I call the meeting to order. Good afternoon, everyone.
Pursuant to Standing Order 83.1, pre-budget consultations begin today for 2012.
I will introduce our first panel of witnesses this afternoon. We have Martin Unrau, president of the Canadian Cattlemen's Association; Kim McCaig, vice-president and COO of the Canadian Energy Pipeline Association; Corinne Pohlmann, vice-president, national affairs, Canadian Federation of Independent Business; Denis St-Pierre, chair of the tax and fiscal policy advisory group for the Certified General Accountants Association of Canada; and Bonnie Dawe, chair of the Canadian income tax committee for the Tax Executives Institute.
Welcome to all the witnesses. Each of you has a five-minute presentation. Then we'll do our questions and answers.
Mr. Unrau, we'll begin with you for your five minutes.
Thank you, and thank you for the opportunity to present to you today.
My name is Martin Unrau and I am the president of the Canadian Cattlemen's Association, which represents over 80,000 beef producers in Canada. Also with me is Andrea Brocklebank, who is a research manager for the Canadian Cattlemen's Association. I have asked her to come in if there are some questions we will need to address.
Canada's beef cattle industry has been through several years of financial turmoil, but until recently was in a strong recovery with tremendous opportunity, owing to strong global demand for beef and positive prices. In 2012 farm cash receipts from cattle and calves, combined with the multiplier effect from downstream economic activity, contributed $26 billion to Canada's GDP.
However, global food demand is expected to double by 2050, which would require a 1.75% increase in productivity per year. Currently productivity is increasing by only about 1.4% per year. This, in combination with increased competition for land and water resources, has resulted in rising and volatile commodity prices. This challenges our industry's ability to maintain positive margins, and more importantly, to fulfill increased demand for food in a sustainable manner.
Increased investments in research and innovation are critical for our industry. This will ensure the long-term sustainability and growth of the Canadian beef industry and allow us to use limited resources more efficiently.
Research investments made over the past 30 years have transformed North American beef production. The beef industry has seen a 14% reduction in water use, a 34% reduction in land use, a 20% reduction in manure production, and an 18% reduction in our carbon footprint per pound of beef produced in the last 30 years.
In tandem, research has assisted in providing consumers with high-quality, nutritious, and safe beef products. Research also provides the science necessary to demonstrate the integrity of animal health and food safety systems, which is increasingly important in trade negotiations and integral to reducing food safety incidents and to growing consumer demand. Continued improvements in production efficiencies through research are also required to ensure industry can compete with other protein sources globally.
Although the need for continued advances in research is clear, we are very concerned that a considerable loss of Canadian research infrastructure, project funding, and scientific expertise may hamper further progress. Despite an increased focus on innovation over the last several years owing to budget cuts, federal research funding for beef over the past two decades has seen a net decline on an inflation-adjusted basis of 35% to 40%, by our estimates. Ongoing cuts have seriously and negatively impacted research programs and scientific expertise. The viability of some critical research programs in areas such as animal health, food safety, and plant breeding are currently in question. Not only does this place future progress at risk, but it is a significant deterrent in attracting new expertise.
One of the most significant recent industry and government investments is the development of a beef cattle industry science cluster. This initiative brings together Canada's largest industry and public beef research funders, which are the Beef Cattle Research Council and Agriculture Canada, respectively, to deliver priority research. I am convinced that the beef science cluster approach will result in a very coordinated, efficient research model; however, cluster funding needs to be increased to ensure meaningful results. This should not come at a cost to the maintenance of basic long-term federal research programs outside of the clusters in core areas.
To summarize, we have three recommendations relating to research. First, investment in beef research needs to be increased to more appropriately reflect its important contribution to the industry and broader public good.
Second, federal research funding must be delivered on a minimum five-year basis. Program delivery has typically resulted in a three-year funding cycle, with gaps in funding. Longer-term, more predictable funding commitments are necessary to maintain strong research programs, attract new scientific expertise, and deliver meaningful research results.
Third, federal government research programs outside of the science clusters must be maintained in core areas, including animal health and welfare, environment, plant breeding, and food safety. This is critical not only for our industry's competitiveness but also to ensure scientific expertise is available to respond promptly and effectively to issues and opportunities that arise.
I would also like to briefly mention increasing investments in market development. This is a critical competitive piece for Canada, which exports 45% of its beef production.
Growth in exports of U.S. beef to Canada and the rest of the world over the past few years has been phenomenal. Some of this is due to currency exchange levels, but some is also due to the USDA's investment in export promotion. A report from the Office of Management and Budget puts returns on market promotion spending at $35 per dollar—
Thank you very much, Madam Chair, and good afternoon.
It is a pleasure to appear before you to share some of the views of the Canadian Energy Pipeline Association. I look forward to answering any questions you might have.
CEPA represents companies that transport 97% of the oil and natural gas produced and used in Canada. Our members currently operate more than 110,000 kilometres of pipeline in Canada, transporting over 3.2 million barrels of oil and 14.6 billion cubic feet of gas every day. They employ over 8,000 full-time employees.
Pipelines are the only feasible means, and the safest, of transporting large volumes of crude oil and natural gas over land.
In delivering budget 2012, acknowledged that the natural resource and energy sector is driving economic growth across the country. It is creating good jobs not only directly but also indirectly in manufacturing, clerical work, skilled trades, and financial services. Canada's resource industries offer huge potential to create even more jobs and growth, now and over the next generation.
The responsible resource development provisions of budget 2012 put in place the enabling conditions to realize these opportunities. CEPA has been a strong supporter of the objective behind regulatory reform, which is to improve the efficiency of, and the environmental outcomes from, environmental assessments. The proposed process reduces duplication, ensures timelines, and maintains or improves environmental standards by focusing assessments on major environmental concerns and on avoiding significant adverse effects.
Our recommendations for the 2013 budget speak to the next steps in this process. They fall into two intrinsically related categories: ensuring regulatory effectiveness, and pipeline safety performance.
CEPA's recommendation with respect to regulatory effectiveness is that the federal government commit sufficient resources to implement the changes set in motion and to monitor their success.
Bill changed the legislative framework for the review of major projects in Canada, but the policy and regulatory work still needs to be completed to support those changes. Continuing the regulatory reform process will ensure that through timely, efficient, and predictable processes, investments can be made with confidence. Strategic scrutiny and clear outcomes will ensure environmental protection.
Pipelines currently transport approximately $125 billion in oil and gas, at a cost of $5 billion a year. Pipeline transportation provides a value-added of approximately $120 billion to the Canadian economy. Given current plans for expansion, the industry is in a position to add even more value, provided it can get the planned infrastructure built.
Integrally related to regulatory efficiency is pipeline safety, as it is the safety performance of our industry that is a key component of maintaining our social licence to operate. Safety is the top priority for pipeline companies in all aspects of pipeline development and operation. The industry is taking a leadership role in these efforts. In 2011, CEPA members spent more than $600 million on monitoring and maintenance activities to ensure the safety of pipelines.
Extensive regulatory tools exist to support and address pipeline integrity, including construction standards, maintenance, audits, and regulatory powers to shut down and investigate. However, Canada does not currently have the means to require and enforce the physical protection of pipelines from the activities of others. Damage to pipelines from third parties is where we face the biggest risk. Experience in other countries shows that lives are saved where laws and enforcement are in place. These measures include requirements for mandatory one call in all jurisdictions and administrative penalties for the enforcement of those rules.
CEPA appreciates the efforts to date to both introduce administrative monetary penalties and to increase the number of pipeline inspections, which we believe, along with transparent enforcement tools, including escalating fines and mandatory one call, is a key part of the solution.
Canada has been fortunate in weathering the economic troubles that have challenged the rest of the world. This is due, in large part, to the role the resource and energy industry has played. The process set in motion by the government to reform the regulatory system is important to ensure that Canada can retain and attract the investment necessary to develop pipeline infrastructure. This infrastructure will support growth in the natural resource sector and the diversification of Canada's markets. Commitments made by the federal government to ensure that the regulatory reform process is effectively and fully implemented to deliver better environmental outcomes and that the regulators have the necessary tools to keep pipelines safe are important steps in making this happen.
Thank you for the opportunity for us to be here today.
CFIB is a not-for-profit, non-partisan organization representing more than 109,000 small and medium-sized businesses across Canada that collectively employ more than 1.25 million Canadians and account for $75 billion in GDP. Our members represent all sectors of the economy and are found in every region of the country.
You should have a slide deck in front of you that I'd like to walk you through as we go through this presentation over the next few minutes.
CFIB's most recent business barometer, which is on slide 2 of the presentation, shows that small business owners were a little more upbeat in September as the index rose for the first time since March, stopping a five-month slide through the spring and summer months. Despite the increase, the index still suggests Canada's economy is growing at below-average rates.
To help get us through this sluggish economy, governments need to address the issues of greatest concern to small businesses. As you can see on slide 3, the top issue is total tax burden, and I'll get to that in a moment.
Second, though, is government regulation and paper burden. We were pleased to see the government's recent red tape announcement and, in particular, the plans to measure the overall burden, set service standards, and implement a system of ongoing oversight and accountability, as these are key factors that can make a difference to small business owners. Now the hard work begins, though, in implementing those changes, so we plan to closely monitor how they are done.
The third high-priority issue is government debt and deficits. Small business owners understand the importance of paying down debt, so we've seen this issue grow in importance as the debt grew over the last few years.
We recently asked small business owners about the current timeframe to eliminate the federal deficit within the next three years. As you can see on slide 4, almost half believe it is an appropriate timeframe, while just over one-third would like to see it eliminated sooner, so we recommend that the government stay focused on eliminating the deficit by 2015 or earlier.
One way to do that is to bring federal public sector wages and benefits more in line with those in the private sector. Last year, CFIB launched a pension campaign calling for greater transparency of public sector pension liabilities and fairness for taxpayers. Over the last year, CFIB has collected over 55,000 alerts from those concerned about the state of Canada's public sector pension system, and many of you have likely received them in your office.
To be clear, we're not asking for changes to public sector pension benefits that have already been accumulated. We were pleased to see the government move to address some of these issues in budget 2012, and we urge all MPs to quickly implement those changes.
We would also like you to consider a few additional measures. For example, as listed on slide 5, increase the normal retirement age to 65 for all in the federal civil service, in a similar way to how the OAS changes were done; convert all MP pensions and all new hires in the public sector to defined contribution plans, which is something the EDC has recently done; and eliminate the bridge benefit that provides retiring public servants with top-ups equivalent to full CPP benefits until age 65. This is something that the Bank of Canada has eliminated already.
Not only is there concern with public sector pensions, but saving for their own retirement is a very real concern for entrepreneurs. Slide 6 is from an upcoming report on succession that shows that almost half plan to exit their businesses in the next five years and more than three-quarters want to exit their businesses in the next 10 years.
One of the most important measures to assist in this transition is the $750,000 lifetime capital gains exemption. Not only is this a key component of a business owner's retirement planning, but it also has been effectively used as a source of financing for the next generation of entrepreneurs.
In 2007 the government increased the exemption from $500,000 to $750,000, the first and only increase in more than 20 years. To avoid waiting another 20 years for an increase, CFIB called on the government to index the exemption to inflation, and this was promised by the Conservatives in the run-up to the 2008 election. However, it has never been implemented. We believe the time has come to not only index the lifetime capital gains exemption to inflation, but to find ways to simplify it and perhaps even expand it to include some assets.
You may recall that the top issue of concern to small business owners was total tax burden. With so many taxes, it was important to understand which ones have the biggest impact on the growth of their businesses.
As you can see on slide 7, payroll taxes had by far the greatest impact on growth. Why? Because it is a tax on jobs. It must be paid regardless of any profit. This is why EI remains a key issue for us, and it is why we continue to push for the extension and expansion of the EI hiring credit for as long as EI rates continue to go up, as they will again in 2013. It's also why we continue to advocate strongly against any increases in CPP premiums.
When asked directly about specific measures that would help maintain or strengthen business performance, it should be no surprise that measures related to payroll taxes are the most important, ranking first, third, and fourth in the chart on slide 8 for the reasons I've discussed. However, also important is reducing the small business corporate tax rate. This is not surprising, as there's been a gradual erosion of the value of the small business rate as the general corporate rate has been coming down.
While CFIB supports reducing all corporate taxes in order to stimulate investment and growth, there are good reasons that the small business rate was significantly lower than the general rate. For example, smaller businesses tend to have a higher tax and regulatory burden per capita. Therefore, we suggest that the government commit to some form of targeted federal-provincial combined tax rate for small business, such as 12%, or, alternatively, commit to a tax plan to ensure that the small business rate does not exceed half, or some percentage, of the general rate.
It is never clearer than during Small Business Week that small businesses truly are the backbone of Canada's economy and the heartbeat of our communities. The recommendations presented here, summarized on the last three slides, are just some of the ways that we can get small businesses growing in Canada.
Thank you, Madam Chair.
Members of the committee, thank you for the opportunity to participate in the pre-budget consultations leading up to Budget 2013.
I am Denis St-Pierre, CGA, Chair of CGA-Canada's Tax and Fiscal Policy Advisory Group. I am a private practitioner from New Brunswick and my work focuses on estate planning and tax strategies for small and medium-sized businesses.
When the finance committee invited Canadians to share their priorities for the 2013 federal budget, you posed five questions. We can summarize all of these questions with one answer again this year, which is tax simplification. We submit that many of Canada' s challenges can be addressed through tax reform. Now that tax rates have come down, we must ask ourselves: what kind of system do we want or, better yet, what kind of system does Canada need for the future?
Canada's tax system is unduly complex. Entrepreneurs will tell you that. My clients tell me that. There is a growing consensus that the complexity of Canada's tax system must be addressed if Canada is to remain competitive, able to attract business and investment, and create jobs and economic growth.
For example, the Canadian Chamber of Commerce identifies Canada' s complex tax system as one of the top 10 barriers to competitiveness. Tax simplification is the number one public policy priority for CGA-Canada. The federal government must take action to modernize Canada' s tax regime.
Canada needs a simple, fair, and efficient tax system to help build a strong, competitive 21st century economy. Done properly, as a revenue-neutral initiative coordinated by all levels of government—federal, provincial, and municipal—tax simplification could yield substantial benefits. A few of them are increased compliance rates, because when it is simple, it is easy to comply; lower compliance costs for taxpayers; less paperwork for businesses; lower administrative costs for government; and a more secure tax base with predictable revenue.
How? In last year's pre-budget report, this committee endorsed CGA-Canada's recommendation to establish an expert panel to review, modernize, and simplify the tax system, as was done in other countries. We thank committee members for their support, and we also want to reiterate that the creation of an expert panel still remains CGA-Canada's first recommendation. There is an important place for an expert panel to chart the course towards improving Canada's tax system, and there is an important role for the finance committee in framing the issues and defining the scope of study for the expert panel.
However, let's not wait for an expert panel to be appointed. There are still concrete measures that could be taken by this committee to simplify the tax system. There are two things for attention.
First, the government must introduce a technical tax amendments bill. The last time a technical tax bill was passed by Parliament was over 11 years ago. Literally hundreds of unlegislated tax amendments to the Income Tax Act—which I showed this committee last year by bringing the Income Tax Act, if you recall—have been proposed, but not yet enacted, which brings uncertainty and unpredictability to the process.
Second, we strongly feel that implementing a sunset provision would ensure that tax amendments are legislated, which ultimately will eliminate the ever-growing backlog of unlegislated tax measures once and for all. With this provision, if a tax policy change is announced and not incorporated into legislation within a reasonable amount of time, the measure would lapse. This would bring greater clarity and certainty to tax legislation, reduce the compliance and paperwork burden, and, perhaps most importantly, prevent any future legislative backlogs.
Those are a few simple but important steps that would go some distance in improving and strengthening Canada's tax system.
Canada needs a 21st century tax system that is simple, fair, efficient, and transparent with low, internationally competitive tax rates.
We would be remiss if we failed to mention that CGA-Canada will be convening a full-day national summit on tax simplification on Tuesday, December 4 in Ottawa. The summit will bring together stakeholders, public officials and thought leaders to strategize on the issue of tax simplification, and to establish priorities and next steps. We hope that committee members will attend the summit, and we look forward to sharing the summit outcomes with the committee.
Madam Chair, thank you for your time. I would be pleased to respond to any comments or questions from the committee on CGA-Canada's recommendations concerning tax simplification.
Thank you, Madam Chair.
I am the tax director for Finning and am here today as chair of the Canadian Income Tax Committee for the Tax Executives Institute. TEI is the pre-eminent association of business tax professionals worldwide. Our 7,000 members work for 3,000 of the largest companies in Canada, the U.S., Europe, and Asia. My comments are endorsed by both TEI's Canadian members and others who have significant operations and investments in Canada.
During the past decade, the government has focused on making Canada's business tax structure more competitive. By reducing the federal corporate income tax rate, the government has confirmed its commitment, enhanced the prospects for sustainable economic growth, and increased the attractiveness of investments in Canada, but Canada must remain vigilant, especially as other countries restructure their tax systems and lower marginal effective tax rates.
Thus, TEI welcomed the opportunity to participate in the government's consultation on the taxation of corporate groups and subsequently submitted comments explaining that implementing such a system will improve competitiveness and better align Canada with the rest of the world. More than two-thirds of OECD countries provide explicit legislative or regulatory regimes for loss transfers, with Canada being the only G-7 country that lacks such a feature.
History shows that economic stagnation may occur following a financial crisis as credit markets tighten. Permitting corporate groups to offset profits and losses and share other tax attributes in an efficient, straightforward fashion will temper these effects by improving corporate liquidity, reducing borrowing costs, and eliminating transaction costs. As important, CRA will no longer have to devote resources to issuing advance income tax rulings.
TEI provided detailed recommendations for a group loss transfer system to the Department of Finance. An annually elective tax loss or attribute transfer system similar to that in the U.K. will be the simplest and most flexible to adopt, requiring the fewest modifications to the Income Tax Act. Attributes that should be part of the system include non-capital losses, capital losses, carry-overs of such amounts, and investment in other tax credits.
Next, in December 2008, the advisory panel on Canada's system of international taxation issued a report with recommendations for enhancing Canada's tax system. Some recommendations have been implemented, but one significant area has not yet been addressed. Specifically, the current process for obtaining waivers of withholding taxes imposed under regulations 105 and 102 should be repealed and replaced with a self-certification system. In respect of regulation 105, the advisory panel found that “service providers commonly gross-up their fees to offset the withholding tax”, which raises costs for Canadian businesses; compliance costs are “significant”; and “the waiver process is cumbersome and so it is not used as often as it should be”.
The advisory panel also determined that regulation 102 places “significant” administrative burdens on non-residents in Canadian corporations. The advisory panel recommended replacing the current advance waiver requirement with a system for non-residents to self-certify eligibility for reduced withholding taxes, especially when the non-resident is exempt under a treaty such as the Canada-U.S. treaty. A certification system based on current information reporting requirements will maintain CRA's enforcement capability but shift compliance costs to the certifying party, minimize tax withholding refunded to exempt parties, reduce tax gross-up costs, and minimize administrative burdens for CRA and taxpayers. TEI urges the adoption of the panel's recommendations.
The 2012 budget included a proposal to curtail foreign affiliate dumping transactions, and draft legislation to implement meant the proposal was released in August. TEI fully supports the government's targeting of abusive tax-motivated foreign affiliate dumping transactions, but regrets that the proposed legislation will diminish Canada's attractiveness in the competition for global capital and investors.
Fundamentally, there is no abuse of the Canadian tax system when cash generated by a Canadian resident business is invested downstream in the common shares of a controlled foreign affiliate, and Canada is entitled to both the growth potential of the downstream investment and future cash repatriations. Ultimately, the economic return from a downstream common share investment will flow back to Canada.
TEI's June and September 2012 submissions provide many recommendations for technical changes, expanded grandfathering relief, and additional relieving measures. We will be pleased to work with the Department of Finance and the committee to narrow the legislation.
In conclusion, TEI thanks the committee for the opportunity to participate in the pre-budget consultations. I'd be happy to answer any questions you may have.
I think we're on the road to creating some benefits around that.
Before the clusters came into being, universities would build small silos and work within them, so at times research would be done on a certain issue, and it would be repeated without anybody knowing about it. Of course, one of the other issues we had was the tech transfer of the research.
Some of this research was repeated. In the last few years, of course, with the science cluster coming into play, research between universities and research centres has been more transparent and more open for others to see. Therefore, we're improving and working on that. It definitely is a positive, yes.
The only difficulty we have is that it seems we don't get the full five-year funding. We end up with three years of funding, so there's always a bit of a gap before the next program begins. When you're doing long-term research, it's very difficult to continue with research if you have a gap between the programs.
Thank you, Madam Chair.
Let me begin with Mr. St-Pierre, because I fondly recall the meeting with Ms. Carole Presseault on December 15 last year. At my office, we were able to talk about the real issues, including the unspeakable complexity of the Canadian tax system. We have that point in common.
Let me use a simple example. I have been filling out my tax return since I was a teenager and I also do it for people close to me. Among others, I do the taxes for my mother, and I will always remember the year she decided to buy public transit passes only to realize that the credit would not apply because her income was not high enough, considering her age, and so on. So she kept using her car.
When I was the critic for small business and tourism, entrepreneurs had a chance to tell me about the problems they had with research tax credits. They told me how complicated, if not impossible, it sometimes was to take advantage of those tax credits. Some told me straight out that it could be a trap. It is quite unfortunate to think that the nature of our tax system can be harmful to both entrepreneurs and ordinary taxpayers. Could you give us some examples? Could you explain to what extent tax rulings can be harmful and show us how difficult the situation is?
Thank you very much for answering my question.
I will now turn to Ms. Pohlmann.
It is a pleasure to see you again. We have done a fair amount of business together. I am not sure if I had a chance to congratulate you before, but I will take this opportunity to congratulate you, or rather thank you, for reporting the transfer, the misappropriation of employment insurance surplus funds. It really is a problem for our entrepreneurs and our workers alike. We are talking about tens of billions of dollars that have unfortunately been diverted from their primary purpose.
I will have the opportunity to ask Mr. Péloquin the question about tourist operators, which are mostly seasonal. However, there are quite a few small businesses that work in cycles based on the seasons. The new employment-insurance measures could complicate their lives. It might be a significant loss of expertise for those that have skilled workers. As the member for Beauport—Limoilou, a riding in Quebec City, a winter city, I used the example of heavy equipment operators, who not only do road work during the summer, but also take care of snow removal and snow clearing during the winter. It is very difficult to replace that type of expertise.
Have any of your members already expressed concerns to that effect? Have you studied the impact of the new employment-insurance measures?
Thank you, Madam Chair.
I want to thank our witnesses for coming today. It's nice to have together such a knowledgeable group of people out of the financial sector.
In this country we've been very fortunate, because worldwide there's been an economic downturn. You mentioned Greece and other countries that are suffering. In this country, we have 770,000 new jobs, a AAA credit rating, and a very sound banking system.
That said, there are a lot of things our government is doing right. You're here today to also give us some extended ideas, because we like to collaborate. We like to talk about what will make things better.
I'll start with Mr. Unrau.
Mr. Unrau, as you know, we put $100 million into the food safety initiative, including $50 million specifically on the system itself and making it better. I know that the cattle industry has taken a hit with the incident that happened in this plant; do you think the measures put in place by our government now have been helpful to all plants, and, if so, how would you suggest something like this happened?
We've also hired 157 new inspectors, as you know.
Thank you, Madam Chair.
I want to thank the witnesses for coming.
We have a tremendous job to do here. We have had approximately 800 submissions from different organizations, and we're trying to bring out the best information we can to make some decisions on budget 2013.
Having said that, I've seen some submissions that are refuting things that have been said here today. I want to go over a couple of things. I'll start with Ms. Pohlmann.
I want to thank Mr. Côté for bringing up the fact that the EI operating account was in fact raided not by this government but by a previous government, and that measures have been taken by this government to address that shortfall. I appreciated your support, as well, as you answered those questions from Mr. Côté.
Talking about EI, there have been some submissions suggesting that we address EI in other ways. In fact, there have been suggestions that we double CPP, and there have been suggestions, and you've probably heard them all, that we go to a 45-day work year whereby we allow people to access EI after 360 hours rather than keep what currently exists, which is that on average you have to work about 600 hours before you can access it—in some places it's lower, of course—and the suggestion that trade is not good for our country.
What would those three items—going to a 45-day work year, going to a doubling of CPP, eliminating trade—do for your businesses?
It's not in order.
We have a couple of minutes left in this session, and I'm going to take the liberty as chair to ask a couple of questions before we wrap up. I'm sorry we don't have more time with the witnesses.
I want to first of all express my condolences to Mr. Unrau, and the whole Canadian Cattlemen's Association, for the challenges your members are facing right now. I'm sure it's very difficult for your members, and I regret that we haven't had more time to hear from you about the kind of challenges, economic and personal, that many of your members are facing. We do appreciate your being here.
I'd like to ask a general question to all the panellists. We only have a couple of minutes, so maybe anyone who wants to answer could take this.
The current issue of The Economist has, as its largest section, an investigation into the whole issue of inequality, both within countries and globally. It talks about the economic and social and personal impacts of inequality.
Could you leave our committee with any thoughts or measures you believe the federal government should take that would help to make sure we're addressing income inequality and that we're not having the subsequent problems that were outlined in The Economist? If you haven't read that, it's very interesting reading.
Do you have any final thoughts on that?
Go ahead, Mr. St-Pierre.
Thank you very much. I want to wish a warm welcome to all of our witnesses for the second half of this meeting.
Welcome to the witnesses.
First, we have Daniel Bergeron from the Agence métropolitaine de transport, followed by Claude Péloquin from the Association québécoise de l'industrie touristique.
From the Canadian Labour Congress, we have Sylvain Schetagne. Bienvenue. From the Forest Products Association of Canada, we have David Lindsay; from the Social Economy Working Group. we have Patrick Duguay; and from St. Boniface Hospital, we have Dr. Michel Tétreault.
Welcome to all of you. You each have five minutes to make your presentations. I regret that I will need to interrupt you if you go over.
We are going to start with you, Mr. Bergeron.
I have a point of order.
I'm so sorry to interrupt. I have a quick point of order I need to clarify, if you wouldn't mind.
Madame la présidente, we've prepared based on the submissions that came to us. There were some 800 submissions. I know that we were only allowed to take 120 to 150 of those that were submitted, but two who are here today never submitted. I'm wondering how we deal with that.
Of the 800 who submitted, we picked the ones that were supposed to come here and present, but we've just now received something from two organizations that didn't submit, as required, by the deadline of August 3. I'm asking for your help in trying to determine how we deal with this. We haven't had the time to read their submissions, so we're ill-prepared to move forward.
I'm asking for your advice. I would like your interpretation of what was decided. I apologize to the witnesses.
My name is Daniel Bergeron. I am the Vice-President of the Agence métropolitaine de transport in Montreal. We are very honoured by the invitation to appear before this parliamentary committee.
The Agence métropolitaine de transport is responsible for public transit in the Montreal area. Our region includes 83 municipalities with approximately 3.6 million people. In terms of public transit in the region, 15 transport authorities are responsible for providing bus, metro and commuter train services. We are talking about 500 million trips a year, which makes public transit a key component of the region. More specifically, public transport agencies in the region provide 10,000 direct jobs, in addition to, obviously, transporting more than 50% of the region's workers daily during morning rush hour.
This year, public transit represented about $1.5 billion in operational costs and region-wide investments. The amount was $1 billion in 1996 and it will be $2 billion in 2017. The funding for current services mainly comes from public transit users—who cover 40% to 50% of costs—as well as the municipalities, the Government of Quebec in terms of investments, and the federal government through various existing funds.
In addition to public transit trips in the Montreal region—and the same goes for Toronto, Vancouver, Calgary and other major Canadian urban centres—there are also a lot of congested highways, blocking the transportation of goods, which slows down economic activity.
To address those concerns, the Agence métropolitaine de transport, with all the transportation agencies and all the cities in the region, including the City of Montreal, the STM and its other partners, has developed a 10-year investment plan to reduce traffic congestion and to foster economic activity by transporting goods and by making the city appealing to its residents. This investment plan provides for a $17 billion investment over the next 10 years; that is a huge amount. Municipal and provincial governments are the main players, but we think that the government has a major role to play on three fronts: first, by creating a public transport investment fund in the range of $1 billion for the next 7 to 10 years; second, by continuing to allow public transit programs to be eligible for existing programs; and third, by proposing economic development guidelines for public transit through a 10-year action plan that would include the two investment funds I mentioned.
So these are the recommendations that AMT would like to submit to you: first, creating a new fund for public transport infrastructure in cities across Canada, for a period of 7 to 10 years and in the amount of $1 billion a year; second, maintaining current funds and the eligibility of public transit for those funds; finally, creating a national public transit action plan to encompass all that.
Good afternoon. Thank you very much for having us here today.
My comments will deal with the importance for the Canadian Tourism Commission to capitalize on the international tourism market. I am vice-president on the board of directors of the Association québécoise de l'industrie touristique. I am also the president and general manager of the Association des stations de ski du Québec and chair of the Canadian Ski Council.
The Association québécoise de l'industrie touristique represents close to 10,000 Quebec businesses, and sector and regional associations. Its mission is to represent the various members and ensure that the tourism industry thrives economically in Quebec and Canada.
The Canadian tourism industry contributes $7.8 billion in revenue to Canada's economy. It operates year-round across the country and employs Canadians of all educational backgrounds and ages. Contrary to other economic sectors such as manufacturing, tourism creates employment that cannot be outsourced. A job in the tourism sector will not be transferred anywhere else in the world.
The Canadian Tourism Commission is Canada's national tourism marketer. It sustains a vibrant and profitable Canadian tourism industry. As worldwide tourism receipts keep growing, Canada's share in this growing export sector continues to erode. International arrivals have increased by 4.6% globally, while international arrivals to Canada are down by 0.8%. Canada's international travel account deficit balance of payments was $16.25 billion in 2011, a 14% increase over 2010. This is not good news for us.
Taking into account Canada's tourism deficit and the enormous economic potential of the industry, it is absolutely incomprehensible for the CTC, our country's marketing agent, to have $14 million, or 20%, of its already limited budget amputated in the 2012-13 financial exercise. While Canada loses ground, countries have invested in considerable marketing vehicles in order to face challenges from newly emerging competitors.
Some countries invest a lot of money in their tourism budget. For example, Ireland has a budget of $211 million to market their destination. In the last 15 years, Ireland has had an increase of 14% in arrivals from key markets. Australia has an annual budget of $147 million to market itself, around the world and it has had an increase of 30%. Canada, with a budget of only $72 million in 2011, in the same period had a decrease of 10% in arrivals from key markets. This is not good news.
Almost all major tourism destinations are cashing in on this incredible boom in the industry, welcoming increasing numbers of visitors every year. Only five of the top 50 most popular destinations in the world are losing ground. Not only is Canada one of the five countries that are losing ground, but we have fallen 18%. Our annual losses in terms of international arrivals amount to 3.6 million tourists since 2000.
Our recommendation is this: as other countries have been investing considerable amounts in promoting their appeal for tourists, the Canadian Tourism Commission has seen its financial resources reduced by 41.5% over the past ten years, from $99 million to $58 million in 2013-14. Canada must have a strong national marketer that will strategically position the country abroad and capitalize on our Canadian national identity, our culture, our nature, and our winters.
On behalf of the 3.3 million members of the Canadian Labour Congress, we want to thank you for the opportunity to present our views on the 2013 federal budget. As you know, the CLC brings together workers from virtually all sectors of the Canadian economy in all occupations in all parts of Canada.
Leading economists, including bank economists, say that Canada's economic recovery is stalling due to slow business investment, high household debt, and weak global growth. Business investments are not where they should be. The across-the-board corporate tax cut didn't deliver the promised investments in real assets, such as new factories and workers' training. Thus, these cuts failed to boost economic growth and productivity and didn't help create more and better jobs in Canada. Instead, those corporate tax cuts delivered high compensation to CEOs, cost Canadians billions in lower than expected government revenues, led to higher federal debt and deficit, and led to cuts in public services. However, those across-the-board corporate tax cuts have helped private non-financial corporations in Canada hoard over $500 billion in cash reserves, money that is not working to create better jobs and more jobs in Canada.
To compensate for the lack of investment from corporations, we need a major public investment program to create good jobs now in Canada, promote our environmental growth, stimulate new private sector investment, and boost productivity. The CLC calls for the federal government to launch, in partnership with provinces and cities, a major multi-year public investment program. The program should include an increase in support for things such as basic municipal infrastructure, mass transit and passenger rail, affordable housing, quality affordable child care, energy conservation through building retrofits, and renewable energy projects.
The CLC supports targeted measures to support and create good jobs in manufacturing and to maximize job creation in industries linked to the resource sector. This will require government strategies on trade, sectoral development, and domestic procurement strategies. Encouraging value-added production and investment in key sectors, along with green jobs and green skills initiatives, will enhance innovation and labour productivity. Having sectoral development policies seeking to promote more investment, production, employment, and exports, especially in important sectors of the economy, is key to attaining a more desirable mix of sectors in our economy.
Also, we cannot afford trade investment that gives priority to investors' rights over the rights of workers and their aspirations for decent work and decent lives. We need a new international trade and investment framework that has, at its core, the promotion of high labour standards and collective bargaining, high job quality, and sustainable global economic development.
Also, Canada's economic success and the future prosperity of every Canadian will depend on the capacity and capabilities of a skilled and educated workforce. While there is much talk on future skills shortages, Statistics Canada reports that there are more than five unemployed workers for every job vacancy in Canada. Training and lifelong learning are critical, and literacy and numeracy skills in Canada lag behind those in many other countries. Training Canadians instead of importing vulnerable migrant labour should be a top priority. The CLC calls for the development of a national tripartite skills development strategy in response to the growing skills gap, the aging workforce, and the specific needs of groups such as aboriginals, recent immigrants, and youth.
Finally, some of our key federal programs do not match today's reality. Only 37% of unemployed Canadians receive EI benefits. The CLC calls on the government to implement a uniform national entrance requirement of 360 hours, increase the benefits level from 55% to 60%, and base benefit and duration calculations on the 30-hour workweek.
The CLC continues to call for a doubling of future CPP benefits phased in on a fully pre-funded basis, and we welcome the support given to the CPP expansion by Ontario and many other provinces.
We call on the federal government and all provincial governments to pursue this option as an urgent priority.
Good afternoon, everyone. Thank you very much.
I appreciate the opportunity to present to the committee today. Staff have already received our pre-budget submission and they have a copy of the more extensive remarks, so I'll try to keep my comments brief in the interest of time.
The forest industry in Canada remains an important part of our economy from coast to coast. There are some 200 rural communities across the country that depend on the forest industry as their primary employer. The forest industry in these communities has faced significant challenges and headwinds in the last number of years, but the Forest Products Association recognized that we couldn't sustain business as usual, and we launched on a path of transformation and renewal.
I'm pleased to report to the committee today that we've made considerable progress on that journey, so I'd like to talk today about some of that momentum and how we can work with our partners to continue.
Earlier this year, the Forest Products Association of Canada launched what we refer to as “Vision 2020”. It focuses on ambitious goals for our products, our performance, and our people. By 2020, we want to have $20 billion of new economic activity; we want to have a 35% increase in our success in improving our environmental footprint; and we want to have an additional 60,000 new recruits, including women, aboriginals, and new Canadians, in those communities in which we work.
Vision 2020 is built on some of our recent successes already: we've improved our productivity, we've diversified our markets, we are making technological breakthroughs and producing innovative products with wood fibre, and we've established world-class environmental standards on behalf of the forestry sector.
The government and all of our partners have been instrumental in supporting these changes. Embassies and trade officials have been very helpful in our trade and marketing efforts. NRCan created the successful pulp and paper green transformation program. There has been critical support from industry, government, and the academic community for FPInnovations which, for those of you who are not familiar, is one of the world's largest forest research centres, located here in Canada. It's unlocking some world firsts for the commercialization of something called nanocrystalline cellulose. It's an amazing product that comes from wood and can be used for everything from bullet-proof vests to lipstick—and I'll leave you to fill in the humour there. A $100 million investment in the forest industry transformation fund, or IFIT, has been very helpful, but it's been oversubscribed by fivefold. That simply indicates the amount of enthusiasm for commercializing these new products that exist in our industry.
While we're very proud of the progress we've made, FPAC and our member companies certainly understand the current fiscal challenges faced by the government and by our economy, and the need for controlling our deficit.
We would strongly recommend that where the government does continue to spend, such spending should be aimed at supporting industry renewal and focusing on enhancing our ability to compete globally and create jobs and prosperity for the long run. The forest sector is one of those opportunities, I would put to you. We're green and we're a renewable resource.
We encourage the government to continue to support the bioeconomy for forestry and agriculture as well. Last year my predecessor at this committee mentioned the potential for the next generation biofuels fund, administered currently at Sustainable Development Technology Canada, and we'd like to see the government continue to look at opportunities to invest in the bioeconomy and to enhance the IFIT program.
By working together with government, the academic community, and our environmental partners, we've already accomplished a lot. We need to continue work with all of our partners to continue to help the forest sector and forest-dependent communities that we serve to meet the goals of Vision 2020.
Let me make a couple of specific suggestions for the committee today.
We need to continue to support research and innovation to make sure some of the groundbreaking products I alluded to are not only developed but also commercialized and taken to the global marketplace.
We'd like to see the government improve its strategic procurement programs to increase the purchase of next-generation forest products, ranging from building materials to biofuels to medical supplies.
We have a challenge with rail services. If we're going to get our product to market, we can't leave it at our loading docks. We need some help with rail service reform.
As my colleagues have already alluded to, we have some challenges with skilled labour shortages, so we need to focus on labour for the next generation coming along in the forest sector.
Madam Chairman, by working together with the government, we can help to create new opportunities for new jobs and new growth in rural and small-town Canada.
By working with all our partners to implement Vision 2020, we'll ensure Canada has a world-class green and renewable forest product sector well into the future.
Thank you for having us here.
My name is Patrick Duguay, and I am the director general of the Coopérative de développement régional Outaouais-Laurentides. My office is just on the other side of the river. I did not have to travel far. In fact, I was dropped off by Taxi Co-op.
The United Nations declared 2012 the International Year of Co-operatives. Last week, 2,600 co-operators from around the world met in Quebec City for the first international summit, at the invitation of Monique Leroux, the president of Desjardins Group.
I am from the Social Economy Working Group, a smaller organization that was created in 1996 at the invitation of the Quebec government at the time. That government had chosen to promote collective entrepreneurship and the meaning of entrepreneurship, to use it for the benefit of communities. So, the Social Economy Working Group is an organization that promotes the development of social economy and brings together major company networks, networks of organizations that support development, social movements and university networks. After all these years, the Social Economy Working Group has its own financial tools to support new projects, strategies to promote the social economy labour force, and research and transfer tools.
With respect to non-profit organizations in Quebec, there are approximately 7,000 collective enterprises, including 3,300 co-operatives, and close to $5 billion in sales, or $30 billion if you include the entire sector and Desjardins Group. The social economy represents 8% of the gross domestic product in Quebec, and that is just to start.
The co-operative and mutual aid movement has deep roots in Canada. Public policies in favour of co-operatives have been adopted in most Canadian provinces. A very sizeable association movement, which is seen mainly in the volunteer sector, is present in all communities in Canada.
Increasingly, collective entrepreneurship is being rediscovered, with its objectives of meeting new needs or needs that had not been properly addressed until now. Social economy enterprises invest in all economic activity sectors, be it transport, forestry or others. In all these sectors, there are enterprises that have chosen to operate under different rules.
Briefly, I would like to present a few approaches, expectations or hopes so that the Canadian government can perhaps better recognize the International Year of Co-operatives. The last thing that was done this year was do away with the only program to support the development of new co-operative initiatives. It was the co-operative development initiative, and came under Agriculture Canada. Its staff went from 94 to 6 employees.
The most important thing for us is to guarantee that all social economy enterprises have fair and adapted access to the SME support programs. Even if the goal of the social economy enterprises is not individual enrichment, but community enrichment, they are still enterprises. Access to development capital would be important. In his last budget speech, Minister Flaherty referred to the
report of the Task Force on Social Finance,
which our organization signed.
Thank you very much, Madam Chair.
Thank you very much, Madam Chair.
I was going to start by saying thank you for the opportunity to talk about some daunting challenges, but when you said speak slowly and do it in five minutes, that just replaced the first challenge. However, I'd like to also talk about some exciting opportunities.
Health care is very rapidly creeping up to a $200 billion industry in this country, and by all analysis, it's an unsustainable industry. That is not only in Canada but throughout the developed world, and totally regardless of who is paying for it. Whether it's private or public or mixed or mutuals, as in Europe, no one can afford to pay the price we are paying for health care now.
St. Boniface Hospital wishes to propose to contribute to trying to help in this phenomenon.
There are really two pieces to this equation. One is, obviously, when there's not enough money, you can either grow the income or reduce the expenses. We have some ideas on both of those.
On the first, in terms of growing income, we think we should be investing more in supporting research in Canada. St. Boniface Hospital was the first stand-alone basic research centre in a hospital in the country. We've had some successes, and some companies have grown quite nicely, thank you. I think of Intelligent Hospital Systems with, the last time I looked, 80 employees in Manitoba. It just didn't exist a few years ago.
However, we still aren't capable of supporting our researchers with our advice and our expertise as much as they need. Everyone wants to support the home-run hitter that everyone knows is a home-run hitter, but people find it very difficult to find the wherewithal to support the guys and girls who are going to hit the singles and doubles for us until they produce that home run.
The other thing that St. Boniface is proposing is to allow our infrastructure to be used in off hours and on weekends by fledgling small and medium-sized enterprises. It might not surprise you to learn that Canada produces 4.1% of the scientific papers in the world, but only 1.7% of the patents that come to fruition. We believe that more products will create more companies, more companies will create more jobs, and more jobs will create more wealth.
That's the plus side of the equation.
I will now speak in French.
On the other side, we need to reduce our health care spending, which is unsustainable. We feel that this is doable. It may seem somewhat contradictory, but it can be done through quality.
A few years ago, at St. Boniface Hospital, we proposed that there be a single strategic priority—quality—and that the way to do it was through the Lean quality transformation approach. We often use the Lean transformation to improve the process and efficiency. But, John Toussaint, who is one of the world's Lean experts in healthcare, said that wasn't the case, that it involves a radical culture change in the approach toward treating patients.
I will say very quickly that we have four main strategic directions: satisfy patients, engage staff, decrease injury to patients, so harm them less, and manage resources.
In four years, the results show that our patients have never been more satisfied. We have hit peaks of client satisfaction twice in the year. Up to 87% of our patients have said that the care they received was very good, or excellent, and not just satisfactory. Our employees have also never been as engaged. In five years, we have had an increase in involvement of 34%.
Our mortality rate at the hospital has decreased by 30% in the past three years. Our goal was to have it drop by 10%. Our financial performance has improved in the past two years, and we have managed to reach our goal, which was 1% year over year. So, over two years, with 1% of our budget of about $300 million, we managed to increase service delivery by $3 million. Last year, it was $6.2 million, and our objective for this year is $9 million.
In short, I am asking you to stop and think. If we were to take the $200 billion spent on healthcare in Canada and applied 1% improvement over five years, year over year, that would be a cumulative total of $30 billion in improvement to financial performance.
If the St. Boniface Hospital managed to help Canadian society overall to reach 10% of that goal, and if the St. Boniface Hospital's contribution was 1% of $3 billion, that would equal $30 million. We recommend that a centre of expertise and learning in these techniques be established so that we can help other institutions in Canada progress in this direction, in order to have patients who are more satisfied and employees who are more engaged, and to gain better clinical results.
Thank you, Madam Chair.
Actually, all through Canada it costs us, with our large cities in Toronto, Calgary, Vancouver, and Montreal, more than $3.7 billion per year in losses in our economy from congestion. Congestion is a major problem.
We can enlarge our roads, but there's a limit to that. We can go to Los Angeles or a place like that to see why. Otherwise, we can invest in public transportation.
The federal government, over the last seven years, has already invested about $1 billion per year in public transportation through actual programs. These programs are very good. They focus on municipal infrastructure, and from that we already have $1 billion per year.
What we recommend for the next 10 years is to maintain those programs that are already very interesting, but also to add a dedicated fund that will add $1 billion per year for the next seven to 10 years for, again, public transportation. It will support the economy everywhere in Canada. This is very specific to public transportation. We have it through all our main cities in Canada. It created almost 80,000 jobs throughout Canada, and we want to sustain that and also sustain people going to work. An example, two out of three people going to work downtown in Montreal are going by transit already, so it's very important for the other workers also.
Thank you, Madam Chair.
Mr. Péloquin, I am going to give you the opportunity to answer an intelligent question, based on facts. I found a letter from Anthony Pollard, the president of the Hotel Association of Canada, with whom I have had numerous exchanges. The letter was addressed to the association's members and was entitled "Canada's tourism industry is in crisis; plain and simple". After describing the cuts imposed on the Canadian Tourism Commission in recent years, he says:
“Due to lack of funding, the CTC has been forced to exit many markets including Italy, the Netherlands, Spain, Switzerland and major cuts in Japan and the United States. Quite simply, Canada is not keeping up globally.”
Mr. Pollard made comparisons internationally with respect to support for tourism. Canada has no reason to be proud. A simple state like Hawaii spends $73 million to promote its tourism around the world, while Canada spends $72 million. California, which has significant economic problems, dedicates $51 million.
Do you want to comment on that?
Thank you, gentlemen, for being here this afternoon. I appreciate you staying late here with us as we do the pre-budget work. I'd like to talk to all of you, but unfortunately we only have five minutes, and she's very close on the watch.
Voices: Oh, oh!
Mr. Randy Hoback: I think I'll go with you, Mr. Lindsay, because I come from Prince Albert and the forestry sector is huge in Prince Albert. It's going to be huge again.
In 2005 we had an NDP government and we had a pulp mill shutdown. Because of the pulp mill shutdown, the sawmill in Big River shut down and the mill in Carrot River shut down.
You can look at Saskatchewan—it'd be a really interesting case study that I'm sure some economists will do—and at what happens when you have bad policy and then you put a government in place that brings in good policy. You can see what happens. In 2005 we were looking for jobs. We're lucky Brian's area in Fort McMurray was hiring people, because the guys who worked in the mill went to Fort McMurray. They stayed in Prince Albert and worked back and forth.
As we now go forward into 2012, it's a really interesting scenario: we have the mill reopening. In fact, it has already started up and they're running it as cogeneration. They're producing green power, which is something we all like to hear, but we have a huge problem. The huge problem now is that I need 300 workers to run the plant and I need 400 construction workers to get it back going. I have an investor who has money, who wants to do it, and who has bought it. It's Prince Albert Pulp and Paper Excellence, and they've worked with the first nations to start getting the people out in the field to cut the trees and do all that work.
The labour shortage is a huge issue in Saskatchewan. Of course, it shows what can happen when you have good policies such as you have with the Saskatchewan Party and a good, strong federal government, and also what can happen when you have the bad policies that we had with the previous NDP government in 2005. The impact it has had on their regions has been phenomenal. In fact, the Carrot River mill is starting up. It looks like the Big River mill will be starting up pretty quickly. We've seen reinvestment in the forestry sector.
Mr. Lindsay, you really touched a nerve when you talked about the exciting new products you're making with forestry fibre. Maybe I'll just ask you about the severity of the skilled labour shortage and how it's affecting your sector.
Thank you very much, Mr. Hoback. That's an excellent question.
I think it's a challenge for all of Canada and all industries with the aging demographics of baby boomers, but particularly in the forestry sector. Because we did face those down periods due to layoffs, our workforce is somewhat older than the average. They will be coming up for retirement. We have a rough estimate of some 40,000 workers who need to be replaced due to retirements, and then an additional 20,000-plus for our new products and our new markets. That's where we come up with the number of 60,000 over the next decade.
That won't come from one source. It has to come from all sources. There are many people who live in these communities close to the mills who traditionally haven't thought of themselves as forestry workers: women, new Canadians, our aboriginal population, our first nations. We are creating programs with all of our employers and with the Forest Products Association to promote forestry as a quality-of-life, good, green job to have.
We will do our part to promote forestry in particular. We need the help of all of our partners—the provincial governments, the federal government, and others—to make sure we have that skilled workforce coming in, whether it's through immigration policy or through making sure there's enriched training and support programs for first nations and transferability of skills across jurisdictions. It's not just skilled labour but unskilled labour, so it's both a volume and a quality challenge. It's not going to be solved with one tool. We're going to need a whole basket of tools. We're working with our partners to develop those right now.
With regard to first nations communities, we just gave an award to a wonderful young woman who is of Métis background. She's developing new and wonderful technologies for the forestry sector. She is a skilled worker from the Métis community. You celebrate successes and try to bring more people into the industry.
That's what's exciting. In Prince Albert we still have these guys working in Fort McMurray flying back and forth. We need 300 new people, so it's 300 new families moving into the Prince Albert region, and that's not talking about the truckers, the loggers, and all the other small communities. Our vacancy rate, they're telling me now, is less than 1% or 2% as far finding places to live is concerned. All of a sudden there are opportunities for carpenters, but try to find a plumber and an electrician.
These are great problems, because in 2005, when we had an NDP government, the issues that were coming to me were regarding who's going to pay the infrastructure bills in these towns, because nobody was living there. Now the issue is how to get more money for infrastructure when we don't have people to build it. It's actually an interesting problem.
You talked about the rail services. I know in the agriculture sector we have huge issues in rail service. I know what it's like to be a farmer and have six or seven semis on the road on a Sunday night, showing up at an elevator, and all of a sudden I get a phone call Monday morning saying that the train didn't show up, so what do I do with these six semis that don't belong to me? I have to get them unloaded somewhere, and the elevator is full.
Where are you at in dealing with railways as far as the service level agreement is concerned? I understand they said that they made negotiations in some agriculture sectors with some of the companies that are doing that. Have they been able to do that with you guys?
The time I didn't use on the last one I may use on this one.
The rail companies have reached out to some of our members, but the Forest Products Association, through my colleague, Catherine Cobden, tried on a number of occasions to come up with an agreement that would be acceptable to all parties, and that was rejected.
Our concern is that we have gone up to the altar a number of times, and then it falls away, so if we have a service level agreement understood in the legislation, then that will create a business tension for the two parties to come together to work it out.
We're not asking government to impose service level agreements; we're asking for a safety valve whereby, should business-to-business discussions not be successful, there is a mechanism to resolve that in the rail and shipper relationship. We're not asking for rules to be imposed; we're asking for a framework if we cannot come to an agreement. If the rail industry is telling us that those are easy to do, then they shouldn't mind having this legislative enhancement.
I want to thank the witnesses for joining us.
We know that our colleagues from across the table spend more time making up stories about us than looking into the repercussions of their own economic policies. If you are behind a $15-billion annual increase in the price of fuel, you should have the decency to refrain from laughing. Canadians who fill up pay that $15-billion amount every day.
We could also criticize this government for limiting itself to a single economic sector—that of natural resources. In terms of figures, in my riding of Marc-Aurèle-Fortin, we lost another 200 jobs recently. Those are 200 workers who need wages, who were ready to work and wanted to work in the manufacturing sector, at the Paccar truck factory. They are joining the ranks of 500,000 Canadians who have lost their job in the manufacturing sector, and that explains the additional 300,000 unemployed people compared with 2008. That is incredible and unspeakable.
Mr. Schetagne, what are the economic consequences of a policy based on a single economic sector?
You have showed those consequences. Such a policy has repercussions on workers' lives, jobs and revenues. Currently, a number of things are coming to light.
We can say that the current government's economic development policy, in terms of sectors, is to have no economic policy. The hands-off approach is used at any cost, under the pretext that the market will take of everything and, if people happen to die, it's their own fault. A magic formula or a miracle is hoped for. We are even hearing the government representatives say that private companies should invest and that everything is there for them. They could invest, but they are not investing. It is up to the companies to invest, but we do not understand. That is the result of the hands-off approach, and we see that proceeding in this way has very poor results.
A nice opportunity is being missed, in a number of respects. We have the opportunity to use our state's borrowing capacity to invest in us, increase our productivity, create more jobs and invest in training for workers.
An opportunity is being missed to be much more strategic in the way the country's natural resources are being used. Those resources should be not only mined here, but also transformed here, to create jobs and expertise here.
An opportunity is being missed to create more training opportunities for Canadians, so that, instead of importing labour force, we can use the 1.4 million Canadians who cannot find jobs. This is especially the case with young people, whose unemployment rate is between 15% and 20%. Some nice opportunities are being missed.
Thank you, Madam Chair.
I was puzzled when I listened to some things that were being said on the committee. I am going to direct my comments to Mr. Schetagne, first of all.
In your presentation you stated that the government had a false understanding of the economy. We all know, and it's public knowledge, that 770,000 net new jobs have been created. We have a AAA credit rating. We have been known, for five years in a row, as the most solid banking system in the world, so we're doing something right.
When I listened to you a little later, you advocated a 30-hour workday. You said that we need to do a child care program, which is basically provincial jurisdiction and not federal jurisdiction. Then you said we should open up free trade. Well, we have opened up more free trade agreements than any government in the history of Canada and we're working now with more. All of these things have been met.
As I listen to you, I am trying to understand a little bit. You talked about taxing people and things like that. How do you square a $21 billion carbon tax being laid on the people? How do you think that would help these people you are talking about, the workers? How would that affect them? That's what members opposite are advocating. I am just curious to hear what you have to say about that.
Thank you. I appreciate your interruption.
You also know, of course, that in that economic action plan the federal government put certain requirements in place, including municipal investment. It was in the economic action plan that the federal government put forward, with provinces matching those funds as well. In essence, the $45 billion, including the stimulus and economic action plan funding, is going to be somewhere around $135 billion. At least, that was the idea.
Do you know, sir, that in relation to this economic action plan, we've had tremendous amounts of investments in highways across the country? VIA has received almost $1 billion. We've had a huge amount of green infrastructure invested, etc. Were you aware that in relation to all of this money, every single member of the New Democratic Party voted against that stimulus funding and all that economic action plan? Were you aware that they actually stood in the House of Commons and said “no” to all of that economic action plan, into which you're suggesting we put forward more? Did you know that?
I want to thank all the witnesses for being here.
We are talking about tourism, and I fully agree that this activity has amazing effects on the economy. That's very important. The government recognizes that, and Minister Bernier is working on it.
My question is for Dr. Tétreault, from St. Boniface Hospital.
Your submission was absolutely incredible, Dr. Tétreault. You have addressed a number of things that we have been repeating over and over again, things like demographics. In the words of your submission, there's a remarkable increase in life expectancy for those over 65 and particularly for those over 85, and fostering a research environment at what you are calling a centre for health care innovation in Canada to assist an elderly population to remain healthy and active in the workplace is of great interest to me and to Canada.
I find it very interesting that your submission focuses on what we've been saying, which is to create some jobs to take care of those vulnerable people in our society and to make sure that we use every dollar efficiently. The 70% of the time that is unfortunately wasted by our nurses, as indicated in your proposal, searching for tools or implements or equipment that they need restricts them from patient care.
I encourage everyone to read the deck that you provided.
The job creation elements in your proposal are fantastic. By partnering business in innovation and in commercialization with the health care industry, there is money to be made and there are jobs to be created, so I appreciate everything you've put forward in your submission.
I want to give you an opportunity to address the letters of support that you distributed. I want to thank you for that.
As an MP in your riding, I get calls about the things you've been doing to educate other hospitals and other industries. I get calls about what you've been doing. You've been asked across the country and in other parts of the world to come and teach this lean program that you are advocating to reduce inefficiencies, etc. You've been approached by people who are interested in this idea of a centre for excellence. You've submitted a couple of letters of support.
I want you to tell us what these are. Give us a snapshot of what you've done for these two agencies that leads us to believe that what you're saying is going to help our economy and our health care industry to progress.
Thank you, and thank you for the kind words.
John Toussaint is one of the world leaders in the lean movement. He's the CEO of the ThedaCare Center for Healthcare Value, and as such has dealt with 60 organizations. We collaborate already quite closely with them in terms of how we can exchange our experiences, our expertise, and our knowledge among hospitals. We are developing programs as we speak as to how to more effectively and efficiently do that.
Interestingly, we had the first Canadian lean summer school in June in Winnipeg. We called it "summer school” because it was in June. This one happened to be francophone, so we had every one of Quebec's teaching institutions, le CHU de Genève, and le CHU Mont-Godinne in Belgique come to see us.
Some of the people who came were the people in charge of quality improvement at the Jewish General Hospital. When they went home, Dr. Stern, who wrote one of the letters, called me and said, “Jesus, these guys say you're so far ahead of us, I have to come and see you.”
We have a fair number of people who come to see us. In a few weeks the University Health Network in Toronto is sending 16 people to come to see what we're about. We think that if we make it more formal and more official and develop the curriculum a bit more, we can have a positive influence.