Finance committee  No, it's the most important. This is where the money is spent, in the prototype development, the engineering, the scale-up. If you don't do that, you can't do this--

Finance committee  We have not seen any consequences as a result of the discussion that is going on. We're under tremendous competitive pressure to attract and retain investment and keep product mandates. Companies are making these decisions all the time. I think we have to give credit to what all levels of government have done, but particularly what companies have done in working to secure these product mandates and investment.

Finance committee  If I could say, having it publicized internationally is not helpful in making the pitch to retain or attract investment. I guess, though, at the end of the day the decision is above all a decision that makes economic sense for the company and is made, to some extent, on tax rates.

Finance committee  We have. First of all, we're dealing with issues in manufacturing that are far too important and urgent to have arguments between jurisdictions when we should be looking at providing solutions. We're been on the record for some time saying there are two major tax issues that we would like the Ontario government to address.

Finance committee  I'm meeting with the Deputy Minister of Finance on Friday.

Finance committee  Perhaps I could go first. This time last year the Canadian dollar was at 84¢. I think when those hearings took place it was probably close to $1.10. Nobody could have foreseen that, and that rapid surge in the dollar has overwhelmed most companies. Most exporters will be in a loss position in their last quarter of last year, and we're beginning to see the consequences of that now.

Finance committee  Our response to the budget was certainly aggressive. It was maybe a little angry, but it was a reflection of some of the disappointment and frustration that—

Finance committee  No, I think the strategy that you set out is correct. Our point of view in saying that this was “Disadvantage Canada” was just to say that not making these crucial investments puts Canadian companies at a global disadvantage.

Finance committee  Our assessment of the budget was that the tax measures in this budget and the investments weren't adequate to meet either the challenge or the urgency of the situation.

Finance committee  If you look at last year when the government introduced the two-year writeoff and looked at the fiscal cost that it estimated, it was estimating that somewhere around one-quarter of the investment would be covered by the two-year writeoff. I think there was perhaps some indication that this wasn't long enough for some investments to take advantage of it.

Finance committee  In the budget the government did two things around the R and D tax credit system. It committed to improving the administration of the system, which is extremely important. We'll see how that works out, because that's been in the works for some time.

Finance committee  In terms of the additional allowances, there was an increase in the allowance for small Canadian-owned companies to take advantage of the credit. I think the estimated benefit is around $70 million over a period of two years. What we were looking at was to make the tax credit refundable, or at least partially refundable, so companies that are making investments in R and D today get the credit today for those tax measures.

Finance committee  I agree with what Mr. Lazar has just said. Continually extending it by one year doesn't give you that much additional certainty for planning your investments. For many companies, apart from those companies that were probably going to make investments anyway in off-the-shelf technology, some of those investments will go ahead, but for any major investment, especially in the processing sectors, these do require three, four, or even five years sometimes even to get regulatory approval to put the equipment in place.

Finance committee  That's a good question. I hope you're going out in March and you'll be participating in our national buyer-seller forum.

Finance committee  That's excellent. We have about 900 companies from across the country coming out to do business in Alberta. When you look at the issue of interprovincial trade, I think it's a good case study of what we have to do to remove some of these cross-border issues. Some companies cannot install equipment—they can't use welders from Ontario, Quebec, Atlantic Canada, anywhere outside Alberta, to work in Alberta itself, because of compulsory certification in Alberta.