I call this meeting to order.
Welcome to meeting number 23 of the House of Commons Standing Committee on Public Accounts. Pursuant to Standing Order 108(3)(g), the committee is meeting today to undertake a study of “Report 1, Just Transition to a Low-Carbon Economy”, of the 2022 reports of the commissioner of the environment and sustainable development.
Today's meeting is taking place in a hybrid format pursuant to the House order of November 25, 2021. Members are attending in person in the room and remotely using the Zoom application.
In light of the directive of the Board of Internal Economy on March 10, 2022, all those attending the meeting in person must wear a mask, except for members, when they are seated during parliamentary deliberations.
To ensure an orderly meeting, I would like to outline a few rules for witnesses and members to follow.
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All comments should be addressed through the chair.
Members attending the meeting in person must raise their hand when they wish to speak. Those members who are attending through Zoom should use the “raise hand” feature. The committee clerk and I will do the best we can to maintain the order of speaking. We thank you for your patience and your consideration in this matter.
In accordance with our routine motion, I am informing the committee that all witnesses have completed the required connection tests in advance of the meeting.
I would now like to welcome our witnesses.
From the Office of the Auditor General, we have Mr. DeMarco, commissioner of the environment and sustainable development; and Elsa Da Costa, director.
From the Atlantic Canada Opportunities Agency, we have Francis McGuire, president.
From the Department of Employment and Social Development, we have Andrew Brown, senior assistant deputy minister, skills and employment branch; and Chris Bates, director general, apprenticeship and sectoral initiatives directorate.
From the Department of Natural Resources, we have John Hannaford, deputy minister; Mollie Johnson, assistant deputy minister; and Ainslee Emerson, acting director general.
From Prairies Economic Development Canada, we have Dylan Jones, interim deputy minister; Justin Riemer, assistant deputy minister, Alberta; and Douglas Zolinsky, director general, enterprises and ecosystems.
Mr. DeMarco, I'm going to start with you. You have the floor for five minutes, after which we will hear from one person from each of the departments I just read out.
We go over to you, Mr. DeMarco, and thank you for joining us today.
Thank you, Mr. Chair. We are happy to appear before your committee this morning to discuss our report on the just transition to a low-carbon economy, which was tabled in the House of Commons on April 26. I would like to acknowledge that this hearing is taking place on the traditional unceded territory of the Algonquin Anishinabe. With me today is Elsa Da Costa, the director who was responsible for the audit.
Our audit focused on Natural Resources Canada, Employment and Social Development Canada and two regional development agencies. This audit covered two related areas: Canada’s preparedness for a just transition to a low-carbon economy and Canada’s support for coal workers and communities affected by the coal phase-out.
Canada has committed to moving away from fossil fuel dependence toward a low-carbon economy that reaches net-zero emissions by 2050. Canada has also committed to what is called a “just transition” for the workers and communities affected by this economic shift. However, the government has been unprepared and slow off the mark. We found that as Canada shifts its focus to low-carbon alternatives, the government is not prepared to provide appropriate support to more than 50 communities and 170,000 workers in the fossil fuel sector.
In 2019, the government identified Natural Resources Canada as the lead department to deliver just-transition legislation. We found that the department took little action until 2021 and it did not have an implementation plan to address this significant economic shift. Without a proper just-transition plan in place, the risks are comparable to what occurred with the collapse of the northern cod fishery in Atlantic Canada in the 1990s. In our 1993 audit, we found that the government was unprepared to deal with the consequences of the moratorium on cod fisheries for local communities and workers.
I would like to turn now to the coal phase-out.
Burning coal to produce electricity has significantly contributed to greenhouse gas emissions. Phasing out coal is an early part of the government's plan to transition to a low-carbon economy.
We found that, without a coordinated federal approach to support a just transition, federal organizations relied on existing mechanisms, such as social assistance programs. These fell short of achieving a just transition for coal workers and the communities they live in.
As the coal phase-out is the first of several transitions to a low-carbon economy facing Canadian workers, communities and governments, the federal government has an opportunity to learn from this experience to improve future policies and programs. The future will involve changes at a much larger scale than the coal phase-out, so it is essential for Canada to make up for lost time and ramp up its approach to a just transition.
Our intent is to provide Parliament with useful information as the government works to meet some critical deadlines that it has set for itself. I trust that the findings and recommendations I have brought forward in this and in our other reports will help the government improve its performance in this area. Because climate change is an intergenerational crisis with a rapidly closing window for action, it is essential for Canada to translate its commitments and plans into action and results. Our future depends on it.
I would like to add that the departments and agencies agreed with all five of the recommendations in our report.
Mr. Chair, this concludes my opening remarks. We are happy to answer any questions the committee may have.
Thank you very much, Mr. Chairman. Good morning to the other members.
I would like to acknowledge that I am joining you today from the traditional territories of the Mi'kmaq, Wolastoqiyik and Peskotomuhkati people.
I'm here to speak about the delivery, via ACOA, of the Canada coal transition. ACOA, as you know, is the federal department charged with fuelling the Atlantic economy. It works with both businesses and communities to build a strong and inclusive environment.
ACOA was mandated to deliver $55 million, under two programs, to help five affected communities in terms of transition. The five communities include Belledune in New Brunswick, Trenton in Pictou County, and Point Aconi, Point Tupper and Lingan in Nova Scotia.
It’s important to understand that the situation across the country can be very different. In fact, when we look at our five communities, the situations are different and we need to adapt to them.
In New Brunswick and in Nova Scotia, there is no imminent shuttering of the coal-generating facilities. Therefore, the labour transition is not going to occur for another five or six years. For us, focusing on the community adjustment rather than the labour force was timely. In our situation, the respective power companies are well equipped to redeploy employees to other higher-skilled jobs and to look at things like early retirement and other measures.
With that in mind, we were really focused on delivering to impacted communities and working with employers first, to establish their priorities in terms of what they saw as a transition. This is consistent with the just transition recommendations, to meet with the affected communities and to learn about their local priorities and goals of developing and diversifying their economy. In Atlantic Canada, we are dealing, as I said, with community transition more than employee transition at this point.
This long-term approach aims to help the communities diversify and build up other sectors to make the most of their local assets to grow the economy and create local employment. Once those goals are established, ACOA then engages with other government agencies to implement measures and meet the needs. Establishing a program or framework comes after community goals are set.
To date, ACOA has supported major, often long-term, projects, including the expansion and upgrading of port infrastructure in Belledune, financing an accelerator in Pictou County and supporting the growth of the bioprocessing sector in Cape Breton. I would like to point out to the committee members that all of the projects supported by ACOA were developed in consultation with and in partnership with community leaders and employers. Through the two CCTI initiatives, ACOA has supported to date 32 projects with total investments of $24.6 million.
For example, some of the things we've done include, in Cape Breton, financing the development of a company called Protocase, creating 50 jobs there; and in New Brunswick, with AJN Investment, developing a green-certified, building panel manufacturing facility that will use 100% recyclable material, creating over 140 jobs.
In conclusion, Mr. Chairman, the Canada transition is helping communities, one by one, to look at their prospects in developing things. We will continue to work and bring in other partners as necessary, once these are identified. I would use, for instance, the accelerator that the community wanted to develop in Pictou County. We brought in people from Innovacorp, Volta, NRC, etc., to bring the federal and provincial provincial partners together to address those issues.
With that, Mr. Chairman, thank you very much. I appreciate being invited.
Thank you, Mr. Chair. Good morning to you and members of the committee.
I'd like to begin by acknowledging that I'm joining you today from the traditional unceded territory of the Algonquin Anishinabe people.
Thank you for the invitation to appear before the committee today and for this opportunity to discuss the commissioner of the environment and sustainable development's Report on Just Transition to a Low-Carbon Economy.
Employment and Social Development Canada, or ESDC, plays a key role in supporting a just transition for Canadians, including supporting Natural Resources Canada to develop just transition legislation and supporting Canadian workers, including equity-deserving groups, in gaining the skills they need for in-demand jobs in key sectors, such as those being created by the transition to a cleaner economy.
We understand the importance of this audit, we agree with its recommendations and we are currently taking steps to address the findings from the Office of the Auditor General.
The commissioner noted that the world is increasingly shifting to clean options. ESDC will continue to support sectors that have been hit hard by the pandemic by helping employers address labour shortages and giving people living in Canada the skills they need to find good jobs.
Under the leadership of Natural Resources Canada, we have completed public consultations on the just transition legislation to seek feedback from a broad range of stakeholders, including workers, unions, employers, communities, provinces and territories, as well as indigenous groups. This valuable input will help us make informed and thoughtful decisions on the just transition.
As most of you already know, labour market pressures are affecting practically all sectors of the economy and most regions of the country. As of February of this year, there were more than 820,000 job vacancies across Canada, which is still significantly higher than prepandemic levels.
To address the labour shortages facing the Canadian economy, it will be necessary to maximize all sources of labour but also capitalize on the opportunities presented by the transition to a low-carbon economy.
To this end, ESDC has a large suite of skills and employment programming and has taken concrete measures to help workers thrive in a low-carbon economy.
For example, to help Canadians access training to meet the changing needs of industry and help employers retain and attract a skilled and diverse workforce, ESDC has recently completed a call for proposals for the sectoral workforce solutions program. This new program will fund sectoral projects that focus on a range of industry-driven activities to help address labour market needs, with a particular focus on building talent for the clean economy.
Maximizing workforce participation is also about accessing untapped labour pools and removing the barriers that restrict workforce participation.
In order to make our workforce more diverse and inclusive, budget 2022 proposes to provide $115 million over five years, with $30 million ongoing, to expand the foreign credential recognition program and help 11,000 skilled newcomers per year get their credentials recognized. Their experience and talent will be needed in technology fields such as automation and digital innovation, which will play a key role in our transition to a low-carbon economy.
In addition, budget 2022 plans to double the amount of funding going to the union training and innovation program to $84.2 million over four years. This funding will help 3,500 apprentices from equity-deserving groups begin and succeed in careers in the Red Seal trades by providing targeted investments that are aimed at addressing barriers that limit participation in fields such as the clean economy.
We recognize the important role that the commissioner of the environment and sustainable development plays in holding the government to account on its environmental priorities.
So, I can assure you that ESDC will continue to work closely with Natural Resources Canada and all of its partners to support a green recovery that will create jobs, build a clean economy and fight and protect against climate change.
Again, thank you, Mr. Chair, for the opportunity to appear before you today.
I'll now end my opening remarks.
Thank you very much, Mr. Chair and members of the committee, for this opportunity.
I'd like to begin by recognizing that we're meeting today on the traditional territory of the Algonquin Anishinabe peoples.
I'd also like to thank the commissioner of the environment and sustainable development for his audit of the just transition, and I'm pleased to inform you, Chair, that Natural Resources Canada is working with other departments to execute a plan to fulfill his recommendations. This plan will complement the work that is under way to seize the economic opportunities of Canada's transition to net zero, particularly regarding jobs.
The government's focus is on ensuring opportunities to create more jobs for workers and families in all regions of the country. Much of this work was not included in the audit because of its timing and scope. For example, the audit's time frame included the pandemic outbreak, a time when Natural Resources Canada was focusing on helping resource companies and their workers face the impact of plunging commodity prices.
We're now well into advancing the just transition. For instance, on June 1, the launched the regional energy and resource tables. This process will identify, prioritize and pursue opportunities for economic growth and sustainable job creation in the energy and resources sectors across Canada.
Through this process, the government will work with provinces and territories, indigenous organizations, as well as industry, labour and experts, to develop growth strategies geared to the strengths of each region. A key part of this work will be to identify the skills and training needs required to ensure that Canada's labour force is poised to participate in the net-zero economy of the future.
In addition, Natural Resources Canada is investing in sustainable energy, mining and forestry initiatives across the country. We are also supporting indigenous peoples, communities and businesses in their participation in Canada's net-zero future.
Meanwhile, regional agencies in Atlantic Canada and the Prairies continue to roll out and deliver the $185 million already committed to communities impacted by the accelerated phase-out of coal-fired electricity. This work is supporting local job creation and economic diversification in Alberta, Saskatchewan, New Brunswick and Nova Scotia. As of April, the government had invested $75 million in 72 projects across these provinces.
I should also mention the recent measures in the 2030 emissions reduction plan and in budget 2022. They include new investments in renewable power, green buildings and neighbourhoods, critical minerals and small modular reactors.
I will turn now to the pending just transition legislation.
Since last July, we have been consulting broadly, drawing on the expertise of the International Labour Organization, to ensure that social dialogue is at the core of the just transition. The legislation will codify how the government puts people first, and that's why we're engaging broadly with workers and their communities, indigenous partners, unions, employers, academics and non-governmental organizations.
We also opened this discussion to anyone who wished to send us a written submission—and some 30,000 people have done so. My department will make public a report summarizing what we heard. To stay on top of the entire just transition process, NRCan is working with other relevant federal entities to monitor, measure and report on programs and to inform parliamentarians and Canadians of the results achieved.
This work is not static. Labour market trends will continue to evolve, and much depends on the pathways that Canada and the rest of the world take to reach net zero. These are decisions taken by everyone, from CEOs to students and workers looking for opportunities in exciting and emerging fields.
For these reasons, the just transition doesn't have a set end date. It requires careful, coordinated and proactive planning to ensure that Canadians have sustainable jobs well into the future.
With that, I thank you for your time, and we welcome your questions.
Thank you, Mr. Chair.
Thank you very much, Mr. Chair.
Good morning to you and to all the honourable members.
Today I am joining you from near the Bow River. I am in Calgary, Alberta, which is Treaty 7 territory, traditional land of the Niitsitapi and, of course, part of the Métis homeland.
The phase-out of coal-fired power production has had a fairly high impact in Saskatchewan and Alberta. We are, in that context, working quite hard to support the affected communities and the people who live in those communities and rely on it. Our goal is that people and the places they live in not be left behind as Canada moves to a net-zero economy.
We believe strongly in the concept of “nothing about us without us”. That's why PrairiesCan staff have spent countless hours at community meetings, municipal and band council meetings, worker transition meetings and events, and talking one on one with community leaders, businesses and workers. This people-centric approach puts workers and communities at the centre of our policy and decision-making on climate change action. That just makes sense. It makes sense to listen to the people who are affected by all of this.
PrairiesCan is delivering $25 million under the coal transition initiative and $105 million under the related infrastructure fund. That is a total of $130 million. PrairiesCan has invested about half of that amount so far. We have funded 52 projects, valued at almost $61 million in 17 coal-affected communities. These are proud towns like Coronach and Bienfait, Saskatchewan, which are working hard to keep families in those communities.
These are not simple projects. Transition centres in places like the two that we set up in Castor, Alberta, are offering training programs and business development opportunities for laid-off workers, and 2,400 people have attended programs like these across coal country. To put that in perspective, we're looking at about 2,800 affected workers. It is a measure of new hope because we know it can be difficult to create and find new jobs in communities that have relied on one high-paying industry.
That's why our funding is also helping rural municipalities in places like Parkland County, Alberta, to align their land-use services and create infrastructure to attract investors and other businesses with new possibilities to make up for their missing tax bases.
This isn't the federal government acting alone. We have partners. These projects involve a wide array of proponents, including municipalities, unions, Community Futures and other local development organizations. All are working to help communities to survive and prosper.
The just transition task force recommended we create flexible funding for communities. That has been our focus. We now have a clearer picture of what communities want to do. It only makes sense to also become more clear on how we measure performance in the future. We thank the commissioner of the environment and sustainable development for this and other recommendations.
I appreciate that the commissioner acknowledged our work to engage local communities. Our aim has been that the people and communities impacted by the phase-out have access to the programming they need. It's really that simple.
Mr. Chair, through you to the committee members, I say that the intentions of these programs are important and good: to support people affected by the move away from coal, to be fair, to be compassionate and to be hopeful.
This is a work in progress. We have more to do. The team at PrairiesCan has been working hard to engage communities. Ultimately, though, it will be the hard work, courage and innovation of the people in these communities that will determine their futures. We need to be there. We need to listen to them. We need to be flexible, and we need to help how we can. I am proud that we have a good start on that.
Thank you very much, Mr. Chair.
Thank you to our witnesses for being here today.
I think I'll go today where I went last week, starting off with the point or the conclusion, when we had the Auditor General here, that spending money is not a result. Saying that you're spending x number of dollars to do something is not actually a result; it's the actual outcomes and changes that would be effected and that we're not seeing.
We saw that with several reports last week, and we're seeing that again in this report this week. We see the commissioner say things like the government “committed to”, but again, afterwards the conclusions were that it was “unprepared and slow”, with “little action” and missed deadlines. I think one of the things that was most concerning was the commissioner alluding to a “collapse” similar to what has been seen in Canadian history in other comparable things.
One of the frustrations I have, Mr. DeMarco, particularly right now with the geopolitical situation in the world, is that we talk about phasing out oil production, for example, and a decrease and lack of emphasis on that. We're seeing Canada's ability to be a leader on the world stage of supporting geopolitical partners in Asia, Europe and the United States with high gas prices, in the production of natural gas and so forth.
In terms of world leaders, there was a recent news article about Prime Minister Boris Johnson visiting Saudi Arabia seeking “more oil output”. We're seeing the European Union banning Russian oil, rightfully so, and looking for other markets. Right now the 27-country bloc relies on Russia for 25% of its oil. One of the frustrating points is that there was a recent article in the National Post, entitled “Joe Biden begs dictators for oil while Canada's energy industry remains hobbled”, saying that in Canada we have the “ability to produce and export [our] natural resources, at little to no cost to the treasury”.
Again, we have a democratic country here that abides by the rule of law. We have strong environmental standards and I think good human rights standards when it comes to around the world.
Mr. DeMarco, as you mentioned, climate change is an intergenerational challenge. It's an international one as well. When Canada does A, country B could come in and fill in a gap of where it is. Do you track emissions of other targets? When oil production is decreased in Canada, for example, and a project in Iran, Venezuela, Saudi Arabia or China is undertaken, are you comparing what those emissions are that are going into the global emissions versus what they could have been by using clean, ethical Canadian oil?
Thank you for the question.
On your first point about outcomes versus outputs, I completely agree. Auditor General Hogan and I both wish to focus our performance audit work on value to Canadians—that is, whether the outcomes that are being sought by the various federal government objectives are being achieved, as opposed to whether there are just outputs being measured, such as money spent, as in the example you used. I agree with you completely on that point.
In terms of global emissions and the challenge of climate change, which is an international and an intergenerational challenge, as you mentioned, in our lessons learned report, which this committee looked at a little earlier this session, we have looked at some of these broader issues you talked about. This is a whole-of-society problem that needs to be looked at, not just in terms of Canadian emissions but also worldwide emissions. That's why, for example, if we have an increase in production in one region and not in another, it may not necessarily result in a net increase, because there may be a decrease somewhere else. So yes, absolutely we are interested in that.
The current geopolitical situation needs to be addressed. The just transition we're talking about in this report is of a longer-term nature, to 2030 and 2050 and so on, and that is happening. The International Energy Agency is quite clear that this transition will happen, but that doesn't mean we have to ignore current realities. They need to be addressed as well.
Canada's role as a G7 nation has been disproportionately poor, I would say, in terms of emission reductions. We're the only one since 1990 to have increased GHG emissions. We do look at our performance in regard to others, while recognizing that there are important energy security and geopolitical situations that may drive shorter-term changes that need to be looked at as well.
Welcome back, Commissioner DeMarco.
Thank you to all the witnesses for coming today.
It's nice to see you, Mr. Morrice, as well.
This is a very timely audit as we strive to meet our greenhouse gas emissions reduction targets. We have a lot to do, and a just transition for those impacted workers and communities is important.
My question is for Mr. Hannaford.
The commissioner found that the government did not adequately support workers and communities affected by the phase-out of coal-fired electricity. Where do you believe the gaps are, and how will they be addressed?
Thank you very much, Mr. Chair, for the question.
As I mentioned in my opening statement, we accept the recommendations of the commissioner and welcome the analysis being done for this important evolving area of policy. The specific recommendations of the task force on coal are largely under way. My colleagues from the regional agencies have highlighted some of the areas where investments have been made and will continue to be made as we evolve towards the phase-out of coal-powered electricity.
NRCan has been highlighting some of these areas of activity through our website, where we are reporting on projects funded through the resources allocated to that end. I think it's important to highlight our overall ongoing work and our work for a net-zero economy.
As I also mentioned in my opening statement, we are now launching, with each of the provinces, a conversation that will focus our activities on areas where there are real opportunities for economic growth and development. Those areas of activity will provide ample employment opportunities over time, so this is a critical piece in our plan to evolve our economy in a way that will benefit all regions of the country and ensure that a people-centric position is taken—one that is informed by the circumstances of each region of the country, and by the opportunities those circumstances present.
There are a couple of pieces to that. I can certainly speak to the role of ESDC and the sort of efforts we are undertaking with respect skills and employment training for diversity groups.
We recognize that there are additional barriers to the full participation of under-represented Canadians. The work we are undertaking right now and the supports we are providing to workers reflect the desire to provide additional assistance and help them get involved.
First off, the sectoral workforce solutions program was announced in budget 2021 to help key sectors of the economy implement solutions to address their current and emerging workforce needs. One feature here is to support equity-deserving groups by promoting a diverse and inclusive workforce and providing wraparound supports such as transportation, accommodations and child care costs to reduce barriers to participation.
Another example would be the apprenticeship service, which helps to promote careers in the skilled trades and which will be investing $470 million beginning in 2021-22 to provide targeted support to employers who hire apprentices.
With respect to this particular program, an additional $5,000 incentive is provided to eligible employers who hire an apprentice from an equity-deserving group.
These are a couple of the examples of where Employment and Social Development Canada is investing in under-represented groups to help them to more fully participate in the labour market.
I'd like to acknowledge my colleagues and the witnesses who are with us today.
My first questions will be for the commissioner.
Mr. DeMarco, it's a pleasure to meet you. Thank you for being with us today.
I'd like you to tell us about the audit. The report that you and your team produced clearly indicates that the government has no formal governance plan or mechanism. In addition, the government has not consulted with the public and it has no system for tracking results.
You summed things up nicely earlier. Since 1992, Canada has been increasing its greenhouse gas emissions and it's lagging far behind other countries around the world, especially the G7 nations.
Are you optimistic about the government's targets to reduce greenhouse gas emissions by 40% from 2005 levels and achieve net zero by 2050?
Thank you for your question.
In this line of work, you have to be optimistic. I'd like our planet to be safe for our children and future generations. I'm an optimist in general.
With respect to the new emissions reduction plan tabled on March 19, we haven't completed an audit. We will study and analyze this plan to see if it will be sufficient to meet the 2030 and 2050 targets.
I think everyone knows that there are gaps in the plan. Some details are missing, including the cap on greenhouse gas emissions in the oil and gas sector. We're going to look at the plan and analyze it. We can already see some gaps, but I hope the government will provide the details that are critical to achieving the 2030 and 2050 targets.
Thank you, Mr. DeMarco.
I really like your optimism, and I share it. However, I'd like us to be more realistic.
Speaking of realism, the government is almost eight years behind in implementing a plan. The next deadline is 2030, eight years from now.
So I'd like you to tell us why you really believe that the government can implement a plan when they are currently eight years behind.
Thank you, Mr. DeMarco.
History tends to repeat itself. I look forward to your upcoming audits.
I will now turn to Mr. Hannaford.
I know you've been with the department for a short time, since January, and I congratulate you on your appointment.
I'd still like to hear from you about what the commissioner's audit report found regarding the absence of defined governance roles and the lack of accountability.
If people are given a mandate by the government but don't have clear instructions, who is responsible for saying that clear instructions are needed to draft legislation?
Mr. Hannaford, I believe you didn't quite catch my question. Who is responsible?
This is what it says in point 1.31 of the audit report:
We found that the federal government had not established a governance structure, roles, or responsibilities to guide federal departments in coordinating and collaborating to support a just transition to a low‑carbon economy.
Mr. Hannaford, I understand that you may not have been in the department at the time. Perhaps someone else from your department could respond.
You can see that there is no governance role, no defined role. You must have a mandate from the government to draft legislation, but absolutely nothing was defined.
Who sounded the alarm in your department to say that this wasn't working?
Thank you very much, Mr. Chair.
I want to welcome the new members of our committee. Thanks for being present today.
Thanks to the witnesses who have provided testimony.
This is probably the worst audit—and in so many ways—that we've seen at this committee. Eight years, as my colleague just mentioned, is what this government has had to deal with what is a matter of our future. This is the biggest issue that this generation will face. Literally, our children may not have a planet to live on, and that is a fact we can't ignore. The fact that some of my colleagues here are in denial about the reality of the deteriorating climate is disappointing.
The other reality is that some of my other colleagues want to simply kill this plan by delay. It's denial and delay, and it just seems like the “Liberal, Tory, same old story” situation. We can't continue to do this, and my colleagues know that. Each and every one of my colleagues knows that.
I'm from the province that this hits the hardest. My family.... I've talked to this committee before about this. People have made real sacrifices in order to make sure they can survive in this environment and this economy, and we're not even approaching some of the people who have the solutions to this.
The unions were made mention of in the consultations. In some of this report.... As the commissioner mentions, there was barely any consultation. We've talked about that. There has been barely any consultation. I've spoken to the unions. They still haven't been engaged. Where are they at the table? They have some of the solutions to this.
We have no federal implementation plan, no formal governance structure and no measuring or monitoring system. I quote: “Overall, we found that Natural Resources Canada and Employment and Social Development Canada were not prepared to support a just transition to a low-carbon economy for workers and communities.”
That is independent advice to this committee about the reality of this plan. How are Canadians supposed to have faith in this? No one around this room is taking this seriously. We have a serious obligation to do this work on behalf of Canadians and to make sure that we can actually hit some of these targets, but it's very clear, as was mentioned by my colleague previously, that we haven't hit one of our targets since—not one of our international targets. That's shameful.
This is a committee about accountability to a government commitment, when the government has done so little—so little. Our own audit here displays that.
Commissioner DeMarco, I sympathize and empathize with you in your role to remain optimistic, but how can Canadians remain optimistic with some of this very clear evidence that the support toward a just transition is just not there?
Even in our Prairies Economic Development board, for example, per your report, they're being forced to utilize existing programs to deliver a just transition framework, programs that were never meant to do that. No one is taking this seriously.
The Natural Resources deputy minister who is here today mentioned consultations. Eight years...? We have to stop talking about this and start doing something. I didn't want to hear that we're going around and making some more plans. The mentioned a big round table discussion. There is information here. The fact that our Auditor General's office has more information than Natural Resources, the lead department, is ridiculous.
Canadians deserve so much better than this.
Mr. DeMarco, in your advice here, is Natural Resources Canada even the appropriate department to be doing this, or should Canadians look at instituting a different department or a different framework, because the question I have is this: Is this system we have right now going to actually be successful?
Thank you for the question.
That is a policy choice of the government in allocating mandates to various departments to implement domestic and international commitments, and this just transition commitment is both. There's a domestic commitment and a commitment arising from the opening words of the Paris Agreement from 2015.
I share your concern. An international agreement that dates back seven years that included the notion of just transition has been in place, and a Canadian commitment to that from day one in Paris when Canada signed that agreement. I was surprised when we opened this file. The question I had was, is that all there is? Five or six years after the commitment was made, there's no governance structure, no legislation and no implementation plan....
I am pleased that the four organizations clearly have accepted all of our recommendations and have now committed to getting things in gear, but I am disappointed that it takes our opening up an audit file for things to get moving again. This department, Natural Resources Canada, was able to create from scratch the emissions reduction fund without a criterion regarding job retention during the pandemic. It chose to put this file, the just transition file, aside during that period. That's a choice it made and is one of the reasons why they're behind in implementing this very important commitment for Canadians, the affected communities and the affected workers.
Thank you, Mr. Chair. It's much appreciated. It's good to be here again on the public accounts committee.
Thank you to all the witnesses who have shared today and to each of my colleagues here.
As a preface, I may start with the proverbial “if a tree falls in the forest” statement. Here's a scenario to consider, perhaps, for our commissioner of the environment.
If a tree falls in the forest in a jurisdiction where there is no replantation plan, where there is little to no regulation, where there is less than adequate compensation for the work being done and human rights violations are very high, or if you have the choice of harvesting that tree in a jurisdiction like Canada, where reforestation is likely to happen, where there's high-paying compensation and wages for that particular worker or individual, and where there's much more environmental regulation and oversight of that particular harvest, the same principle could apply to the energy sector as well: Is it better for us?
As we know, we're tackling climate change and dealing with these issues. They are international in scope. What happens in one jurisdiction obviously affects other jurisdictions. Would it not be better for us as Canadians to make sure, while the world is still largely dependent upon and looking for energy from reliable and safe places, of the jurisdictions under which the best environmental regulations are put in place, where the workers are properly compensated and where we can get a good return on investment for the production of energy? Would it not make more sense to make sure that Canadians are employed and have the opportunity for making a good livelihood and providing for their families, rather than outsourcing those jobs to other jurisdictions that are far less regulated and do not have near the environmental regime in place that we have here in Canada?
For you, Mr. Commissioner, I think many Canadians are asking that question. They are wondering why we are putting all of the emphasis on shutting down our sectors or transitioning away from our resources while the world is still needing them and, in fact, increasingly demanding good, safe, reliable sources for their energy supply, which is going to be needed for the foreseeable future. I think Canadians want answers to that question, and they would ask this committee and others to say: “Hold on just a second: Why won't we prioritize Canadian workers where we have some of the best regimes in the world under the environment?”
I put that to you, Mr. Commissioner. Are you as well seeing and hearing that feedback from Canadians with those types of concerns?
Thank you, Chair and thank you to our witnesses.
I've noticed our Conservative colleagues speak with passion here today, but I haven't heard much about what was achieved when the Conservatives were in power for nearly a decade it terms of just transition. We still have time here today, so maybe we'll hear more on that.
Mr. DeMarco, thank you for your work, sir.
Looking at the report, I think it's important to put Canadian policy on this in a context—a global context, to be specific. Your report does give examples of the European Union, New Zealand and Scotland in terms of governance structures One assumes—I don't think it's written here exactly—that these could be emulated by NRCan and ESDC. I will have a question on governance structures a bit later.
Mr. DeMarco, which countries are doing just transition well, in your view? What are real models and real examples? Do we look the European Union, New Zealand and Scotland? Are those the examples or are there other countries that stand out?
We have a committee structure now that derives from a deputy minister's implementation committee that relates to climate. At both the director general and the director level, we now have a governance structure within the government.
I'd also note that as part of the ongoing work with respect to potential legislation, we have been consulting very widely, including with unions, with a view to establishing some of the principles that should be guiding all policy development in this area and all the work that we will be doing. We also look toward potentially creating an independent body to advise with respect to just transition, which will be another aspect of our overall approach to this.
Thank you very much, Mr. Chair.
I want to thank the witnesses again for your answers.
I would like to turn to the question of how much work is yet to be done in light of Canada's starting point.
One of my colleagues mentioned our relationship in terms of the data compared with other countries with governance structures that are taking this seriously, as you said, and are doing the work within their governments to make sure they can hit their particular international targets within the international community.
Where does Canada rank in comparison with other countries in terms of where we're starting from? They've already begun a process of reducing their emissions. As you mentioned during your opening remarks, Canada has increased its production of greenhouse gases. Where do we currently rank?
Thank you very much, Mr. Chair.
Given the opportunity to continue on a few different things here, I will address my colleague from the NDP's comments about denial and delay. We heard a lot of huff and puff there, a lot of righteous indignation about criticism from other parts. I would argue, and I'm saying here, that there is no denial or a delay here. I think the question to the commissioner that I have been asking is about how the denial, or the reality that we face in reducing emissions, is an international challenge and that we have to look at in that context.
Mr. DeMarco, I asked in my opening round about whether we ought to look at the production and emissions of other countries I listed that are filling the gap of where Canadian energy is not going. I'm very proud as a Canadian of our energy sector in this country, and particularly of the frontline worker and making sure they're supported with paycheques here, as opposed to others around the world. But we live in denial if we think that when we cancel a project here that this same project just won't happen elsewhere. We are seeing the reality of companies moving to other countries that don't have the same focus, that don't have a commissioner such as you, and don't have that same emphasis on environmental targets. We try to feel good here in Canada, and we're losing good Canadian paycheques and jobs here and they're going to countries and companies around the world that don't give two hoots about what we're talking about here.
I do think living in denial amounts to two things. One is acknowledging that when we scrap projects here in this country, they just go away and that the environment gets better. Your report confirms that it does not, but it also confirms that we're not tracking the decisions we're making in Canada and the impacts they're having on global emissions, because they're going to other countries that don't have the same environmental standards, net zero, carbon capture, and all these environmental aspects. The reality is, for all that huff and puff, we are going to see the NDP, tonight in a confidence vote, and for the next three years, vote with the Liberals and again see very little change.
I'll just go to my question and this is a question for Mr. Hannaford, just to test this.
The tone and the status quo of what I'm hearing here is about discontinuing. The commissioner referenced that the legislation to support workers was not available. It was supposed to be tabled in the fall. The one thing that was missing, in the comments you made today, was an actual timeline of when the legislation is going to be ready, when it's going to be tabled to come to Parliament. We heard beforehand of changes in the consultations process, and all of these things. We see the damning report by the commissioner, and in the response today, I, frankly, think we're getting the status quo of no timelines and no plans to actually bring something forward. There have been consultations, discussions and so forth, and we've known about the problem for years.
Can you give a date of when the legislation will be tabled in Parliament to actually move support for workers forward? I just want a date.
I didn't hear a date there or a time frame. That was an issue before, and there's still not one going forward, so I will note that the NDP will continue to be supporting the Liberals in confidence votes on this plan going forward.
The other thing I would ask the commissioner about, in my time remaining, is performance metrics. One of the things we just dealt with in the climate change report before was the federal government having committed to increasing its emissions-reduction targets from 40% to 45%. The report noted that no measuring mechanism was actually implemented to measure the progress.
Mr. DeMarco, when we talk about these measuring tools, can you confirm that you're still lacking even the ability to measure the progress or lack of progress being made when it comes to emissions reductions?
I'm going to pause for a second before I go to our next witness.
Clerk, whenever someone on Zoom answers a question, we're getting a very loud sound in our ears as if it's coming from the committee floor. I don't know if you're hearing the room there, but it's jarring, and I think it's very hard on the ears.
Could you have the technical team there try to clean that up? I have not noticed it before, although I don't often do these meetings remotely, but I can tell that some of our witnesses are having trouble. It's both jarring in the ear and interrupting their chain of thought.
If that could be cleaned up, please, I think it would be appreciated by everybody who is on the line. I see Mr. DeMarco nodding as well. I can tell that it is having an impact on the answers from our witnesses.
If there's anything that I need to see, Clerk, just send me a text and we will suspend if we have to. I will turn now to Mr. Dong.
Mr. Dong, it's over to you. You have the floor for five minutes.
Thank you very much, Chair.
I too want to thank the witnesses and welcome the new members joining us today.
Before I ask questions, I want to correct my NDP colleague. He said in the previous rounds that we are killing the planet. We can't kill the planet. The planet will still be here. It's the next generations that we have to worry about, and he probably would agree with me.
That leads to my observation here today. It's fascinating to talk about what happened or has happened in the last eight years, but what's even more fascinating is that my Conservative colleagues on this committee are still having this policy debate.
The Paris Agreement happened many years ago. I recognize the need for a just transition for the workforce. In November 2016, as noted here in the report, the federal government announced that it would be amending its existing coal-fired electricity regulation to accelerate the phase-out of traditional coal-fired electricity in Canada. I know that predominantly four provinces are affected.
As I go through the report, I read that Alberta and Saskatchewan are accelerating the phasing-out of coal-fired generation and in Nova Scotia and New Brunswick it will probably be a few years before that kicks in. That makes me wonder, in terms of phasing out coal and transiting the workforce, which one is the horse and which one is the carriage, because if it takes a few years for a certain province to phase out coal generation, the workers are still there.
I'm not arguing with the fact that we need to build a framework and have a governance structure to help these workers to transition and help these communities transition. They are very much included in the whole plan. As I was going through the report—
By the way, I just want to confirm something with the commissioner.
In the last eight years, is this the first audit you have done on the just transition?
In our case, again, we are not going to see any layoffs from the coal-generating facilities for some time—five or six years—and in fact we don't think there will be any, because the utilities—and we work closely with them—will seek to retain those people and redeploy them. There will be some early retirements as well.
For instance, with ESDC, in this particular case we haven't engaged as much as we have in other instances with government. We are developing long-term plans for each community. I want to come back to our role being very micro: It is five strategies for five communities that are all different.
They all have measurables. They all have distinct strategies that we've agreed to with the communities, so at the micro level that we're working at, we are very much in touch and working with industries such as bioprocessing in Cape Breton, which has, particularly since COVID—and we're lucky we got started before COVID—real implications. We've seen real successes in terms of attracting other monies into things, and this is tied to the labour force that's coming out of the Cape Breton University that works in this bioprocessing.
Thank you. It's great to be here.
Thank you to the witnesses for their testimony today.
I'd like to start off by reiterating what my colleague said right at the outset, which was that “spending...is not a result”. I want to specifically ask about training skilled workers around some of the comments made by Mr. Brown from ESDC. The reason for this is that in my home province of Ontario we phased out coal some years ago. Nuclear is an important part of the electricity generation going forward, and I know that there are incredible shortages in terms of skilled workers, whether that be boilermakers or linespeople, etc., in order to help generate that electricity.
My observation would be that the Ontario government, under the leadership of the labour minister there, Monte McNaughton, has done all the heavy lifting in terms of attracting workers to the skilled trades. The references you made in your testimony to one federal program, which was going to create 3,500 skilled workers, seem to be at a snail's pace compared to what's going to be needed. In Ontario, it has been estimated that one in five jobs by 2025 will be in the skilled trades.
Maybe you can comment on that, or there may be others in the regional development agencies who also have a perspective on that.
Great, and thanks for that question.
First off, I would certainly say that, as I mentioned earlier, we're really experiencing across the country labour and skills shortages, which are certainly more acute in some areas than others. We also recognize that further developing and further preparing Canadians to take jobs in the skilled trades is one of the key areas for Canada in terms of being able to meet our labour market needs.
It's also an area where we work with provinces and territories, so this isn't something that we or they do alone in terms of helping people get into the skilled trades. I think it's also an area that's quite relevant with respect to just transition, because we know that over the coming years there are going to be a lot of opportunities with respect to greener energy and the green economy, and we need to help workers acquire the skills to be successful in that new economy.
While some of those workers may come—new workers and youths who are just completing high school or other education—it's also going to depend on people who are part of the workforce right now and are upskilling and re-skilling to ensure they have the skills to be successful in that area.
Chris Bates is one of my colleagues who may be able to add a little bit with respect to the skilled trades.
Thank you. Thank you, Mr. Chair.
I have a quick follow-up question on the carbon tax.
We know it's a signature piece of legislation in regard to tackling climate change, according to this government, but we do not have, to my understanding, any metric through which we are measuring how many megatonnes of carbon emissions have actually been reduced as a result of the carbon tax.
Is that correct, Mr. DeMarco—yes or no? I don't believe we have a metric, do we?
I also have a quick follow-up.
No, that's great. I understand. We don't have one.
We're in a cost-of-living crisis in this country, and it is affecting our producers, our businesses and our farmers. We're hearing this repeatedly. The input costs keep soaring. The cost of groceries keeps going up, and the cost of transportation. This is affecting the cost of living.
We do not have a metric through which we can yet measure whether any megatonnes of carbon have been removed from the environment as a result of the carbon tax. It's a punitive tax, ineffective overall, and I don't think Canadians are satisfied with what we've seen so far. The fact that we don't have a metric at this point to measure the reductions in carbon is quite substantive.
Thank you very much, Chair.
I too thank the witnesses for being here.
As a gentle reminder—I've been on this committee a long time—this is a process committee, not a policy committee. We're here, and I am delighted that we are studying a report by the commissioner of the environment and sustainable development, because that was our objective early on. It was to give some lift and also to add the kind of analysis that a public accounts committee can add to the conversation.
We're not disputing whether or not we need to be fighting climate change. We are looking at the consequences and the programs that the government has to put in place, and whether we're being effective in putting those programs in place.
The just transition is indeed a very key part of that, so I would like to address my questions to Mr. Jones.
We heard a little bit from Mr. McGuire, but I'd like to hear from Mr. Jones, from Prairies Economic Development Canada.
Please speak to us about what you're seeing on the ground, the kind of consultations that are going on. Do you feel that the work that is being done now by NRCan and ESDC will be helpful to your department?
Mr. Chair, this new regime where you have to think before you speak is a blessing.
I'm going to turn this question over to Justin Riemer. I think it's a question about what we're hearing on the ground, and he's been most connected to that.
I'll maybe just say, overall, that communities are really concerned and really seized of this, and very passionate about finding solutions, particularly solutions that don't involve their workers having to leave that community to go to another community to find work.
Justin, you may want to add to that.
Yes, it is very true. There are concerned communities. We've been having consultations with them—the unions, the workers, the municipal leaders—in those affected communities in Alberta and Saskatchewan for a few years now, as we deliver our programs. We have been investing in projects to maintain jobs in those communities, train up workers, assist workers in transitioning to new sectors and new employment. We are starting to see some results from those investments.
We have invested in some infrastructure projects in those areas. In Alberta, it's anticipated that they will be fully off coal electric generation by next year, so the transition is under way. However, because the economy is fairly high growth in Alberta and the Prairies right now, there is a good degree of employment opportunity, but it may not be in the communities where the coal electricity has been generated.
We have a variety of programs. We have a coal transition program, where we're working with the community, based on municipal and community leadership, to invest in things such as worker training sites, industrial land development, feasibility studies for irrigation and other economic development opportunities the community has identified as priorities.
We also have an infrastructure fund that invests in infrastructure needs for an identified community that is affected by coal, in an effort to support investment attraction into that area, for instance, funding roads or other types of infrastructure that are going to address the infrastructure shortcomings of that area and appeal to investors to promote new industry development in those sectors.
We have a variety of, I think, micro-oriented economic development programs in communities to support economic growth in those regions and support the workers through entrepreneurship, business supports and other types of identified training needs.
Mr. DeMarco, since we're here today to talk about the audit, that is what we're going to focus on.
I also want to go into more detail with you about the government's diligence in setting up an informal working group. Don't you think it's dilettantism? In other words, they set up an informal working group, make recommendations, and the government doesn't ensure that those recommendations are followed.
In the audit, you said no one was accountable. The working group's first recommendation proposed that the transition plan be sponsored by a responsible minister. However, no one is deciding on roles and making decisions. There is no one responsible for accountability within the department. I'd like you to talk about accountability and coordination of actions in this plan.
Thank you very much, Mr. Chair.
I'm going to be very brief because I want to be able to share a few moments of my time—at least a minute and 15 seconds—with Mike.
I want to thank the witnesses.
Again, thank you for being present with us today on this really critical report.
I want to thank my friend Han from across the way for correcting me. I do at least agree that my statements have inspired discussion among this group, which I'm happy about. My Conservative colleagues as well got very excited to talk about climate change, which I never see. It's very exciting to see that we have agreement on some things.
I will yield the rest of my time to Mr. Morrice.
Thank you, Mr. Desjarlais, and thank you, Mr. Chair.
When the Canadian Centre for Policy Alternatives talks about a just transition, it talks about including “compensation, retraining and career support, job transfers and pension bridging for affected workers.” Similarly, the task force on just transition for Canadian coal power workers, in their recommendations—which this audit noted have not been completed—talks about protecting pensions and securing “income support, education and skills building, re-employment and mobility.”
My question is for Mr. Hannaford.
If you're in the midst of working on the legislation, can you confirm that these key items recommended by both a third party and a really critical task force will be part of the prosperous or just transition legislation?
This is for the commissioner.
As we wrap up the hearing today, this is maybe a bit of an opportunity for self-reflection, on the spot, about not only your report and the concerns you've outlined, but perhaps some of the responses we've heard from the various departments and the leadership responsible for implementing some of your recommendations.
You mentioned this in the section for support for workers not available during transition away from coal. The AG's report states on page 7, "Past examples of economic transitions demonstrate that if these transitions are not properly planned, they can fail to support Canadian workers and communities.”
In your opening, you alluded to several examples in Canadian history where the government response was not timely enough to match the programs to support workers. You've outlined this in your report again. You've heard the response today from Natural Resources Canada about the legislation to support workers, which you're advocating for.
Based on your report, your recommendations and on what you've heard today, are you confident that there's going to be a timely response in these supports, as you've recommended?
You're saying that it's been eight years now and Natural Resources Canada is in a consultation phase.
I want to get your reflections here.
Our fun job on the public accounts committee is to report back on your report. I just want to get you on the record here. Not only do we have your report and heard your recommendations, but we've also heard from Natural Resources Canada, for example. Are you confident now, based on your recommendations, that they are going to implement and change course? Is there actually going to be change to something different from the status quo? Again, looking out east and to those programs that are coming, do you have any more confidence from what you've heard today that they're going to be any more prepared to deal with this than they were before?
Again, with regard to upskilling and re-skilling and your specific question about the budget 2022 commitment, there is work that we are continuing within the department to develop very specific proposals for providing support to mid-career workers. We're also using some of the programs that I've mentioned already, for example, the sectoral workforce solutions program. This is one where we're looking at people and at how we can provide them with the skills to be successful, specifically with the transition to a low-carbon economy.
Staying on the theme of mid-career workers, there was also a commitment in budget 2022 to work with provinces and territories on the labour market development agreements and the workforce development agreements. As you may know, these are the funding arrangements that we have with provinces and territories, which represents about $3 billion annually in training spending. These provide supports to more than a million individuals across the country each year. This is one of the areas as well where the federal government would like to make mid-career workers a priority.
There are other things that we're also doing there. The Government of Canada committed to launch a clean jobs training centre to help workers across sectors upgrade or gain new skills so as to be on the leading edge of the zero-carbon industry. This, again, is one of the things where we have been leveraging the consultations with respect to just transition to help inform the way that we would intend to take forward the clean jobs training centre.
We are going to close it at that.
I want to thank all of our witnesses for appearing today.
I apologize about some of the audio difficulties we had. I appreciated your patience with that while we worked towards a solution.
Just before I adjourn the meeting, I'm going to remind committee members that on Thursday, June 9, we'll be studying two draft reports in camera. The report on the “Public Accounts of Canada”, as well as “Report 13: Health and Safety of Agricultural Temporary Foreign Workers in Canada During the COVID-19 Pandemic”.
With that, I will adjourn the meeting.