INDU Committee Meeting

    I call the meeting to order.

    Good afternoon.

     I hope that everybody had a good weekend in their constituencies.

    Colleagues, just as a reminder, if your earpieces are not in use, please ensure that they are on the sticker in front of you to protect the health and well-being of the interpreters, who are working hard on our behalf here today.

     Pursuant to Standing Order 108(2), the committee is resuming its study on the subject matter of Bill C-15, an act to implement certain provisions of the budget, and, in particular, clauses 389 to 398, 589 to 591 and 597 and 598. You will recall I received a letter from the chair of the finance committee asking us to undertake some of the work in relation to Bill C-15, as is common practice, to reduce the workload. We have done so.

     We already heard from witnesses in relation to this last week. Joining us today, we have Mélanie Joly, Minister of Industry.

    The minister is joined by Charles Vincent, senior assistant deputy minister, industry sector; and Samir Chhabra, director general, marketplace framework policy branch.

    I'd be pleased to speak in both languages.

    All right.

     This is Canada, so I can choose to pronounce your name in either language.

    Absolutely.

    I'm comfortable speaking both languages.

     Well, then, we'll go fifty-fifty.

    Colleagues, this is a nice change of pace from the in camera reviews of studies we've been doing, so I welcome the opportunity for the discussion.

    Minister, you have 10 minutes for your opening remarks.

    We will then proceed to questions from members of the various parties, as usual.

    The floor is yours, Minister.

    Thank you, Mr. Chair.

     I'm pleased to be here today to talk about why the budget implementation act really matters, and why it's such a key part on how we move Canada's industrial strategy forward.

    Right now the global economy is changing fast; we know that. Competition is intense; supply chains are being reshaped, and countries around the world are moving aggressively to secure the industries of the future. In that context, Canada cannot afford to stand still. We need to be strategic, consistent and, above all, able to act. That's exactly what the BIA allows us to do. It's the tool that turns policy direction into real-world action. It strengthens confidence in our markets, modernizes the rules that govern our economy and gives businesses the predictability they need to invest and create jobs here at home.

     I say this with a sense of real concern because, at a time when workers and communities are looking to Parliament for leadership, the continued delays around the BIA are preventing support from reaching people when they need it most. These measures were designed to respond to very real pressures facing workers and key industries, yet progress is being slowed, not by substance but by obstruction. It is disappointing to see Conservative members choose delay over delivery, and the consequences are not political; they are human. Workers are left waiting; communities are left uncertain, and businesses that want to invest are left without the clarity they need.

    Budget 2025 Implementation Act, No. 1, will help us support key sectors: clean technology, advanced manufacturing, critical minerals and the digital economy. Governments around the world are moving quickly in these sectors, but so can Canada.

     The strategic response fund is a good example, giving the government the ability to support major projects, attract significant investments and protect critical industries. This legislation lays out the rules for the fund to do what it is supposed to.

    Canada's auto strategy supports that approach. It is designed to strengthen the entire chain, from critical minerals and battery manufacturing to the assembly of zero-emission vehicles. Budget 2025 Implementation Act, No. 1, will support the strategy by ensuring clear, modern and predictable market rules for a sector in the midst of a major transformation.

     In this context, I would like to take a moment to highlight the working group that we're setting up, which brings together partners from the Government of Ontario and the federal government.

    The objective over the coming weeks is clear: Bring the right players together to develop a solid and credible engagement plan to move forward. In practical terms, this means convening and inviting decision-makers to the table. We will work with key mayors, including those of Ingersoll, Brampton and Oshawa, as well as other mayors from Ontario's group of automotive municipalities. Among our immediate goals are building the next Honda Civic in Canada and securing the production of the next generation of the Toyota RAV4. We also want to hear from other companies about their plans so that we can maintain and grow automotive production in Canada. We will use our defence industrial strategy as leverage.

    I'm also pleased to announce today that the members of this task force committee will be Flavio Volpe, president of the Automotive Parts Manufacturers' Association; Lana Payne, national president of Unifor; the Honourable Vic Fedeli, Ontario's Minister of Economic Development; Premier Doug Ford; and me. The task force will first begin with these members. However, we will seek to bring in additional partners, including representatives from the new technology sectors—because we know we have the best and brightest in the country—and including also the Ontario Auto Mayors, the Global Automakers of Canada, Toyota, Honda and the Canadian Vehicle Manufacturers' Association. Their expertise and leadership both at the federal and provincial levels will be essential assets in guiding the group's work and ensuring constructive dialogue with all partners. The overall objective is simple: to write the next chapter of Canada's automotive industry together.

    Together, Budget 2025 Implementation Act, No. 1, the strategic response fund and the auto strategy form an integrated, consistent approach, one that gives us the tools to act, support workers and communities, and ensure Canada's attractiveness as an investment destination for the industries of the future.

    Budget 2025 Implementation Act, No. 1 is more than just numbers on a page—it's a strategic tool. It builds confidence, modernizes rules and gives Canada the ability to act decisively in a rapidly changing global economy.

    I would now be pleased to answer the committee's questions.

    Thank you very much, Minister.

    Colleagues, before we begin, as I reflect on the last time we had an opportunity to gather in such a setting, I'll give you a friendly reminder that I will be very generous in ensuring that folks have the opportunity to ask questions and answer questions. I'll be fair with the clock. There is no need for us to try to fight for that space. I will gladly and generously create it for us.

     With that, we will enter into our line of questioning.

    Ms. Dancho, the floor is yours for six minutes.

     Thank you, Mr. Chair.

    Thank you, Minister, for being with us again today.

    Last week, you and the Prime Minister announced a $2.3-billion taxpayer-funded subsidy for Canadians to purchase electric vehicles. As you know, the subsidy is available for American-made electric cars, which we found quite shocking given what the Americans are trying to do to our auto sector. You're well aware that 5,000 jobs have been lost and countless others.

     Can you explain the rationale of allowing taxpayer-funded subsidies, up to $2.3 billion, to go towards the purchase of American-made electric vehicles?

    With regard to the auto strategy, the objectives are clear. There are two of them. The first is to support auto production in Canada, which I think we all agree on here. The second is to make sure that we help the industry get to a place where the rest of the industry in the world is, which is basically electrification. By 2039, 40% of all the cars sold in the world will be EVs. While the Americans are taking their own decisions, we will be at the forefront of this industry. We won't just stay idle.

    To your point, I want to make sure that we're supporting auto production in Canada—

    Minister, the point is that you created a subsidy program, a very generous one of $2.3 billion, a significant taxpayer investment for electric vehicles.

     Why did you not disallow the American vehicle market to have access to that? Given what the Americans are doing to our auto sector market, it is odd to me, as well as to everyone at this table and the auto sector workers who have lost their jobs, that our tax dollars can go towards subsidizing the American market.

    You mentioned that we should be helping all auto sectors. I don't agree that we should be helping the American auto sector. I'm not sure why you do.

     First and foremost, everybody—industry, Premier Ford, unions and consumer groups—is in favour of the strategy. Why is that? They get the fact that we're supporting those who invest in us.

    What is important in your question—which the Conservatives have, unfortunately, not alluded to—is the fact that we have countertariffs on U.S.-made vehicles. However, the reality is—

     I appreciate that, Minister, but I am trying to watch the clock.

     I'm sorry. I want to make sure I finish.

    Yes, Minister. You have 20 seconds.

     Madam Dancho, I've paused it for the duration of her answer.

    We have countermeasures. When American automakers reduce their production in Canada, we reduce their market access. We just did that with Stellantis, where 50% of the cars they used to send to Canada now, if they're sent, have tariffs. It's the same for GM, which has 24.2% less market access.

    If you look at them, the incentives are linked to the fact that it is all to support domestic production in Canada.

    Thank you, Minister.

    One or possibly two vehicles manufactured in Canada are eligible for this subsidy. The last time your government brought forward a similar EV subsidy, 99% of it went to foreign electric vehicles. We can assume a similar situation will happen with the EV subsidy you announced today. Again, I'm not quite sure why you would design a program wherein Canadian taxpayer dollars could go towards benefiting the American auto sector.

    Can you explain why that's ethical in the situation we're in today with job losses, which is the explicit goal of the Trump administration?

     Obviously, the U.S. tariffs are creating this.

    Unfortunately, the Conservatives have been long to denounce the tariffs against the auto sector. You even had a colleague, the member from Oshawa North, who was freelancing last week. Until he was reminded that he was representing GM, and that GM auto workers were being impacted by the tariffs, he said nothing about it.

    That being said and if we put that aside, what is important is that we are all about affordability. We want to make sure people have access to cheap EVs, that they can embrace electrification—

    That's including American EVs.

    —and that we can have more EV auto production in Canada. It's also so that people can have access to cheaper EVs—

    There aren't a lot of options to buy Canadian-made EVs, as you know.

    —which is what Canadians are looking for.

    That leaves very little option for Canadians. There are a number of options in the U.S. within the subsidy rules as you've established them. Again, we're quite shocked that you've created a program wherein Canadian taxpayer dollars will benefit the American auto sector.

    It's quite simple. Do you agree that this is ethical given what they're doing to our auto sector?

    The reality is that we have auto manufacturers from the U.S. here in Canada. We have GM in Oshawa. We do. We have Stellantis in Windsor. We have Ford in Oakville. We want to make sure we keep their footprint—

    Are you saying it's a negotiation strategy?

    —unless the Conservatives are against the footprint of these jobs—

    Are you saying that?

    —which number around 10,000.

    Colleagues, give me one moment, please.

    Several members are flagging an issue with the interpretation because two people are speaking over one another.

    I have been pausing the clock, Madam Dancho, when I have found the minister's answer to go a little longer. You have one minute and 40 seconds remaining. As I mentioned at the outset, this is about fairness. We want quality answers.

     Minister, I'll afford you about 20 seconds to respond.

     Madam Dancho, I'll then go back to you. Again, if I see there's a lack of equality, I'll pause the clock in order to afford you the time that remains.

     Minister, please take about 20 seconds.

     I think her colleague, Mrs. Borrelli from Windsor, would agree that the jobs at Stellantis are important. Now there are three shifts. We need to make sure we support auto workers here in Canada, including those working for U.S. companies.

    At the same time, we need to make sure GM and Stellantis, which have reduced their auto production in Canada, are on the hook. We're going after the money, and we're reducing their market access. This is what we're doing with—

    Again, you seem to be placing this as some sort of negotiating strategy. This is a subsidy available to cars exclusively made in the United States.

    It's not exclusively.

     If they're made in the United States, they're eligible for this subsidy. It's not employing any Canadians if you're buying an American-made electric vehicle. It just seems very unethical to us that you would design a program like that.

    It would be quite simple to say that American vehicles are not eligible for this, given what they're doing to our auto sector. I'm not quite sure why you're not taking that position.

    Perhaps you can elaborate.

     Yes.

    When we say that we're reducing their market access, we mean they will have tariffs imposed. When they have tariffs imposed, of course, it will be higher than the $50,000 cap for vehicles.

    When you say that we're subsidizing, the reality is that we're supporting cars—

     That's not correct, Minister.

    —that will be less than $50,000. Obviously, this will have an impact on vehicles coming from the U.S. that are linked to automakers reducing their footprint.

     There are 20 seconds left, Madam Dancho. Make it concise, please.

    Minister, make your response concise, please, and then we will move on to the next question.

    Are you giving me 20 seconds?

    I'm giving you 20 seconds, yes.

    Again, this subsidy is accessible to American-made electric vehicles. We feel that's deeply unethical, given what the American administration is doing. I'm not satisfied with your answers, so I'm going to move the following motion, Mr. Chair:

    Mr. Chair, there have been communications with other parties, so I know that with some tweaks we can get to a good motion here that we can pass, but I don't want to take away a lot of questioning time from everyone.

    If you agree, Mr. Chair, we will allow this to be paused and at the end of the minister's time today, we will resume this discussion in public.

     Thank you, Madam Dancho.

    Colleagues, I have two things. First, this is the identical motion which Madam Dancho put on notice on Friday, so there are no problems in terms of admissibility here.

    We appreciate the fact that we have the minister and her officials here. We should be taking advantage of that time.

    I'm going to take a quick glance around the room to ensure that you'll allow me to bypass the standing order here and that we commit that we will get to this when the minister leaves. We'll honour that commitment, so that we can continue—

    Raquel Dancho: In public.

    The Chair: —in public.

    Over to you, Ms. O'Rourke, for six minutes.

    Thank you very much for being here, Minister. Thank you for the measures in budget 2025.

     In the context of our productivity study, and in the context of the defence industrial strategy, witness after witness after witness talked about the importance of the regional tariff response initiative. They talked about improving the SR and ED program. They talked about the value of the productivity superdeduction.

    Minister, I'm wondering if you want to talk about the pieces in budget 2025 that are really critical to pass as quickly as possible to give businesses confidence that these measures are in place for them, particularly as they pertain to agribusiness, manufacturing, trades training and retraining.

    I will hand it over to you to talk about how urgent it is to pass the budget, so that businesses can have access to these critical supports.

    Thank you, dear colleague.

    I have a couple of things.

    It goes without saying that all the measures in Budget 2025 Implementation Act, No. 1, regarding the strategic response fund are very important. The fund gives us the tools to help tariff-affected businesses while investing in businesses looking to grow in Canada.

     A few weeks ago, as the industry minister, I put forward my plan for the sector. We must not only protect jobs, but also create them. That is why the strategic response fund and all the measures related to the tax credits and R and D are so important.

    For too long, small and medium-sized businesses have shouldered the costs of excessive red tape and waited longer than they should to receive the funding they deserve. This has caused frustrating cash flow issues, especially for growing businesses that constantly need to invest in and embrace cutting-edge technology. That is why we have made additional investments in a new approach, the tax credits.

     That is why the passage of Budget 2025 Implementation Act, No. 1, is so important. I gave you two examples, but I could go on. I could give you 50.

    Does it make sense for the members of the opposition to vote against a budget that will help workers access training, help industries access funding and bring tariff relief to some of the hardest-hit industries?

    Do you understand why they are against all those supports for our most vulnerable industries, supports that would help them build resilience and seize opportunities for growth?

     Thank you, Ms. O'Rourke.

    I can understand parliamentary sparring. I can understand the desire of the opposition, especially the Conservatives, to play partisan games in an effort to elbow the government a bit. However, these are not normal circumstances. We are in a time when anxiety and unpredictability are running high because of our neighbour to the south. That creates an investment climate that is somewhat averse to new key forms of funding or investment.

    We need predictability. We need to implement this plan, which has strong support across the country. It lays out clear policy commitments and has been very well received by the business community. For that reason, I think it's time to stop playing politics. We need to be able to pass this budget.

     Minister, to come back to the auto strategy announcement, which was very well received by the Canadian Vehicle Manufacturers’ Association, Unifor, auto dealers and global automakers, could you share with this committee why the response has been so positive and why it's so strategic at this moment for the industry?

     We did a lot of work and we met a lot with the workers. I went to Ingersoll, Brampton and Oshawa. I've been in contact with many of the players in the industry. We also met, obviously, with Lana Payne. I have her on speed-dial. She's been very helpful. We both agree that we need to do more to fight for these jobs, because if we don't, there's real traction for these jobs to go south of the border.

     We also worked a lot with the premier. He and I speak to each other every two or three days. I've also been in constant contact with Minister Fedeli, because we both want the same thing, which is to protect jobs and, at the same time, create more jobs.

     I've been in contact with Honda and Toyota. I've been to Japan, South Korea and Germany to attract more investments in the auto sector. I was in contact again with Bev Goodman at Ford over the weekend. She's the president of Ford Canada. I've met with GM. I've met with Stellantis. I speak to Rob Wildeboer all the time. He's in charge of Martinrea. I was on the phone with Linda Hasenfratz from Linamar over the weekend.

     The goal is to understand everybody's position and, based on that, bring a plan that is very pragmatic.

    What the industry is facing right now is the U.S. tariffs. At the same time, there's a real industrial revolution happening in the sector. Basically, there are great technologies being developed in China and around the world. We need to make sure that the North American market is not the last market to embrace them, because the rest of the world is modernizing.

     How do we do it? That's what we were trying to do. I think we were able to land on a really good plan, which is about supporting auto workers and supporting auto production. At the same time, we want to make sure that there's real research and development and a real adoption of new technologies in order to have a very strong auto sector for the next hundred years.

    Thank you both.

     Mr. Ste‑Marie, you may go ahead for six minutes.

    Thank you, Mr. Chair.

    Welcome, Minister, Deputy Minister and Director. Thank you for being here and answering our questions.

     My first questions pertain to Bill C‑15 and the parts we've examined in parliamentary committee.

    I'll start with the part that deals with data portability.

     In the bill, you're introducing a consumer-driven banking framework.

     How will that align with the data portability regime provided for in Quebec's law 25?

    Alignment is necessary to avoid three things: one, fragmented rules around consent and the ability to revoke consent; two, operational gaps around formats and communication time frames; and, three, legal uncertainty for provincial co-operatives such as Desjardins.

    Those are quite technical questions, so if you don't have the answers today, please get back to the committee in writing.

     Mr. Ste‑Marie, we've talked about those issues, you and I, and I know how important they are, legal uncertainty, especially.

     We will get back to you with those answers. Law 25 was passed before the budget implementation bill, which still hasn't been passed, of course. That's why I am here today.

     We will certainly be able to get you the answers to those questions.

    All right. Thank you.

    My next question is on the same topic.

     In the event of an incident, a breach or inappropriate use by a third party, for instance, who is responsible for what? Specifically, I'm talking about the institution disclosing the information, the third party receiving it and the authorities.

    In addition, what quick and standardized remedies will be put in place for the benefit of Quebec members?

    That, too, will be part of our response.

     I know that my colleague Evan Solomon is examining all the issues around data and data privacy in his work on reforming the Personal Information Protection and Electronic Documents Act.

    The various pieces of legislation relating to those issues fall more within his purview. We will get back to you with a response on that as well.

    Thank you very much.

    I'll continue with the parts of Bill C‑15 that we have studied.

    I have to say that I was particularly disappointed with the changes that were made with respect to greenwashing. In previous budget implementation bills, an amendment was made to the Competition Act to regulate advertising related to greenwashing. When a claim was made, it had to be supported by a credible study. In addition, individuals were given the power to bring civil proceedings under that amendment.

    Bill C‑15 removes that. Claims no longer need to be supported by studies, and individuals no longer have the right to sue. Even the lawsuits that had already started were dropped.

    I noticed something funny when I watched the news on television: as soon as Bill C‑15 was tabled, I started seeing the Pathways Alliance ads promoting oil and pipelines again.

    Why did you choose to back down on that?

    When it comes to advertising rules related to climate change, our objective was to bring a little more predictability and trust to the sector, because, in general, these rules had a direct impact on investments in the energy sector, including green energy. We saw that as a problem. The intention was good, but the way of doing it was ill-advised.

    Our objective is to ensure that we embrace this energy transition and reduce our greenhouse gas emissions, while providing a regulatory framework that enables investment.

    Thank you for your answer, even though I'm not convinced and I don't share your position on this.

    My next question is on another topic.

    On the south shore, across from Montreal, Lithion's goal is to recover electric car batteries when they reach the end of their useful life. That company is now in trouble. Quebec reportedly announced $30 million in support, while Ottawa offered only $3 million dollars.

    Is that something you're looking at?

    Could there be more assistance?

    In fact, the Government of Quebec contacted me this morning to address this issue. I also met with a number of company representatives. I know it well, since I visited it with Antony Blinken, former U.S. secretary of state, when he came to Montreal. We talked about the very good co-operation between Canada and the United States at the time on the issue of new energy and the energy transition.

    I will follow up, of course. I've also had a lot of conversations with Christine Fréchette on this issue.

    Okay.

    In my opinion, strategically, it would be essential to have a company that can recover those batteries. There's nickel—

    I agree.

    When we talk about the battery industry and investments in electric vehicles, battery recycling is certainly one of the points to consider. That's why Lithion is such an important company.

    Okay, thank you.

    I have four seconds left, so I'll come back to it in the next round.

    I'm going to recycle your time and add it to your next question, Mr. Ste‑Marie.

     Mr. Seeback, welcome back to the industry committee.

     The floor will be yours for five minutes.

     Thank you, Mr. Chair.

    Minister, you've announced your new strategy for automotive, and I know you think it's going to work to create investment in Canada and create new production of vehicles. I honestly hope you're right, because we need that help.

    What I want to ask you about is giving EV subsidies to American-made vehicles. I spent the weekend speaking with unemployed auto workers in my riding who worked at the Brampton facility. When I explained to them that Canadian tax dollars were going to subsidize the purchase of American EVs after their plant closed—it was supposed to build the Jeep Compass, and that production went to the United States—they were outraged, because Donald Trump has declared an economic war on our auto sector, and they lost their jobs because of it.

    What do you have to say to those auto workers who I spoke to on the weekend about subsidizing American EVs?

    Listen, Kyle, I met with them months ago, and I've met with the Stellantis workers. Some of them were offered a job in Windsor, which I think is too far away, to build the Dodge Charger, which will be supported by this new EV incentive.

    We can be proud, because the Dodge Charger just won the North American car of the year award at the Detroit Auto Show, and President Trump was there. It's a Canadian-made EV. We're very proud of that.

    Also, the Ontario Auto Mayors just tweeted that they welcome the auto strategy and the rebate program project to support more than 840,000 new EV purchases. It's good news. They said that the EV market has “already grown from 3.1% in 2019 to 15.4% in 2024”—

    Minister, with all due—

    —so that's really good news as well.

    Okay.

    Mr. Seeback, as I did with Madam Dancho, I've paused the clock and I'm writing down how much time everyone is getting. Don't worry; we'll get through it.

    Mr. Seeback, it's back to you with three minutes left.

    With all due respect, Minister, you didn't answer the question. I know it's a difficult one, but could you please try to answer the specific question. What do you say to Canadian auto workers who have lost their jobs because of Donald Trump's tariffs on Canadian autos, and what do you say to them when your government is going to subsidize the purchase of American EVs?

    I don't want to hear about the auto strategy. I just want to know what you say to them. They want to know. They asked me to ask this question.

    What do you say to them about Canadian tax dollars going to subsidize the purchase of American vehicles?

     When I spoke with the auto workers, they told me they were really happy with the auto strategy because it brings predictability to a sector that is under attack by the U.S. administration.

    When I told them that we need to embrace electrification because that's where the rest of the world is going, and we will be leapfrogging the American industry, they said yes, they agree.

    When I said to them that in the eighties, when the U.S. auto plants were closing, we decided to bring in the Japanese automakers, and at this point they make up 77% of our production, they said yes, they agree.

    Meanwhile, what I say to them is that we need to make sure we at least keep the U.S. automakers in Canada, those that are still here, to keep the jobs of their colleagues.

    That's not what the subsidies—

    In exchange, if they reduce their production, we will be able to reduce their market access. Therefore they won't have access to the EV incentives. They said to me, “Minister, that makes a lot of sense.”

    No one I spoke to this weekend—

    I can give you the names of the people I talked to.

    You should update them, because I don't think you told them American EVs would be eligible for this subsidy. When I told Canadian auto workers, they were outraged.

    You spoke about the Dodge Charger. Do you know how many Dodge Chargers were sold in Canada last year that would be eligible for this? You probably don't, but I do: 600. Six hundred vehicles are going to be eligible in Canada.

    Did you also hear that Stellantis is discontinuing its production of the Pacifica EV? They've put out that statement.

    The vast majority of these subsidies are going to go to foreign countries, including the United States, whose president has declared war on our auto industry. I don't know how you justify that.

    You can change your mind. You can say, “You know what? We made a mistake. American EVs are not eligible until the trade war is over.”

    Why won't you do that?

    Something I don't understand about the Conservatives' point of view on industrial policy linked to the auto sector is why they're against electrification. You were against EV mandates, so, okay, we got rid of them, but we want to reduce GHG emissions and align ourselves more with Europe.

     We're against giving Donald Trump Canadian taxpayer dollars for our vehicles.

    No, it's more ideological than that. Fundamentally, there is something that I don't understand, because it is about embracing where the change is happening in the sector. It is about making sure that we can build the best cars in the world for the world. It is to stop being a hostage of our geography and being able to export around the world. It is about also addressing the real affordability issue at a time when people want to invest and buy new vehicles, but they need a bit of help.

    Everybody is in favour of our auto strategy, including the EV incentives. Only the Conservatives are against it.

    Thank you very much, Mr. Seeback.

    Mr. Bains, the floor is yours for five minutes.

     Thank you, Mr. Chair.

    Thank you, Minister, for joining us today and for all your hard work during this difficult economic trade war with the U.S.

    You've stated that Canada will invest in those companies that will invest in us. Can you please explain how this process is under way already?

     Yes. Depending on auto production in Canada, if, for example, U.S. automakers produce a number of cars in Canada, they have the right to bring in cars from the U.S. without tariffs, but if they reduce their production, then we put tariffs on the number they're basically reducing. Fifty per cent of the auto production of Stellantis last year was tariffed. That is making cars that are sold by Stellantis in Canada much more costly, and then they will be over the $50,000 threshold, which is the threshold to have access to EV vehicle incentives.

     At the same time, we obviously have a strategic response fund to help Honda, Toyota and companies that are investing more in Canada. We think it's a good way to make sure that in Cambridge, Alliston and Woodstock, people continue to be employed, and more than that, we can have the next generation of Civics built in Canada. The good news is that the RAV4, a new model by Toyota, was just announced. Karim Bardeesy, my parliamentary secretary, was there. We also want to make sure that we have the new Lexus model built in Canada.

    That's our goal, to really protect the jobs, anchor them for the long run, be partners with these companies and, at the same time, be able to attract new investment from Korea, Germany and China.

     You talked about the strategic response fund. Bank of Canada research suggests that food inflation last year was almost entirely due to rising import costs. The government is setting aside $500 million from the strategic response fund to help businesses address the cost of supply chain disruptions without passing those costs on to consumers.

    Can you outline how this funding will strengthen Canada's food sovereignty, domestic food production and processing?

    We know that some of the food that is sold in our grocery stores is impacted by the American tariffs. While we have no tariffs on food, sometimes through their supply chain, they will go from Brazil or Asia to the U.S. and then from the U.S. to here. When the goods enter the U.S., they are tariffed. The tariffs are included in the prices. Then they come to Canada. That's a problem.

    We also need to make sure that we increase our food processing and production in Canada. We need to be much more sovereign when it comes to our food production. That will decrease the cost of food, and it will also create good jobs. That's why we have more funding in the strategic response fund to attract investments.

    My team and I are in conversations with companies these days to make sure that is the case.

    Could you explain the issue around the $400 million loan to Algoma, which then laid off 1,000 employees just days later?

     Canada needs to have a strong domestic steel sector. Can you touch on why that loan was necessary?

     It was because Algoma is deeply impacted by the tariffs. The entire business model of Algoma and all our steel plants was based on the fact they would send steel to U.S. automakers on the other side of the border. That's basically how these plants would become profitable, based on the free trade agreement that we had, and still have, with the U.S., but unfortunately there are now 50% tariffs on the steel and aluminum sector.

    What happened is that we offered liquidity, but I really think that by the end of next year we will be able to bring back at least 500 employees to Algoma. I went to Sault Ste. Marie twice last year, including back in December when the announcements of the layoffs happened. I met with the union. I know how frustrating and difficult this is.

    We're in conversations as we speak. Actually, I'll be meeting with Algoma this week to support the building of a new beam mill and also a new plate mill. We think that will allow Algoma workers to offer products for the housing sector and for infrastructure building, and at the same time, the military and defence sectors. That's our goal.

    It is a really difficult time, but we're having conversations with Algoma. We think we can get to a deal. Also, we are in conversations with Tenaris to create more jobs in Sault Ste. Marie.

    Thank you.

    Thank you very much, Mr. Bains.

    Mr. Ste‑Marie, you have the floor for two minutes and 34 seconds.

    Thank you, Mr. Chair.

    Before I start my two minutes and 34 seconds, I have a point of order.

    You made a comment about the quality of the interpretation, that is to say that, when there are cross-conversations, it causes problems for the interpreters. There were others that were reported to us afterwards.

    Obviously, I remind my colleagues to please respect decorum for our interpreters, who do an extraordinary job.

    The message is received. That's a good reminder.

    Thank you, Mr. Ste‑Marie.

    Yes, thank you.

    Madam Minister, can you give us an update on the assistance program for the forestry industry?

    How many businesses, ideally by province, have used it? How many loan guarantees have been granted?

    What I know right now is that we have already provided support in the form of $200 million dollars. We committed to disbursing that money to 15 companies. Many of the regional development agencies are also there to help the sector with economic development.

    The problem right now is that a number of companies in the forestry sector are worried. They're reluctant to take on more debt. Basically, the business model is very difficult because of extremely high tariffs, which make it difficult for businesses to operate.

    So it's a huge challenge for companies in the forestry sector, because they have to find a way to change their business model while dealing with liquidity challenges. My colleague Tim Hodgson, the Minister of Energy and Natural Resources, has created a working group to try to find an even better solution. We're already seeing that what we're offering is good, but there's still more to be done.

    On that point, we adopted the proposal put forward by the forestry sector unions and many sawmills.

    Since most of the duties are held in trust until the dispute is resolved, they proposed that the government advance them half of the funds that were set aside there, in the meantime, which would allow them to continue selling their products to the United States.

    That potential solution could work, but we are still discussing it with your colleague.

    Yes, that's right.

    I know that Minister LeBlanc is very aware of the situation. There have been a number of discussions with American representatives. Let's just say that negotiations with them are very difficult.

    Yes, that is indeed the case.

    I have very little time left.

    On Wednesday, you're going to announce the defence industrial strategy. What can you tell us about that?

    In the media this morning, it was mentioned that 75% of procurement is currently linked to imports from the United States.

    Are you aiming for a specific percentage, as part of this strategy, that would flow back into the Canadian economy?

    For us, it's going to be very important to create jobs through the defence funding. This reliance on the U.S. defence sector must end.

    The government is going to create more than 100,000 jobs in Canada. Our procurement rule will be, first of all, to build here. If it's not possible to build here because Canada doesn't have the necessary skills, it will create partnerships and associations. If we can't do that, then we will buy products elsewhere.

    I'll give you an example. Bombardier, which is an aerospace manufacturer, can certainly build planes. It's the same thing for the Davie shipyard in Quebec City. If Canada can't do it alone, Bombardier and Saab can work together to create and build a surveillance aircraft, like the GlobalEye.

    Let's take the example of submarines, which we don't build in Canada. The idea is not only to buy German or Korean submarines, but also to create jobs at Marmen in Trois-Rivières.

    The government could also create AI jobs at Cohere in Toronto. It could also create jobs at Algoma Steel, or in Sorel in the steel sector or, of course, in Saguenay—Lac‑Saint‑Jean in the aluminum sector, thanks to investments and procurement.

    Thank you.

    Mr. Ste‑Marie, you're always doing a good job of finding an extra minute in your speaking time. The minister also helped you this afternoon.

     Mr. Guglielmin, the floor is yours for five minutes, followed by Mr. Ma, and that will conclude our time today.

    Thank you, Chair.

    Thank you, Minister, for taking our questions.

    Minister, you've been in government for a long time. Is it fair to say that you believe government should be transparent and accountable?

     As always, of course.

    As many Canadians are well aware, we're here discussing the budget implementation act. It sounds rather innocuous, but what most Canadians wouldn't be aware of is that it's a 600-page omnibus bill.

    Buried on page 300, in part 5, division 5, clause 208, is a provision that allows you as minister and other of your ministerial colleagues to exempt any individual, corporation or organization from being subject to federal laws, with the exception of those that fall under the Criminal Code. From my understanding, those exemptions don't require parliamentary approval. They can last up to six years. They're being justified with vague terms like “public interest”, “innovation” and “competitiveness”.

    Minister, do you believe your government should be able to selectively suspend laws behind closed doors, passed by Parliament?

     I have a point of order, Mr. Chair.

     Go ahead on your point of order, Mr. Bardeesy.

     I know that certain parts of the budget implementation act have been sent to this committee. I don't know if that part has been sent to this committee.

    I think we've been relatively flexible in some of the topics of discussion here today—

    An hon. member: [Technical difficulty—Editor] good job.

    The Chair: —so I'll afford the minister an opportunity to respond.

    Colleagues, there's a lot of crosstalk here. We're almost there.

    Minister, I'll go to you and provide you an opportunity to speak to this.

    I think it's fair game for now, Mr. Bardeesy, but I appreciate your bringing the matter to my attention.

    Madam Joly.

     Yes, of course this government believes in innovation. We believe in cutting red tape. We also believe in the importance of parliamentary oversight.

     I guess my concern with this provision specifically, and I think the concern that Canadians would have, is that clause 208 allows ministers veto power over laws passed by Parliament, basically going all the way back to Confederation, as long as they don't fall within the Criminal Code. It makes elected representatives less relevant and concentrates more power in the cabinet and with the Prime Minister.

    It's not like Canadians don't have reason to be concerned. I mean, we have seen major scandals from your government, from the Liberal government, where political discretion in the past has intersected with powerful corporations. SNC-Lavalin and WE Charity are two obvious examples. Respectfully, Minister, you were in cabinet at the time. Had these laws been on the book, we would never even have known about any of these conflicts of interest.

    Can you explain why Canadians should trust that this new exemption power wouldn't just be more exemptions for well-connected Liberal insiders?

     First and foremost, we always respect ethics laws. I personally always do, and I will always do so, as well.

    Your point is well taken. I think that is why this committee is studying the BIA. You should make a recommendation and we'll take that into account. We believe, as I mentioned, in parliamentary oversight.

     To make the point, so Canadians watching and people at this committee can understand how serious this could be, we have examples here now on the disclosures for the Prime Minister's lobbying, where they're more than double, where he's met with business more than double the amount of times as the previous prime minister. According to the Canadian Centre for Policy Alternatives, 59 people with whom the PM is connected have become the heads of Canada's largest corporations.

    Our concern, and I think the concern that Canadians would share more broadly, is we need to be confident that exemptions under clause 208 don't simply reflect exemptions for the prime minister's friends.

    Can you commit today that every exemption granted under 208 will be publicly disclosed, with full legal justification before doing so?

    The Prime Minister came into politics having a breadth of experience in the private sector and also having worked at the Bank of England and the Bank of Canada, which is actually very useful to the country at this time, when we're dealing with a trade war.

     I'm convinced that the ethics screens are in place and that all laws are being followed and that there's no tolerance for any form of breach of the screen.

    Why? Fundamentally, what we value as a government and an institution is the trust of people. I really think that you should make the recommendation, which is important, and we'll take that into account. I really believe in the work of MPs, such as you, and I really think that we need to make sure there are strong guardrails to keep the public's trust.

     Thank you, Minister.

     I can appreciate the business experience. I spent my career in business before getting into Parliament to apply business acumen to the parliamentary process. That doesn't mean that we, as parliamentarians, and you as a minister of the Crown, shouldn't be enacting laws that are as narrow as possible to ensure that there's no room for exploitation, conflict of interest or corruption.

    That's exactly why you should come up with recommendations. We'll make sure that we act in good faith and see what can be done to create some important guardrails.

     I agree that we need to go fast and make decisions quickly. We need to reduce the red tape. We need to get rid of bureaucratic reflexes that have been in the public service—sorry, colleagues—for too long. At the same time, we need to make sure that there's parliamentary oversight. I think we can square that circle.

    Thank you, Minister.

     Mr. Ma, you'll conclude the line of questioning with five minutes allocated.

     Minister, your recently announced auto strategy received great reviews from labour unions, from provincial government and environmental associations. Everyone appears to be pleased with the direction our government is now going.

    How will the newly announced auto strategy help define the Canadian auto industry strategically in the coming years?

    A lot of decisions were taken by the auto sector, and a lot of it was linked to the Inflation Reduction Act under President Biden. A lot of decisions were taken in the U.S. linked to that. President Trump decided to make his own decision. That's fine, but we need to think ahead.

     Thinking ahead means asking how we can continue to build cars that people will want to buy at an affordable price and stay competitive and how we can keep our footprint here at a time when there's a strong push for U.S. automakers to leave and go south of the border, while being able to attract new investments. We know that we will be revising CUSMA. That's something we'll be working on.

    We came up with different ways. I've talked about enticing auto production in Canada. We do that through the $3-billion strategic response fund for auto. We're doing that through a remission system that basically is to support automakers in Canada. When they reduce their footprint, we penalize them and we reduce their market access for cars coming from the U.S. We're doing that also because we believe that companies that will increase their production in Canada should be able to benefit from it.

     We're looking at creating a credit system for companies that will be able to produce more to sell to those that are decreasing their footprint. That is why we will be able to anchor the companies that are here and potentially attract more car companies. We want to use defence procurement also to attract investors, either from Korea or Germany.

     Minister, colleagues here today have expressed concerns about EV subsidies going to the pocket of Donald Trump and so forth. Can you walk us through how the government is supporting domestic production?

     I just mentioned the strategic response fund and the remission framework, obviously because we're imposing tariffs on U.S.-made cars. I also just mentioned the EV tariffs, of course.

    The EV incentives include the cars that are made in Canada. They can be even more than $50,000, if they're made in Canada. We will be there to support them.

    It is for the Dodge Charger right now, but it's also for plug-in hybrids. We think that the plug-in hybrids, including the new RAV4, the next Civic—we hope—and the Lexus will be able to be covered, but we think we can have more.

    We have the Volkswagen battery plant right now that has started construction. LG also has a battery plant. We have two really important battery plants and we think they are really important anchors for new investors.

     That's great.

    Minister, to follow up on that, how has the government helped to expand consumer choices with the recent trade missions?

    We have a free trade agreement with Europe. We have a free trade agreement with Asia. We believe that by having a bloc of middle-power countries together working on having a free trade zone without tariffs, we can increase choices.

    We also want to make sure that automakers that are exporting a lot to Canada are able to also produce in Canada. That's definitely our goal and we'll work with them to attract more investment.

    Colleagues, that brings us to the end of the first hour.

    Madam Minister, thank you for joining us.

     Mr. Vincent and Mr. Chhabra, we very much appreciate you being here as well. We understand how difficult it is to take time away from the office, so we appreciate it.

    Colleagues, I am going to very briefly suspend, in order to allow the parties a moment to talk about the motion. We will come back publicly to deal with it and then I'll suspend again for us to go in camera to get to the report.

    The meeting is suspended.

     Colleagues, this is reminder that we are still public.

     We are going to deal with the motion that Madam Dancho brought forward. Once we've dealt with it, I will suspend so that we can go in camera and continue with the report.

    Mr. Guglielmin, your hand is up. The floor is yours.

     Thank you, Chair.

    We had some discussions among the parties. I'd like to move an amendment, which I believe will satisfy everyone here, to remove the words “that this study take precedence over all other business”. Also, we want to make some additions. The first one is “new auto strategy;” and the second one is:

     Okay.

    Mr. Ste‑Marie, is the interpretation correct?

    Ideally, it would be good to send the translation to the interpreters, but it was presented to me.

    Okay. It's to conduct your study on artificial intelligence at the same time, that is, after the reports have been completed.

    Just before, Mr. Guglielmin, do you want to...?

    Do you want me to read the whole thing?

    No, I think it's okay for the time being because written copies are being handed out.

     Mr. Bardeesy, you're on.

     Thank you, Chair.

    Thanks to our colleagues, Madam Dancho and Mr. Ste-Marie, for starting the collaboration on this part of our deliberations.

     As I said briefly in our last meeting, the shorter study we did on autos had a beneficial impact on some of the deliberations of government and in the interaction with what we were hearing from witnesses, in particular, with regard to the effects of the electric vehicle availability standard and the prospective chill of investment that comes from U.S. trade actions, and the actions that Canada needed to take, in a unified way, to address the issues in front of us. I commend the work that we've already done on this file. Having had real results doesn't mean there are not disagreements or differences among the parties, some of which have been already raised today.

     This motion creates the effect of our doing two concurrent studies again, which we had done in the fall period. I know that's more unusual than usual in the work of the committee and for the hard-working analysts we have. I do want to, at some point, put a question to the table officers about what the practical effects would be of implementing this motion, given that we did it with some hesitation last time and that we had a schedule in mind for the winter session, which didn't include this study. Once again, I just want to note that we did have an auto study in the fall that we put in place, in response to the circumstances on the ground there.

    I also note that this motion has language in and around reporting findings and recommendations to the House. I think that, on this side and collectively, we've already used committee time, and question period and debate time in the House, quite well to highlight the issues in the auto sector that need a full and public airing. Indeed, we'll get four more meetings, so eight hours more, of a full and public airing on that with, potentially, the invitation of the minister, who, if she accepted the invitation, would be appearing for the third time before this committee.

    Mr. Bardeesy, I'm sorry to cut you off. I'm very eager to get the productivity report done. I think you're building up to your point, so could I ask you to get to it.

     Thank you.

     I am, yes.

    I'm concerned about the effect of this motion if there are no amendments. It would cause another delay in the use of House time. We have a lot of important bills to work on and vote on, including Bill C–15, which we studied a few minutes ago. I therefore move an amendment.

     This amendment would add at the end of the motion, “and that pursuant to Standing Order 109, the committee requests that the government table a comprehensive response to the report”.

    In French, this consists of adding the following at the end of the motion: “et que, conformément à l'article 109 du Règlement, le Comité demande au gouvernement de déposer une réponse complète au rapport.”

     I'm going to give the floor to Madam Dancho to clarify it, but just as a reminder of where we are procedurally, that's a subamendment. Therefore, we're currently on the subamendment being proposed to the amendment.

    Madam Dancho.

    Mr. Chair, just so I understand, is it in addition to the last sentence, or is it replacing the last sentence? Is it “and the committee report its findings and recommendations to the House and the government issue a response”? I'm just not understanding it.

     It's in addition to.... My understanding of the Standing Orders is that the response to the report is then required to be done before the report of the committee's findings. That is my understanding.

    Give me one second. I think we're now tripping on ourselves a bit.

    Mr. Bardeesy, could you reread specifically what it is you're hoping to subamend?

    It's to add at the end of the motion, “and that pursuant to Standing Order 109, the committee requests that the government table a comprehensive response to the report”.

    My understanding of its effect is that the government's response is required before the committee then reports to the House.

    I'm going to suspend very briefly to allow for some clarity. I think I understand what you're trying to do.

    I'll just clarify a couple of things, and then I'll give the floor back to Mr. Bardeesy.

    It was my mistake. I thought you were making a change, initially, to Mr. Guglielmin's amendment, which would therefore have made it a subamendment. Technically, it's a new amendment. Technically, I should have dealt with this amendment first and then moved on to that amendment, but we're fine. It's a separate amendment, so we're going to entertain this amendment first, and deal with it. Then, we'll go to that amendment.

    For technical purposes, essentially, Mr. Bardeesy....

    Actually, Madam Clerk, to make it easier, I think we should adopt Mr. Guglielmin's first because then we're changing.... This was my mistake.

    Mr. Ma, unless it's on a point of order—

     I do have three comments on this.

    That's no problem.

    I'm sorry, but this is my error. Just so I can explain the logic here, Mr. Guglielmin's amendment changes the substance substantially at the beginning of the amendment.

    Unless Mr. Bardeesy were to give us that exact same language before we even adopted it, rendering his moot, then we would have to go back to him, and it's a little dirty to do it that way.

    We're going to come back to you. There appear to be some questions, Mr. Guglielmin, in relation to your amendment, so we're going to deal with that first, and then we can vote on that. That's going to bring us then to a changed amendment, assuming we're supportive, which I think everybody is. Mr. Bardeesy will then have the opportunity to bring forward his new amendment, which will make the change that he suggested, and then we should be ready to go.

    I'm sorry that it got a bit messy.

    Mr. Guglielmin, did you have anything to add to your amendment?

    No.

    Okay.

    Mr. Ma, you wanted to speak to his amendment.

     Yes, please. I have three comments.

    One, towards the end, about studying two concurrent topics, I don't think that's a very efficient use of time. It really convolutes the whole dialogue between parties and coordination. From my experience, that's not a good use of the committee's time. I think we should stay focused on one topic at a time.

    My second comment is on the topic of “no less than 2 hours”. I think we all know that if it's meant to be a consecutive two hours, that's very tiring. I mean, no lecturer can actually do two hours either, as we have these meetings as well. We know it's mental fatigue. What I would say is that maybe two one-hour sessions would be sufficient. I'm sure you'd still be able to cover the same amount of information.

    My last comment is on the word “alone”. Look around this room. We all have assistants behind us. Why is it that the minister is restricted to coming to this meeting alone? Those are my comments.

    Okay. The comments are heard. I didn't hear a proposal of a subamendment, just some feedback.

    Madam O'Rourke, were you hoping to continue this?

     I would agree, and I would move that we strike the word “alone”.

    I'm seeing agreement.

    Is that your only suggestion?

     It is at this time, yes.

    Do we strike the word “alone”?

    I'm just looking around for unanimous consent.

    (Amendment agreed to [See Minutes of Proceedings])

    The Chair: Good. We're moving forward.

     We are still technically in the conversation on the amendment put forward a moment ago by Mr. Guglielmin.

    Are there any comments?

    Mr. Ste-Marie.

    Mr. Chair, I'd like to clarify things.

    I believe all three parties are in agreement that the amendment and Mr. Bardeesy's suggestion to amend it should pass. I therefore invite you to proceed with the vote.

    If that's the case, that's great.

    Okay. We can do this all in one go here, everyone, as long as we're clear. What I'm hearing is that there's support for Mr. Guglielmin's amendment.

    Madam Dancho.

    I want to add just one point of clarification, because I appreciate the Liberal response to the word “alone”. The reason we mentioned it that way is that we didn't want her to come with other witnesses, but otherwise I agree.

     How they're interpreting it is that it would be odd, but that's not the purpose of how we wrote it. It's fine to strike it, as long as she isn't coming when there's a panel of four other witnesses. That was the point of what we were trying to achieve.

    Okay.

    On Mr. Guglielmin's amendment, everyone is okay with it, inclusive of the change with the word “alone” struck.

    (Amendment agreed to [See Minutes of Proceedings])

    The Chair: For Mr. Bardeesy's amendment, perhaps just for clarity you could read it again, Mr. Bardeesy.

    Yes. It's to add at the end of the motion the following: “and pursuant to Standing Order 109 the committee requests that the government table a comprehensive response to the report”.

    In French, it's to add the following at the end of the motion: “et que, conformément à l'article 109 du Règlement, le Comité demande au gouvernement de déposer une réponse complète au rapport.”

    Okay.

    (Amendment agreed to [See Minutes of Proceedings])

    (Motion as amended agreed to [See Minutes of Proceedings])

    The Chair: Excellent.

     I'm going to suspend, colleagues. I'm warning you in advance for it—

    Go ahead.

    We've adopted the amendment now. Don't we have to adopt the motion as amended?

    That's what we just did.

     We've agreed to adopt the motion as amended, inclusive of Mr. Guglielmin's, Madam O'Rourke's and Mr. Bardeesy's amendments. We're good on the motion.

     I'm sorry. Okay.

    Colleagues, now that we have a new set of meetings in front of us, you'll need to start thinking about witnesses, please.

    I'm warning everybody now that I really want to get productivity done, and this has taken longer than I hoped it would. We've now added more work, which is completely fine, but it's in addition to the AI study, which I was very keen to get to.

     I might ask us to stay a little longer today to get productivity done. That's your warning.

    We're going to suspend to go in camera.

    [Proceedings continue in camera]