantially less cost with better results than any other province across the country.

These kinds of things can be done creatively, and we encourage you to look at them, but with the emphasis on reinvesting to reduce the social deficit that's been created by the slash-and-burn policies of the last few years, as well as addressing the fiscal deficit and debt.

Thank you very much.

The Chairman: Thank you very much, Mr. Gill.

We'll hear from the Canadian Teachers' Federation, Mr. Harvey Weiner.

Mr. Harvey Weiner (Deputy Secretary General, Canadian Teachers' Federation): Thank you, Chair. We, as well, are pleased to be here in the capacity of discussing children's issues.

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We see in our society, on a day-to-day basis, very strong, well-organized lobbies on health issues, seniors' issues, etc. The voice of children is a voice that is certainly not heard often enough or with sufficient strength.

As teachers—and we represent 242,000 teachers across this country, teaching in elementary and secondary schools in every province and both territories—we see on a day-to-day basis the baggage that young students bring with them to school. We feel it is time we began to look at children's issues on the basis of the needs of these young people, because they are the future taxpayers, the future leaders, the future citizens who will be determining the strength and the success of this country as we move into the 21st century.

We often forget that it is these children, as adults, who will be paying the taxes, who will be supporting the pensions we hope to have when we reach the age of retirement, who will be supporting the kind of health system we hope to have when we are in need of health services, etc.

So, coming back to a theme that is resonating around this table, we look at children's issues from a perspective of investment rather than a perspective of expenditure.

One of the key problems that has not yet been overcome is the jurisdictional problem. When we talk about children, it seems the federal government looks at jurisdiction as prenatal to perhaps about age five or so. Then the youngsters go to school from age five to about 16 or so, and they drop off the federal map and into the provincial map. Then suddenly, when there's a transition to work or the labour market, they're again a federal responsibility.

We say this is nonsense. The federal government has to develop partnerships with both the provinces and the communities at large—and we're pleased to see it has begun to take some leadership in this area—partnerships that we around this table believe must be enlarged to include the voluntary sector, the non-governmental sector, in building and developing sustainable plans to ensure that every child born in this country has a full opportunity to become a healthy, productive, self-sustaining individual contributing to his or her community. It is in this way, we would suggest, that a lot of the expenditures that governments are currently involved in will be substantially reduced. So we are truly talking about an investment.

To borrow some of the jargon of the day, when we talk about human resource development or human resource investments, the human resource doesn't begin to exist at age 16 or 17. The human resource begins to exist from pregnancy onward. It is how healthy the development is of that embryo and that child, when the child is born, that will determine to a large extent the capacity of that young person to be the kind of citizen we would like to see every youngster in Canada become.

Abundant and ample research has been done in the world on these particular issues to show that the first two or three years, if not earlier, are the most critical in terms of the child's development—the development of the brain, the neurons, etc. The research is there.

The Canadian government has been investing, through Human Resources Development Canada, in a study that we are proud to have worked on: the National Longitudinal Survey of Children. It is a critical research study that must continue to be funded, a study that will be tracking more than 20,000 youngsters to adulthood. It has already begun to produce a lot of results that indicate quite clearly that targeted investment in a number of areas could in fact save substantial dollars for Canadians and produce, again, the kinds of citizens we would like to see.

The people you have around you today at this table and others working in the voluntary sector have considerable expertise in the day-to-day services that young people need. We are recommending very strongly that this committee, in its report to the minister, in making recommendations on investment—sustainable investment in youngsters—put forward the notion that a true partnership must involve the organizations around this table and others in building an agenda that is going to make a meaningful impression on the kinds of problems we deal with day to day.

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Let me conclude by saying we recognize around this table that we cannot achieve all of our objectives at once, that there are not obviously—and we recognize this—adequate dollars to put into a budget to address all of the problems at once. But if we don't start today, we will have to start tomorrow or the day after, or the cycle we see of poverty, of problems of various types, will continue to perpetuate itself.

We are very strongly recommending therefore that this committee, in its recommendation to the minister, make reinvestment in our children, the future of this country, the highest priority.

Thank you, Chair.

The Chairman: Thank you very much.

Now we'll move to the Learning Disabilities Association of Canada. Mr. Roy Cooper.

Mr. Roy Cooper (Learning Disabilities Association of Canada): Mr. Chairman, members of the committee, thank you very much for inviting the Learning Disabilities Association of Canada to appear before you today.

I have to point out that I feel I am different from most of the others around the table in that I have been a volunteer with the Learning Disabilities Association of Canada, the Learning Disabilities Association of Ontario, and our local Ottawa-Carleton chapter for 20 years. I first became involved with the association because one of my daughters has learning disabilities. So I have a personal stake in what you do to provide for the needs of future children who will enter the world and have learning disabilities.

I would like to begin by stating that the Learning Disabilities Association of Canada is pleased with this government's deficit reduction achievements. During the past few years the government faced tough decisions and made difficult choices. Without its leadership and vision of the future we would not be here today discussing forward-thinking priorities.

In the global and competitive economy in which we live, we believe the future of our nation relies in part on the investment we are willing to make in children and families. For many years it was believed that 10% of the population head learning disabilities. Current research in the United States of America shows that this number may be as high as 20%. Research also shows that the earlier the diagnosis and intervention, the better the outcome.

At the Learning Disabilities Association of Canada, and as the parent of a child who has learning disabilities, I can tell you that we live with this every day. It is astonishing to us that in Canada very little, if anything, is done to address the fact that 70% of young offenders have learning disabilities. This does not mean that learning disabilities inevitably lead to criminal behaviour. What it does mean is that without early diagnosis and intervention, far too many young Canadians with learning disabilities tire of going to school, tire of not being able to keep up with the class, tire of being told by their teacher that they are lazy, dumb or stupid. It also means that as a nation we end up paying between $70,000 and $90,000 per year to keep one young offender with learning disabilities in custody.

The Learning Disabilities Association of Canada has a national constituency with over 10,000 members in every part of the country. Unfortunately, not all those with learning disabilities belong to our association, because then we'd be talking in excess of 3 million people. It seems to us that our hard-earned tax dollars would go much further if this money were invested in early diagnosis and intervention instead of waiting for crime to happen and simply dealing with it by incarceration.

We urge you to demonstrate the same leadership and vision you have during the past few years by: ensuring that all teachers receive training on children with special needs before graduating from teacher preparation programs; making it mandatory that every Canadian child who falls behind by one year receives an assessment by a psychologist or educational psychologist; providing young offenders who have learning disabilities with targeted programs and support needed to help put a stop to criminal behaviour; supporting families who need to hire tutors, send their children to remedial classes or buy specialized software for their children; investing in research to help identify environmental contaminants that affect neurological development of the fetus and the young infant; encouraging Finance Canada to work with the Learning Disabilities Association of Canada to clarify and improve the disability tax credit guidelines where learning disabilities are involved.

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While we recognize that some of these recommendations would require federal government involvement in new areas, and to work co-operatively with provinces and territories, we recommend that you consider the alternative, which is the financial burden of carrying 20% of our population with learning disabilities for years to come.

I thank you for your time and attention.

The Chairman: Thank you very much, Mr. Cooper.

Now we'll move to the Canadian Institute of Child Health. Dr. Graham Chance, welcome.

Dr. Graham Chance (Canadian Institute of Child Health): Thank you, Mr. Chairman and committee. With me is Ms. Jenny Tipper, also from the Canadian Institute of Child Health.

Mr. Chairman, while the deficit was being successfully brought down, the number of Canadian children living in poverty increased by 400,000. The number of food banks nationally rose to 460 attended by 2 million Canadians, including 900,000 children. The income gap widened to be the third highest among OCDE countries and the proportion of young people unemployed or living in poverty progressively increased.

Clearly, the social safety net, which was designed to protect the dignity of Canadians, developed large holes. If we as a society value our values of compassion and tolerance we must conclude that the deficit reduction had adverse impacts on vulnerable people in Canada. Consequently, the Canadian Institute must assert that Canada is failing to honour the commitments it undertook as a signatory to the United Nations Convention on the Rights of the Child.

Guidance in answer to the question of priorities for spending issues was given by the Prime Minister in his September throne speech when he stated that children must remain at the top of the agenda. From what I've just stated, it is clear that children are not yet at the top of the agenda, but we agree they should be placed there. As the Prime Minister also commented, we owe our greatest obligation to our young.

My colleague from the Canadian Teachers' Federation has stressed the need to invest in human capital. Wherever else spending increases might be considered, there is no question that the greatest long-term value will accrue from investments in the young. Research over the years, as he has stated, has proven without question the value of investment in early brain development and has indeed shown the profound impacts of environment on the growth of a child's brain. This value, the value of investment in the young growing child, has been shown to outweigh any other form of economic investment.

Specifically, then, the Canadian Institute would recommend that the investment in the national child benefit should continue but should be fully indexed to inflation and not tied to parental employment status.

In Canada at present the elderly have resort to the CPP, working-age Canadians have their unemployment insurance, but from the child point of view there is no comparable fund. We would therefore agree with Campaign 2000, that a comparable social investment fund for children should be created to ensure a decent standard of living for modest- and low-income families, accessibility of Canadian children and their families to comprehensive and nurturing early child development, child care, and parent support programs.

Job-protected parental leave and benefits should be expanded, recognizing again the critical importance of parental time—which is at a premium in this country—spent on young children. We commend the implementation of the centres of excellence, but along with the Canadian Teachers' Federation we would recommend that it be expanded and accelerated.

A national system to monitor and report on the healthy developments of all children in Canada—a national children's report card—should be developed so that society in Canada can know in detail the health of our country's children and the impact of economic and social actions taken by governments.

We recognize that in implementing a national children's agenda the federal government will be working jointly with every province. We urge the federal government to continue to demonstrate leadership in this area and build on the past collaborative successes, such as community action programs for children.

Society's attitudes and values must acknowledge that children neither determine the circumstances of their birth nor the environments in which they grow. For the quality of life, as we know it in Canada, to survive globalization, the needs and well-being of children and their families must be given first priority. We truly believe that then, and only then, will the other priorities of society be ordered correctly.

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Thank you.

The Chairman: Thank you, Dr. Chance.

We'll now move to the representative from the Child Poverty Action Group, Christa Freiler.

Ms. Christa Freiler (Child Poverty Action Group): The Child Poverty Action Group is a public interest policy and research organization that began in 1985. That was even before anyone in Canada agreed there was child poverty in this country, and we were one of the founding members of Campaign 2000.

I want to begin by addressing the deficit reduction process question and the phenomenon that some people have called the triumph of the fiscal imperative, which is the view that the fiscal deficit is and must be the nation's priority and that we have no choice but to cut social programs. I will later contrast that with what we're calling the social imperative, the perspective that we need to assess human needs and investments in people and that these should determine our economic priorities.

In 1994, almost exactly three years ago, the Child Poverty Action Group was one of a number of public interest organizations that argued that Canada's fiscal crisis was not the result of an unaffordable system of social programs. We demonstrated that Canada had neither overprovided nor overspent on social programs, but rather this country had undercollected relative both to our capacity to collect revenue and compared with other industrialized countries.

It is now well known that during the period from 1976 to 1985, a majority of advantaged middle-income Canadians, as well as Canadian corporations, enjoyed a tax holiday that resulted in a serious decline in public revenue. This is relevant to the situation now as well.

For two decades Canadians were subjected to distortions about the source of the fiscal deficit and bombarded with the notion that we pay too much tax. This is not a new situation. The evidence, however, does not bear this out, not now nor then.

Equally important, contrary to media reports, the public is not demanding tax cuts. In fact, during the last federal election only 7% of Canadians stated that keeping taxes as low as possible was their first priority. Canadians understand that they have to pay to keep their social programs and to address national priorities, which they themselves have identified, such as child poverty.

What has changed since 1994? Well, one important change is that the federal government has made significant progress in reducing the fiscal deficit and a post-deficit surplus is being projected. Canadians are being told there will be enough money for both investments and reductions in the future.

What has not changed? What has not changed is that, although less explicit and therefore less transparent, the struggle is still between the social imperative and the fiscal imperative. We should not assume that there will be enough money for debt reduction, tax cuts, and social investments, as much as we would all love to believe that. The size of the post-deficit surplus is probably being overstated by the tax reduction proponents in order to convince us that there will be enough money for both, or even all three, but that reductions should come first. This time around—and I mean in this coming federal budget—the fiscal imperative must not triumph as it did in 1995. We would argue for the social imperative taking precedence in the 1998 federal budget.

The case for social investments in children, youth, and families has already been made in the federal throne speech and is strongly supported by a majority of Canadians, and obviously all of the people around this table. According to public opinion polls, Canadians believe that investing in children and young people is an important priority.

On the other hand, tax cuts will deprive the federal government of the revenue needed to make social investments in children and families, and tax cuts will increase the likelihood that social spending cuts will be seen to be necessary the next time Canada experiences a serious recession.

Why should child and family poverty be a national priority? Canadians have indicated that child poverty should be a priority because they understand the devastating impact, which some of my colleagues talked about already, on the lives and life chances of almost 1.5 million children and their parents. Canadians are in effect telling our governments that they will not tolerate squandering the lives of another generation of Canadian children.

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But child poverty should also be a priority for governments and policy makers because it's a symptom of other problems: a symptom of a labour market with a shrinking number of decent, secure jobs; a symptom of a social security system that has had to simultaneously compensate for falling market incomes and contend with spending cuts; a symptom of a fragile and underdeveloped set of family polities in Canada that treat children as a private responsibility rather than a shared one between the parents and society; and finally, a symptom of the fact that women in Canada are not adequately supported as either mothers or workers. The relationship between child and family poverty and economic vulnerability of women with children is not accidental.

In conclusion, we support Campaign 2000's contention that children must have first call on the social dividend. Campaign 2000 made a presentation to this committee in Toronto on October 20. We support, as do other people around this table, the development of a national children's agenda, but one in which the federal government plays a significant role and to which it makes a fiscal commitment.

Indicators of movement toward these goals in the 1998 federal budget would for us include the expansion and improvement of the national child benefit system as first announced in the 1997 budget. The $850 million down payment in the 1997 budget is an important first step, and we must recognize that. We would expect the second instalment of $850 million—that's what I have here; we should be so lucky—in the 1998 budget in view of the magnitude of the investment required. A federal investment of $2 billion, which is what some people think is the end point, clearly is not enough to make a dent in both alleviating and preventing child and family poverty.

The second indicator of movement toward this goal would be to make early childhood education and child care a priority of the national children's agenda.

The third would be to state a commitment to introduce other needed elements of the national child poverty strategy, such as a child support advance maintenance system, and, as a couple of people have already suggested, a family leave or family supplement program that recognizes the importance and legitimacy of raising children.

Fourth, I support the Campaign 2000 recommendation to introduce a social investment fund in recognition that a new approach is needed to pay for the required investments in families with children.

Thank you very much.

The Chairman: Thank you very much, Ms. Freiler.

We will now move to the representative from the Canadian Policy Research Network, Suzanne Peters.

Welcome.

Ms. Suzanne Peters (Canadian Policy Research Networks): Thank you.

I come to the table in the midst of a research project that's trying to understand in a very lateral way, across programs and policies, what might work together. I come to the committee trying to look at that problem from a very long-term perspective with the sense that the kinds of investments we can make today are the beginnings of what we can achieve over the longer term.

I think the reality we all face is that the current policies in place are largely informed by top-of-the-mind public opinion polls—they tell us only superficial judgments—and that the policies and programs we are looking at are reactive. They have been put in place as responses to crises. We haven't thought through how they connect and what are the reciprocal effects.

We also understand that they're scantily evaluated. While we have very good research, as my colleagues have suggested, on some of the basic determinants of what's wrong with children, we don't know very much about how the programs we actually have in place work, and what makes a difference.

The problems we have in place, when they are evaluated, also tend to deal with outputs, what the program is doing, and not with outcomes. I would say that the national children's agenda is making a very big stride forward under the national child benefit to assess outcomes of child poverty.

Finally, one of the biggest problems we have in this whole long-term view is that there is very little that allows for feedback and adjustment in the system. I come to the project with the notion that we have to base our future actions on a sense of what the public's values are; on what is the deliberated kind of public judgment in this country; and on the kind of excellent research we have in place and need to put forward.

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From that point of view, an ideal societal strategy would be much more explicitly responsive to deliberated values and judgment. It would be interconnected and systematic, taking into account the ways in which programs and policies affect one another, and it would use our resources to best effect. It would be evidence-based and would look at effectiveness sharply. It would be outcome-driven and self-correcting, using those values and that evidence to get to better results over the long term. It's essential.

I take this as a starting point, and when I look at other countries, as the study we're involved in does, both internationally and interprovincially, it's clear that societies that invest strategically in children are getting better outcomes.

So if we look at different countries with their different strategies, we have choices in front of us in Canada. They are getting better outcomes than we are in Canada as a whole. Particular provinces in this country, including Quebec and Saskatchewan, are making strategic investments and are getting better results. We need to think about those models and how they can inform what we can do in Canada as a national strategy.

In a study over recent months, I've tried to look deeply at how Canadians would deliberate and develop a best-policy mix, essentially for a town that I asked them to construct. I asked them to think about the kind of place they want to live in and about what they would do for children.

One of the things that's clear from this research is that not only are children a priority in the sense of being at the top of the public opinion poll, but when you give Canadians the chance to evaluate those expenditures we make on children in contrast to the expenditures we're making in other areas, there are two reactions. Number one, they're surprised at how little we're spending on kids relative to other areas, and number two, they're willing to make larger investments. They want outcome results. They want that money to be used well and they're willing to make that investment. They see it as more important than getting a tax break.

We all know this happens in the context of a lot of distrust and a lot of skepticism that government can achieve these kinds of results. The decline in the sense of trust—that this can be just handed over—is there and it's in front of us all. It's in front of the researcher as well as the government.

They do expect us, however, to find a way to collaborate across sectors, and they expect governments to find a way to collaborate to put children at the top of the priority list.

Let's look for a minute at what they expect governments to do...not to do it alone. They do think communities are important and families have to be supported. They want the three levels to work together. They offer incredibly broad support for the kinds of infrastructure spending we're already doing in health care and education. If I don't put it on the list, they say, “Wait a minute.” If I put it on the list, they say, “Why do you bother to ask us to debate this? It has to be in place.”

They reject very few proposed programs on the basis of cost. If they reject a program, it's because they either see it as too restrictive in that it cuts down on parents' options or as regressive in that it cuts down their choices as to where they are in their current ability to be in the labour market and to raise their children.

There's a tremendous emphasis on prevention, that is, in going upstream and making those investments for very young children. What's surprising from this study is that there's a tremendous emphasis on making certain that we reach all children, not just children at risk. One of the things that comes out of the study is the awareness that every child is at risk and in uncertainty, given the uncertainty of families in relation to the labour market in Canada today. That suggests that they support a universality in services. They accept that there must be targeted services in place for people at special risk, but they want accessible services across the board for all families in response to the difficulties families are facing in just holding on to a job, in staying in the labour market, in making the most of their resources, and in keeping track of the kids.

They want flexibility. They imagine communities as anchors. They think of communities as places where parents help to decide, where parents help to deliver, and they see governments as part of that package. Therefore they want flexibility. Not every community in this country is the same. A national strategy or a national children's agenda must offer them the capacity to flexibly design what will work for their communities.

They want to make sure that no one falls through the cracks. The income support issue is the issue where you have the least resolved public judgment in this country today. They want that national enriched children's benefit. When we give them a list of options, that's what they choose, but they want those supplements offered in a context whereby families do not face barriers to being in the labour market.

They are divided on how to support labour market interaction vis-à-vis child care as a formal system, on whether or not we need to create tax breaks to support parent options in child care and on whether income supplements should be in place for families whose members stay at home.

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I honestly have to say to you that there is no resolved public judgment on that issue. It's the one they say is primary. It's systemic, that every family faces, but they know and recognize, as they begin to deliberate and trade off these options in groups, that they themselves haven't come to a resolution on that particular conflict and that we as researchers and as the voluntary sector and as governments have to help them work through some of those choices.

I think the findings of this study—and they are midstream—suggest that as a country we are ready to make larger and more strategic investments in kids, and we need to begin to engage citizens more deeply and more widely in a process whereby we can understand what they want to do, resolve some of these conflicts, and generate a new social pact across stakeholder groups.

If you look at the international evidence, if you look at Quebec in terms of the Projet de société, it's when everyone comes to the table and makes decisions together that you begin to see progress on major fronts of this kind.

We need to begin to think about the basic core pieces that Canadians have said to us are important, that is, the broad social infrastructure, addressing poverty, creating community anchors for services, and creating new options to support that interface that almost every Canadian with a child is facing: how are they going to maintain employment?

Finally, we can begin to think, as we think through the learnings of what is the best mix, of how we construct and evaluate pilots that teach us about the effectiveness of what works, and we use those pilots not just as microcosmic research evidence but as a platform to go back to the public and say this is working and it can work in your community too. We need to try these things out. We can make a difference. We can create greater public learning, greater awareness, and we can begin to develop social cohesion around issues like children in this country.

I would agree with my colleagues that the social imperative, as Christa put it, is in front of us, that Canadians are with us on that front, but they need help and support. There's more work to be done, and we must see this as a long-term path to a societal strategy that can begin in 1998 but must cover future years.

Thank you very much.

The Chairman: Thank you very much, Ms. Peters.

Now we will move to the question and answer session, and I'm sure from your excellent presentation some very interesting questions will be asked.

Mr. Harris.

Mr. Dick Harris (Prince George—Bulkley Valley, Ref.): Thank you, Mr. Chairman. Just so I get an idea here, other than Mr. Cooper, is anyone else here as a volunteer representing the organization and not as a paid representative of that organization?

Mr. Gill.

Mr. Mel Gill: I'm a volunteer with the Child Welfare League of Canada, paid to work in the field.

Dr. Graham Chance: I'm chairman of the organization, but I'm totally a volunteer.

Mr. Dick Harris: Thank you.

I was listening to the presentations, and I want to comment on one thing and maybe ask a question. There was a lot of concern over the government's “slashing and burning”—it was mentioned a couple of times—as they sought to decrease the deficit.

In fact, the numbers will bear out that of all the deficit cutting in the years 1993 to 1996, only about slightly over $2 billion was actually cut from CHST entitlements. So what I'm saying is, I don't know if the slashing and burning of social programs can actually describe the huge bulk of deficit cutting that the government has done over the last couple of fiscal years. I tend to think, given the actual numbers, there may be an exaggeration there.

Also, I have a couple of specific questions, one for Mr. Gill. Mr. Gill, you talked about a social deficit. Briefly, why do you think we have a social deficit?

Mr. Mel Gill: There's a social deficit because we have increasing numbers of children living in child poverty. We have an enormous increase in the numbers of abused children coming to the attention of organizations like mine. The incidence of child abuse in the community is substantially higher than the incidence of AIDS or cystic fibrosis or a lot of those other things, and yet there's no research money put into that area.

We have increasing numbers of kids ending up in the criminal justice system. Those create social deficits, learning disorders, and so on.

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Mr. Dick Harris: So what you're saying is that it's been the cutting of spending to social programs that's causing this, then.

Mr. Mel Gill: It's certainly contributing to it.

I would take issue with your $2 billion. That may be what's been cut out of the CHST, but when you consider that the Canada assistance plan, which was in place prior to that, used to cost-share 50-50 on child protection services and many other services at the community level, that's been pulled out.

Prior to that, there was a 5% growth ceiling on Canada assistance plan shared costs for services like that for Alberta, B.C., and Ontario.

Mr. Dick Harris: The massive deficit spending pretty well stopped somewhere around the year 1992-93. For about 20 years prior to that, we built up a huge annual deficit because the government was providing money for just about every function of our country that you could imagine.

I guess I'm finding it hard to rationalize if this social deficit is.... Do you consider it to be just a new thing? In fact, if it's not a new phenomenon, then what caused the social deficit that we had, say, 10 or 15 years ago, and all the social problems we have now, when we had money for everything? Why did we have a problem back then? Did we have a problem back then, or is this just something new because the government is starting to get its bank in—

Mr. Mel Gill: I think it's been growing. Christa Freiler already indicated, as Statistics Canada did in the 1991 report, that only a very small portion of the current accumulated debt is as a result of transfer payments or payments on behalf of social, health and education programs.

Ms. Christa Freiler: Two things.

In the research literature, the comparative social policy literature, Canada is commonly referred to as a social policy laggard. “Laggard” means we're away behind anyone else. So if there was a social deficit prior to the CHST, which there was, it's because Canada has never distinguished itself by spending a lot, or even a reasonable amount, on social programs. European countries—and I think Suzanne was alluding to this—have always spent considerably more. I'm not talking just about Sweden.

So the social deficit is a long-term problem that has been exacerbated recently.

The $2 billion that you're identifying is the first time I think any one of us around the table has heard about $2 billion. All of the available information is that $7 billion will have been cut from the Canada health and social transfer by the time it comes to maturity and that it is the single largest contributor to the federal government's deficit reduction strategy.

Mr. Dick Harris: Mr. Weiner, I listened to your presentation and I found one thing really unsettling. It was the fact that all through your presentation, talking about the kids and stuff, not once did you mention the word “parents”. You talked about organizations like this around the table, dealing with parents' problems. You talked about federal jurisdiction being transferred to provincial jurisdiction and back to federal jurisdiction.

In your grand vision of how kids should be raised, do you see a place for parents to take responsibility? Or was that just an accidental omission?

Mr. Harvey Weiner: As a parent, obviously I consider that there is a very important place for parents in raising children.

I'm actually very pleased that you asked the question, because not only has the number of parents, percentage-wise, in this country gone down, but so has the number of children that parents tend to have. I think we have to develop a new mind-set in this country, that these are not your children or my children, but these are our children.

The organizations that you see around the table here and others that are not here—which are representing parents, in some cases specifically, but parents working as members of these organizations to deal with these very real problems that children have—are going to need not only the understanding but the help, assistance, and participation of those who don't have children any longer or never had children, because they are our children and they are the citizens of the future, who will be providing us, we hope, with the standard of living we would like to have in our retirement years.

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Mr. Mel Gill: I refer the member to the preamble in the domestic violence and children document. It really outlines the assumptions we operate on. Clearly families have a primary responsibility, but there are residual roles for communities and the state.

Mr. Al Hatton: Just a quick comment, Mr. Harris. If in fact you track the cuts over various departments, some of which ostensibly are not under Health, such as Heritage, which used to support voluntary action...that department was wiped out. Human Resources Development sent hundreds of thousands of dollars into communities for employment training, and a whole series of skill training programs have now been rolled over to provinces. People don't know how that's actually going to have an impact over time.

If you look at Justice, if you look at Environment, if you look at almost every department, the cuts going out into communities and through provinces are far more severe than what the numbers say, because at the same time as the federal government stopped money going to the provinces, the provinces began to do exactly the same thing. The cumulative effect of that has been quite profound. The rationale was that the private sector would increase spending or contributions to the community to offset that, but that has not happened.

When you take all those things together, that's why we have a growing social deficit. Part of it is more awareness. A large part of it is also the fact that there have been cuts across various departments.

The Chairman: Mr. Perron.

[Translation]

Mr. Gilles-A. Perron (Saint-Eustache—Sainte-Thérèse, BQ): Excuse me for being late and for my attire. I got stalled on highway 148.

Thank you ladies and gentlemen for coming.

Knowing that the deficit is about to be eliminated this year or at the beginning of next year, in other words very shortly, and that a dividend is supposed to arrive, knowing also that the Finance minister is planning to commit 50% of that dividend to debt reduction, 25% to investments in new or existing programs and 25% to tax cuts, I was quite surprised to see that none of you commented that this morning. I would like to have your opinion about that. Do you think that this 50-25-25 allocation formula which was announced by Mr. Martin is appropriate? Would you have other proposals to submit to Mr. Martin?

[English]

The Chairman: Mr. Weiner.

[Translation]

Mr. Harvey Weiner: I cannot speak on behalf of every organization around this table, but we think that priority should be given to some reinvestments in children. However, that does not mean that we collectively believe everything should go into the reinvestment basket. My organization did not take any specific stand on that 50-25-25 allocation formula, but taking into account what's going on in our society, we believe that our government can reinvest in children. In our mind, it's top priority.

The Chairman: Thank you, sir.

[English]

Ms. Suzanne Peters: I think one of the difficulties the government faces is that you are under equal pressure to show results in some of the programs you've made claims you'll make progress on as you might be making progress on tax breaks. From what I read what citizens are saying, they would rather see those results in good areas than see the tax breaks. I can't guide you by a proportion, but that's certainly the message I hear.

Ms. Christa Freiler: I would agree with that. The 25% and 25% may be competing with each other. The 25% in tax cuts may prevent the 25% from being spent on social spending. I don't think they are complementary, I think they compete with each other.

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I would like to support my colleagues who are arguing that Canadians are not asking for tax cuts. The pressure is coming from a small advantaged group of communities. I don't understand why the federal government feels it's necessary to bow to those pressures when there doesn't seem to be any pressure from Canadians at large.

The remaining question then is whether it should be 50% into social spending and 50% into debt reduction. I think one of the points we hinted at, which maybe needs to be made more strongly, is the commitment to invest in kids has to be an equally strong commitment in bad times as well as in good times. What we've seen in the last 10 years is that whenever there's either a surplus or a projected surplus, or times are good, then we talk about investing in kids. When there's a recession, when there is the need to balance our fiscal books or something, then we cut back on services to people.

I think Canada's commitment in the UN convention was that it was in bad times as well as in good times. So the question is that if we start committing 50% of the fiscal dividends to debt reduction, are we going to have enough to invest in families with kids during bad times? Or is this just a commitment we make when the sun is shining and then when it's raining we cut back again? I think the formula is somewhat flawed unless it takes that into consideration.

The Chairman: Thank you, Ms. Freiler.

A final comment, Mr. Hatton.

Mr. Al Hatton: I was here last year. I was here the year before when the fairly broad group representing think-tanks and the banks and two of us from the community talked for five hours the day after Mr. Martin gave his last year's address about getting closer to zero. Then the debate was 100% about getting to zero. We fought on the left side of the table—not necessarily on the left side of the perspective—against people on the right side of the table—not necessarily on the right side of the perspective—about the fact that when we got to zero we had to again reinvest in people.

I don't want to play the percentage game, but the bottom line now is we're close to zero. It will be sometime soon, as you say, and we don't exactly know when. Unless we start redressing the balance between the economic and the fiscal we're going to continue to divide Canadians into the rich and the poor, into the well skilled and the less skilled, into those who have an advantage in this new economy and the new society we're trying to build and those who don't.

In opposition to the body of thought that says the priority is the debt now, now that we've got to zero, or give a tax cut back to Canadians, we would argue that both of those things are shortsighted. Eventually, yes, that's where we have to get to, but the sooner we reinvest in people in the areas we've been talking about, both children and others, the better state we're going to be in as a society. We're going to be able to compete, if you will, globally across a whole series of sectors, not just economically.

The Chairman: Thank you very much, Mr. Hatton.

A final comment, Mr. Cooper.

Mr. Roy Cooper: As a parent I'd like to say that whatever the percentage is, my taxes are moved wherever they go and wherever the leaders of the country think they should go.

I'm speaking as a parent who can provide some of the services my daughter needed in order to get through the system. But I'm one of the fortunate; I'm one of Canada's middle class. I'm a public servant. I'm a scientist. I make a good living.

My cry is for those people who are single parents who live on welfare and find out they have a child who has learning disabilities. The school system is supposed to provide services for that child. There are supposed to be services before they go to school, but they don't get those services because they're not there. The money goes there, but the regulations that ensure people get those services only apply for those who can apply the pressure to the system—those of us who have a knowledge of the system, those who are better educated.

It is not apparent that if you have a child who you suddenly find out is learning disabled you can go down to the office and have somebody help you go through the needs. In fact, the organization I represent can only serve a few of those, because we don't get any dollars from the government to provide services. We do it on a volunteer basis. Unless everybody can get equal service in spite of what their value is, that they can get the needs...we will save money. We will not spend money because it takes $7,000 to educate somebody who is learning disabled per year. If you incarcerate him it costs $70,000 to $90,000 a year. So it's money saved up front. It's prevention. It shouldn't be that way, but it's a fact of life.

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The Chairman: Mr. Riis.

Mr. Nelson Riis (Kamloops, NDP): Thank you very much, Mr. Chairman.

It's interesting we have this discussion today, while outside these precincts the debate is raging between tax cuts and education, basically. One can put their own spin on that, but basically that's what this is about. It's a tragedy that's unfolding out there.

We've heard some interesting interventions today. Somebody pointed out how we've identified as a society that we're prepared to invest heavily between the ages of 6 and 18, or grade 1 and grade 12, but before that and after that we are reluctant or hesitant.

I agree pretty well with everything everybody said here today, but I have two questions, one, not to be taken the wrong way, about the volunteer sector. I listened with interest to Mr. Martin's statement in Vancouver and I think he mentioned the word “volunteer” a number of times. To what extent do you think we're looking at volunteers as a way to compensate for inadequate support, to say that rather than invest in children or invest in young people with learning disabilities or whatever, we're going to rely even more on the volunteer sector, and perhaps come up with some tax incentives to encourage that or the organizers; whatever? Is this just an easy way out for government—providing some minor support for people like yourself?

Secondly, although maybe people have explained it, why do you think we have been so lax in dealing with the needs of young people when you compare us with other countries, as somebody mentioned? In our social policy our record is somewhat abysmal. Somebody mentioned earlier—I forget who it was—the increase in child poverty in the last handful of years. It's a horrible situation out there. Why has this occurred? We're not an uncaring society. We're not uncompassionate. Why have we simply abandoned so many kids, and why do we continue to do so?

Mr. Al Hatton: I think some people in government and some citizens see this as an easy way out. I don't think there's any question about that. There's a certain appeal to thinking, well, if we have to pay for this, as against letting volunteers do it.... It doesn't take a rocket scientist to figure, oh, volunteers are a great way to do it, a humane way to offer services.

The problem is it's not universal. The problem is it's based on a group of people coming together or an individual giving service. It's very spotty. At the end of the day, if we don't partner with government there are going to be huge gaps in services, and that is not what we're supporting.

So we do not see reinvesting in the voluntary sector as a means by which government can stop, in a sense, fulfilling its responsibility to provide services equitably across the country where there are gaps. We would not fall into that trap. Workfare and ways to fob stuff off onto the community are not what we're talking about. We're talking about working in partnership with government, using the resources for maximum output. I think that would be the strategy we're promoting.

We know there's a danger. Part of it is pitting unions against the community against the voluntary sector. That's not what we're about. We're trying to take the high ground and say the government has a role, the private sector has a role, and so do we; how do we rejig those arrangements for maximum investment of dollars.

Mr. Mel Gill: On the second question, the fact that kids don't vote is one factor. I think most Canadians think we ought to do more for kids but don't know what to do. We haven't had a national strategy. There has been no goal we can set our sights on.

Perhaps I can come briefly to the earlier question. I think the question you're asking is important, but it has to be taken as one question in a broader context. Tax cuts really are intended to put money back in the hands of consumers. We've had probably the most astronomical growth in consumer debt, which is being charged back, in the credit card case, at virtually usurious rates. We've had no wage growth to speak of in the last half-dozen years. If you really want to look at how to put money back into consumers' pockets, you need to look at the broader picture, including targeting tax cuts.

Dr. Graham Chance: I don't think it's a case of abandoning children. I think most parents in fact would argue otherwise. But one of the problems surely has been the view that children's growth and development are essentially a responsibility of parents—essentially.

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In the past, that worked relatively well. But in fact parents these days find it impossible to fulfil the responsibilities they want to be able to fill either financially or from the point of view of having the time available to do it.

We've tended to stress parental responsibilities instead of saying that we as a society have responsibilities to children. I don't think we have followed societal responsibilities to children as we should have. I couldn't have quoted those data had we been a caring society. I think it's a misnomer to say that we are a truly caring society when we see the situation of children in this country. Basically, we're an uninformed public with regard to the overall state of health of children in this country. I think we have to recognize that.

That's why, in fact, the Canadian Institute of Child Health feels so strongly that there should be a true database of the health of Canada's children. It's so that everyone could know, from community to community, where the problem areas are. We don't have the data. Communities know they're in trouble, but they don't know where.

Others have clamoured much louder than children, because children cannot clamour to have their own needs met. Those needs are being met for some but not all. But essentially children cannot clamour. Children's voices can't be heard.

So over the years, we watched the accumulating debt of social capital, which we've been prepared as a public, as a general society, to watch accumulate. As long as we go on watching that, we'll see this country deteriorate.

The Chairman: We'll move to Mr. Jones.

Mr. Jim Jones (Markham, PC): Thank you, Mr. Chairman.

I really believe that we might have a social problem in this country, but we have a bigger problem, which is really a job problem. If parents can't get a job and they're living below the poverty line, then they really can't look after their children. So I think this is a symptom of a bigger problem, and we should be addressing this problem.

I think Mr. Hatton said that over the last three years the government has been supporting the private sector versus the government side or the voluntary side. I'd like him to explain what he meant by that.

Also, Mr. Weiner talked about an investment in children. I assume that coming from the Canadian Teachers' Federation you're really talking about probably education or in that arena. Canada is one of the countries that spends the most dollars per capita on education. How do you explain a country like Singapore, which just a few years ago was near the bottom of the totem pole in education but now ranks at the top, and it's spending more money on education? I would just like you to quantify what you mean by investments.

Also, I think Christa talked about how we don't have a social problem, but we have a problem in the undercollection of tax. I'd like you to be able to provide me with the data from the situations to which you might have been inferring.

Then, last but not least, I guess it was Suzanne Peters who referred to the Quebec and Saskatchewan situation, of which I'm not aware, and how they're making strategic investments. What are these strategic investments and how are they working?

Mr. Al Hatton: I made the comment that over the last probably 10 years, the values of the private sector have been primordial, ruling everything, including our sector. This has been about globalization, living within your means, the bottom line, cuts, downsizing, and right-sizing.

We're not against that, but it's not the answer to everything. You can't quantify human development. You can't put a number on justice. It's said that in our sector we're not accountable. It's said that government is not accountable. How are you going to quantify volunteer activity? Are you going to put a price on it? Say it's $10 an hour. Okay, that's $12 billion at $12 an hour. That could be somebody at an entry-level job of $6 or a CEO making $2,000 a minute, and all of them volunteer.

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That's not to demean the private sector. It's simply to say that I think the balance has swung too far, to that ruling everything. We've lost sight of the very useful role government has played over the last 30 or 40 years to in fact distribute certain benefits and wealth across both regions and within populations that deserved more attention.

Second, I think some in the right-wing have basically been saying that government is out of control; it's incompetent; bureaucrats are faceless wasters of time. That's very simplistic, yet that in a sense is what has ruled a lot of public policy. We see some provincial governments making tremendous mileage with that kind of perspective.

But if you study the polls, if you really look at what Canadians are saying, that's not what they're saying. They think, yes, governments have been living beyond their means, but they don't think bureaucrats are incompetent. They're saying, we need more results from your work, and how do we work on that?

In a sense, I think everything switched too far in one direction. It has to be rebalanced. The sooner it's rebalanced, I think everything will proceed better.

Government's on the right track. Some governments are trying to say, okay, what business are we in? What's our real role? We would support that, their figuring it out. Then we'll come in—there would be assets in the resources that exist in the community—and try to improve things in partnership. We don't have the answers alone. We know government doesn't. How do we work together?

That's what I meant.

Mr. Harvey Weiner: We'll be participating in an education round table, so I'd be prepared to go into a lot more depth on it. But I think it's symptomatic of a problem we have to deal with in this country.

Who is it who said there are lies, damn lies, and statistics? You're referring to a specific test and a ranking of the test scores. I would suggest to you that you spend some time—I don't know, maybe you have—reading the TIMS document, a 140-page document.

I think you will find that on that one test where the Singaporean students scored the highest—and I have the press release; I would be delighted to share it with you—Singapore announced in July that it is going to be investing $5 billion over the next seven years. The employers who are receiving the Singaporean students are finding that the students, who are very good at regurgitating memorized facts, have very little creativity and very little in the way of skills to apply the knowledge in a job situation. You'll be interested to note, I think, that Canadians are being brought in to help address this particular problem.

We're finding this in terms of many of the scores. People like a score so that they can reduce something to a number—we compare this way or we compare that way. But very little attention is paid to the interpretation of many of these scores.

When we look at the research, etc., we find that every country has problems with education, and there are choices that have to be made in education. No system has a perfect education system. We can learn certain things from what others are doing, but there are also problems. The phenomenon of the grass is greener on the other side is something that applies to us, but as I've just pointed out, it also applies to the Singaporeans. So there are choices that are made.

When we look at the United Nations and its evaluation of education, it has Canada as number one. Percentage-wise, Canada has more people at a higher level of education, with more post-secondary students on both a part-time and degree basis, etc., than any other country in the world.

When you go into this, I would suggest to you that you read the reports, you go into the data, and you look at the interpretation. The problem we have in this country is that a newspaper gives you a 30-second clip, a headline, and raw scores.

Perhaps I can give you an example. There was a ranking done of secondary schools in Montreal. A school was ranked at 100. The focus was put on that particular school. What the newspaper failed to indicate was that the school was a second-chance school for drop-outs, and 30% of those drop-outs were succeeding in getting their diplomas. The way it was reported, 70% of the kids were failing in that particular school.

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Ms. Christa Freiler: I don't want to give you all the statistics. I just happen to have with me—and I'm happy to give you—a report that we co-authored in 1994, called “Paying for Canada: Perspectives on Public Finance and National Programs”, that can answer your questions.

I just want to point out two of the statistics in here. In the period from 1975 to 1981 Canada had the largest drop in central government tax revenue of all G-7 countries and Canada was the only G-7 country with a drop in total government tax revenues during that period.

With information from the Organization for Economic Co-operation and Development, Statistics Canada and the Canadian Tax Foundation, there are tables in here that show that Canadians' income tax and social security contributions are low by international standards, and are even lower than those of the United States when social security contributions are included.

This was written three years ago, so some of these statistics are a bit out of date. If you give me your card, I will happily send you updated versions. But there is a lot of statistical data that would support my point about undercollection.

The Chairman: We'll move to Ms. Redman, followed by Mr. Assad.

Ms. Karen Redman (Kitchener Centre, Lib.): I really appreciate your comments today. A lot of the thoughts you're expressing were indeed expressed by Minister Martin in the pre-budget statement he made in Vancouver.

He specifically talked about private and voluntary sectors and all levels of governments as key players.

I do believe government and society have passed the point where they can throw money at problems, and Minister Martin did talk about cutting up a credit card. I don't think there's a huge windfall of money. I think we have taken a prudent course and paid down the deficit, and I support that.

What we've heard on our cross-country tour is that there is a human cost to that.

I also believe in dealing with things in context, so a lot of what I'm hearing today at this table I find to be really appealing.

But specifically—and Ms. Peters did hit on the nub of my question—I would ask Mr. Gill and Mr. Weiner to comment on what they see as being the appropriate role for the federal government to play.

One of the things we heard when we travelled across the country was a great deal of disenchantment and some suspicion in certain provinces about turning money over to the province in that jurisdiction. So I guess I would just like to hear from you what's appropriate for the federal role.

Mr. Mel Gill: This is an issue that was discussed at some length in the preparation of this document, and there was enormous skepticism that we would ever get a consensus on this kind of a document.

What came out of it was that there must be strong federal leadership with the provinces in the development of a national agenda for children and that clear targets must be set in specific areas and that the federal government should not get out of the business of cash transfers, that there should be a floor rather than a ceiling—and I think Mr. Martin is committed to that—on cash transfers, because without that sort of hammer you simply have no control over what the provinces do.

I think the approach with the child benefit and provincial government commitment to reinvesting moneys freed up is probably the way to go.

Ms. Karen Redman: Before Mr. Weiner responds, can you just comment on the $12.5 billion? In your estimation, is that adequate?

Mr. Mel Gill: I have no way of measuring that. It was certainly intended to go much lower than that. I think you need to look at it as a proportion of total federal-provincial expenditures and find some benchmark in that way.

Mr. Harvey Weiner: On the issue of leadership, someone has to take the leadership role in this and we believe the federal government is best placed.

If this is to become a national priority, it can only be the federal government that can take that kind of leadership. But leadership does not mean that the federal government can or will be able to impose one set of programs or one way of doing things. Nor does it mean that the involvement of the voluntary sector, parents, everyone in this particular process, should in any way be diminished.

As a matter of fact, the federal government should be making provision.... That's one of the things the organizations around this table share in common: that we want a place at the table as these issues are being discussed and developed. We don't want to be in a position where have to react to a plan that's been developed without the benefit of the expertise, the knowledge, and the information that we can bring to bear on it.

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We think the same should hold true for the provinces—and presumably it will—and the communities across this particular country or else these agreements will not be reached.

That doesn't mean one pattern or one size fits all, but it does mean that the federal government has to assume that leadership role. We think the federal government is the only partner that is placed to take the leadership role. As Mel said, in order to assume that in an effective way—quite frankly, the way in which the world works—there has to be a significant cash component that the federal government is putting up as part of the carrot for that kind of participation.

The Chairman: Mr. Assad.

Mr. Mark Assad (Gatineau, Lib.): Thank you, Mr. Chairman.

This is extremely interesting. What comes to mind is the fact you mentioned, which is very true: we do not have any policy in the area of community organizations, and I think it shows. Somebody else mentioned that there are many programs out there, but we can't seem to size them up. God knows there's been no evaluation of these programs and how effective they've been.

With respect to this issue of child poverty, we hear about it more because it's been more evident in the last years. I'm familiar with some organizations and their volunteer groups. Often we discuss it and ask who is best suited at the level of the street, if I can use that term, to pinpoint it exactly—we know it's there—and to identify the poverty and the resources needed. These resources have to be continuous.

I'm sure you can tell me that organizations like your own are probably best suited to give the necessary information to the federal government. If you want the federal government to be the leader, I agree. It should be the leader, but I think the bureaucrats need the information that only you have in order to be able to pinpoint this kind of poverty.

If you'll just permit me, in conclusion here, there are many answers and many questions that I have in mind. One of our colleagues, Mr. Harris, mentioned the deficit. In 1990 Statistics Canada presented an extremely interesting document. It showed the evolution of the federal deficit and it showed clearly that social programs were not responsible for our level of indebtedness. That's the first point.

Secondly, there are a lot of voices out there that are not heard from very often. Even the Canadian economists' association pointed out in a publication that one of the reasons why the deficit got out of control was the monetary policy and the extremely high interest rates we had in the late 1980s and 1990s.

But I'd like to get back to whether or not you believe—and I'm sure you do, because I do—organizations like your own are best suited to point us in the right direction as to what kind of programs we could have. We have $850 million on the table. I'd like to know if anybody can tell me exactly how this money's going to be channelled.

Mr. Mel Gill: I'd like to reinforce my hope and my sincere desire that people will read this document. It is very comprehensive. It bridges many of the philosophical divides that exist around government tables.

Mr. Al Hatton: Mr. Assad, there is a coalition called Campaign 2000, which has been fighting the issue of child poverty and has a whole series of policy recommendations. That's one vehicle.

Another is a group called the Children's Alliance. It's another vehicle that brings a number of community organizations together, organizations with various sorts of expertise related to the issue of children in general and child poverty specifically.

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There are several instruments and ways by which we can meet with both federal and provincial members or bureaucrats to talk about a series of solutions, depending on what the issue is. The framework provides an overview. As specific issues are identified, we have a series of people in community organizations and at the community level who can work with whomever wants to target specific options. We can spend more time in detail working those options out.

We don't have all the answers, but we have some of the areas in which we know what the problem is, and we have some solutions. In working with officials, I think we can toss those solutions out to see what the best mix is.

The Chairman: Ms. Torsney, did you have a final question?

Ms. Paddy Torsney (Burlington, Lib.): It's more of a comment.

Ms. Freiler, I wonder if you could get a copy of the documents in to the clerk.

Also, Ms. Peters, could we get your study? I don't think we received some of the information, but I think it would form a really good basis for us when we're writing our report.

I just wanted to assure you that, at least in the meetings that I chaired across the country, there wasn't a huge cry for tax cuts. Even amongst the business community there was a lot of support for our society. I think you should be somewhat comforted that this was the case, although clearly some provinces have different priorities than others.

That was more of a message than anything, and I really appreciated the information. I look forward to working with the document Mr. Gill provided to us.

The Chairman: Thank you very much, Ms. Torsney.

On behalf of the committee, I'd also like to express to you our sincerest gratitude for a well thought out presentation. It certainly provides us with a framework within which to work, and I'm sure that you'll find many of your thoughts and ideas reflected in our report. Thank you very much.

The meeting is adjourned.