Natural Resources Committee on Dec. 4th, 2012

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Is FPInnovations playing a role with organizations like FPAC and others in terms of promoting some of these innovations?

[Serge Dupont]

That's right. Many of these other organizations also are represented on the board of FPInnovations, so it is very much the place where you have discussions with the industry around areas where Canada could best advance its interests globally and in Canada.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Okay, thank you.

I want to switch back to the isotopes. I have a quick question.

I think I might only have about half a minute left, Mr. Chair.

[The Chair, Conservative, Leon Benoit]

You have 15 seconds for a very short question.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

What is your timeline with respect to the isotopes when you're talking about these new projects? What is the timeline for when we expect to start getting results from some of these programs?

[Serge Dupont]

Well, again, we know now from the projects we've already funded that they can produce the technetium-99, which is the substance that goes into a patient's body. We know they can produce it and they can replicate that process.

The question now is about ensuring that you would have the right kind of purity of the product on a consistent basis, and that you would meet the regulatory requirements, and also about trying to develop some kind of standardization of the process so that you can do it on a commercial level or a commercial scale. That's what we still need to do with this additional funding support to get it there. Clearly, we would like to have, by 2016, a reasonable dissemination of those technologies in Canada, to start meeting the needs of Canadians when the NRU basically comes to an end as regards the production of medical isotopes.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Allen.

We'll go to our final questioner for the officials. That is Ms. Liu, for up to five minutes.

Go ahead, please.

[Laurin Liu, NDP, Rivière-des-Mille-Îles, QC]

Thank you, Mr. Chair.

I share the concerns of my colleagues regarding the $4 million allocated for advertising on responsible resource development. In the NDP, we believe that it is more important to consult with the First Nations and Canadians properly rather than simply spend these funds on advertising.

My question has to do with the expected savings in the Natural Resources Canada portfolio. In 2012 and 2013, we expect to save $67.8 million. Can you tell us how many positions will be eliminated following the 2012 budget?

[Serge Dupont]

Yes.

In total, we have to eliminate 250 positions within the department as a result of the 2012 budget and the action we have agreed to take to reduce the deficit. The adjustments have already started. We had to and will have to make other adjustments to take into account additional financial constraints.

As I mentioned earlier, the Natural Resources Canada budget was doubled at one point. After the economic action plan, it was brought back to the previous level. We have to make adjustments, and we have already informed all employees. Most of them know exactly what to expect. We worked closely with the unions on this. We should be able to implement the adjustment set out in the 2012 budget.

[Laurin Liu, NDP, Rivière-des-Mille-Îles, QC]

Thank you.

I would like to share my time with my colleague, Mr. Gravelle.

[The Chair, Conservative, Leon Benoit]

Go ahead, please, Monsieur Gravelle.

[Claude Gravelle, NDP, Nickel Belt, ON]

Thank you.

There's $54 million in the estimates to support the forestry sector, including $17.2 million for marketing and $10 million for innovation. How is this little bit of money going to reverse the catastrophe in the industry, with job losses of 222,000 in Ontario, Quebec, and British Columbia? Where will the jobs come from with so little money invested in forestry?

[Serge Dupont]

Number one, there had been a number of very significant commitments made for the forest sector over the last number of years. There was the $1 billion for the pulp and paper green transformation program which has been fully disbursed. That has helped mills across the country improve their productivity, improve their energy use, and become greener.

There has been, as I mentioned earlier, $100 million over four years invested in the forest industry transformation.

These sums, the ones you're citing, are actually making a difference in terms of expanding new markets and putting new technologies into—

[Claude Gravelle, NDP, Nickel Belt, ON]

But, sir, we're dealing with the supplementary estimates (B) and it's $54 million. It's not the numbers you're citing—

[Serge Dupont]

That's a fair comment, but simply to put this into context—

[Claude Gravelle, NDP, Nickel Belt, ON]

—so how is $54 million going to help?

[Serge Dupont]

I was mentioning to an honourable member earlier that these amounts are used, for example, to expand our presence in other markets. I mentioned the exponential growth in exports to China, which is basically transforming the industry in British Columbia at this time and having some ramifications across the country as well. On the technology side it is about looking at new products that are going to be the products for tomorrow. I think it is having an impact.

We are continuing the dialogue with the forest products industry at many levels.

[Claude Gravelle, NDP, Nickel Belt, ON]

Thank you.

I have one more brief question.

With respect to Ontario forestry job losses every single year since 2005, all of these stats, these records have disappeared from the Natural Resources website. Some 220,000 job losses are embarrassing to the government. Why were these stats yanked from the website? Who makes the decision to yank these stats from the website? Is it you, is it the minister, or is it the PM's office?

[Serge Dupont]

I'll have to look into the issue of whether or how statistics would have been taken off the website. I'm not aware of that, so I'll have to look into it.

[Claude Gravelle, NDP, Nickel Belt, ON]

Can you get back to the committee on that?

[Serge Dupont]

Sure. I have no problem getting back. In fact, I may be learning something in the process, because I didn't know those stats were removed from the website.

The other thing I would say, Mr. Chair, and I think it's acknowledged by the industry and by others, is that there are a number of global structural developments that have hit—no question—and cyclical factors of the forest industry. There's the downfall of the U.S. housing market and the fact that, obviously, there's less demand for newsprint today. That's meant radical change and radical adjustment for the industry. The government has tried, through targeted programs, to make interventions that would be productive, but the industry could not sustain itself in the same way that it had been operating in the past.

[The Chair, Conservative, Leon Benoit]

Okay, thank you, Mr. Gravelle and Ms. Liu.

Thank you very much to the officials from the Department of Natural Resources for being here today and for answering questions and doing a great job of it.

We will suspend the meeting now for a couple of minutes as we change witnesses. The minister will be coming to the table, and we'll get into his statement and questions and comments after we reconvene.

[The Chair, Conservative, Leon Benoit]

Good afternoon, everyone.

We'll reconvene meeting 60 of the natural resources committee. We're dealing today with supplementary estimates (B) for 2012-13.

Appearing as a witness in the second part of our meeting today is the Honourable Joe Oliver, Minister of Natural Resources. Welcome to you, Minister. With the minister remains the deputy minister, Mr. Dupont.

Minister, if you could go ahead with your presentation, and then we'll get to questions and comments.

Again, thank you very much for making yourself available.

[Joe Oliver, Conservative, Minister of Natural Resources]

Good morning.

Thank you for this opportunity to meet with the committee.

Mr. Chair, members of the committee, since the government's economic action plan was first introduced in 2008 to respond to the global recession, our top priorities have been to support jobs for Canadians and to sustain Canada's economic growth. Today, I'm proud to say that Canada is making progress on both of those important objectives.

Since 2009 employment has increased by over 820,000, more than 390,000 above its pre-recession peak, and the strongest job growth among G-7 countries. More than 90% of all jobs created in Canada since 2009 have been in full-time positions and about 75% of these jobs are in the private sector and nearly 70% are in high-wage industries.

This strong record of job creation sets Canada apart from many nations, and could be clearly seen in our economy with the best growth in GDP in the G-7 since the recession. Certainly, Mr. Chair, our nation's natural resource industries have played and will continue to play a key role in Canada's ongoing economic resilience. Nearly 20% of our economy is dependent on natural resources and more than 50% on our exports.

In 2011 the forest, energy, and mining sectors employed nearly 800,000 people. With indirect employment that total increases to 1.6 million jobs with even greater contributions in the future.

Over the next 10 years, there is potential for more than $650 billion to be invested in over 600 major resource projects in Canada. That means the creation of hundreds of thousands of new jobs.

The funding requested from supplementary estimates (B) will continue to help bolster our resource sector and create jobs and economic growth.

With our Supplementary Estimates (B), Natural Resources Canada's 2012-2013 funding will show total budgetary authorities of $2.85 billion. NRCan's supplementary request calls for additional net funding of $1.2 million. This net funding request of $1.2 million is the result of various proposed funding increases and transfers.

For example, we are increasing funding in a number of priority areas including $54.2 million to expand market opportunities and promote innovation in the forestry sector; $7.7 million to revitalize our satellite receiving facilities, in addition to transferring some internal funds of $3.9 million for this purpose; and $6.9 million to advance medical isotope production technologies.

Our government is committed to ensuring the safety of pipelines throughout the country. Pipelines are the safest form of transportation of oil and gas, and we are taking steps to further improve that safety record.

Supplementary estimates (B) provide $5.9 million in funding to the NEB, which will be used to hire additional security staff. This will increase the number of pipeline inspections by 50%, as well as double the number of comprehensive pipeline audits. It's important to note that this funding will be fully cost recovered from industry.

The government is also seeking supplementary funding for other parts of the natural resources portfolio, about $77 million for Atomic Energy of Canada Limited, AECL, and $8.6 million for the Canadian Nuclear Safety Commission.

The AECL request for $77 million will allow the crown corporation to meet operational requirements for its nuclear laboratories for the remainder of the year. These operational expenditures are consistent with AECL's budgetary plans for 2012-13 and do not reflect cost overruns or unexpected items.

Mr. Chair, members of the committee, our government's sound fiscal management is definitely paying some dividends for Canadians and Canada's economy.

To maintain this positive economic momentum, economic action plan 2012 focuses on the drivers of growth and job creation—innovation, investment, education and skills development—underpinned by our ongoing commitments to keeping taxes low and to returning to balanced budgets over the medium term.

This comprehensive forward-looking plan will continue to deliver high-quality jobs, economic growth, and sound fiscal management, all of which help Canada to maintain its strong position in the global economy.

A key part of our government's plan for the economy is to expand and diversify Canada's energy markets for both oil and natural gas. The International Energy Agency is now predicting that the United States will become the world's largest oil producer by 2020 and will be close to energy self-sufficiency by 2035. Essentially, this means that Canadian oil exports to the U.S. will be competing for a declining portion of U.S. imported oil. This massive shift in U.S. energy production will have far-reaching implications for Canada, given that we export virtually all of our oil and natural gas to U.S. markets.

This lEA projection underscores the fact that our government is doing the right thing today in helping to diversify Canada's energy markets in the Asia-Pacific and elsewhere, as the U.S. ramps up its own energy production. That's why Canada must also build and expand the infrastructure needed to move our product to coastal regions for export.

The expectations are also very high for Canada's mining sector. With major projects anticipated over the next decade, the need for skilled workers will also expand. According to the Mining Industry Human Resources Council, Canada's mining sector will need to hire more than 100,000 additional workers over the next 10 years.

The mining industry is among the country's largest private employers of aboriginal people, who make up 7.5% of its workforce. Aside from their proximity to major mining and energy projects, aboriginal communities can leverage another important asset, a young workforce. According to the Public Policy Forum, in the next 10 years approximately 400,000 aboriginal Canadians could enter the workforce. That's why our government's economic action plan 2012 provides more than $690 million to make sure aboriginal youth are job ready.

There is a tremendous new global opportunity for Canada to thrive economically, so long as we make the right decisions today to capitalize on our vast resource development potential.

In addition, we need to continue to focus on innovation in the natural resources sector, through such programs as our ecoENERGY innovation initiative, which supports a wide range of investments to promote energy efficiency in buildings, communities, industry, transportation, and advances in clean electricity, renewables, and bioenergy. I look forward to the advice of this committee as part of your study on innovation in the energy sector.

Mr. Chair and members of the committee, I have travelled to current and potential markets over the past year and a half to promote the great economic attributes of Canada's resource industry: energy, mining, and forests. At every opportunity I have witnessed great admiration, and even envy, for Canada's accomplishments and potential. It's clear to me that the world is taking notice of Canada as a reliable and responsible source of energy and resources. Other nations and their business communities see Canada as a place to invest safely and as a source of high-quality products and resources.

The choices Canadians make today will determine our success in the future, so I urge all members of Parliament to work in the spirit of cooperation to ensure that Canada does indeed seize the great potential of increased jobs, growth, and long-term prosperity for generations of Canadians from coast to coast to coast.

Thank you again for this opportunity to speak. I'll be pleased to answer any questions you may have.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Mr. Minister, for your presentation.

One cannot help but get excited about the potential for the natural resources sector in the years ahead.

We go now to questions and comments, a seven-minute round, starting with Mr. Leef.

Go ahead for up to seven minutes, please, sir.