Evidence of meeting #52 for Finance in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was infrastructure.
A video is available from Parliament.
4:40 p.m.
Senior Vice-President, National Affairs, Canadian Federation of Independent Business
Yes, we would like to test that. We know the apprenticeship tax credit and the apprenticeship grant are well liked by our membership as well.
4:40 p.m.
NDP
Murray Rankin NDP Victoria, BC
Also then, to pursue this, Mr. Brakel, your third recommendation mentions increasing apprenticeship completions by creating a financial incentive for employers who retain apprentices in their third or fourth year of training. I thought that was a really excellent suggestion. How exactly would you do it? How rich would you make the incentive? Have you given any thought to how it would work?
4:40 p.m.
Senior Director, Economic, Financial and Tax Policy, Canadian Chamber of Commerce
Yes, one of the challenges has been why more apprentices don't fill out the third or fourth year. One of the challenges is that they just find another job or something different. That's why we were really looking at a tax incentive to make it more reasonable for businesses to hold them through that third and fourth years, and potentially that could lead them to pay the apprentices a little bit more just to keep them around to the third and fourth year.
We don't have specific numbers. We think that's something that would really work well. We heard from our members that is something they would consider.
4:45 p.m.
NDP
Murray Rankin NDP Victoria, BC
In your eighth recommendation, you talk about lowering tax rates, with fewer tax credits for individuals and corporations. It was refreshing for me to read that. Do I read correctly that you're opposing the plethora of boutique tax credits that now litter our tax act?
4:45 p.m.
Senior Director, Economic, Financial and Tax Policy, Canadian Chamber of Commerce
There are quite a lot of taxes—even some of our tax accountants who are members say that it's quite complicated now. In terms of how to pay for the tax reductions, we're saying that an overall reduction in some of the tax credits would enable us to lower the overall rates and simplify—
4:45 p.m.
NDP
The Vice-Chair NDP Nathan Cullen
Thank you, Mr. Rankin.
Over to Mr. Van Kesteren for up to six and a half minutes, please.
4:45 p.m.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
Thank you, Chair.
Thank you all for being here.
I'll go to the chamber first. I don't think anybody has asked you to elaborate on your sixth point, to establish a development finance institution. Can you maybe just talk about that quickly?
4:45 p.m.
Senior Director, Economic, Financial and Tax Policy, Canadian Chamber of Commerce
Yes, absolutely. When we were looking at measures to improve trade and trade with emerging markets, we heard something from businesses about every country in the G-7 having a development finance institute, an institute that provides financing for development. That's quite different from our export credit agency, which just does exports. This would be a financing body that would just provide financing, not just the usual foreign aid, but actually provide long-term loans to create the infrastructure and private sector involvement to boost growth in emerging markets and developing countries.
We think it would be hugely advantageous in boosting local growth in a lot of developing countries and getting Canadian companies potentially more involved in those types of markets.
4:45 p.m.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
Let me understand this correctly. Are you suggesting that if, for instance, a company wants to set up shop in Ghana—I've been to Ghana; I've seen lots of people who would love to go to work in Ghana—you would give financing or create an institution that would enable that company to set up shop there, so that we can...?
4:45 p.m.
Senior Director, Economic, Financial and Tax Policy, Canadian Chamber of Commerce
When we're looking at development aid, what works best isn't providing just straightforward grants but actually providing the financing to build those infrastructures to create the private sector. A lot of those institutions and businesses in Ghana can't borrow five- or ten-year money, so whether it's the World Bank or a Canadian development finance institution that comes along and gives them that ten-year money so that they can build a business, then you get that private sector growth. That is what creates the sustainable long-term growth. That's why we're very supportive of a development finance institute.
4:45 p.m.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
Didn't we have that happen—I'm a little confused here. Are you suggesting this for reasons of giving our Canadian businesses a chance to set up shop in foreign countries, or are you trying to develop the economy so that they'll buy our goods?
4:45 p.m.
Senior Director, Economic, Financial and Tax Policy, Canadian Chamber of Commerce
It's a bit of both. The best way to develop growth in some of those developing countries is this private sector growth, and the way to do that is through financing.
Canada already participates in IFC and World Bank and so a lot of those contracts are done in countries like Ghana, but the Canadian companies don't always get to participate, because they don't have the same experience as certain others. So we think a Canadian development finance institute would benefit and create a lot of development growth in those countries, and it would also give Canadian companies a chance to get in on the ground floor of a lot of those developing countries.
4:45 p.m.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
Ms. Pohlmann, this question was also asked of Mr. Wilkes. Have you found in your surveys that the job vacancies are both skilled and unskilled?
4:45 p.m.
Senior Vice-President, National Affairs, Canadian Federation of Independent Business
Yes, they absolutely are, and in fact, in the more recent surveys I would say that the greater proportion is skilled labour, but there's definitely a growing concern with unskilled labour as well. I have to say, with the change in the temporary foreign worker program, that is becoming even more apparent.
4:45 p.m.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
What about some suggestions that we raise the minimum wage? Would that help the unskilled? Maybe it would attract them to the workplace.
4:50 p.m.
Senior Vice-President, National Affairs, Canadian Federation of Independent Business
Raising the minimum wage is always a challenge because, ultimately, the issue is about putting money back into the pockets of people and we don't believe that raising the minimum wage is the way to do that. We believe that you need to increase your basic exemption and make sure that you're not taxing people more. That is the better way to make sure we're dealing with people who are at the low income part of the salary scale, rather than trying to impose more costs on small business. It's not just the minimum wage that goes up for small business for their minimum wage workers. It's their entire workforce that all has to go up incrementally, so it's a big cost.
4:50 p.m.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
I think I used your name and I was wrong. I've read so many reports that I forgot where I read it, but someone has suggested that we split the EI. Is that something your membership has talked about? Just so that everybody understands—and I'm just going to ask this question across the board—currently the employer pays 60% and the employee pays 40%. You said it was 40-40-20, but in essence you're asking taxpayers to make that. I mean there's only one taxpayer.
What about the split of 50-50?
4:50 p.m.
Senior Vice-President, National Affairs, Canadian Federation of Independent Business
Just to be clear, we were not asking for the government to put in 20%. We were asking to move it to a 50-50 split. It once was 40-40-20.
4:50 p.m.
Senior Vice-President, National Affairs, Canadian Federation of Independent Business
Yes. There was a time when employers and employees paid the same. Today we see the opportunity to move it to 50-50, given that a bigger and bigger proportion of the EI benefits is actually special benefits paid out, which benefits society, and perhaps the worker should be paying a bit more of a fair share in EI costs.
4:50 p.m.
Conservative
Dave Van Kesteren Conservative Chatham-Kent—Essex, ON
If we move in the right direction—I guess the question will answer itself—if we build a strong economy, the need for EI will lessen, won't it? That won't be that great a concern because, if that is the case, then the premiums will drop as well.
Having said that, have we a kind of agreement that maybe we should see a lowering of EI and to start with it at 50-50?
I'm going to go to you, Mr. Brakel—
4:50 p.m.
NDP
The Vice-Chair NDP Nathan Cullen
You have just 30 seconds left so maybe you could concentrate questions.