Bill C-234

An Act to amend the Greenhouse Gas Pollution Pricing Act

This enactment amends the Greenhouse Gas Pollution Pricing Act to expand the definition of eligible farming machinery and extend the exemption for qualifying farming fuel to marketable natural gas and propane.

[Kyle Larkin]

To answer your second question, there are many things that the government can do to support grain farmers. Lowering taxes and regulations is number one on the list. We talk about the capital gains tax, Bill C-234 and the carbon tax as unfairly penalizing grain farmers. There are a number of regulations and taxes out there that are really penalizing grain farmers. That really hurts their competitiveness.

When you look at the international market, Canada is known for having some of the highest quality grain around the world. We export over 70% of the grain and grain products that we produce here in Canada. It's fundamentally important for the competitiveness and profitability of grain farmers. We need to keep those international channels open.

Our largest worry is protectionist measures by some of our largest trading partners. The top five trading partners right now, or as of last year, in order are the United States, China, Japan, Indonesia and Mexico. Some of them have carbon pricing schemes and some of them don't.

What we know is that our grain farmers are reliant on trade in grain and grain products getting to those markets and another 145 markets around the world. We need to ensure that when we're looking at mechanisms like carbon border adjustment mechanisms, we're truly looking at the global market and how this could impact grain farmers back home.

[Keith Currie]

That's a loaded question. Certainly Bill C-234 in its original form was something that the agriculture community applauded because of the relief it was going to give to producers, to primary production.

As has been mentioned many times in this committee, producers are price-takers, not price-setters, so any further costs added to their bottom line have to come out of their bottom line. We appreciated what Bill C-234 represented. Then, unfortunately, it was changed incredibly at the Senate and had to go back to the House.

As is, it is better than nothing. However, our preference would be to have it back in the original form it was in. If it needs to go back to the Senate, so be it. It may not last the lifetime of this government to actually get passed if it were to go back to the Senate. Timing is important around this bill, for sure.

[Yves Perron, Bloc, Berthier—Maskinongé, QC]

All right. Thank you.

Mr. Currie, you mentioned Bill C‑234 in your opening statement. At the beginning of the meeting, we talked about bills C‑280 and C‑282, and the trouble they're running into in the Senate. Bill C‑234 was reported back to the House with an amendment, but it still includes a grain drying exemption.

What do you want to say to the elected members of Parliament? Should we pass the bill as is or send it back to the Senate, knowing full well that it won't come back?

[Keith Currie, President, Canadian Federation of Agriculture]

Thank you, Mr. Chair.

It's good to be back in front of this committee one more time.

As most of you know, my name is Keith Currie. I'm the president of the Canadian Federation of Agriculture, and I'm an eighth-generation farmer here in Ontario.

I just want to start by saying that Canadian farmers are committed to sustainability, and we do applaud the committee for taking a very proactive approach in studying this emerging issue.

I'll get straight to the point. Our main concern with discussions related to the implementation of border carbon adjustment mechanisms—or BCAs, as I'll refer to them—relates to their potential to establish non-tariff barriers to trade and undermine Canada's competitiveness, if not done correctly.

As an example, Canadian supply chains for inputs such as fertilizers, pest management products, and equipment are highly integrated with the United States. Given the absence of carbon price in the U.S., we are concerned that a Canadian BCA would increase the price of critical agriculture inputs here in Canada. A large portion of farm inputs, supplies and equipment are imported into Canada as manufactured products. Any additional carbon levy or import surcharge on these imported goods would add more carbon-related costs onto primary producers, further reduce farm operating margins, and negatively affect their competitiveness in global markets.

Furthermore, we have been very clear on our ongoing concern regarding the impact the carbon tax is having on Canadian farm profitability, sustainability and competitiveness. As this committee is well aware, we have always been and remain supportive of Bill C-234, which in its original form would have provided much-needed relief to Canadian farmers across this country. While we do believe measures like BCAs could play a part in levelling the playing field for Canadian farm businesses, the lack of international guidance or standards on this front could result in inconsistent unilateral approaches that establish protectionist non-tariff barriers to trade under the guise of sustainability.

Given these concerns, any consideration of BCAs in a Canadian context can only work if Canada were to form part of a coalition of countries and regions that implement BCAs, including the United States. In addition, we would need to see strong multilateral disciplines, including a rules-based approach underpinned by science-based standards. Without such international disciplines and widespread international adoption, BCAs would have limited value for Canadian agriculture exports, given the lack of developed domestic carbon pricing systems in key export markets.

Were Canada to explore a Canadian approach to BCAs that is not harmonized with U.S. policy, including the level of subsidy supports to affected industries, there is a significantly higher risk that Canadian producers would bear the higher prices. At the end of the day, Canadian producers are price-takers on the international market and do not have the ability to pass on any negative price impact stemming from BCAs or other similar mechanisms. As a result, any consideration of a BCA in a Canadian context would need to be coupled with additional support to help reduce carbon emissions domestically, including investment in research, extension and programs.

We also need to be aware that BCAs are likely to place upward pressure on food price inflation, which has already proven to be quite sticky when compared to other consumer goods, given the number of imports that occur from major emitters like China.

Finally, while Canada already has a well-established commitment to reciprocity when it comes to trade agreements, BCAs are somewhat new and unexplored territory. From our perspective, the same principles that guide our actions from a reciprocity perspective, such as equal treatment, rules-based order, and flexibilities where appropriate, need to be carried forward into any future development and implementation of a BCA.

In conclusion, from our perspective, any consideration of BCAs, whether in Canada or by major trading partners, cannot occur unilaterally or in a vacuum without the support of an internationally supported science-based framework.

Thank you. I look forward to the questions.

[Alistair MacGregor, NDP, Cowichan—Malahat—Langford, BC]

Thank you to all of our witnesses. This is actually a pretty fascinating study. It seems like we're very much dealing with a hypothetical scenario. Basically, a what-if question is before us. I do appreciate the three of you who are guiding the committee through this study.

Maybe I will start with you, Mr. Cosbey. I think it's quite obvious that agriculture occupies a very special place in our economy. Many people recognize that. I think you can even see it in federal legislation like the Greenhouse Gas Pollution Pricing Act, which does have exemptions carved out for farming activities, farming machinery and qualifying farm fuels. I think you can see that also as a result of the majority of the House of Commons supporting a bill like Bill C-234. I think it was very much in the spirit of those existing exemptions.

Due to the fact that we're dealing with a hypothetical scenario, what I would like to know is this. Often when we're trying to think up a policy, I don't think there's enough attention paid to the good that agriculture is doing, to the good farming practices, because we know that, depending on how one farms, it can have a tremendous impact on not only the emissions but also the carbon capture that the farm is able to do. I guess I'd like to have your expertise here.

In a hypothetical scenario where we're having these conversations between the EU and Canada, how would the various parties come to an agreement on how we measure the capacity of good agricultural practices to capture carbon? Is there an agreed-upon standard that we could...?

I guess I'd just like to hear your thoughts to guide our committee on those conversations.

[Yves Perron, Bloc, Berthier—Maskinongé, QC]

Thank you, Mr. Chair.

Mr. White, I'm going to continue with you.

You just asked that we pass Bill C-234. The way to pass it quickly is to pass it in the form in which it came back from the Senate, to avoid it being sent back there, because we know it could spend a lot of time there, going by Bill C-282, which has been there for over a year. The Bloc Québécois supports the adoption of Bill C‑234 as is. I therefore call on my colleagues to pass it next week and bring it into force immediately.

Furthermore, how do we go about establishing regulations to improve performance? You talked about doing it through the World Trade Organization, and that makes a lot of sense.

That said, my concern is to take into account what has already been done. Let's take the example of a producer who uses no-till or already does crop rotation, compared to another producer who doesn't do that and uses more pesticides and herbicides. We know that some amount is necessary, but efforts can be made. How can we recognize what has already been done in Canada and Quebec in relation to foreign countries with which we do business? It's not an easy thing to do.

[Rick White]

It's a great question.

I hadn't really thought of it as food security, because we're awash in food. From a canola perspective, we grow way more than we consume domestically, so if food security is domestic, we're good. If food security is more global, maybe it's not so good, because our product does feed a lot of people globally.

On the carbon tax part of your question, that is one area that the government needs to reconsider, especially for farmers. Bill C-234—speaking of sticks from Tyler's earlier comments—would alleviate the stick on farmers.

My suggestion here is that this is coming up again in the House on October 26. Bill C-234, in its original form, is our preferred approach. However, the reality of the situation—and without much faith in the Senate—is that we would encourage the amended Bill C-234 to go through immediately. It won't help as many farmers, but it will help farmers in need right now, and we need an early harvest for those farmers to get some tax relief.

The emissions are not going down because farmers do not have any alternative, and it becomes a straight-up tax. This stick is just acting on farmers as a club, and they can't do anything about it except take it on the chin and reduce their bottom line.

Please get Bill C-234passed and get some relief to those farmers. Lots of those farmers are feeling the brunt of China right now, and they're going to feel a lot more of it in the next six months.

[The Chair, Liberal, Kody Blois]

Dr. Webb, I have just one final question.

I think what I'm hearing today is.... The elephant in the room has been around carbon pricing in agriculture. It's largely non-existent on farm fuels. Bill C-234 is before the House. I chide my Conservative colleagues sometimes about when it might be called.

I think the broader question, whether or not carbon pricing applies, is if there would be some other form of, let's say, contribution from the industry. If we believe there's work to be done—and I take the point you've made about the fact that farmers have done this by adopting technologies and that they've been focused on innovation—there may come a time when there is a trade-off between the economy and the environmental outcome. How do we actually go about finding that balance?

I take your point about a Canadian ag strategy and regional pieces; that's all fine. However, we're talking about Canada's position in the world in terms of how we reconcile both Canada's existing, perhaps, competitive advantage on sustainability and the idea that we want to continue working industry-wide—not just in agriculture—on reducing emissions with not wanting to undermine competitiveness in a world where we are trading globally.

If you held the pen, how would you construe it?

I'm not hearing about CBAM. Is it maybe a club approach, where you would align with other countries that are clearly asking their agriculture industry to do something, whether it be on pricing or on other types of initiatives, such as massive government subsidies to try to help industry, that have an impact on the taxpayer's purse?

How would you draw it, if you had the pen, in about one minute?

Opposition Motion—Confidence in the Government

[Yves Perron, Bloc, Berthier—Maskinongé, QC]

Madam Speaker, I thank my colleague for his question and for his usual collaboration.

Indeed, this is something I find deeply disturbing. We are asked to refrain from making personal attacks and stick to debating content, so I will address the grain farmers of Canada. They should call Conservative members and ask them to move forward with a vote on Bill C‑234 before the government is defeated, possibly at the end of October.

That is a good idea. They should call Conservative members and ask them why the House is not voting on Bill C‑234. The bill has passed in the Senate. If the amendments are accepted, the bill will come into force almost automatically. Farmers would get the exemption right away. I strongly advise farmers to call Conservative members.

[Francis Drouin, Liberal, Parliamentary Secretary to the Minister of Agriculture and Agri-Food]

Madam Speaker, I have a great deal of respect for my colleague. I also have the good fortune to work with him on the Standing Committee on Agriculture and Agri-Food.

Of course, I supported Bill C‑282, as did our government. I am well aware that the Leader of the Opposition and his local riding association have twice raised the idea of getting rid of supply management with his political party. The possibility exists that the House leader of the official opposition could become the minister of foreign affairs. He once described Brexit as a good thing.

I would like my colleague to help me understand the political game that the Conservatives are playing at the expense of farmers, specifically when it comes to Bill C‑234.

[Yves Perron, Bloc, Berthier—Maskinongé, QC]

Madam Speaker, I think I was a bit hasty in phrasing my question to the leader of the government. We misunderstood one another, but I will come back to this in my speech. I would like her to listen to what I am going to say, and I would like to receive information on Bill C‑234.

I would just add that I will be sharing my time with my colleague from Saint-Jean.

Getting back to the motion before the House, I would like to start by saying that our Conservative colleagues are not being serious. They are mocking us today. I say that because, two days ago, they moved a non-confidence motion that said the House does not have confidence in the Prime Minister. That is all it said. Our response was that we found it interesting that they thought that. Let me reassure them. We do not trust anyone. We do not have confidence in the current government and we do not have confidence in any Conservative government. My job is to protect the interests of Quebec until we are independent. That is our job. We are trying to make progress every day. We will continue to do so, despite the Leader of the Opposition's ambitions and his propensity for stamping his feet. He really wants to be emperor, replacing the current emperor. We told them that it was not enough. We will vote on motions with some substance. Two days later, with more theatrics, they come up with the idea of including their slogan in the motion, thinking that we would definitely vote with them. How can anyone take them seriously?

I find it quite sad. I am not making personal attacks, I am talking about the content. As members know, I focus on content, and I want things to move forward. We tell them that it is not good enough and that we are going to vote for things that are important to Quebec. They come back with a motion saying it is time to “axe the tax, build the homes, fix the budget and stop the crime”, which they repeat to us ad nauseam, approximately 72 times a day, without ever explaining it. That is what I find interesting. I want to hear them explain what they are going to do.

They tell us in the motion that food has been taxed. I just spoke on Bill C‑234, which deals with the carbon tax we keep hearing about. As we in the Bloc Québécois are reasonable people, we agreed to create an exemption for grain drying. The bill already went to the Senate and has come back to the House. All that remains is to vote on it. The first speech I made in the House last January dealt with this, but since then, people claiming to want to make life easier for farmers have been blocking the legislation. They are adding speakers to fill the time and they are not allowing us to vote on the bill. Once we vote on it, it will be settled, provided we accept the Senate amendments, of course. That is the reasonable, intelligent and rational choice that the Bloc team has made, because that is how we operate.

The Conservatives keep yelling at me that the government is taxing food, but I would like them to show me that they do not plan to do the same. Results do not matter to them. What they want is an election. They are scheming for power. Nothing else matters. All they want is to score political points, spout slogans, generate sound bites and rake in money. They are not working for the people.

They talk to us about housing. Many times I have heard government representatives say that the Leader of the Opposition, while serving as housing minister, created something like six affordable housing units. I must confess, I did not check this figure. We hear it often. There must be some truth to it, although we should exercise caution. Everything said in the House is not necessarily true. We have to be careful. There is no proof. We will be careful.

People talk to us about interference and a centralist government, but the opposition leader is directly threatening cities with funding cuts if he does not like the look of the mayor. That is quite something. We are hearing that if a mayor is incompetent, their funding will be cut. First of all, he has no right to do that in Quebec. That has to go through Quebec. There is more to it than that.

They might be angry because they received only 12% of the vote in LaSalle—Émard—Verdun. They are hot and bothered about getting a more positive vote, maybe. Even yesterday, members began saying that the Bloc Québécois was no longer party of the regions because we captured a Montreal riding. That is interesting. We in the Bloc work for everyone.

[Yves Perron, Bloc, Berthier—Maskinongé, QC]

Madam Speaker, as government leader, my colleague must be in the know. I would like her to apprise me of the status of Bill C‑234, because our Conservative colleagues have been yelling non-stop against the carbon tax.

Quite reasonably, an exemption was created in Bill C‑234. I would like my colleague to tell me whether what I heard is true. It seems to me that so many speakers are being added that we will never be able to pass this bill.

Is it true? Could the vote happen soon?

Finance

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Madam Speaker, the extraordinary display of hypocrisy that just occurred in the House has never before been seen on a level like that in the history of this country and in the history of this austere chamber.

What happened? The leader of the NDP knew he was going down. We had a great candidate. I was at doors with him many times. Colin Reynolds is a construction electrician, a guy on the executive of his local IBEW union board who grew up in the area and who really connected with the residents.

The leader of the NDP knew he was going to lose the by-election. What did he do? He said that he was ripping up the agreement and that he was done with the Prime Minister. Unfortunately, the people of Elmwood—Transcona deserve better. They deserve better than having the leader of the NDP try to fool them into thinking he is a man of principle. He is not, and that was established today. In front of the entire country, the man who said he was ripping up the agreement got up, taped it back together and said that he believes in the Prime Minister and is voting with him. In fact, he said he has confidence in the Prime Minister.

The height of hypocrisy is on a level never, ever before seen on the floor of the chamber. Canadians will not forget it, and the people of Elmwood—Transcona will not forget it come the next election.

Regarding the issue of the report, as I said, I sit on the committee. Conservatives really are the only members on the committee who are doing their best to hold the government to account. We had some great ideas for the report that our colleagues from other parties on the committee would not support. Therefore, for the people watching, I will explain that we attached a dissenting report to the report, which we are allowed to do. Anyone can look it up online and read the dissenting report. I want to go through some parts of it, but before I do, I want to just circle back for a second to look at part of the Liberal government's record.

In 2015, in order to fool Canadians into voting for him, the Prime Minister promised to balance the budget by 2019. Of course that never happened. In fact he doubled the national debt in nine years. It is hard to get one's head around that, but just to put it in perspective, in 2015, when the Prime Minister first was elected to office, the national debt was $616 billion. Today it is over $1.2 trillion. The Prime Minister has gone more in debt than all other prime ministers from 1867 to today combined.

Today the interest on the debt is $52 billion a year, which is more than we spend on health care, more than we spend on defence and in fact more than we actually collect in the GST. It is important for people watching to know that when they go out and buy something in the store and the store adds on the GST, that money is going directly to paying the interest on the massive, historic debt that the Prime Minister has managed to rack up.

Therefore at committee, Conservatives made a number of common-sense recommendations that were rejected by the NDP and Liberal members. One of the recommendations we made, which we had hoped would be a recommendation in the report, was to axe the carbon tax. The reason we wanted to axe the carbon tax is pretty straightforward, and I will go through some of those points. For example, the Governor of the Bank of Canada, Tiff Macklem, came to committee and told us that the carbon taxes are inflationary and that by cutting the carbon tax, inflation would come down by 0.6%, bringing the CPI back into the bank's target range.

The government has an opportunity now to start with the carbon tax on farmers. The common-sense Conservative bill, Bill C-234, should be passed immediately in its original form to take the tax off farmers to help lower food prices. I know it has been said many times in the House, but when one taxes the farmer who produces the food, taxes the trucker who ships the food and taxes the grocer who stocks the food, the food costs more. What is the result? It is two million Canadians lining up at food banks, and a historic number of homeless encampments across this country.

Earlier this year, as part of the finance committee's housing study, Mayor Cam Guthrie from Guelph was a witness. He was elected in 2014. I asked Mayor Guthrie how many homeless encampments there were in Guelph the year he was elected. He said there were zero. I asked how many there are today, and he said there are 20. That is just one example.

I made a speech about this the other day in the House and went through the litany of housing-hell stories across this country as a result of the apocalyptic, historically terrible housing policies of the Liberal government. With $82 billion on the national housing strategy, never before has so much been spent to achieve so little.

It is time to axe the failed and inflationary carbon tax that makes gas, groceries and home heating more expensive, and to bring down inflation so Canadians can once again earn powerful paycheques so they can afford nutritious food and a home in a safe neighbourhood. It seems like a simple ask, part of the Canadian dream, but that dream has been broken by the failed policies of the Liberal government.

We said to axe the tax, and we also talked about building more homes. There is a housing crisis in this country. There is an affordability crisis, and we need to build millions of homes. However, the Liberals and the NDP voted against our common-sense Conservative bill, the building homes, not bureaucracy act, a bill that would have gotten houses built. Instead they just got in the way. They are the gatekeepers of the House of Commons, and they got in the way of a common-sense bill that would have helped Canadians. Of course, we also need to fix the budget and stop the crime. Let us bring it home.

Opposition Motion—Confidence in the Prime Minister and the Government

[Jasraj Singh Hallan, Conservative, Calgary Forest Lawn, AB]

Mr. Speaker, Bill C-234 was an amazing, great, common-sense Conservative bill in its original form. However, since the radical, ideological, orange jumpsuit-wearing environment minister bullied senators into changing it into some radical new form, it would do nothing but punish farmers even more. Not only is the government punishing farmers with its carbon tax scam and radical ideologies, but Bill C-234 in its original form would have rewarded our hard-working farmers. This is one thing Liberals have failed to admit: If we are taxing the farmer who is making the food and the trucker who is shipping the food, at the end of the day, that cost all gets passed down to the person who is purchasing the food.

It is time to axe the tax and bring back Bill C-234 in its original form to get the cost of food down again.

[Yves Perron, Bloc, Berthier—Maskinongé, QC]

Mr. Speaker, let us have a debate on the content. I know this subject quite well.

The member talked a lot about the carbon tax in his introduction. I would like to talk to him about Bill C‑234. We have had a lot of discussions about it in the House. There has also been a lot of tension around this bill. Yesterday, in my speech, I explained that we had chosen to accept the Senate amendments and that we could put the bill to a vote. This bill has been in the House since January, but the Conservatives will not let us vote on it.

I will ask my colleague the following question. Why not vote in favour of the grain drying exemption? That would give something meaningful to farmers right away. Are the Conservatives ready to put the bill to a vote?