Evidence of meeting #25 for Public Safety and National Security in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was finance.
A recording is available from Parliament.
5:20 p.m.
Conservative
The Chair Conservative Daryl Kramp
Thank you very much.
Thank you, Madam Doré Lefebvre.
Mr. Payne, please, for five minutes.
5:20 p.m.
Conservative
LaVar Payne Conservative Medicine Hat, AB
Thank you, Mr. Tasevski, for coming. We've been getting some really interesting information today.
I'm going to give my colleague, Mr. Norlock, one minute to pose a question. I know that he didn't have that opportunity.
5:20 p.m.
Conservative
Rick Norlock Conservative Northumberland—Quinte West, ON
Thank you.
I'll give you an example. Mr. Easter mentioned Habitat for Humanity and smaller communities not having the ability. Well, Habitat for Humanity is in most smaller communities. I know it is in my community. They're building houses in communities of about 1,000 to 3,000 people.
I would like to use an example, and ask if you have any input. With a small government investment in training and opportunities, we took 12 hard-to-hire people with no experience in construction. It was a faith build; in other words, a whole bunch of local churches got together and raised $300,000 in a very short period of time. They partnered with this organization which worked through the department of education. They hired 12 people to work on this build site. At the end of the build, eight, ten or twelve people had a permanent full-time job in the construction industry.
Would that be a good example of how public-private partnerships work with non-profit organizations?
5:20 p.m.
Co-Founder and Partner, Purpose Capital
I would say it could.
I don't know if Bill Young had a chance to talk about Inner City Renovations out of Winnipeg, but that is essentially a similar model. In that case it was Bill Young catalyzing that investment. That would be an example.
To go back to the example of Habitat for Humanity, I actually know Habitat quite well. I know that they are very interested in models of impact investing for their piece.
In the city of Toronto, we have the different organizations coming together to create a larger Habitat for Humanity in the city of Toronto. One of the strategies that they have to increase the number of units that they build is actually to employ impact investing or social finance mechanisms.
The example you gave would, in my opinion, be an example,
5:20 p.m.
Conservative
5:20 p.m.
Conservative
LaVar Payne Conservative Medicine Hat, AB
Thank you.
It's interesting that some of the opposition are suggesting that this is the wrong type of investment. You talked a little bit about silos. When you have silos, people just kind of keep their heads inside. They can't see beyond the borders and how potentially this would work to help different people in different organizations.
In terms of the social housing aspect, as you talked about, now those investors have some assets as part of this whole thing. They're going to get a return on their money. I see that as potentially helping out lots of organizations and people.
You did talk about some of the values that come out of these. Thinking of financing, I'm wondering if you've got another example that you could tell us about that would help us get past these major hurdles of developing these kinds of models.
5:25 p.m.
Co-Founder and Partner, Purpose Capital
Again, I'm giving you examples in the real estate housing space mainly because that's the area of experience that we have as a firm. There's something called the life lease. I mentioned it in my notes. For those who haven't heard of the model, a life lease is a mechanism that someone who is in supportive housing needs, say an elderly individual who has some form of disability or requires not everyday care but requires care from time to time, a nurse to come to their unit. The life lease creates the ability for that person to actually purchase a leasehold on a piece of property.
Instead of that individual moving into a long-term care facility and essentially paying $3,000 to $5,000 a month just to rent, what they can actually do is purchase the unit that they're moving into. Often these are going to be, say, townhouses or condominium units next door to a long-term care facility or near a hospital.
What you have the ability to do is to create for the person who's in need the opportunity to own an underlying asset.
5:25 p.m.
Conservative
The Chair Conservative Daryl Kramp
Thanks very much. I'm sorry, but your time is up.
Mr. Rousseau, you have about three to four minutes.
5:25 p.m.
NDP
Jean Rousseau NDP Compton—Stanstead, QC
Thank you very much.
I'll be speaking French.
Could you list your assessment parameters for your investments and tell me which could apply to crime prevention programs? Which parameters or measures would be used to assess how successful an investment is?
5:25 p.m.
Co-Founder and Partner, Purpose Capital
You mean specifically for crime prevention?
5:25 p.m.
Co-Founder and Partner, Purpose Capital
If I were to look at an intervention for crime prevention, I would look to a couple of criteria. One would be, is this something that can show long-term reduction in recidivism? If the current programming can generate—I don't know the specific targets, but let's say that today you're generating 50% reduction in recidivism rates through programming. The intervention that you would want to invest should have a tangible target on top of that. If I want to increase that target by 10%, the interventions you look to invest in should have that as one key target, something tangible that can be measured. The more tangible the measurement, the better it is.
When it comes to social outcomes, they really are best left to anecdotal or case studies, but the more hard data you can create, the better. If there's a reduction in the use of resources, say in the criminal justice system—I believe that to prosecute one youth in the drug courts costs about $120,000 to go through the entire chain. If you can show that an intervention that is not directly supported by government, say through a social finance mechanism, can remove youth from going through the court system, it's not as if there's a de-investment of government. What you're doing is you're saving government money, and if the intervention is less than what would otherwise be spent to prosecute that youth.... The Peacebuilders example, I think their programming is in the vicinity of $30,000 per youth. Those would be some examples of criteria.
May 27th, 2014 / 5:25 p.m.
NDP
Jean Rousseau NDP Compton—Stanstead, QC
Okay.
Could this also apply in rural areas? I am thinking especially of examples you may not be familiar with. For example, there is less philanthropy in some rural regions in Quebec. It would be more difficult to have instruments to measure how successful a program is in these types of regions.
5:25 p.m.
Co-Founder and Partner, Purpose Capital
That's a very interesting point. It depends on the nature of the crime you're trying to prevent, I think.
One of the things that I think is key to one of the questions that was asked earlier is you're bringing together the community to help solve the problem. This is not something the government has to create the answer for. The culture shift that I think needs to occur is to say the actors in our society are figuring out the ways to create the interventions that make the most sense, that matter to that community.
The government is not the funder of those things. It's not the one that runs the programming. You're simply the actor that is helping to catalyze, to support. That could be through policy change. It doesn't have to be through any capital intervention.
The best answer I can give for that piece is to say the first thing I would do is I would talk to rural Quebec and see what kind of interventions their community is already trying to create. Are they undersupported? Are they reliant on small, local, charitable foundations? Is that not enough support? Is there a way you can enhance that investment?
5:30 p.m.
Conservative
The Chair Conservative Daryl Kramp
Thank you very much, Mr. Tasevski.
Thank you, Mr. Rousseau.
Colleagues, we are finished with our time allotment today.
On behalf of the committee, the chair would like to thank you, Mr. Tasevski, for spending some time with us and giving us some thoughts and certainly some responses.
At this point, we will adjourn for the day.