I call this meeting to order.
Welcome to meeting number 18 of the House of Commons Standing Committee on Government Operations and Estimates.
Today's meeting is taking place in using the new webinar format. Webinars are for public committee meetings and are available only to members, their staff and witnesses. Members may have remarked that the entry to the meeting was much quicker and that we are immediately entering into an active participation, bearing in mind that we've had a little bit of delay here in getting the witnesses. All functionalities for active participants remain the same. Staff will be non-active participants only and can therefore can only view the meeting in gallery view.
I'd like to take this opportunity to remind all participants at this meeting that screenshots and taking photos of your screen is not permitted.
To ensure an orderly meeting, we have a few rules to follow, please.
Interpretation in this video conference will work much like it is in a regular committee meeting. You have a choice at the bottom of your screen to either use the floor, English or French.
Before speaking, please wait until I recognize you by name and, when you're ready to speak, you can click on the microphone to activate your mike. When you're not speaking, we would ask that your mike be on mute.
To raise a point of order during the meeting, committee members should ensure that their microphone is unmuted and say “point of order” to get the chair's attention.
In order to ensure social distancing in the committee room, if you need to speak privately with the clerk or the analysts during the meeting, please email them through their committee email addresses.
For those people who are participating in the committee room, please note that masks are required unless seated and when physical distancing is not possible.
Now, with that, we have one witness here.
Thank you, Ms. Bull, for being with us.
I'll invite her to have some opening remarks, and, hopefully, by the time she's done, we will have the second witness so we can proceed further.
Ms. Bull, you have five minutes, please.
[Witness spoke in Ojibwa and provided the following text:
Aanii, Tabatha Bull n'indignikaaz, Nipissing n'indoonjibaa, Migizi dodem.
[Witness provided the following translation:]
Hello, my name is Tabatha Bull. I am from Nipissing First Nation, and I belong to the Eagle Clan.
As president and CEO of the Canadian Council for Aboriginal Business, I want to thank you, Mr. Chair and all distinguished members of the committee, for the opportunity to provide you with my testimony and to answer your questions.
Speaking to you from my home office, I acknowledge the land as the traditional territory of many nations, including Mississaugas of the Credit, the Anishinabe, the Chippewa, the Haudenosaunee and the Wendat peoples.
From the beginning of the pandemic, the government provided supports for business. A number of those supports were required to be remedied to include indigenous businesses. CCAB has repeatedly highlighted the need for a navigator function specific to indigenous business to assist with the understanding and uptake of the various programs. Indigenous businesses have found navigating the bureaucracy, which often does not consider their unique legal and place-based circumstances, a significant barrier to accessing the supports necessary to keep their businesses alive and maintain their well-being.
The lack of targeted assistance for indigenous business to utilize these government supports underlines the need for an indigenous economic recovery strategy that is indigenous-led, builds indigenous capacity and is well resourced to support indigenous prosperity and well-being.
Such a strategy was not mentioned in the recent Speech from the Throne, nor the fall economic statement. We acknowledge the number of important renewed commitments that were made, but there was no mention of efforts to support the economic empowerment of indigenous peoples, businesses or communities. We hope the government will use the upcoming budget to signal to Canadians that indigenous prosperity and economic reconciliation matters.
During my previous appearances before the House of Commons Committee on Indigenous and Northern Affairs on May 29 and November 17, I stated that unique circumstances facing indigenous businesses were not initially considered when forming the eligibility of CEBA or Bill . This left many ineligible for the wage subsidy. We appreciate that these gaps were remedied. However, we must not forget the additional burden the almost month-long gap had on many indigenous businesses.
Unfortunately when the government introduced Bill , which extended the benefits for rent and wage subsidies, CCAB again had to underline that the government did not consider the unique circumstances facing indigenous business. In this case, it took 82 days to receive clarity from federal officials that the aboriginal economic development corporations are likely not eligible for the rent subsidy. This delay and the disappointing response demonstrate that indigenous businesses continue to be an afterthought when programs are designed to support Canadian businesses.
To support sound federal policy development and effective interventions during the pandemic and in collaboration with leading national indigenous organizations, CCAB undertook two COVID-19 indigenous business surveys to understand the impact of COVID-19. From our most recent survey, we found that nearly half had to let go of staff. Although 57% of indigenous businesses remained open throughout the pandemic, 30% of those businesses surveyed indicated they would survive less than six months without additional financial support. In this vein, I would like to underline that indigenous businesses have repeatedly told us they cannot take on any more debt.
I also mentioned in my appearances at House and Senate committees that numerous indigenous businesses were prepared to readily provide PPE to meet Canada's medical needs. Lists of such indigenous businesses were provided to numerous federal departments as early as March 2020, but only a small fraction of the over $6 billion of federal procurement contracts for PPE was awarded to indigenous business. In a press release of September 21, 2020, it was noted that seven indigenous companies were awarded contracts totalling approximately $2.5 million. This equates to 0.04% of the federal spend on PPE. We understand through discussion with PSPC and through our own combing of publicly available data this value is slightly higher. However we continue to be unable to obtain confirmation of the total spend on PPE in indigenous businesses.
To remedy this information gap, I would like to propose that this committee consider measures that would mandate government departments and agencies to report on their purchases from indigenous businesses as a part of their submissions to the main estimates and the supplementary estimates committee. Simply put, we cannot evaluate and improve upon what we do not measure and report.
I would like to leave you with this point of consideration. Too often, indigenous business concerns are an afterthought, resulting in indigenous organizations like CCAB working to prove to government that their response has not met the needs of indigenous peoples.
A reasonable starting point to support indigenous economic recovery would include procurement and infrastructure set-asides for indigenous businesses and communities respectively, and for government organizations to publicly report these expenditures.
CCAB is committed to continuing to work in collaboration with the government and our members and partners to help rebuild and strengthen a path toward reconciliation and a healthy and prosperous Canada.
Thank you, all, very much for your time.
Good afternoon and thank you, everyone.
My name is David McHattie. I'm vice-president of institutional relations for Tenaris in Canada. I'm the board chair of the Canadian Manufacturers & Exporters.
The impact of the COVID-19 pandemic on Canadians has been severe by any metric, and I believe that the impact will be lasting for a considerable period of time. I was appointed to the COVID-19 supply council to provide insight and expertise regarding impacts on the Canadian manufacturing sector and how it can better support Canada during this time of need.
As an essential business for Canadians that directly generates 10% of GDP and employs directly 1.7 million Canadians, it is important that COVID-19 policy supports are developed with Canadian manufacturing in mind. Including direct and indirect impact, manufacturing amounts to nearly 30% of Canada's economic activity.
Priority issues for Canadian manufacturers are important for all of Canada. The safety and health of Canadian manufacturing employees is the primary priority. The industry needed access to PPE, timely testing and information to provide the goods essential for Canadians. Many manufacturers have ramped up or shifted production in response to the crisis to make more food, energy, PPE and other health care and health sciences products or input products. While this sector has modified its production, it has also had new safety protocols, and production regimes negatively impact its costs.
As many countries restricted supplies, Canadians became more aware of how important a stable, secure and flexible local manufacturing supply chain is to our national well-being. This is as important for industrial products as it is for consumer products. Organizations like the Canadian Manufacturers & Exporters were able to quickly transmit best practices through training services and to connect to members.
By creating the COVID-19 supply council, the federal government took a good step in reaching out to a diverse group for feedback, insights and support. The diversity of this group led to stimulating discussion that benefited all. Initiatives undertaken by the government that connected suppliers and buyers to establish a contingency reserve for strategic products and to inspire the expansion of Canadian supply chains have been lauded universally.
Considering that we're all learning lessons from the past 15 months, it is important that we continue to ask ourselves questions. How has the definition of essential goods changed for Canadians? Manufacturing does matter. Can we develop ideas and produce them here to supply ourselves and the world? How can we stimulate more domestic supply of essential goods through industrial policy and procurement strategies? How can we inspire Canadians to buy more local without limiting the benefits from globalization?
It's with the spirit of questions like these that the supply council worked. I appreciated the opportunity to participate and to contribute and felt like the government was listening to the views of manufacturers and exporters and Canadians broadly.
I know you're doing some analysis from a long-term perspective, but in the short term, do you have a say in the contracts that have been signed?
For example, the government ordered 40,000 respirators and received about 21,000. However, by any estimate, we have far too many respirators.
In your meetings, do you address these kinds of issues, namely, should we stop spending hundreds of millions of dollars on equipment we no longer need? Do you participate in these discussions?
Definitely, and without a doubt in those first months manufacturers moved as rapidly as they could to serve the communities where they operated, where their people were employed and where their customers were.
From coast to coast, across the country, there were manufacturers stepping in to do that. They often did so at their costs, because they were in an environment where you had to operate with different production regimes, often starting a product from scratch, or adapting an existing product, often at a higher cost.
It was very valuable to share with the government in many forums, including this forum, that Canada could help and connect, using government procurement where possible, with suppliers and buyers. It was a great opportunity, and would have an important benefit in communities across the country.
Mr. McHattie, I just want to say thank you to all your members who stepped up big time and produced for Canadians so we could have that PPE. It could have been a very different story had they not done that a few months ago.
I'll say the same thing to you, Ms. Bull. I know a lot of aboriginal businesses stepped up to the plate when Canada called.
I'd just love to hear what sort of problematic issues you have encountered. I know there were 28 contracts issued to aboriginal-owned businesses, but I am hearing from you that we need to find a way to measure that better. You said you'd love to see a way to provide the number of contracts that were provided to aboriginal-owned businesses through the supply bills. Is that what you said at the beginning?
I bring this to you because one of the motions that I brought before this committee was to look at this government's commitment under its existing policies on procurement. One of them is the federal contractors program, which has an agreement to implement employment equity for contracts that are over $1 million. While not directly related to sole-source procurement or procurement directly to aboriginal businesses, certainly this would manifest itself in strategic partnerships with manufacturers to ensure that they're meeting these employment equity standards.
One of the requirements of this is that once a contractor receives an eligible contract from the Government of Canada, the contractor must fulfill the following requirements: collect workplace information, complete a workplace analysis and provide an achievement report, establish long-term and short-term goals on equity-seeking groups, and make reasonable efforts to ensure that reasonable progress is made towards having full representation of the four designated groups.
The second designated group on the list happens to be aboriginal peoples. I'm wondering if your council has had any conversations around how procurement through the federal government is reflected in this way, or if some of the small and medium-sized businesses have been approached to partner up on the federal contractors program to ensure that these employment equity requirements are in place.
I would strongly agree.
I'll share with you, just for your own note and for the note of the people who are on this committee and the folks who are watching, that there's a compliance policy in this. I've taken a keen interest in this because it also impacts many other groups.
In that, if a contractor is found in non-compliance, then the contractor will be placed on what's called the federal contractors program limited eligibility to bid list. Why I bring this up as a note is because the footnotes is that there are no names currently on the limited eligibility to bid list. Based on a previous motion I'm bringing to your attention that you could bring back to your committee, it seems as if it's the government's position on this policy that all of the contractors in the federal contractors program are in compliance, which, quite frankly, I find very difficult to believe.
In wrapping up my questions in this round to you, Ms. Bull, I'm going to ask you to take the remaining time here to suggest.... You brought up a motion, but are there other clear ways in which we can ensure that existing government programs are actually meeting the mandate? Notwithstanding that there's probably going to be a third wave, and knowing what we know now from your time on the council, what would be some recommendations that this committee could take away to ensure that all the well-intentioned good-language programs of this government, “bringing meaning to procurement”, the set-aside program for aboriginal business, are actually having tangible results for the communities that they claim to support?
Thank you very much, Chair.
Thank you to the witnesses for being with us today. I very much appreciate your time.
Certainly the impact of COVID has been significant, and we've scrambled to respond. In particular, of course, last March and April, the government found itself in a situation where it had to scramble. Originally, it would appear that the thought it would be a good idea to include Canadians in the solution. She talked a lot about “a collaborative approach” that she wished to take at that time.
Out of this, she formed a special council composed of 16 individuals, and the two of you were part of that council. Those 16 individuals were selected from a variety of different backgrounds, either from the private sector or from not-for-profits. The minister originally felt that you had the ability to offer helpful insight and make recommendations to her. That's my understanding of the intent.
Then, when we look at the minutes that were made available online, we see that you had only three meetings that were posted publicly, and we found out today that there were actually four meetings. Originally there was a meeting on May 8, another one on May 28, another on June 22, and then not until December. The December meeting isn't reported online; however, you commented that the meeting did take place.
On May 8—that was your first meeting—according to the brief paragraph of explanation provided online, the only things that were done at that meeting were that the minister greeted you, she thanked you for your involvement, she went over the terms of reference and then commented that the next meeting would be in three to four weeks, without setting a concrete date and without really giving you your mandate.
We find that the next meeting was held on May 28, three weeks later. Now, we're in the middle of a pandemic at this time. The government was having a very difficult time procuring equipment, the PPE, that was necessary to keep this country afloat.
The minister said that she wanted a collaborative approach. She put these 16 people around a table who have incredible expertise to offer, but yet she didn't feel it was necessary to bring you together for three weeks, again, in the middle of a massive crisis, arguably the worst crisis since World War II.
The minister felt that she could go it alone, that she could make all sorts of decisions and...all sorts of money, without needing the expertise of industry, without needing the expertise of individuals who have collective wisdom to offer.
I find that interesting. It would appear, then, that this council was more for the sake of appearances and looking like the government cared about the opinion of Canadians—bringing expertise into the room with them—rather than actually doing so.
It seems that a blind eye was turned to qualified individuals, which is disheartening. Canadians deserved to have your voices heard. I think you had some really cool things that you would have been able to contribute had a meeting been convened during that important and crucial time from the beginning of May to the end of May, when numerous decisions were made.
I guess my question is, did you have the opportunity between meetings to submit advice or insights? Was there a mechanism by which you could do that, or was it only at meetings that were held by the minister?
I'd like to begin by acknowledging that I'm streaming from the traditional unceded territories of the Squamish, Musqueam and Tseil-Waututh nations. My riding also includes the traditional unceded territories of the Sechelt, Lil'wat and N'Quatqua nations. I'm very grateful for their stewardship of these lands and waters since time immemorial.
Ms. Bull, you mentioned the disproportionate impact to first nations-owned businesses. I've certainly seen it first-hand in my riding, particularly for those involved in the arts, culture and tourism sectors, of which there are many. You mentioned that the unique circumstances of indigenous-owned businesses bar them from government COVID-19 relief programs. I'm hoping you can explain why that is.
Initially, the first program under CEBA was designed for access through traditional financial institutions. We know that only about 33% of indigenous-owned businesses have relationships with traditional financial institutions. There was further funding provided, $307 million, through the national aboriginal capital corporation to be distributed in the same way as CEBA through the aboriginal financial institutions, but that money was not available to be distributed until late June. Again, there was a significant delay from when CEBA was announced.
Then, on the wage subsidy program that was unrolled initially, aboriginal economic development corporations were not eligible for the wage subsidy. That's because of the structure of how they're set up. We did have many discussions across government. Again, that was also remedied, but it was about a three-month delay from when other indigenous businesses were able to access the wage subsidy in comparison with economic development corporations. Economic development corporations do employ a significant number of Canadians, indigenous and not.
Mr. McHattie, I can appreciate your mention that between meetings you could send a note. I understand that is one form of communication; however, in your comments, you also said that you found the conversations very insightful or very helpful, which tells me that there's a lot to be gained when people are brought together, when they are at the same table and collaborating in the same room at the same time.
I would gather from your comments, then, that actually a lot was missed when meetings weren't called for long periods of time. Again, there was a long period of time of three weeks in May, then another long period of time from the end of May to the end of June, and then there was another six-month period from the end of June to December. That's a lot of waiting time between meetings and a lot of opportunities that are missed, to go to your point that conversations can be had that are incredibly insightful and altogether helpful, not only for you as industry leaders, but of course for the as well.
It's interesting to me that the council was formed and was supposed to be a place where there's a meeting of the minds. It brings people together to where they are able to put forward different ideas and engage and perhaps even debate in lively discussion for the sake of coming up with new and innovative ideas.
It's confounding to me, then, why the wouldn't call a meeting more regularly, especially at the beginning of the pandemic when things were being figured out. Wouldn't you agree with me that holding a meeting where people can collaborate is important?
I'd like to come back to the way the council operates. I have somewhat conflicting information, and I'd like your perspective.
When the COVID-19 Supply Council was established, the stated that it was “not meant to fill a particular gap in the supply chain per se” but that its purpose was “to take a fresh look at the procurements.” In her words, it's more like an advisory committee.
As for , he said the council's job was to ensure that Canada would have sufficient supplies to continue fighting the pandemic, such as ventilators, masks and hand sanitizer
From what I'm hearing today, you were called in to give advice, but you weren't really involved in the operations. But the Prime Minister said you were there to help with operations.
Mr. McHattie, which is the right version: the 's or the 's?
As I speak to you now, I am on the Quebec side of the Ottawa River, on the territory of the Algonquin Anishinabe people.
Thank you, Mr. McHattie and Ms. Bull, for being with us today.
I had the pleasure, as parliamentary secretary at PSPC, of sitting in on a number of those supply council meetings. I want to thank our witnesses for their time, their expertise, their insights and their knowledge.
Frankly, Mr. Chair, I find this badgering about what was discussed at these meetings a little tawdry, and certainly unproductive on the part of the opposition. What you had were conversations with people from all walks of life, and notably from the business community, during a crunch time for Canada. It's a matter of public record that we were in a PPE crunch, and we called out to representatives across the country to come and counsel the minister and the government on these issues. I know their advice was very well taken and very well received.
In that spirit, I want to further the conversations that went on in the minister's supply council and ask about next steps.
I'll start with Mr. McHattie. From your perspective at Canadian Manufacturers & Exporters, what are the barriers you see that remain in order to continue the evolution of a domestic supply chain for PPE, and for any sort of health-related applications that were discussed and outlined?
With about a year's worth of hindsight, are there things governments could be productively doing to help Canadian manufacturers get a bigger foothold in this sector?
That's a great question.
I certainly don't mind, and I didn't consider it badgering. I think the work that's done by members of Parliament in trying to hold the administration to account is perfectly fine and acceptable, so I'm okay with that. However, I want to bring it up a level.
What can we do better in Canada to attract investment in Canadian manufacturing, regardless of whether it's PPE, biosciences or whatever? Think about things in terms of when you invest in new capital equipment; you're investing in a higher or more advanced technology. It's more likely to have digitization, automation and the kind of industry 4.0 Internet of things. This is something where Canada—as ranked among OECD countries—is near the end of the list. We're not at the front of the list. We would like that trend to be reversed, so we need to find ways to attract investment to Canada.
There are two aspects to that. We can compare ourselves to the United States and we can compare ourselves to other OECD countries. The report of the Industry Strategy Council is an extremely good report for someone like me: I love to think and talk about that. It's tough for Canadians to read all of these detailed things. It's easy to say we should have lower, more competitive taxes and we should find a way for companies to have more to reinvest. We need to partner with companies to invest more, so we need to do a lot more of this.
Innovation is not only in R and D and in new concepts and ideas. Innovation is in applying what's available today. When you're a manufacturer, you need to keep investing in your manufacturing equipment. Every time you do something new, it is going to be more innovative. We have a great opportunity to do more of that. I would like to connect lessons we learned in the COVID-19 supply response with those broader manufacturing investments, and I think we have opportunities to take.
Thank you very much, Mr. Chair.
Mr. McHattie, in your comments, you talked a lot about attracting investments and creating jobs.
Ms. Bull, my question may be of interest to you, as well.
The idea is not to attract these investments from abroad, but to attract them from within. Do we have that opportunity in Canada, or are we still waiting for the good Lord to come through the side door?
As I said, I think that the supply council was an opportunity for us as an indigenous association—as well as for other minority associations—to have a voice at a table that maybe we don't always have the opportunity to have. That conversation did lead to the supply hub. I did find an opportunity.... When mentioning the indigenous businesses that could provide PPE, there was follow-up to ask who those businesses were, and there was a link to the supply hub to the list of businesses that can provide PPE.
That is definitely a step in the right direction. However, I do stress again that this needs to be a government-wide solution and a government-wide indigenous entrepreneurship strategy, not something that fits within one ministry. Within every program that comes out of ISED or NRCan, we need to be looking to ensure that those programs meet the needs of indigenous businesses and that indigenous businesses have the same opportunity to participate in those programs. That is something that we're pushing for very hard in our upcoming budget submission as well.
I think we also need to really look at the opportunity and the propensity of indigenous businesses to export, both generally in the U.S. and in Australia, as well as the opportunity for them to participate in export dialogues with their indigenous counterparts in Australia, New Zealand, the U.S. and across the globe.
Thank you, Ms. Bull and Mr. McHattie, for being here today and bearing with us as we dealt with the challenges of the telecommunications. I appreciate your comments and your staying with us the whole time.
At this point in time, the public portion of the meeting is now complete, and we will be going in camera. You're free to go.
Members of the committee, the clerk will have sent you a page that basically indicates how to get onto this meeting and then how to get onto the in camera meeting. You will have to get out of this meeting completely and then re-enter through the in camera portion with the new code. We will see you in about five minutes, hopefully—as quickly as we can—and then we can reconvene.
Thank you, everybody.
[Proceedings continue in camera]