Bill C-38 (Historical)

Jobs, Growth and Long-term Prosperity Act

An Act to implement certain provisions of the budget tabled in Parliament on March 29, 2012 and other measures

Part 1 of this enactment implements certain income tax measures and related measures proposed in the March 29, 2012 budget. Most notably, it
(a) expands the list of eligible expenses under the Medical Expense Tax Credit to include blood coagulation monitors and their disposable peripherals;
(b) introduces a temporary measure to allow certain family members to open a Registered Disability Savings Plan for an adult individual who might not be able to enter into a contract;
(c) extends, for one year, the temporary Mineral Exploration Tax Credit for flow-through share investors;
(d) allows corporations to make split and late eligible dividend designations;
(e) makes the salary of the Governor General taxable and adjusts that salary;
(f) allows a designated partner of a partnership to provide a waiver on behalf of all partners to extend the time limit for issuing a determination in respect of the partnership;
(g) amends the penalty applicable to promoters of charitable donation tax shelters who file false registration information or who fail to register a tax shelter prior to selling interests in the tax shelter;
(h) introduces a new penalty applicable to tax shelter promoters who fail to respond to a demand to file an information return or who file an information return that contains false or misleading sales information;
(i) limits the period for which a tax shelter identification number is valid to one calendar year;
(j) modifies the rules for registering certain foreign charitable organizations as qualified donees;
(k) amends the rules for determining the extent to which a charity has engaged in political activities; and
(l) provides the Minister of National Revenue with the authority to suspend the privileges, with respect to issuing tax receipts, of a registered charity or a registered Canadian amateur athletic association if the charity or association fails to report information that is required to be filed annually in an information return or devotes resources to political activities in excess of the limits set out in the Income Tax Act.
Part 1 also implements other selected income tax measures and related measures. Most notably, it
(a) amends the Income Tax Act consequential on the implementation of the Marketing Freedom for Grain Farmers Act, including the extension of the tax deferral allowed to farmers in a designated area who produce listed grains and receive deferred cash purchase tickets to all Canadian farmers who produce listed grains and receive deferred cash purchase tickets;
(b) provides authority for the Canada Revenue Agency to issue via online notice or regular mail demands to file a return; and
(c) introduces a requirement for commercial tax preparers to file income tax returns electronically.
Part 2 amends the Excise Tax Act to implement certain excise tax and goods and services tax/harmonized sales tax (GST/HST) measures proposed in the March 29, 2012 Budget. It expands the list of GST/HST zero-rated medical and assistive devices as well as the list of GST/HST zero-rated non-prescription drugs that are used to treat life-threatening diseases. It also exempts certain pharmacists’ professional services from the GST/HST, other than prescription drug dispensing services that are already zero-rated. It further allows certain literacy organizations to claim a rebate of the GST and the federal component of the HST paid on the acquisition of books to be given away for free by those organizations. It also implements legislative requirements relating to the Government of British Columbia’s decision to exit the harmonized sales tax framework. Additional amendments to that Act and related regulations in respect of foreign-based rental vehicles temporarily imported by Canadian residents provide, in certain circumstances, relief from the GST/HST, the Green Levy on fuel-inefficient vehicles and the automobile air conditioner tax. This Part further amends that Act to ensure that changes to the standardized fuel consumption test method used for the EnerGuide, as announced on February 17, 2012 by the Minister of Natural Resources, do not affect the application of the Green Levy.
Finally, Part 2 amends the Air Travellers Security Charge Act, the Excise Act, 2001 and the Excise Tax Act to provide authority for the Canada Revenue Agency to issue via online notice or regular mail demands to file a return.
Part 3 contains certain measures related to responsible resource development.
Division 1 of Part 3 enacts the Canadian Environmental Assessment Act, 2012, which establishes a new federal environmental assessment regime. Assessments are conducted in relation to projects, designated by regulations or by the Minister of the Environment, to determine whether they are likely to cause significant adverse environmental effects that fall within the legislative authority of Parliament, or that are directly linked or necessarily incidental to a federal authority’s exercise of a power or performance of a duty or function that is required for the carrying out of the project.
The Canadian Environmental Assessment Agency, the Canadian Nuclear Safety Commission, the National Energy Board or a review panel established by the Minister are to conduct assessments within applicable time limits. At the end of an assessment, a decision statement is to be issued to the project proponent who is required to comply with the conditions set out in it.
The enactment provides for cooperation between the federal government and other jurisdictions by enabling the delegation of an environmental assessment, the substitution of the process of another jurisdiction for an environmental assessment under the Act and the exclusion of a project from the application of the Act when there is an equivalent assessment by another jurisdiction. The enactment requires that there be opportunities for public participation during an environmental assessment, that participant funding programs and a public registry be established, and that there be follow-up programs in relation to all environmental assessments. It also provides for powers of inspection and fines.
Finally, the enactment specifies that federal authorities are not to take certain measures regarding the carrying out of projects on federal lands or outside Canada unless they determine that those projects are not likely to cause significant adverse environmental effects.
This Division also makes related amendments to the Environmental Violations Administrative Monetary Penalties Act and consequential amendments to other Acts, and repeals the Canadian Environmental Assessment Act.
Division 2 of Part 3 amends the National Energy Board Act to allow the Governor in Council to make the decision about the issuance of certificates for major pipelines. It amends the Act to establish time limits for regulatory reviews under the Act and to enhance the powers of the National Energy Board Chairperson and the Minister responsible for the Act to ensure that those reviews are conducted in a timely manner. It also amends the Act to permit the National Energy Board to exercise federal jurisdiction over navigation in respect of pipelines and power lines that cross navigable waters and it establishes an administrative monetary penalty system.
Division 3 of Part 3 amends the Canada Oil and Gas Operations Act to authorize the National Energy Board to exercise federal jurisdiction over navigation in respect of pipelines and power lines that cross navigable waters.
Division 4 of Part 3 amends the Nuclear Safety and Control Act to extend the maximum allowable term of temporary members of the Canadian Nuclear Safety Commission from six months to three years. It is also amended to allow for a licence to be transferred with the consent of that Commission and it puts in place an administrative monetary penalty system.
Division 5 of Part 3 amends the Fisheries Act to focus that Act on the protection of fish that support commercial, recreational or Aboriginal fisheries and to more effectively manage those activities that pose the greatest threats to these fisheries. The amendments provide additional clarity for the authorization of serious harm to fish and of deposits of deleterious substances. The amendments allow the Minister to enter into agreements with provinces and with other bodies, provide for the control and management of aquatic invasive species, clarify and expand the powers of inspectors, and permit the Governor in Council to designate another Minister as the Minister responsible for the administration and enforcement of subsections 36(3) to (6) of the Fisheries Act for the purposes of, and in relation to, subject matters set out by order.
Division 6 of Part 3 amends the Canadian Environmental Protection Act, 1999 to provide the Minister of the Environment with the authority to renew disposal at sea permits in prescribed circumstances. It is also amended to change the publication requirements for disposal at sea permits and to provide authority to make regulations respecting time limits for their issuance and renewal.
Division 7 of Part 3 amends the Species at Risk Act to allow for the issuance of authorizations with a longer term, to clarify the authority to renew the authorizations and to make compliance with conditions of permits enforceable. The Act is also amended to provide authority to make regulations respecting time limits for the issuance and renewal of permits under the Act. Furthermore, section 77 is amended to ensure that the National Energy Board will be able to issue a certificate when required to do so by the Governor in Council under subsection 54(1) of the National Energy Board Act.
Part 4 enacts and amends several Acts in order to implement various measures.
Division 1 of Part 4 amends a number of Acts to eliminate the requirement for the Auditor General of Canada to undertake annual financial audits of certain entities and to assess the performance reports of two agencies. This Division also eliminates other related obligations.
Division 2 of Part 4 amends the Trust and Loan Companies Act, the Bank Act and the Cooperative Credit Associations Act to prohibit the issuance of life annuity-like products.
Division 3 of Part 4 provides that PPP Canada Inc. is an agent of Her Majesty for purposes limited to its mandated activities at the federal level, including the provision of advice to federal departments and Crown corporations on public-private partnership projects.
Division 4 of Part 4 amends the Northwest Territories Act, the Nunavut Act and the Yukon Act to provide the authority for the Governor in Council to set, on the recommendation of the Minister of Finance, the maximum amount of territorial borrowings and to make regulations in relation to those maximum amounts, including what constitutes borrowing, the relevant entities and the valuation of the borrowings.
Division 5 of Part 4 amends the Financial Administration Act to modify, for parent Crown corporations, the period to which their quarterly financial reports relate, so that it is aligned with their financial year, and to include in the place of certain annual tabling requirements related to the business and activities of parent Crown corporations a requirement to make public consolidated quarterly reports on their business and activities. It also amends the Alternative Fuels Act and the Public Service Employment Act to eliminate certain reporting requirements.
Division 6 of Part 4 amends the Department of Human Resources and Skills Development Act to establish the Social Security Tribunal and to add provisions authorizing the electronic administration or enforcement of programs, legislation, activities or policies. It also amends the Canada Pension Plan, the Old Age Security Act and the Employment Insurance Act so that appeals from decisions made under those Acts will be heard by the Social Security Tribunal. Finally, it provides for transitional provisions and makes consequential amendments to other Acts.
Division 7 of Part 4 amends the Department of Human Resources and Skills Development Act to add provisions relating to the protection of personal information obtained in the course of administering or enforcing the Canada Pension Plan and the Old Age Security Act and repeals provisions in the Canada Pension Plan and the Old Age Security Act that are substantially the same as those that are added to the Human Resources and Skills Development Act.
Division 8 of Part 4 amends the Department of Human Resources and Skills Development Act to add provisions relating to the social insurance registers and Social Insurance Numbers. It also amends the Canada Pension Plan in relation to Social Insurance Numbers and the Employment Insurance Act to repeal certain provisions relating to the social insurance registers and Social Insurance Numbers and to maintain the power to charge the costs of those registers to the Employment Insurance Operating Account.
Division 9 of Part 4 amends the Parks Canada Agency Act to provide that the Agency may enter into agreements with other ministers or bodies to assist in the administration and enforcement of legislation in places outside national parks, national historic sites, national marine conservation areas and other protected heritage areas if considerations of geography make it impractical for the other minister or body to administer and enforce that legislation in those places. It also amends that Act to provide that the Chief Executive Officer is to report to the Minister of the Environment under section 31 of that Act every five years. It amends that Act to remove the requirements for annual corporate plans, annual reports and annual audits, and amends that Act, the Canada National Parks Act and the Canada National Marine Conservation Areas Act to provide that that Minister is to review management plans for national parks, national historic sites, national marine conservation areas and other protected heritage areas at least every 10 years and is to have any amendments to a plan tabled in Parliament.
Division 10 of Part 4 amends the Trust and Loan Companies Act, the Bank Act and the Insurance Companies Act in order to allow public sector investment pools that satisfy certain criteria, including pursuing commercial objectives, to directly invest in a Canadian financial institution, subject to approval by the Minister of Finance.
Division 11 of Part 4 amends the National Housing Act, the Canada Mortgage and Housing Corporation Act and the Supporting Vulnerable Seniors and Strengthening Canada’s Economy Act to enhance the governance and oversight framework of the Canada Mortgage and Housing Corporation.
This Division also amends the National Housing Act to establish a registry for institutions that issue covered bonds and for covered bond programs and to provide for the protection of covered bond contracts and covered bond collateral in the event of an issuer’s bankruptcy or insolvency. It also makes amendments to the Trust and Loan Companies Act, the Bank Act, the Insurance Companies Act and the Cooperative Credit Associations Act to prohibit institutions from issuing covered bonds except within the framework established under the National Housing Act. Finally, it includes a coordinating amendment to the Supporting Vulnerable Seniors and Strengthening Canada’s Economy Act.
Division 12 of Part 4 implements the Framework Agreement on Integrated Cross-Border Maritime Law Enforcement Operations between the Government of Canada and the Government of the United States of America signed on May 26, 2009.
Division 13 of Part 4 amends the Bretton Woods and Related Agreements Act to reflect an increase in Canada’s quota subscription, as related to the ratification of the 2010 Quota and Governance reform resolution of the Board of Governors of the International Monetary Fund, and to align the timing of the annual report under that Act to correspond to that of the annual report under the Official Development Assistance Accountability Act.
Division 14 of Part 4 amends the Canada Health Act so that members of the Royal Canadian Mounted Police are included in the definition of “insured person”.
Division 15 of Part 4 amends the Canadian Security Intelligence Service Act to
(a) remove the office of the Inspector General;
(b) require the Security Intelligence Review Committee to submit to the Minister of Public Safety and Emergency Preparedness a certificate on the Director of the Canadian Security Intelligence Service’s annual report; and
(c) increase the information on the Service’s activities to be provided by that Committee to that Minister.
Division 16 of Part 4 amends the Currency Act to clarify certain provisions that relate to the calling in and the redemption of coins.
Division 17 of Part 4 amends the Federal-Provincial Fiscal Arrangements Act in order to implement the total transfer protection for the 2012-2013 fiscal year and to give effect to certain elements of major transfer renewal that were announced by the Minister of Finance on December 19, 2011. It also makes certain administrative amendments to that Act and to the Canada Health Act.
Division 18 of Part 4 amends the Fisheries Act to authorize the Minister of Fisheries and Oceans to allocate fish for the purpose of financing scientific and fisheries management activities in the context of joint project agreements.
Division 19 of Part 4 amends the Food and Drugs Act to give the Minister of Health the power to establish a list that sets out prescription drugs or classes of prescription drugs and to provide that the list may be incorporated by reference. It also gives the Minister the power to issue marketing authorizations that exempt a food, or an advertisement with respect to a food, from certain provisions of the Act. The division also provides that a regulation with respect to a food and a marketing authorization may incorporate by reference any document. It also makes consequential amendments to other Acts.
Division 20 of Part 4 amends the Government Employees Compensation Act to allow prescribed entities to be subrogated to the rights of employees to make claims against third parties.
Division 21 of Part 4 amends the International Development Research Centre Act to reduce the maximum number of governors of the Centre to 14, and to consequently change other rules about the number of governors.
Division 22 of Part 4 amends Part I of the Canada Labour Code to require the parties to a collective agreement to file a copy of it with the Minister of Labour, subject to the regulations, as a condition for it to come into force. It amends Part III of that Act to require employers that provide benefits to their employees under long-term disability plans to insure those plans, subject to certain exceptions. The Division also amends that Part to create an offence and to increase maximum fines for offences under that Part.
Division 23 of Part 4 repeals the Fair Wages and Hours of Labour Act.
Division 24 of Part 4 amends the Old Age Security Act to provide the Minister of Human Resources and Skills Development with the authority to waive the requirement for an application for Old Age Security benefits for many eligible seniors, to gradually increase the age of eligibility for the Old Age Security Pension, the Guaranteed Income Supplement, the Allowance and the Allowance for the Survivor and to allow individuals to voluntarily defer their Old Age Security Pension up to five years past the age of eligibility, in exchange for a higher, actuarially adjusted, pension.
Division 25 of Part 4 dissolves the Public Appointments Commission and its secretariat.
Division 26 of Part 4 amends the Seeds Act to give the President of the Canadian Food Inspection Agency the power to issue licences to persons authorizing them to perform activities related to controlling or assuring the quality of seeds or seed crops.
Division 27 of Part 4 amends the Statutory Instruments Act to remove the distribution requirements for the Canada Gazette.
Division 28 of Part 4 amends the Investment Canada Act in order to authorize the Minister of Industry to communicate or disclose certain information relating to investments and to accept security in order to promote compliance with undertakings.
Division 29 of Part 4 amends the Customs Act to allow the Minister of Public Safety and Emergency Preparedness to designate a portion of a roadway or other access way that leads to a customs office and that is used by persons arriving in Canada and by persons travelling within Canada as a mixed-traffic corridor. All persons who are travelling in a mixed-traffic corridor must present themselves to a border services officer and state whether they are arriving from a location outside or within Canada.
Division 30 of Part 4 gives retroactive effect to subsections 39(2) and (3) of the Pension Benefits Standards Act, 1985.
Division 31 of Part 4 amends the Railway Safety Act to limit the apportionment of costs to a road authority when a grant has been made under section 12 of that Act.
Division 32 of Part 4 amends the Canadian International Trade Tribunal Act to replace the two Vice-chairperson positions with two permanent member positions.
Division 33 of Part 4 repeals the International Centre for Human Rights and Democratic Development Act and authorizes the closing out of the affairs of the Centre established by that Act.
Division 34 of Part 4 amends the Health of Animals Act to allow the Minister of Agriculture and Agri-Food to declare certain areas to be control zones in respect of a disease or toxic substance. The enactment also grants the Minister certain powers, including the power to make regulations prohibiting the movement of persons, animals or things in the control zones for the purpose of eliminating a disease or toxic substance or controlling its spread and the power to impose conditions on the movement of animals or things in those zones.
Division 35 of Part 4 amends the Canada School of Public Service Act to abolish the Board of Governors of the Canada School of Public Service and to place certain responsibilities on the Minister designated for the purposes of the Act and on the President of the School.
Division 36 of Part 4 amends the Bank Act by adding a preamble to it.
Division 37 of Part 4 amends the Corrections and Conditional Release Act to eliminate the requirement of a hearing for certain reviews.
Division 38 of Part 4 amends the Coasting Trade Act to add seismic activities to the list of exceptions to the prohibition against foreign ships and non-duty paid ships engaging in the coasting trade.
Division 39 of Part 4 amends the Status of the Artist Act to dissolve the Canadian Artists and Producers Professional Relations Tribunal and transfer its powers and duties to the Canada Industrial Relations Board.
Division 40 of Part 4 amends the National Round Table on the Environment and the Economy Act to give the Round Table the power to sell or otherwise dispose of its assets and satisfy its debts and liabilities and to give the Minister of the Environment the power to direct the Round Table in respect of the exercise of some of its powers. The Division provides for the repeal of the Act and makes consequential amendments to other acts.
Division 41 of Part 4 amends the Telecommunications Act to change the rules relating to foreign ownership of Canadian carriers eligible to operate as telecommunications common carriers and to permit the recovery of costs associated with the administration and enforcement of the national do not call list.
Division 42 of Part 4 amends the Employment Equity Act to remove the requirements that are specific to the Federal Contractors Program for Employment Equity.
Division 43 of Part 4 amends the Employment Insurance Act to permit a person’s benefits to be determined by reference to their highest earnings in a given number of weeks, to permit regulations to be made respecting what constitutes suitable employment, to remove the requirement that a consent to deduction be in writing, to provide a limitation period within which certain repayments of overpayments need to be deducted and paid and to clarify the provisions respecting the refund of premiums to self-employed persons. It also amends that Act to modify the Employment Insurance premium rate-setting mechanism, including requiring that the rate be set on a seven-year break-even basis once the Employment Insurance Operating Account returns to balance. The Division makes consequential amendments to the Canada Employment Insurance Financing Board Act.
Division 44 of Part 4 amends the Customs Tariff to make certain imported fuels duty-free and to increase the travellers’ exemption thresholds.
Division 45 of Part 4 amends the Canada Marine Act to require provisions of a port authority’s letters patent relating to limits on the authority’s power to borrow money to be recommended by the Minister of Transport and the Minister of Finance before they are approved by the Governor in Council.
Division 46 of Part 4 amends the First Nations Land Management Act to implement changes made to the Framework Agreement on First Nation Land Management, including changes relating to the description of land that is to be subject to a land code, and to provide for the coming into force of land codes and the development by First Nations of environmental protection regimes.
Division 47 of Part 4 amends the Canada Travelling Exhibitions Indemnification Act to increase the maximum indemnity in respect of individual travelling exhibitions, as well as the maximum indemnity in respect of all travelling exhibitions.
Division 48 of Part 4 amends the Canadian Air Transport Security Authority Act to provide that the chief executive officer of the Authority is appointed by the Governor in Council and that an employee may not replace the chief executive officer for more than 90 days without the Governor in Council’s approval.
Division 49 of Part 4 amends the First Nations Fiscal and Statistical Management Act to repeal provisions related to the First Nations Statistical Institute and amends that Act and other Acts to remove any reference to that Institute. It authorizes the Minister of Indian Affairs and Northern Development to close out the Institute’s affairs.
Division 50 of Part 4 amends the Canadian Forces Members and Veterans Re-establishment and Compensation Act to provide for the payment or reimbursement of fees for career transition services for veterans or their survivors.
Division 51 of Part 4 amends the Department of Human Resources and Skills Development Act to add powers, duties and functions that are substantially the same as those conferred by the Department of Social Development Act. It repeals the Department of Social Development Act and, in doing so, eliminates the National Council of Welfare.
Division 52 of Part 4 amends the Wage Earner Protection Program Act in order to correct the English version of the definition “eligible wages”.
Division 53 of Part 4 repeals the Kyoto Protocol Implementation Act.
Division 54 of Part 4 amends the Immigration and Refugee Protection Act and the Budget Implementation Act, 2008 to provide for the termination of certain applications for permanent residence that were made before February 27, 2008. This Division also amends the Immigration and Refugee Protection Act to, among other things, authorize the Minister of Citizenship and Immigration to give instructions establishing and governing classes of permanent residents as part of the economic class and to provide that the User Fees Act does not apply in respect of fees set by those instructions. Furthermore, this Division amends the Immigration and Refugee Protection Act to allow for the retrospective application of certain regulations and certain instructions given by the Minister, if those regulations and instructions so provide, and to authorize regulations to be made respecting requirements imposed on employers in relation to authorizations to work in Canada.
Division 55 of Part 4 enacts the Shared Services Canada Act to establish Shared Services Canada to provide certain administrative services specified by the Governor in Council. The Act provides for the Governor in Council to designate a minister to preside over Shared Services Canada.
Division 56 of Part 4 amends the Assisted Human Reproduction Act to respond to the Supreme Court of Canada decision in Reference re Assisted Human Reproduction Act that was rendered in 2010, including by repealing the provisions that were found to be unconstitutional and abolishing the Assisted Human Reproduction Agency of Canada.

[Prof. Len Zedel]

It's one line in Bill C-38 about the Coasting Trade Act. It has implications for the Canada-Newfoundland and Labrador Offshore Petroleum Board, as to how offshore projects are regulated.

My impression is that a full and thorough debate is hard to have when this issue comes up as one line in an omnibus bill.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

The only thing I'm going to say at this point is this. Does this mean that for every witness who comes before us now we're going to have to ask them what political party they're associated with, what background...what activity they've done, what's their history, what comments they may have made? It's taking it to a level where we shouldn't be going.

Why don't we just talk to the witnesses about Bill C-38 and get on with this?

[Stephen Hazell, Senior Counsel, Ecovision Law]

Thank you, Mr. Chair. I appreciate the opportunity to appear before the committee this evening on a very important matter for Canada's environment and for sustainable development.

My message to the committee is this: less haste, more speed. The Canadian Environmental Assessment Act, by virtue of Bill C-38, will be repealed in total. It's not a tweak. It's not just about streamlining and timeframes, as was suggested in the budget documents. You are repealing an entire federal statute, and you are replacing it with another that includes a number of new concepts that have not been tested.

Many of the recent comments by several ministers have focused on the perceived need to streamline environmental assessments, such as by authorizing the substitution of federal reviews by provincial reviews, and to ensure that panel reviews are completed within reasonable timeframes. While Bill C-38 proposes many important and mainly unwise amendments to achieve streamlining and certainty in panel review timeframes, these are far from the most important changes to environmental assessment proposed in Bill C-38.

In the time I have available I want to touch on three main areas of concern that I have with respect to the bill.

The first thing is that the bill would essentially eliminate the legal requirement to carry out project environmental assessments. This will mean far fewer assessments and much narrower assessments of those project assessments that do occur. How does this work? Right now under the Canadian Environmental Assessment Act all triggered federal projects require assessment unless they've been excluded by regulation or by operation of the statute. Now, only projects that have been designated pursuant to a regulation would be subject to the act.

Let me pause here to say that we have not yet seen a draft of this regulation, although we do know that the Canadian Environmental Assessment Agency has been working on it. It is absolutely imperative for this committee to see that regulation before signing off on anything.

We don't know how long or how short this list of designated projects will be. We understand that the government is making use of the comprehensive study list regulations, the current regulations, as a template for that. At the moment, the Canadian Environmental Assessment Act registry lists 39 comprehensive studies being undertaken and 11 panel reviews. So a fairly small number of comprehensive studies and panel reviews are being undertaken. Under the new law, roughly 4,000 environmental-screening assessments being undertaken annually under CEAA would be eliminated.

There will be a fairly small number of so-called designated projects that will be subject to the act. But that doesn't mean they will actually be assessed for their environmental effects. Proposed paragraph 10(b) of CEAA 2012 gives the Environmental Assessment Agency the authority to make the determination that these designated projects not be subject to environmental assessment. In effect, there could be very few environmental assessments of projects undertaken pursuant to the new law.

Scott Vaughan, the parliamentary commissioner, was here yesterday. He estimates that 20 to 30 environmental assessments will be undertaken under the new law. I would suggest that this amounts to an abandonment by the federal government of environmental assessment. Thus the new bill could well be an empty vessel, with very few environmental assessments actually being carried out.

If this is the case, and if the new bill is applied to a mere handful of projects annually, it really doesn't matter what the rest of the legislation says with respect to timelines, substitution, equivalency, and public participation. The fact is that there's going to be very little environmental assessment activity happening at all.

My second point relates to the abundance of discretion in the bill.

I would say that CEAA 2012 is not so much a law imposing requirements for the conduct of environmental assessments as it is a statute enabling the exercise of discretion by ministers and responsible authorities. The new bill provides broad discretion to the agency and the environment minister to determine that the environmental assessment of a project is not required, to scope the factors to reconsider the environmental assessment, and to determine whether a provincial project is “an appropriate substitute” for the federal process.

This will inevitably result in the politicization of environmental assessment and consequent delays. Right now we have clear rules. We're substituting those clear rules with discretion in the hands of the agency's responsible authorities and the minister.

For example, assume that aggregate quarries on the scale of the proposed Melancthon quarry in southern Ontario are listed as a designated project by regulation. The first step of the proponent of such a quarry could well be, through obtaining an Ottawa lobbyist, to pressure the agency and the minister to exercise the proposed paragraph 10(b) discretion to ensure that no environmental assessment is required, or failing that, to exercise proposed subsection 19(2) discretion to scope the environmental assessment of the quarry down to a stream crossing.

This sort of thing does go on, I'm afraid.

My third point relates to increased litigation risks.

There will be increased litigation risks because we have a brand new piece of legislation with many new concepts that are being incorporated using terms such as designated project, environmental effects, interested party, appropriate substitute. This legislation has been developed in secret—I would suggest in haste—without the benefit of other experts, whether from industry or from civil society, and that means there are likely going to be many mistakes.

I note that the cone of silence approach that has been taken with respect to this bill is strikingly different from that undertaken with respect to previous environmental assessment laws. The original Canadian Environmental Assessment Act in 1992 was preceded by several years of public discussion and three different bills tabled in Parliament.

The major amendments to CEAA in 2003 were also preceded by a public consultation led by the agency, as well as the House of Commons environment committee hearings.

In addition, there was a multi-stakeholder process called the regulatory advisory committee, which had industry, environmental groups, first nations, provinces, and federal departments that worked over draft regulations to ensure they were right, before they came into force.

Unfortunately, we have none of that now. I do suggest that the use of a multi-stakeholder body would be an important way to get this legislation right. The government does have some record in this. I've been a part of a multi-stakeholder group that has been working on the air quality management strategy, which has had industry representatives and environmental groups, as well as provincial governments led by the Government of Alberta, and we're very close to a national deal that will reduce smog emissions in this country as part of a multi-stakeholder process, not a unilateral process.

I've only touched on a few of the many grave concerns that I have with this legislation, and certainly this subcommittee faces a significant challenge in trying to understand the bill, first of all, understand the comments of witnesses, and propose amendments that could mitigate the, frankly, devastating impacts that this legislation will have on Canada's natural environment.

Less haste will yield more speed and a better law.

My recommendation is that this subcommittee remove the proposed CEAA 2012 from Bill C-38, and propose to the overall finance committee that it be referred to the House of Commons environment and sustainable development committee for its review. I would further suggest that this review be done in collaboration with some multi-stakeholder group.

I would have suggested the National Round Table on the Environment and the Economy, but obviously that's not possible.

My final comment is that I want to repeat something I said before.

I think it's really important that this committee have that draft designated projects regulation in front of it before you wind up your hearings. I believe that the committee should ask the Minister of the Environment for that regulation before you wind up your process here.

Thank you very much, Mr. Chair.

[Lorne Fisher, Councillor, Corporation of the District of Kent]

Thank you very much.

On behalf of the five municipalities from the Upper Fraser Valley of British Columbia—the City of Chilliwack, the District of Hope, the District of Kent, the Fraser Valley Regional District, and the Village of Harrison Hot Springs—I wish to extend our appreciation to the committee for this invitation to participate in the discussions of the changes to the Canadian Environmental Assessment Act, the Fisheries Act, and the Species at Risk Act, as proposed in Bill C-38.

We commend the federal government for taking these initiations to simplify and expedite the approval process for major projects that have environmental implications. As communities that facilitate the corridor for major transmission lines, pipelines, both major railway lines, and the Trans-Canada Highway, we are well aware of the public hearings, etc., that major corporations—such as BC Hydro, Fortis, etc.—have to satisfy in order to expand their services to our communities and to the province of B.C. as a whole.

This is a stringent approval process; however, the efficiency of the present system could be improved. It is hoped that the changes proposed in Bill C-38 will achieve that objective. Time is money, and lengthy delays in the approval process for major projects can result in lost opportunities and can be harmful to the overall economy of our country.

However, of immediate concern to our communities in the Fraser Valley are the proposed changes to the Fisheries Act and the Species at Risk Act. The Fraser Valley is a flood plain known for the very high productivity of its soils for forage production—five or six harvests per season—and its specialty crops of fruits and vegetables.

Because of relatively high seasonal rainfalls and high water tables associated with the annual freshet from the Fraser River, it is essential for the productivity of these soils that they be drained effectively. This requires the annual maintenance of a network of engineered ditches that have been constructed to maintain the quality of these soils. The farmland and the surrounding forest and mountains are also drained by natural streams and sloughs that are legitimate fish habitat, and by the Fraser River itself, which of course is habitat for salmon and other species of fish such as the sturgeon.

The conflict between the farmers and the municipalities on the one hand, and the Fisheries Act and the Department of Fisheries and Oceans personnel on the other, is DFO's insistence that agricultural drainage ditches are fish habitat and therefore subject to the DFO directives based on the Fisheries Act. Therefore, obtaining approvals for annual drainage maintenance and routine culvert and bridge repair has become a major expense for the municipalities and a source of frustration for the farmers.

For the District of Kent, whose major industry is agriculture, 80% of the drainage costs are due to direct and indirect costs of getting approvals and permits from DFO. The proposed changes in the definition of fish habitat, as stated in Bill C-38, would limit fish habitat to streams, sloughs, and rivers, which are the habitat of the commercial fishery, and hopefully they will exclude agriculture drainage systems from being designated as fish habitat.

Similarly, if routine ditch maintenance is considered to result in the destruction of fish habitat, the municipalities whose ditches were involved must have provided compensation in the past, in the form of establishing new riparian areas that must be maintained in perpetuity. This requirement may be justified if natural streams are involved; however, it should not be required for ditches that are dry for a significant portion of the year. It is our interpretation that the proposed changes in Bill C-38 would eliminate the requirement of this form of compensation when drainage ditches are cleaned.

The Fraser Valley has a moderate climate, which has resulted in the identification of some waterways as home to species that are rare in Canada, such as the Salish sucker, Nooksack dace, and the Oregon spotted frog—which obviously belongs in Oregon.

That was not a problem for the municipalities until the Salish sucker and the Nooksack dace were declared endangered species by the federal Species at Risk Act, and the Oregon spotted frog was designated endangered by the British Columbia Ministry of Forests, Lands and Natural Resource Operations. These two species, the Oregon spotted frog and the Salish sucker, share the same habitat, except the Salish sucker prefers deep, shady, cool waterways, and the Oregon spotted frog prefers sunny, grassy ponds.

The frustration for municipal staff is that they may get a permit for drainage maintenance from the federal DFO, only to have it forestalled by the staff of the provincial ministry. This type of conflict does not appear to have been recognized in the proposed changes to the Species at Risk Act. For the species that occur in only a very limited area of one province, it is suggested that their designation as a species at risk should be left up to the province that they call home rather than up to the federal act.

In the past year, DFO staff have been very diligent at holding public hearings to discuss with farmers, industry, and municipal staff the implications of establishing a critical habitat for the Salish sucker in the Fraser Valley. The maps of these designated areas of critical habitat were provided in the draft of the proposed recovery strategy for the Salish sucker. The suggested restrictions on the use of agricultural land and the management and development of streamside urban properties, as occurs in the village of Harrison Hot Springs, are major restrictions on the value and the use of land.

Of greater concern, in spite of many requests from the public, DFO could not or would not provide a cost-benefit analysis for the establishment of this critical habitat nor would it commit to a population for the species deemed as suitable. In fact, the strategy states that it is likely that the species will remain at risk for the foreseeable future. There are changes to the Species at Risk Act, which are proposed in Bill C-38, that should eliminate some of this degree of uncertainty.

A number of issues have been identified in these very short introductory remarks. We look forward to further discussions related to the suggested changes in the legislation concerning both the Fisheries Act and the Species at Risk Act. Thank you.

[Professor Richard Steiner, Professor, University of Alaska, Conservation and Sustainability Consultant, Oasis Earth Project, As an Individual]

Thank you.

I appreciate the opportunity to provide my comments on that specific provision of Bill C-38 as well, the exemption for foreign-flagged vessels.

On its surface, it's not a bad idea per se, but I would caution with one caveat, and that is you have to have a very good government regulatory environment, plus good enforcement of that regulatory environment, to make sure it's as safe as possible. We had a good experience here in the United States just two years ago with a foreign-flagged, foreign-owned vessel that we thought was under good U.S. control. It's named the Deepwater Horizon. I think we all remember the catastrophic results of that. That vessel was flagged in the Marshall Islands and owned by Transocean. We thought the U.S. government was doing the proper job in regulating it; it wasn't. So we have to have very high controls in the regulatory environment here.

I'll make a couple of very quick, respectful recommendations for the bill or this provision of the bill. Number one, make it explicit in bill language that the exemption does not exempt the vessel from any Canadian existing or future regulations or laws. I think it's important that environmental regulations not be rolled back in any way in this bill. I think this bill is actually an opportunity, a good opportunity, to strengthen Canadian environmental regulation. I think that's in industry's best interest as well, as we found out here in the United States.

Secondly, I think this is an opportunity to improve Canadian standards. By the way, I would offer that in my opinion as a biologist, neither the Canadian standards for seismic mitigation nor the United States' standards are as good as we can do. We need to do better, and we must do better.

Thirdly, I would respectfully recommend that the bill ask the Canadian and U.S. governments to develop a bilateral agreement to make seismic mitigation and monitoring consistent across our borders, in the Atlantic, the Arctic Ocean, and in the Pacific. It makes no sense to have conflicting regulations and monitoring environments.

Finally, I would recommend that the bill suggest that the Canadian administration negotiate a seismic mitigation protocol at the Arctic Council to be trans-Arctic. I think Professor Zedel did very well in going over some of the very brief risks of seismic arrays offshore—and they are very real—so I will not touch on those here. I did provide the committee staff with a copy of notes, and you're all welcome to have those if you would like.

My principal issue is that neither the U.S. system nor the Canadian system are as good as they need to be in managing seismic shoots offshore. I've scanned the statement of Canadian practice on this, and, frankly, a 500-metre safety zone for seismic shoots is in and of itself insufficient. It needs to be a received level, a sound level for cetaceans, pinnipeds, seabirds, and fish. We know that impacts can go out to 50 or 60 kilometres on certain species away from seismic arrays, and the effects can be quite profound, particularly with continuous sound pulses over a long period of time.

There are a number of other things. In the transboundary radiation of sound, even though these guns are pointed down into the seabed, which is where they're targeted, there's a lot of horizontal radiation and propagation of the sound out to several hundred kilometres. If we are, for instance, shooting off the Alaska Arctic coast, the Beaufort Sea off the Canadian Mackenzie Delta is going to be radiated with sound as well. So we have to have some consistency and, I feel, a bilateral agreement to make it as safe as possible.

I think I'll stop at that. There are a number of other issues I touched on in my notes, and I would encourage all of you to take a look at those.

I would be delighted to answer any questions.

Thank you very much.

[Matthew Holmes, Executive Director, Canada Organic Trade Association]

Thank you, Mr. Chair and honourable members.

I am very pleased to appear before you this evening as a representative of the organic sector in Canada. The Canada Organic Trade Association is the member-based organization representing the organic value chain, from producers and manufacturers through to retailers and exporters.

The organic sector is relatively new, but it is growing at a tremendous speed. The recently released Statistics Canada census of agriculture data showed that while total farms in Canada have declined by 17% since 2001, the organic farms have increased by 66.5%. So we now have approximately 5,000 certified operators in Canada, including handlers and manufacturers.

Our domestic market is worth over $2.6 billion per year, making Canada the fifth-largest world market for organic. Globally, organic sales are now valued at $59 billion per year.

In 2009, COTA welcomed the government's new regulations for the organic sector, controlling and defining organic claims in the marketplace and making the national standards mandatory. Subsequently, the government established progressive trade agreements through the world's first equivalency arrangements with the United States and the European Union, giving Canadian domestic certification and Canadian producers unparalleled access to 96% of the world market.

Although it's a quickly growing market, the organic sector in Canada still faces many challenges, including supply shortages, especially in seed. It's an impasse in which we are obliged to meet our regulated standards but have no formalized government mechanism or funding to innovate or respond to opportunity in those standards, which is similar to the issue Mr. Kingston raised. A particular risk to our business model is posed by the unmitigated introduction of prohibited genetically engineered products. This can cause our members to lose the organic designation of their product, with loss of market access.

On the current changes proposed in Bill C-38 pertaining to the Seeds Act in division 26, COTA notes that the role and authority of the president of CFIA are increased significantly. The proposed changes would give the president of CFIA the ability to grant licences to any person to perform any activity related to controlling or assuring quality of seeds, including sampling, grading, or labelling. Under the current legislation, the only other role described by the Seeds Act for the president of CFIA is the designation and oversight of inspectors.

It's important to note that the proposed changes, in our opinion, do not remove the powers of the CFIA inspectors, but may provide CFIA with the avenue to outsource review services for specific functions or aspects. That outsourcing could go to industry groups, private enterprise, or individuals, as far as we know.

I should note that the Canada organic regime is delivered via a system of third-party inspectors, accredited certifiers, and conformity verification oversight bodies enforced by CFIA and its inspectors. Therefore, I cannot speak against third-party delivery of certain services and functions that have regulatory oversight. However, without more details, which we don't yet see in Bill C-38, on who would qualify for such licences and how they would be overseen and enforced, it is prudent to caution that there could be an inherent risk due to lack of transparency, accountability, or neutrality. This is dependent on the limits and parameters established by the Governor in Council.

It's also feasible that this new role for the president of CFIA has the potential to enable external criteria or purity standards to come to bear on the introduction of new seed varieties. That could lead, for example, to the introduction of new genetically engineered seed that has been approved by a foreign government but has not been reviewed or assessed for environmental release in Canada.

Such a shift within CFIA and the Seeds Act certainly echoes sentiments expressed by the biotechnology sector calling for a low-level presence policy in Canada to allow unapproved events from genetic engineering appearing in shipments below a certain threshold to enter Canada without action or mitigation. But as you know, seed has a tendency to grow and multiply, so for the organic sector, the introduction of new GE seeds into our environment, without at least the check and balance of due process and review by government agencies, threatens the integrity of our quickly growing and high-value market. And this market, I'll remind you, is directly responsive to consumer preferences and concerns.

Thank you for your invitation to speak and your attention tonight.

[Philippe Bergevin, Senior Policy Analyst, C.D. Howe Institute]

Thank you, Mr. Chair. Thank you for giving me the opportunity to appear before you today.

My name is Philippe Bergevin. I am a senior analyst at the C.D. Howe Institute. My remarks will focus on a slightly different topic, at the committee's request. I have prepared some observations on the Investment Canada Act.

I will be making my presentation in English, but I will be pleased to answer your questions in both French and English.

To start, I'd like to offer some specific comments on the amendments contained in division 28 of Bill C-38, which relate to the Investment Canada Act. Overall, I believe the measures are positive, although perhaps they do not go far enough. The measures that are aimed at facilitating the disclosure information related to the act are definitely welcome steps. Increased transparency enhances predictability in the application of the act, which obviously is positive for both investors and the public at large.

I do, however, see some potential unintended consequences with respect to the proposed powers for the government to accept securities against potential fines imposed on foreign investors. While this amendment will enhance the credibility of the commitments made by foreign investors to the government, I believe they will have, to some extent, a chilling effect on some foreign investors. If they were to become common practice, it would, frankly, perhaps raise some red flags in the case of some investors.

I think that's going to increase the level of transparency further in terms of the act itself. There are still no formal requirements for the minister to disclose publicly the reasoning for rejecting an investment, in particular if and when a foreign investor eventually withdraws their application. It's important for the minister to articulate his or her reasoning when turning down an investment, and even when accepting an investment, because it builds an inventory of decisions that can help clarify the legislation and therefore the understanding of potential investors. Disclosure also helps the notion that the review process is not unduly politicized, but rather based on sound principles.

There are also, in my opinion, further opportunities to clarify aspects of the act through the use of guidelines. The criteria used under the act are inherently subjective and unpredictable in their application, so the increased use of guidelines helps provide more guidance on the government's interpretation of the act.

More fundamentally, however, I would respectfully submit that parliamentarians consider whether the net benefit test is the right question for Canada, in the same spirit as the Red Wilson competition policy review panel report. I think Canada should adopt a national interest test and scrap the current net benefit test. What does that mean in practice? It simply means that you move the burden of proof from the business to the government, so it requires the federal government to invoke important public policy reasons such as national security, or cultural policy, for instance, to block a proposed investment.

There are already some similar concepts in the act, but such public policy reasons would become the main building block of the act under national interest tests. Such an approach would be more consistent with the view that there are positive benefits, on average, associated with foreign investment, while recognizing that in some limited circumstances there are valid public policy reasons that could be invoked to deny a foreign investment proposal.

To conclude, while the amendments before you in regard to enhanced transparency regarding the Investment Canada Act are, in my opinion, positive steps, there's an opportunity to adopt a test that would recognize that in most instances foreign investment is beneficial for the Canadian economy, while making sure that the federal government still has all the latitude to uphold important public policy objectives.

Thank you.

[Bob Kingston, National President, Agriculture Union]

Good evening. My name is Bob Kingston. I am the national president of the Agriculture Union.

Before going on a leave of absence to serve as an elected union officer, I spent 25 years as a CFIA and Agriculture Canada inspector, including 15 years as a multi-commodity supervisor.

For the Agriculture Union, two themes emerge from the amendments to the Seeds Act and the Health of Animals Act proposed in Bill C-38.

The first can best be summed up by quoting the British statesman and philosopher, Edmund Burke, who once said that those who don't know history are destined to repeat it. Let me explain.

Bill C-38 would amend the Seeds Act to privatize the seeds program, including inspection. The CFIA president will issue and revoke licences for private companies to whom this responsibility is handed off. This presumes that the CFIA will be in a position to set standards for these companies, and enforce those standards through oversight, except as in this case, CFIA often designs systems without considering the resources required to properly monitor the systems they put in place.

For example, we can look at the Maple Leaf Foods listeriosis outbreak in the late summer of 2008. The Prime Minister appointed Sheila Weatherill to find out why the outbreak occurred and to recommend ways to prevent another.

Just before the outbreak, the CFIA had implemented a new inspection system called the compliance verification system, or CVS, a fact that was central in Sheila Weatherill's report. Let me quote what she had to say about CVS. The CVS was “implemented without a detailed assessment of the resources available to take on these new tasks”. She also found that the CVS was flawed and in need of “critical improvements related to its design, planning and implementation”.

Ms. Weatherill recommended that the CFIA make sure that its resources and inspection processes are in alignment; in other words, make sure you know how many inspectors and other resources you need to make your systems work properly.

With all of the positions being cut at CFIA, they simply do not have the resources to take on the oversight required by the proposals in Bill C-38, especially when you consider the other new systems the agency is currently developing, also without regard for available resources.

For example, the agency is putting in place a new regulation to license all food importers. This may or may not result in safer imported food, but without additional resources to monitor compliance and enforce standards, we'll never know. Regulations without enforcement capacity are worse than no regulations, and the new licence system may become little more than an unattended paper exercise.

As Mr. Burke would advise, remember the lessons of the Maple Leaf outbreak when considering new systems at the CFIA. There are many examples like this, but none more serious than what happened at Maple Leaf, which was pretty serious.

However, time is short, so I'll move to the second theme, which is the secrecy around the decisions related to the budget.

Changes at the CFIA arising from the budget were decided in secret. This was unfortunate because many senior managers at the agency have little expertise or experience in the industry they regulate, meaning that the wisdom, knowledge, and experience of their front-line experts would have been invaluable in making those decisions. Without that expertise, decisions were made that could have serious consequences. Let me give you an example.

Because of budget cuts, the agency has decided to close its plant quarantine facility at Saanich on Vancouver Island and move the operation to Summerland, in the heart of the wine and fruit industry in the B.C. interior. If made in the open, this decision would have raised red flags among those involved with plant health or fruit production in B.C. Even the expert industry-government advisory group, the British Columbia Plant Protection Advisory Council, was not consulted, and still hasn't been.

This is a post-entry quarantine station where plants are grown for years while being checked for diseases before being released into the regular production environment. South Vancouver Island is a good place for it because of its natural isolation characteristics. This decision will put potentially diseased plants in the middle of one of Canada's richest agricultural regions.

In addition, the Summerland facility will have to be expanded and land purchased, costs that will offset potential savings. As well, the current site cannot be sold by the government as it is locked up in aboriginal title.

We have other concerns about the proposed amendments to the Health of Animals Act, as well as several other things going on right now in the agency, but time is short, so I guess I'll have to hope there's a question.

[Christian Simard]

This is important. I have heard a lot of nonsense about it. However, as a former sovereignist MP, I am very interested in the issue of overlap between provincial and federal authority.

As you know, there are already some agreements on environmental assessments between the federal government and the Government of Quebec, with a view to using the best procedure available. When a project comes mostly under Quebec's jurisdiction, Quebec's procedure applies, and when a project mainly comes under federal jurisdiction, federal procedure applies. There is an agreement about that.

Actually, this provision looks more like an abandonment of responsibility than delegation. There are various elements involved. For instance, earlier, it was said that habitat protection responsibility may be delegated to third parties. However, those third parties can be companies, which are not necessarily conservation agencies.

If we take a closer look at this, it is not a matter of halieutic strategy—in other words, a strategy for protecting fish and their habitat. It is more of an industrial strategy based on the philosophy whereby the environment is an impediment to resource development. According to that philosophy, if a lot of resources are developed and a lot of money is made, some of that money will go towards environment protection. That is a very outdated view of sustainable development, but it is nevertheless the underlying strategy.

When it comes to the Gulf of St. Lawrence, we could say that it is better for a single office—in this case the National Energy Board—to assess the gulf, instead of five provincial offices or partnerships between Canada and Quebec or Newfoundland and Labrador. In a way, that is somewhat logical. The issue stems from the fact that this task will be entrusted to the National Energy Board, which is primarily concerned with energy projects and for which environmental or habitat protection is an afterthought. The whole process is being corrupted.

In some cases, it may be said that this is a good thing. We may think that the Gulf of St. Lawrence comes under federal jurisdiction. Resources are a provincial responsibility, but habitat comes under interprovincial jurisdiction. Therefore, if the federal government does not conduct a full assessment, it is abandoning its responsibilities.

The reform is supposed to protect fish habitat, but in fact, it is unfortunately a tenacious attempt to create shortcuts and bypass assessments in order to move things forward as quickly as possible. For instance, Bill C-38, which is before us today, allows the National Energy Board to decide within a 45-day period that a seismic exploration assessment is unnecessary. However, that may lead to serious problems for sea mammals. You know, exploration zones are created to check whether there is oil on site, and the board could simply decide, within 45 days, that it is unnecessary to conduct an assessment at the exploration stage. However, we know that the exploration projects in the Gulf of Mexico were a failure.

The government is playing the sorcerer's apprentice by proposing a very broad reform, included in a piece of legislation on budget application. This is a very broad reform that is riddled with shortcomings and possible loopholes to encourage—in the absence of scientific evidence and time for reflection—overly rapid development of natural resources that may cause massive pollution.

[Anne Minh-Thu Quach, NDP, Beauharnois—Salaberry, QC]

Thank you, Mr. Chair.

I would like to use my time to ask Mr. Simard some questions.

Mr. Simard, thank you for joining us. I would first like to point out that you said that Bill C-38 violates the non-regression principle in terms of environmental protection. I would like you to provide us with more information about that.

It is said that Bill C-38 will enable the federal government to delegate environmental assessment responsibilities to the provinces, under the pretext that time delays are too long or that there is duplication of work. However, yesterday, the commissioner said that the delays were due to a lack of coordination between departmental agencies and that an agency may exempt the same designated project because it no longer has enough time to assess it.

As a result, the number of assessments could go from 6,000 to 30 per year. How could that affect the Great Lakes or the Gulf of St. Lawrence?

[Thomas Siddon]

Mr. Chairman, what I see being attempted here, with all due respect, is to suggest that the principle of section 35 can be replaced by a long recitation of some of the practicalities of application, which is the place for regulations, not for legislation. The principle should stand as it stood in the first three lines of section 35—only three lines.

I also want to quickly say, Mr. Chairman, that there's a significant distinction between the use of the term “serious harm” in the proposed legislation and the term “No person shall carry on any work...that results in harmful alteration, disruption or destruction...”. “Serious harm”, under the definitions of Bill C-38, is that you have to kill fish before you've done serious harm. I think that's long after the barn door has been left open and all the cattle have got out.

Further to that, we're giving the minister such broad powers of stepping away from the provisions of the principle of the act, which is a protective principle, not a permissive principle. What this act is proposing is to take away the protective nature of the Fisheries Act—in particular, section 35—and replace it by a whole bunch of permissive loopholes, which I object to.

[Randy Kamp, Conservative, Pitt Meadows—Maple Ridge—Mission, BC]

Yes, but my point, Mr. Siddon, is that the strategic direction we're taking with the Fisheries Act changes in Bill C-38 is to provide greater focus on fisheries resources, not necessarily on fish. Now, I don't know if you agree with that, but let me carry on with the historical story.

That was in 1986. This was your policy, which reads very similarly to what we have in Bill C-38. I don't see how we can conclude anything other than that. That was the interpretation of section 35, the HADD section, as it was known by your department at that time.

Now as the years went on—after your time, Mr. Siddon—they developed a decision-making framework to know how to provide authorizations and which projects needed it and would get it and so on. That document from 1998, which was called “A Decision Framework for the Determination and Authorization of Harmful Alteration, Disruption or Destruction of Fish Habitat”, has an important section, section 2, that says the first question the manager needs to ask himself is, if the project site is in an area potentially impacted by the project, is fish habitat present there?

It says this: Section 35 is not about the protection of fish habitat for the benefit of fish, but of fisheries. Therefore, the decision required is a determination of whether or not the potentially affected fish habitat directly or indirectly supports—or has the potential to support—a commercial, recreational or subsistence fishery.

I put it to you, Mr. Siddon, that this is precisely the direction that we're taking, the direction that you contemplated in the habitat policy, which is still in effect to this day. We are enshrining in legislation what is in the habitat policy, so that we have the legislative clarity and the tools to be able to move forward with the policy you put in place.

[Christian Simard]

Under the new environmental assessment provisions, environmental impacts will be limited to the impacts on fish, aquatic species protected by the legislation, and migratory birds—with the exception of federal land. That scope is extremely limited and will allow for a laisser-faire approach and a lack of assessment, which may have a major impact on future projects and environmental protection.

Much has been said about the Fisheries Act. Provisions on fish habitat will be amended so as to protect only fish that is important to trade, aboriginals or recreational fishing. The provisions of Bill C-38 radically reduce the notion of habitat protection.

Nature Québec fully agrees with the letter 650 Canadian scientists sent to Prime Minister Harper to complain about the amendments to the Fisheries Act. They define habitat as "the aquatic and/or terrestrial environment necessary to the survival of all species, including fish. All species, including humans, depend on healthy habitats".

Therefore, protection cannot be limited to certain habitats or certain types of fish. Doing that would distort everything we refer to as ecosystems and the protection of the environment. Wildlife habitats, already poorly protected, will lose virtually all protection. The focus will be placed on certain species that are dependent on a quality habitat.

I would like to conclude my remarks by saying that our ecological footprint on the planet is already very large. Development can no longer be done like it used to. We must absolutely ensure the durability of ecosystems and cannot pit economic development against environmental protection, as this bill seems to be doing. It provides for many systems that function by exception, geographic exceptions. Certain zones, certain activities, such as road and mine construction, could be removed from the Fisheries Act.

As you know, there is already an exception in the Metal Mining Liquid Effluent Regulations that makes it possible to not comply with the Fisheries Act. That led to the transformation of natural lakes into tailing ponds. That's one small exception whose meaning was corrupted in reality. With the way things stand, how many natural lakes or rivers will be used for roads, without assessment, without examination, without protection, to eventually be made into tailing ponds?

There are bogs in northern Quebec and Canada, and some wetlands are not necessarily suitable for fishing but are essential for ecosystems. So it is extremely important to not create this type of discretionary exception system. That is why Nature Québec is in favour of major change and the removal of those bill provisions on budget application.

Thank you.

[Christian Simard]

On behalf of Nature Québec, I want to thank the members of the Subcommittee on Bill C-38 for having me this evening. I will make my presentation in French.

Nature Québec is a non-profit organization that brings together individuals and 120 conservation organizations from across Quebec. So we have several thousand members and supporters who work on protecting the environment and promoting sustainable development.

Nature Québec works on maintaining species and ecosystem diversity. Since 1981, our organization has been committed to the objectives of the World Conservation Strategy of the International Union for Conservation of Nature, or IUCN. Our objectives are to maintain essential ecological processes and life support systems, to preserve genetic diversity and to ensure the sustainable development and utilization of resources and ecosystems.

Nature Québec is an active member of several coalitions, including the St. Lawrence Coalition, an interprovincial coalition that was created to convince government institutions to urgently put a moratorium on gas and oil exploration and development in the Gulf of St. Lawrence, until such a time as a full environmental assessment is conducted on the impacts of that industry.

Like others before us, we want to reiterate that the use of a budget implementation bill that amends 69 pieces of legislation and transforms Canada's environmental protection economy—including 19 pieces of legislation or areas of activity that are affected at that level alone—is a perversion of democracy, and at the very least a lack of respect for parliamentary institutions.

It is totally unacceptable that the Standing Committee on Environment and Sustainable Development—on which I sat between 2004 and 2006 as a member for Beauport—Limoilou—was not asked to hold a thorough debate and broad consultations on the legislative provisions that are directly related to and will directly affect environmental protection in Canada. I must admit that we fully agreed with the recommendation made by Ecojustice, which appeared yesterday or the day before, asking that the bill be divided, so that at least part 3 would be subject to a specific piece of legislation that could be thoroughly debated. The bill was drafted quickly, with provisions that apply both retroactively and immediately, and some provisions we are not familiar with that will apply pending a cabinet decision later on. Part 3 of the bill is worthy of special treatment and should be debated thoroughly.

When I was an MP, I remember having agreements with the Conservative Party, more specifically regarding Bill C-15, An Act to amend the Migratory Birds Convention Act, 1994 and the Canadian Environmental Protection Act, 1999. We obtained a fairly special amendment that helped protect migratory birds from oil spills. I would like to see that Conservative Party again. By passing that bill, they made some progress in terms of the environment in Canada.

Through various measures, Bill C-38 directly violates the principle of non-regression in environmental law, a principle that will be debated and perhaps adopted in Rio. That principle was adopted at the third international meeting of environmental law experts and associations in Limoges, in 2011. It says the following:

To prevent any regression in environmental protection, the states must, in the common interest of humanity, recognize and establish the non-regression principle. To do so, the states must take the necessary steps to guarantee that no measures shall reduce the level of environmental protection achieved thus far.

I will talk about hydrocarbon development and the concrete impact Bill C-38 will have in terms of that. Pursuant to provisions retroactive to July 1, 2010, Bill C-38 sows confusion in the ongoing assessment process in the Gulf of St. Lawrence and opens the door to oil development without proper environmental assessment. The Canada-Newfoundland and Labrador Offshore Petroleum Our understanding is that the board's role as the responsible authority for environmental assessment was taken away, retroactive to July 1, 2010.

What is happening with the ongoing screening process? Who will take over? Will it be the National Energy Board, which is one of the three recognized authorities, along with the Canadian Environmental Assessment Agency and the Canadian Nuclear Safety Commission? The board will have 45 days to determine whether a more in-depth environmental assessment is necessary.

I want to remind you that only three responsible authorities will now be recognized—the Canadian Environmental Assessment Agency, the National Energy Board and the Canadian Nuclear Safety Commission. However, two of the biggest recent environmental disasters—the Gulf of Mexico oil spill and the Fukushima nuclear disaster—tell us that there must be independent alternatives to such regulatory agencies as the NEB and the Canadian Nuclear Safety Commission, which are often too close to industry interests to do credible work in terms of environmental protection.

I want to remind you that the value of fish landings in the Gulf of St. Lawrence is $500 million a year, and the total value amounts to $1.5 billion if we take processing into account. That is a real treasure trove, which is already available, while the hope in hydrocarbons is still only potential.

Allowing oil exploration without a full environmental assessment guarantee would be totally irresponsible. You will recall that recent disasters in the Gulf of Mexico and the North Sea happened during the exploration stage.

How much time do I have left, Mr. Chair?

[Pamela Schwann, Executive Director, Saskatchewan Mining Association]

Bonjour, Mr. Chairman, members of the public and committee members.

I'm here today to speak on behalf of the Saskatchewan Mining Association.

First, thank you very much for the opportunity to appear before the committee in consideration of part 3, “Responsible Resource Development”, in Bill C-38.

I understand the focus tonight will be on reducing duplication of jurisdictions and timelines.

I'd like to start by emphasizing that our comments tonight are based on a preliminary analysis of the legislation. Further, from our experience we know that the effect of the proposed changes will depend not only on the details of the regulations and policies that we have not yet seen, but also on the implementation of those changes across Canada. We welcome the opportunity to fully participate in the development of these regulations and to have an ongoing open dialogue to ensure that the comprehensive reform required to achieve the government's goal of “one project, one review” in a clearly defined time period is realized in the implementation stages.

EAs are planning tools for projects that, if approved, will have other provincial and federal oversight as they go into operation, as has already been mentioned. With respect to the new Canadian Environmental Assessment Act, we were before the House of Commons committee late last year as part of the review of the current act, advocating for common-sense reform.

In particular, we advanced a number of different concepts embodied by this legislation. These include rationalizing project triggers so that administrative or routine decisions do not require an EA; respecting the principle of “one project, one process”, with a view to better use of equivalency between federal and provincial EA processes, thereby eliminating multiple EAs; and establishing timelines for EAs. In these three respects, we are of the view that the new CEAA holds a promise of additional improvements and clarity and predictability, as well as the promise of reducing duplication of process while not weakening the overall protection of the environment afforded by the current paradigm.

More specifically, we see the designated projects approach as a means to ensure that EAs are required where appropriate. The role of equivalency has been enhanced and provides the potential for provinces' EA processes to lead and reduce the duplication of federal and provincial reviews.

To facilitate the use of the equivalency provisions, it is critical that the mechanics of the process be certain and clear. Certainly, Saskatchewan's environmental regulatory regime is robust and mature, and on an outcome basis could be fully substituted for the federal EA process, particularly in sectors where the provincial government has recognized expertise.

Lastly—establish cycle times for EAs to improve the predictability and timeliness of the review—the SMA is optimistic that the proposed amendments could increase the efficiency and the effectiveness of Canada's regulatory system. We are very eager to work with the federal government to realize the potential benefits as they move forward in implementing the many amendments across all industries. Again, as already mentioned, the test will be in the details of the regulations that we haven't seen yet and how the legislation is interpreted and applied in practice.

For example, the development of a designated projects list is key to how efficient and predictable the new CEAA will be. We had previously submitted that only those activities or undertakings that would trigger a federal permit and that are not bounded by a current licence should be subject to an EA. We want to ensure that the scope of the new CEAA process does not expand so as to have unintended consequences, such that new projects or modifications to existing projects that previously would not have been subject to a federal EA end up being included in the designated project list.

I would like to speak to one comment we had provided that was included within our previous submission, but was not enacted upon within the positive reforms that we've seen to date—the extension of the positive reforms to projects primarily regulated by the CNSC.

For example, we were disappointed to learn that the federal-provincial equivalency and full substitution will not be made available to uranium mining projects under the new Canadian Environmental Assessment Act. Further, as currently drafted, the timelines specified in the act do not apply to the projects that have federal EAs led by the CNSC, although we were very pleased to read the comments provided by the CNSC yesterday to this committee about introducing new regulations with defined timelines for rendering a decision for a licence to prepare a site and construct a uranium mine.

Last year, the Australian government reviewed and approved the coordinated federal- and state-level EA for what will be the world's largest uranium-producing mine, the expanded Olympic Dam deposit, in less than one year.

When you compare that to the more than seven years required in the latest EA to bring a new uranium mine into production in Saskatchewan, it's obvious that it is far more attractive for companies to invest in uranium projects outside of Canada that have similar environment and safety standards, but where there is a more timely return on investments. In the interest of fairness, we hope that our uranium mining members will see the same benefits that have been afforded to other mining sectors.

At this point, we are not advanced in our comments with changes to the Fisheries Act. The incorporation of means for better federal and provincial cooperation is valuable, as is the incorporation of a larger tool box for dealing with the act's absolute prohibitions, such as the possibility of regulations for proposed section 35. However, at this time, we are not clear how certain provisions of the act will work together in practice. In particular, we are concerned with the differences in wording between proposed sections 35 and 36, and the challenges this will present. We support the definition of fishery as applying to commercial, subsistence for aboriginals, and recreational fisheries. However, this is not carried through into proposed section 36. We hope to work with officials to develop greater clarity through regulations and guidance. We are hopeful that habitat banking can be part of the approach to conserve Canada's fisheries, while allowing sustainable development to continue.

With respect to SARA, the proposed changes are positive, but certainly more work needs to be done to have effective and realistic legislation. We commend the government for moving forward in recognizing that changes to SARA are required.

To summarize, I want to thank the federal government for recognizing that the existing federal environmental assessment system needed comprehensive reform, and for bringing forward legislation to implement system-wide improvements to achieve the goal of “one project, one review”, in a clearly defined time period, while upholding the pillar of environmental protection.

In closing, we are advocates for a regulatory system that reduces overlap and duplication, establishes clear timelines, and concentrates on areas where potential environmental impacts are the greatest, while ensuring that the environment is protected. My colleagues and I would welcome any questions that you have.

Thank you.