Bill C-69

Budget Implementation Act, 2024, No. 1

An Act to implement certain provisions of the budget tabled in Parliament on April 16, 2024

Part 1 implements certain measures in respect of the Income Tax Act and the Income Tax Regulations by
(a) denying income tax deductions for expenses incurred with respect to non-compliant short-term rentals;
(b) exempting from taxation the international shipping income of certain Canadian resident companies;
(c) exempting from taxation any income of the trusts established under the First Nations Child and Family Services, Jordan’s Principle, and Trout Class Settlement Agreement;
(d) doubling the volunteer firefighters and search and rescue volunteers tax credits;
(e) extending the eligibility for the Canada child benefit in respect of a child for six months after the child’s death;
(f) increasing the cap on labour expenditures per eligible newsroom employee from $55,000 to $85,000 and increasing, for four years, the Canadian journalism labour tax credit rate from 25% to 35%;
(g) extending eligibility for the mineral exploration tax credit by one year;
(h) providing a refundable tax credit to small and medium-sized businesses in designated provinces by returning a portion of fuel charge proceeds from the province;
(i) providing a refundable investment tax credit to qualifying businesses for investments in certain clean hydrogen projects;
(j) providing a refundable investment tax credit to qualifying businesses for certain investments in clean technology manufacturing property;
(k) amending the definition “government assistance” to exclude bona fide concessional loans with reasonable repayment terms from public authorities;
(l) implementing a number of amendments to the alternative minimum tax;
(m) increasing the home buyers’ plan withdrawal limit from $35,000 to $60,000 and deferring the repayment period by three additional years;
(n) excluding the failure to report under the mandatory disclosure rules from the application of the section 238 penalty;
(o) introducing a $10-million capital gains exemption on the sale of a business to an employee ownership trust; and
(p) implementing a number of technical amendments to correct inconsistencies and to better align the law with its intended policy objectives.
Part 2 enacts the Global Minimum Tax Act , a regime based on the rules of the Organisation for Economic Co-operation and Development (OECD). The global minimum tax regime will ensure that large multinational corporations are subject to a minimum effective tax rate of 15% on their profits wherever they do business. It sets out rules for the purposes of establishing liability for the tax and also sets out applicable reporting and filing requirements. To promote compliance with its provisions, that Act includes modern administration and enforcement provisions generally aligned with those found in other taxation statutes. Finally, this Part also makes related and consequential amendments to other texts to ensure proper implementation of the tax and cohesive and efficient administration by the Canada Revenue Agency.
Part 3 amends the Excise Tax Act , the Excise Act , the Excise Act, 2001 , the Underused Housing Tax Act , the Greenhouse Gas Pollution Pricing Act and other related texts in order to implement certain measures.
Division 1 of Part 3 amends the Excise Tax Act by repealing the temporary relief for supplies of certain face masks or respirators and certain face shields from the Goods and Services Tax/Harmonized Sales Tax.
Division 2 of Part 3 amends the Excise Act , the Excise Act, 2001 and other related texts in order to implement changes to
(a) the federal excise duty framework for tobacco products by
(i) increasing the excise duty rates for tobacco products, including imposing a tax on inventories of cigarettes held by retailers and wholesalers,
(ii) changing the process by which brands of tobacco products for export are exempted from special excise duty and marking requirements,
(iii) allowing certain information to be shared for the administration or enforcement of the Tobacco and Vaping Products Act , and
(iv) requiring the filing of information returns in respect of tobacco excise stamps;
(b) the federal excise duty framework for vaping products by increasing the excise duty rates for vaping products; and
(c) the federal excise duty framework for alcohol by
(i) extending by two years the two per cent cap on the inflation adjustment on beer, spirits and wine excise duties, and
(ii) cutting by half for two years the excise duty rate on the first 15,000 hectolitres of beer brewed in Canada.
Division 3 of Part 3 amends the Underused Housing Tax Act and the Underused Housing Tax Regulations by, among other things,
(a) eliminating filing requirements for certain owners;
(b) reducing minimum penalties for failing to file a return; and
(c) introducing a new exemption for residential properties held as a place of residence or lodging for employees.
Division 4 of Part 3 amends the Greenhouse Gas Pollution Pricing Act by providing authority, in certain circumstances, for the sharing of certain information amongst federal officials and for the public disclosure of certain information by the Minister of National Revenue.
Part 4 enacts and amends several Acts in order to implement various measures.
Division 1 of Part 4 amends the Budget Implementation Act, 2022, No. 1 to delay the repeal of the Prohibition on the Purchase of Residential Property by Non-Canadians Act for two years.
Division 2 of Part 4 amends the National Housing Act to increase the in-force limits for guarantees issued by the Canada Mortgage and Housing Corporation (CMHC) in respect of mortgage-backed securities and Canada Mortgage Bonds and for mortgage default insurance provided by CMHC from the temporary $750 billion to the permanent $800 billion. It also amends the Borrowing Authority Act to avoid the double counting of liabilities related to Canada Mortgage Bonds that are guaranteed by the CMHC and have been purchased by the Minister of Finance, on behalf of the Government of Canada, in the calculation of the maximum amount of certain borrowings under that Act.
Division 3 of Part 4 authorizes the making of payments to the provinces for the fiscal year beginning on April 1, 2024 respecting a national program for providing food in schools.
Division 4 of Part 4 amends the Canada Student Loans Act and the Canada Student Financial Assistance Act to expand eligibility for student loan forgiveness to early childhood educators, dentists, dental hygienists, pharmacists, midwives, teachers, social workers, psychologists, personal support workers and physiotherapists.
Division 5 of Part 4 amends the Canada Education Savings Act to, among other things,
(a) authorize the Minister responsible for that Act to open a registered education savings plan in respect of a child born after 2023 who is eligible for the payment of the Canada Learning Bond and is not the beneficiary under such a plan, so that the Minister may pay a Canada Learning Bond in respect of the child; and
(b) increase, from 20 to 30 years, the maximum age of a beneficiary under a registered education savings plan in respect of whom a Canada Learning Bond may be paid on application.
It also makes consequential amendments to the Income Tax Act .
Division 6 of Part 4 amends the Bretton Woods and Related Agreements Act to increase the maximum financial assistance that may be provided in respect of foreign states.
Division 7 of Part 4 amends the Bretton Woods and Related Agreements Act to increase the amount of the payment that the Minister of Finance may provide to the International Monetary Fund in respect of Canada’s subscriptions. It also amends the International Development (Financial Institutions) Assistance Act and the European Bank for Reconstruction and Development Agreement Act to provide for new financial instruments that the Minister of Foreign Affairs or the Minister of Finance, as the case may be, may use to provide financial assistance to the institutions referred to in those Acts.
Division 8 of Part 4 amends the International Financial Assistance Act to, among other things, provide that foreign exchange losses in relation to programs referred to in that Act must be charged to the Consolidated Revenue Fund and provide for the making of payments to Development Finance Institute Canada (DFIC) Inc. in relation to programs referred to in that Act out of the Consolidated Revenue Fund.
Division 9 of Part 4 amends the Export Development Act to lower the limit for total liabilities and obligations referred to in subsection 24(1) of that Act from $115 billion to $100 billion.
Division 10 of Part 4 amends the Financial Administration Act to broaden the application of subsection 85(2) of that Act to other Crown corporations.
Division 11 of Part 4 amends the Financial Administration Act to require certain banks and other financial institutions to disclose prescribed information for federal payments accepted for deposit.
Division 12 of Part 4 amends the Federal-Provincial Fiscal Arrangements Act to enhance the Canada Health Transfer for qualifying provinces and territories.
Division 13 of Part 4 amends the Pension Benefits Standards Act, 1985 to require that the Superintendent of Financial Institutions publish certain information relating to pension plan investments. It also amends the Pooled Registered Pension Plans Act to require that plan administrators provide specified information by written notice to certain persons when they become members of a pooled registered pension plan.
Division 14 of Part 4 amends the Canada Pension Plan to, among other things,
(a) provide for a death benefit of $5,000 in cases where no other Canada Pension Plan benefit, with the exception of the orphan’s benefit, has been paid in respect of the deceased contributor’s contributions;
(b) create a new child’s benefit for dependent children aged 18 to 24 who are in part-time attendance at school;
(c) maintain eligibility for the disabled contributor’s child’s benefit if the disabled contributor reaches the age of 65;
(d) allow for the deeming of an application for a disabled contributor’s child’s benefit on behalf of a child to have been made at an earlier date under the Canada Pension Plan ’s incapacity provisions;
(e) preclude entitlement to a survivor’s pension if an individual has received a division of unadjusted pensionable earnings in respect of their deceased separated spouse; and
(f) clarify the determination of the payee of the disabled contributor’s child’s benefit.
It also makes a consequential amendment to the Canada Pension Plan Regulations .
Division 15 of Part 4 amends the Public Sector Pension Investment Board Act to provide for the payment of certain amounts into the Consolidated Revenue Fund by the Public Sector Pension Investment Board.
Division 16 of Part 4 enacts the Consumer-Driven Banking Act , which establishes a consumer-driven framework for individuals and small businesses to safely and securely share their data with the participating entities of their choice.
It also makes related amendments to the Financial Consumer Agency of Canada Act to establish the position of Senior Deputy Commissioner for Consumer-Driven Banking who is responsible for consumer-driven banking matters and to provide for, among other things, the supervision of participating entities.
Division 17 of Part 4 amends the Bank Act to, among other things, clarify the definitions “deposit-type instrument” and “principal-protected note”.
Division 18 of Part 4 amends the Office of the Superintendent of Financial Institutions Act to increase to $100,000,000 the maximum amount that expenditures made out of the Consolidated Revenue Fund to defray the expenses arising out of the operations of the Office may exceed the Office’s total assessments and revenues.
Division 19 of Part 4 amends the Bank of Canada Act to clarify that the Bank of Canada may enter into repurchase, reverse repurchase and buy-sellback agreements.
Division 20 of Part 4 amends the Canada Business Corporations Act to
(a) harmonize fines for a corporation guilty of an offence related to the collection or sending of information regarding individuals with significant control; and
(b) set separate fines and imprisonment terms on the basis of a summary conviction or a conviction on indictment for a director, officer or shareholder of a corporation guilty of an offence related to individuals with significant control.
Division 21 of Part 4 amends Parts I to III of the Canada Labour Code to, among other things,
(a) provide that a person who is paid remuneration by an employer is presumed to be their employee unless the contrary is proved by the employer;
(b) provide that if, in any proceeding other than a prosecution, an employer alleges that a person is not their employee, the burden of proof is on the employer; and
(c) prohibit an employer from treating an employee as if they were not their employee.
Finally, it also includes transitional provisions.
Division 22 of Part 4 amends the Canada Labour Code to, among other things, set out certain employer obligations relating to policies respecting work-related communication and clarify certain employee rights and employer obligations relating to terminations of employment. It also includes transitional provisions.
Division 23 of Part 4 amends the Employment Insurance Act to extend, until October 24, 2026, the duration of the measure that increases the maximum number of weeks for which benefits may be paid in a benefit period to certain seasonal workers.
Division 24 of Part 4 amends section 61 of An Act for the Substantive Equality of Canada’s Official Languages in order to add a reference to subsections 18(1.1) and (1.2) of the Use of French in Federally Regulated Private Businesses Act in subsection 19(1) of that Act, which An Act for the Substantive Equality of Canada’s Official Languages enacts.
Division 25 of Part 4 authorizes a corporation that is to be incorporated as a wholly owned subsidiary of the Canada Development Investment Corporation to provide loan guarantees as part of an Indigenous loan guarantee program and authorizes the payment out of the Consolidated Revenue Fund by the Minister of Finance of amounts that are required in respect of those guarantees.
Division 26 of Part 4 authorizes the payment of up to $1.3 million to entities or individuals involved in the government’s engagement in a pilot project for the creation of a Red Dress Alert.
Division 27 of Part 4 provides that the subsidiary of VIA Rail Canada Inc. incorporated with the corporate name VIA HFR - VIA TGF Inc. is, as of the date of its incorporation, an agent of His Majesty in right of Canada and may enter into contracts, agreements and other arrangements with His Majesty as though it were not such an agent.
Division 28 of Part 4 amends the Impact Assessment Act , in response to the majority opinion of the Supreme Court of Canada on the constitutionality of that Act, to, among other things,
(a) align the preamble and purpose provision with the primary objective of that Act, which is to prevent or mitigate significant adverse effects within federal jurisdiction — and significant direct or incidental adverse effects — that may be caused by the carrying out of physical activities;
(b) replace the definition “effects within federal jurisdiction” with “adverse effects within federal jurisdiction” and, in doing so,
(i) restrict the definition to non-negligible adverse changes,
(ii) limit transboundary changes to those involving the pollution of transboundary waters and the marine environment, and
(iii) include, in respect of federal works or undertakings and activities carried out on federal lands, non-negligible adverse changes to the environment or to health, social and economic conditions;
(c) ensure that the impact assessment process applies only to those physical activities that may cause adverse effects within federal jurisdiction or direct or incidental adverse effects;
(d) ensure that, in deciding if an impact assessment of a designated project is required, one factor that the Impact Assessment Agency of Canada must take into account is whether another means exists that would permit a jurisdiction to address those effects;
(e) amend the final decision-making provisions to provide for an initial determination as to whether the adverse effects within federal jurisdiction and the direct or incidental adverse effects are likely to be, to some extent, significant, and then, if so, provide for a determination as to whether those effects are justified in the public interest; and
(f) improve cooperation tools to better harmonize the impact assessment process with the processes for assessing effects that are followed by provincial and Indigenous jurisdictions.
Finally, it also includes transitional provisions.
Division 29 of Part 4 amends the Judges Act to increase the number of salaries authorized for judges of superior courts other than appeal courts. It also reduces in a corresponding manner the number of salaries authorized for judges of provincial unified family courts.
Division 30 of Part 4 amends the Tax Court of Canada Act to provide that, if a party to a proceeding under the general procedure of the Tax Court of Canada is not an individual, that party must be represented by counsel, except under special circumstances.
Division 31 of Part 4 amends the Food and Drugs Act to, among other things, authorize the Minister of Health to
(a) establish rules for the purpose of preventing, managing or controlling the risk of injury to health from the use of therapeutic products, other than the intended use, or the risk of adverse effects on human beings, animals or the environment from the use of a drug intended for an animal;
(b) exempt any food, therapeutic product, person or activity from the application of certain provisions of that Act or its regulations; and
(c) deem, on the basis of decisions of, information or documents produced by, a foreign regulatory authority, that certain requirements of that Act or its regulations are met in respect of a therapeutic product or food.
Finally, it also includes a transitional provision.
Division 32 of Part 4 amends the Tobacco and Vaping Products Act to authorize the provision of customs information to the Minister responsible for that Act for the purpose of the administration and enforcement of that Act and to authorize that Minister to disclose information to other federal ministers for certain purposes.
Division 33 of Part 4 amends the Criminal Code to broaden the criminal interest rate offence to prohibit a person from offering to enter into an agreement or arrangement to receive interest at a criminal rate and from advertising an offer to enter into an agreement or arrangement that provides for the receipt of interest at a criminal rate. It also repeals the provision that requires the consent of the Attorney General prior to commencing proceedings related to the offence.
Division 34 of Part 4 contains measures that are related to money laundering, terrorist financing and sanctions evasion and other measures.
Subdivision A of Division 34 amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to, among other things,
(a) permit information sharing between reporting entities for the purpose of detecting and deterring money laundering, terrorist financing and sanctions evasion;
(b) authorize, subject to certain conditions, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) to disclose certain information to provincial and territorial civil forfeiture offices and to the Department of Citizenship and Immigration;
(c) authorize FINTRAC to publicize additional information pertaining to violations of that Act; and
(d) extend the application of that Act to cheque cashing businesses.
It also makes consequential amendments to the Personal Information Protection and Electronic Documents Act and the Cross-border Currency and Monetary Instruments Reporting Regulations .
Subdivision B of Division 34 amends the Income Tax Act and the Excise Tax Act to allow provincial or superior court judges, a judge of a superior court of criminal jurisdiction or a judge as defined in section 552 of the Criminal Code to grant on application by a Canada Revenue Agency official the authorization to use device or investigative technique, or procedure or otherwise do any thing provided in a warrant, for purposes of tax investigations.
Subdivision C of Division 34 amends the Criminal Code to provide for an order to keep an account open or active and for a production order to require the production of documents or data that are in a person’s possession or control on dates specified in an order that fall within the 60-day period after the day on which it is made.
Division 35 of Part 4 amends the Criminal Code to, among other things,
(a) create new offences in respect of motor vehicle theft, including an offence concerning the possession or the distribution of an electronic device suitable for committing theft of a motor vehicle, and in respect of criminal organizations; and
(b) add, as an aggravating factor, evidence that an offender involved a person under the age of 18 years in the commission of an offence.
It also makes consequential amendments to other Acts.
Division 36 of Part 4 amends the Radiocommunication Act to, among other things, prohibit the manufacture, import, distribution, lease, offer for sale, sale or possession of certain devices specified by the Minister of Industry. It also amends that Act to establish as an offence or a violation the contravention of that prohibition.
Division 37 of Part 4 amends the Telecommunications Act to, among other things, require telecommunications service providers to provide their subscribers with a self-service mechanism that allows them to cancel their contract for telecommunications services or modify their telecommunications service plan and to inform those subscribers before the expiry of their fixed-term contract, as well as in other specified circumstances, of other service plans that those providers offer. It also amends that Act to prohibit the charging of certain fees.
Division 38 of Part 4 amends the Corrections and Conditional Release Act to, among other things,
(a) provide that the Correctional Service of Canada is responsible for implementing any arrangement — approved by the Minister of Public Safety and Emergency Preparedness — entered into by the Commissioner of Corrections and the Canada Border Services Agency with respect to the support that the Service may provide to the Agency to assist in the exercise of certain powers or the performance of certain duties and functions;
(b) control the access of the inmates of a penitentiary to a designated immigrant station adjacent to the penitentiary and the access of the immigration detainees of a designated immigrant station to a penitentiary adjacent to the station; and
(c) provide that, in exigent circumstances, staff members of the Service may provide additional support to detention enforcement officers of the Agency to assist them in the exercise of certain powers or the performance of certain duties and functions.
It also amends the Immigration and Refugee Protection Act to define the term “immigrant station”, to provide that an area of a penitentiary may be an immigrant station only if it is designated under the Corrections and Conditional Release Act and to set out the circumstances under which a person detained under that Act may be detained in a designated immigrant station.
Finally, it provides for the repeal of those amendments on a specified date and includes a transitional provision.
Division 39 of Part 4 contains measures related to public debt and the borrowing of money.
Subdivision A of Division 39 amends the Financial Administration Act to clarify that certain regulations and directions do not apply to contracts related to the borrowing of money entered into by the Minister of Finance.
Subdivision B of Division 39 amends the Borrowing Authority Act to increase the maximum amount of certain borrowings.
Division 40 of Part 4 amends the Trust and Loan Companies Act , the Bank Act and the Insurance Companies Act to require certain financial institutions to make available information respecting diversity among directors and members of senior management.
Division 41 of Part 4 amends the Trust and Loan Companies Act , the Bank Act and the Insurance Companies Act to extend the period during which federal financial institutions governed by those Acts may carry on business.
Division 42 of Part 4 amends the Federal Courts Act to provide that the Federal Court has jurisdiction to hear applications for judicial review of decisions of the Social Security Tribunal on the extension of time to make a request for review or reconsideration under the Canada Disability Benefit Act . It also amends the Tax Court of Canada Act and the Department of Employment and Social Development Act to, among other things, provide the Tribunal with jurisdiction to hear appeals of decisions made under the Canada Disability Benefit Act and require that matters related to income raised in those appeals be referred to the Tax Court of Canada.
Division 43 of Part 4 amends the Controlled Drugs and Substances Act to repeal provisions related to the ministerial power to exempt supervised consumption sites from the application of that Act. It also amends that Act to allow for the making of regulations respecting authorizations for supervised consumption and drug checking services and includes transitional provisions.

[Blaine Calkins, Conservative, Red Deer—Lacombe, AB]

I have a little bit of time and I want to make my point.

The point is that if Health Canada has made an error in judgment in labelling a nicotine pouch as a natural health product instead of labelling it as a product under the tobacco and vaping products legislation and regulations, that would be something for which you wouldn't need the powers here.

Every power I see in Bill C-69 for the Food and Drugs Act deals with “other than the intended use”. It's in the supplementary rules for a therapeutic product. In the promotion, it's “other than the intended use”; under uncertainty, it's “other than the intended use”.

This is all about off-label use. It has nothing to do with the existing powers that the government has in order to properly regulate these products, categorize them and sell them appropriately in the Canadian marketplace.

Am I missing something?

[Blaine Calkins, Conservative, Red Deer—Lacombe, AB]

Thank you, Chair.

Mr. Buckley, I'm assuming you're listening to the testimony here today.

Mr. Arango, in his previous answer to a question, indicated that the government already has a regulatory process started and a gazetting process going, whereby these pouches or nicotine.... I don't think anybody here is arguing that we should be getting these things out of the hands of kids. Nobody here is making that argument. We're simply trying to draw a line between what the minister has said in defence of Bill C-69 and the Food and Drugs Act, and whether or not the government actually needs the power to do so.

Mr Buckley, you strongly argue that the government already has the ability to do so. My colleague Mr Davies just mentioned the Tobacco and Vaping Products Act.

If that's the case, what would prevent the minister...? Does the minister have the power right now?

Let's say one of these nicotine pouches had a natural product number. Could the minister pull that natural product number from that product? It's just a simple yes or no.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

You can give me your general impressions.

What would you suggest, for example, with regard to the separate study of division 31 of Bill C-69?

Do you have any responses to the arguments advanced? On what arguments are the suggestions you're making to the committee based?

[Blaine Calkins, Conservative, Red Deer—Lacombe, AB]

On the supplementary rules under therapeutic products, right now there's a bill in the House, Bill C-368, that seeks to undo the changes that were made in Bill C-47 in relation to therapeutic products.

As the voice of the Natural Health Product Protection Association, if Bill C-368 does pass in its current form, can you tell us what impact that could have for the natural health product industry in regard to changes in Bill C-47, and now in Bill C-69, should they pass in their current form?

[Blaine Calkins, Conservative, Red Deer—Lacombe, AB]

My assessment of the minister's arguments in using nicotine pouches and flavoured vaping products as a rationale for this power grab, both in Bill C-47 and in Bill C-69, is that they're a bit of a red herring.

Under the Food and Drugs Act as it existed even before Bill C-47, Health Canada has the ability to stop the sale of any product it deems unsafe. It has the ability to seize any product. It has the ability to stop any personal use imports across the border if it wants to. It could mandate a label change, adding any warnings that it wants to, and it can withdraw any natural product number. It actually approves a natural product number in the first place, and it has the power therein to withdraw a natural product number.

Is the issue actually the regulated use and sale of these nicotine pouches or is it actually the contraband sale of these nicotine pouches?

[Blaine Calkins, Conservative, Red Deer—Lacombe, AB]

Thank you, Chair.

I will start my questions with Mr. Buckley.

Going back, Bill C-69 is a budget implementation act. It's not an actual act tabled by the health minister. It's an act tabled by the finance minister. These are substantive changes to the Food and Drugs Act. This follows on the heels of other substantive changes to the Food and Drugs Act passed last year in the budget implementation act bill, Bill C-47.

Do you and your organization have any comments for this committee about the appropriateness of having these discussions in a finance committee rather than tabling an individual piece of legislation that specifically deals with health and can be scrutinized and vetted through the appropriate channels here in our Parliament?

[Manuel Arango, Vice-President, Policy and Advocacy, Heart and Stroke Foundation of Canada]

Thank you very much, Mr. Chair.

Heart and Stroke appreciates the opportunity to appear before this committee to discuss Bill C-69, the budget implementation act.

I would like to address four measures today that were included in budget 2024, namely the school nutrition program funding, tobacco and vaping taxes, measures to address nicotine pouches, and pharmacare funding.

First, the $1-billion investment over the next five years to implement a national school nutrition program will greatly benefit the health and well-being of children in Canada. This investment is important to the one-third of students in elementary schools and two-thirds of students in secondary schools who do not eat a nutritious breakfast before school, leaving them at risk for learning, behavioural and health challenges at school.

The reality is that food insecurity puts people at risk for various chronic diseases, including heart disease and stroke. The annual economic burden to Canadians of chronic diseases, which is attributed to unhealthy eating and other modifiable risk factors, has been estimated at a staggering $28.2 billion. Canada is seeing increases in the rates of illnesses, such as type 2 diabetes, heart disease and cancer, much of it stemming from poor diets. In 2019, dietary risk factors contributed to an estimated 36,000 deaths in Canada.

Evidence shows that school food programs help to produce better health and education outcomes, including a reduction in the risk of chronic disease and improved mental health, as well as improved concentration and learning, which are associated with improved graduation rates.

School food programs can have significant positive economic impacts. A preliminary University of Guelph study suggested that a national program could stimulate the development of over 200,000 jobs. Also, a national school nutrition program can help to educate our kids on the value of local agriculture and the important role that local farmers play in supporting healthy diets. It will be key for this measure to be implemented, given that Canada is the only G7 country without a national school food program.

Heart and Stroke is also pleased to see strong action on tobacco and vaping control by way of increased taxation. Smoking remains the leading risk for premature death and disability in Canada. It places a burden on our economy, with over $11 billion in lost productivity and health care costs in 2020.

Also, Canada has some of the highest youth vaping rates in the world. The reality is that increased taxes on tobacco and vaping products are one of the most effective strategies to reduce consumption, especially among price-sensitive youth and young adults. Young people have lower disposable incomes, and research shows that they are more sensitive to e-cigarette and tobacco price increases.

Heart and Stroke is also pleased to see the federal government's resolve to move towards a healthier nicotine-free generation. The budget includes a proposed amendment to the Food and Drugs Act that will help address the alarming uptake of nicotine pouches amongst our youth. The reality is that the unregulated sale of nicotine pouches, such as Zonnic, is a real danger to young people in Canada. With attractive flavours, such as Tropic Breeze, Chill Mint and Berry Frost, and colourful small packages, these packages entice youth to try nicotine pouches. The devastating result is that youth will become trapped in a cycle of nicotine addiction.

This proposed amendment will restrict the marketing, restrict the use of attractive flavours, impose a minimum age for sale, require placement of these products behind the counters at pharmacies, and impose warning labels and other measures. These are key to helping to protect our youth from these harmful products.

Finally, as a last point, the allocation of $1.5 billion in funding over five years to support the launch of the national pharmacare program is critical in order to improve drug coverage among the seven and a half million people in Canada with no insurance or inadequate insurance. The current patchwork of public and private plans in Canada has created fragmented drug access, leaving millions struggling to afford their prescription medications.

While many people in Canada have some form of drug coverage, it is often not sufficient and poses affordability issues for some. A 2024 poll commissioned by Heart and Stroke and the Canadian Cancer Society found that one in five people in Canada do not have sufficient prescription drug coverage. Over one in four Canadians had to make difficult choices in order to afford prescription drugs, such as cutting back on groceries; delaying paying rent, mortgage or utility bills; and/or incurring debt.

One in 10 people in Canada diagnosed with a chronic health condition were more likely to visit an emergency room due to a worsening health issue because they were not able to afford their prescription medications.

People with diabetes are more likely to develop heart conditions at a younger age and are three times more likely to die of heart disease. As such, the budget 2024 investment in pharmacare will support 3.7 million people in Canada living with diabetes in managing their condition at home. It will also reduce their risk of developing heart conditions, among other complications.

We hope to see the coverage expanded to cover heart disease and stroke drugs in the near future.

I'll be happy to address any comments or questions. Thank you very much.

[Stephen Hazell]

Thank you.

I would say that we are looking for several amendments to the impact assessment as amendments to Bill C-69. The government has covered off the constitutional issues that the Supreme Court of Canada has raised. We think that's been done adequately, but they have overreacted to that. They fear another court challenge.

Our view is that with the changes that the environmental community has provided to the committee, and I think several parties as well, those issues relating to transboundary issues can be corrected. We can ensure that the federal government can do assessments to the limits of its constitutional authority.

Thank you for that opportunity.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Then I'd like to ask Mr. Turnbull, who represents the government on this committee, to make those analyses public and available. As he said, carbon pricing is widely discussed in Canada. So that would add to the information the public has on the subject.

Now getting back to the budget, Mr. Giroux, my question concerns a somewhat technical aspect that troubles me, so I'd like to hear your opinion on it. You said in your analysis that the government had announced $61.2 billion in new spending that was partially offset by $21.9 billion in revenue-raising measures. We're eagerly awaiting the bill respecting the main revenue-raising measure, and we're obviously awaiting your analysis of that measure as well.

However, when I received the notice of ways and means motion, I was surprised to see that the measure wasn't in it. It isn't in Bill C-69 either. However, as I understand it, when the government announces measures in the budget, such as changes to capital gains taxation, it has to table a ways and means motion and then a bill.

Is it normal for that kind of measure announced in a budget not to appear in the notice of ways and means motion or in the bill to implement the budget?

[Yves Giroux, Parliamentary Budget Officer, Office of the Parliamentary Budget Officer]

Mr. Chair, members of the committee, thank you for inviting me to appear before you today.

First, I'd like to say a few words about the office's work on carbon pricing.

In April of this year, in the course of reviewing and updating our computable general equilibrium or CGE model, PBO staff discovered that the original CGE simulations underlying our March 2022 distributional analysis of carbon pricing inadvertently included the economic impact of both the federal equivalent fuel charge and the output-based pricing system. CGE estimates from these simulations were published in our March 2022 report, table 3-1, and were also used in the update to that report that we published in March 2023.

Weeks ago, on April 17, we published a notification flagging this modelling issue. It appeared on the home page of our website. The notification also indicated that we plan to provide an updated analysis of carbon pricing by the fall of this year.

I am truly sorry for this modelling error and for not providing more prominent notification to parliamentarians.

PBO staff are working diligently to prepare this update to incorporate recent policy changes, new projections and new CGE modelling. This analysis is challenging and complex, involving multiple models, programs and databases. We will publish updated analysis when we have full confidence in our results.

Further, going forward, I will ensure that parliamentarians are provided with more prominent notification should similar issues arise.

I would now like to discuss the reason for our appearance today, which is Bill C-69, An Act to implement certain provisions of the budget tabled in Parliament on April 16, 2024.

I am joined today by Chris Matier and Mark Mahabir, directors general in my office.

On April 30, my office published an analysis including highlights of Budget 2024. In that budget, the government announced $61.2 billion in new spending that was partially offset by $21.9 billion in revenue-raising measures. Thus, on a net basis, the new measures reduce the budgetary balance by $39.3 billion over 2023–2024 to 2028–2029.

My office has also published cost estimates for measures included in budget 2024, including the refusal of tax deductions for short-term rental, employee ownership trusts, Canadian journalism labour tax credit enhancement and accelerated capital cost allowance for eligible new purpose-built rental housing. We also published a blog post on increasing the borrowing limit.

In the coming weeks, my office will publish further analyses on measures announced in the 2024 budget, including the capital gains inclusion rate increase, the Canada disability benefit, an investment tax credit for clean energy, tax reduction for entrepreneurs and an update on the alternative minimum tax measures.

We are also preparing to publish analyses on reaching NATO's 2% target on defence spending, as well as the procurement of polar icebreakers. These analyses aim to provide parliamentarians with important information on key issues to inform your discussions about the country's economic and financial situation.

We would be pleased to respond to any questions you may have regarding our budget 2024 analysis. Merci.

[Stephen Hazell, Consultant, Nature Canada]

Good morning, Mr. Chair and committee members.

My name is Stephen Hazell and I am pleased to represent Nature Canada.

Thanks so much for the opportunity to appear before the committee as it considers Bill C-69, and specifically the amendments to the Impact Assessment Act.

Nature Canada is one of the oldest nature conservation charities in Canada, representing a network of over 130,000 members and supporters.

Nature Canada's key message today is that the proposed government amendments to Bill C-69 would severely undercut federal authority to assess impacts of proposed projects that cause serious transboundary environmental effects, such as acid gas, greenhouse gas emissions and reduced water flows in transboundary rivers.

Recall that the Supreme Court of Canada's October 2023 opinion confirmed the federal authority to carry out impact assessments of development projects as long as those projects have the potential to impact federal jurisdiction. The court opined that several IAA provisions strayed out of the federal constitutional lane. The government's proposed amendments fully address these issues, in Nature Canada's view.

Unfortunately, the government's amendments overreact to the court's opinion. The result is that proposed developments generating millions of tonnes of toxic air pollutants and GHGs or causing major reductions in transboundary water flows would not be subject to even the possibility of federal assessment.

Here are two examples of what I'm talking about, based on my own personal experience from over 40 years as an environmental lawyer working in Ottawa.

First, Colacem, a multinational corporation, is proposing a cement plant on the shores of the Ottawa River in Ontario, a few kilometres east of the province of Quebec, 70 kilometres upwind of Montreal and 50 kilometres upwind of Kanesatake First Nation. The Colacem plant would produce one megatonne of GHGs every year, as well as acid gas pollution in excess of Canadian standards.

The Kanesatake First Nation opposes the plant and says it was not consulted. No one consulted Quebec either. Ontario conducted no impact assessment, and Quebec was unable to undertake one, given that it wasn't on Quebec territory.

In 2018, Nature Canada petitioned the federal environment minister to convene a federal assessment of the proposed cement plant. That petition and a subsequent one were rejected.

The point is that the government's proposed Impact Assessment Act amendments would prevent a federal environment minister from even entertaining a request to designate any similar project generating significant transboundary air pollution, leaving downwind provinces—not to mention the United States—at the mercy of upwind provinces.

Nature Canada proposes that the IAA allow projects such as the Colacem cement plant to be designated for assessment so long as the transboundary air pollution is significant. Nature Canada is confident that the test for national concern under “peace, order and good government” as set out out by the Supreme Court in the previous Greenhouse Gas Pollution Pricing Act reference, can thus be met—perhaps with a backstop provision.

My second example is from 1986. Saskatchewan proposed the Rafferty and Alameda dams on the Souris River, which flows south into North Dakota before looping north to join the Assiniboine River, which flows through the middle of Mr. Morantz's riding.

Changes to the quantity and timing of transboundary water flows of the Souris were the key environmental issues at the time, not damage to fish habitat. Initially, the federal government refused to convene an environmental assessment for Rafferty and Alameda, but did so after the Canadian Wildlife Federation—where I served as legal counsel—applied successfully to the Federal Court for an order mandating an assessment.

My second point is that the government's amendments would preclude the federal government from assessing the impacts of such dams or other types of projects, like irrigation schemes, on transboundary waters.

Nature Canada says all adverse changes to international and interprovincial waters—not just pollution-related changes—should be included as effects within federal jurisdiction. The full text of these amendments is contained in amendments that have been tabled with the committee by several parties, as well as by other groups, such as Ecojustice.

Nature Canada recognizes that provinces may challenge the amended IAA in court. However, given that climate chaos and destruction of nature are the issues of this century, the federal government must face such challenges and advance impact assessment legislation that aggressively supports climate stability and nature conservation within federal jurisdiction.

Thank you very much.

[Carolyn Webb, Knowledge Mobilization Coordinator, Coalition for Healthy School Food]

Thank you. Good morning.

On behalf of the Coalition for Healthy School Food, I want to thank you, Mr. Chair and the committee, for inviting me to speak on the Budget Implementation Act.

The Coalition for Healthy School Food is made up of more than 300 non-profit member organizations and over 140 endorsing organizations from all provinces and territories. We've been advocating federal funding for a cost-shared national school food program for years, and we were pleased with its inclusion in the April 16 budget.

This is a historic moment for Canada. Thanks to this investment, we will be joining all the other G7 countries and most industrialized countries in the world by establishing a national school food program. This investment is the result of an excellent social and economic policy that will ensure that children and youth at schools across the country are well fed, ready to learn and have an equal opportunity to succeed. It will also help families by lowering grocery bills and will support women and parents, food suppliers, food systems, employment, economic growth and communities.

As stated by a recent World Food Programme report, all the evidence shows that school meal programs, along with other social protection initiatives, are one of the smartest long-term investments that any government can make. Since 2023, we've seen more and more provinces and territories invest in school food, including $214 million over three years in British Columbia, $30 million annually committed by Manitoba and $18.8 million in Nova Scotia. As of the 2024-25 school year, the combined investment from provinces, territories and municipalities is projected to be over $285 million annually.

Despite growing investments from other levels of government, programs need federal support now more than ever. In Ontario, for example, the affordability crisis and other factors have made it so that programs are really struggling to feed the children and youth who access them. Over the past three years, student nutrition program providers report that food expenses have increased by 40% to 80%, while student participation rates have risen by 25% to 40%. This has impacted the quality and quantity of the food served in programs: Some regions can no longer serve a full meal and offer a simple snack like a granola bar instead, while others have reduced the number of days that they serve kids or have had to shut programs down months before the end of the school year because they've run out of money.

Federal funding will provide enormous support to existing programs in this country. This funding is necessary and should be disbursed as soon as possible. Although all the federal, provincial, territorial and municipal investments combined aren't enough to reach all children and youth in Canada, federal funding will help existing programs ensure that students are well fed, that schools stay off waiting lists and that far more students are included in school food programs. These programs will be able to stabilize, expand and adopt best practices, in particular by involving students in planning, growing, preparing, serving and learning about foods and by providing good jobs. They can also purchase more local foods, which, as we all know, generates significant benefits for food suppliers and communities.

The coalition has been advocating that federal funding be be transferred to provinces and territories because each province and territory has an existing system in place to flow funding to school food providers, along with a mechanism for public accountability. All provinces and territories also have food and nutrition policies that strive to ensure that the food served is as healthy as possible. We know that many provinces and territories have reached out to Minister Sudds to express their support and their interest in federal partnership, because school food programs need a significant amount of investment to serve quality programs, to support the health and well-being of children and youth and to succeed.

The coalition has also been advocating that the federal government enter into discussions with indigenous leaders to negotiate agreements for the creation and enhancement of permanent, independent, distinctions-based first nations, Métis, and Inuit school meal programs, and we ask that this work happen without delay.

We recommend that your committee ensure implementation of the budget, which states:

In Budget 2024, the government proposes to provide a statutory appropriation authority in the Budget Implementation Act that would enable the Minister of Families, Children and Social Development to sign bilateral agreements and transfer funding to provinces and territories to support National School Food programming for the 2024–2025 school year.

For the health and well-being of children, youth and families across Canada, we urge you to support the budget implementation act so that this process of signing bilateral agreements can begin as soon as possible.

Thank you.

[The Chair, Liberal, Peter Fonseca]

I call this meeting to order.

Welcome to meeting number 146 of the House of Commons Standing Committee on Finance.

Pursuant to the House of Commons order of reference adopted on Wednesday, May 22, 2024, and Standing Order 108(2), the committee is meeting to discuss Bill C-69, an act to implement certain provisions of the budget tabled in Parliament on April 16, 2024.

Before we begin, I would like to ask all members and other in-person participants to consult the cards on the table for guidelines to prevent audio feedback incidents. Please take note of the following preventative measures in place to protect the health and safety of all participants, including the interpreters. Only use the approved black earpiece. The former grey earpieces must no longer be used. Keep your earpiece away from all microphones at all times. When you're not using your earpiece, place it face down on the sticker that is on the table for this purpose.

Thank you all for your co-operation.

Today's meeting is taking place in a hybrid format, pursuant to Standing Order 15.1.

In accordance with the committee's routine motion concerning connection tests for witnesses, I'm informing the committee that all witnesses have completed the required connection tests in advance of the meeting.

I'd like to make a few comments for the benefit of the members and witnesses.

Please wait until I recognize you by name before speaking. For members in the room, please raise your hand if you wish to speak. For members on Zoom, please use the “raise hand” function. The clerk and I will manage the speaking order as best we can, and we appreciate your understanding in this regard. I remind you that all comments should be addressed through the chair.

I'd like to welcome the witnesses with us here today.

From the Centre for Future Work, by video conference, we have Jim Stanford, economist and director.

From the Coalition for Healthy School Food, we have Ms. Carolyn Webb, knowledge mobilization coordinator.

From Nature Canada, Mr. Steve Hazell, consultant, is joining us.

From the Office of the Parliamentary Budget Officer, we have the Parliamentary Budget Officer, Monsieur Yves Giroux. Joining him is Chris Matier, director general of economic and fiscal analysis, and Mark Mahabir, director general of costing and budgetary analysis. Welcome to you all.

With that, we're going to have time now for opening statements.

We'll start with Mr. Jim Stanford from the Centre for Future Work, for up to five minutes.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Green.

We want to thank our excellent witnesses. Thank you for coming before the finance committee on Bill C-69. We wish you the best with the rest of your day.

Members, we are adjourned.

[Mark Weber, National President, Customs and Immigration Union]

Mr. Chair and members of the committee, thank you for the opportunity to address the finance committee today.

My name is Mark Weber. I appear before you today as a member of the national board of directors of the Public Service Alliance of Canada, which represents 245,000 members, most of whom are federal public service employees. Many also work for post-secondary institutions, territorial governments, non-profits, indigenous organizations and even some private employers. I am also the national president of the Customs and Immigration Union, a component of the PSAC, which represents over 12,000 employees of the Canada Border Services Agency. That includes 9,000 members of the border services group, who have now been without a contract for two years.

On the positive side, budget 2024 provides significant funding for post-secondary students, workers and institutions, especially in remote locations. This is good news for our members in that sector, and we congratulate the government on these announcements.

We suggest that the list of eligible professions include occupational therapists. Also, if not already included in the definition of “nurse”, please include registered practical nurses, RPNs; licensed practical nurses, LPNs; and registered nurses. Ideally, distribution of these funds would happen no later than 30 days after the act receives royal assent.

Bill C-69 provides language that clarifies in the Canada Labour Code that employers are responsible for properly identifying employees as such, instead of skirting responsibilities by claiming that they are contractors. This is also a welcome and long-overdue change for Canadian workers.

We are also pleased to see language around an employee's right to disconnect during non-work hours. Unfortunately, this section makes some of the same mistakes that the Ontario government has made in its changes to Ontario's Employment Standards Act and should include minimum standards that apply to all workers and employers, along with meaningful penalties for breaches of these standards.

While the elements mentioned above are certainly positive, we are concerned that the budget and the bill leave out some important aspects. There is no money for Phoenix damages or increased funding to hire and retain more staff to deal with the nearly half-million Phoenix cases still in the backlog currently. There is no money to increase capacity at the pay equity commission, which is sorely behind.

Even more concerning are two issues that are included in Bill C-69.

First, changes are made to the Public Sector Pension Investment Board Act. We understand from different sources that these are housekeeping changes made so that the Treasury Board can move money to and from members' plans in the case of a non-permitted surplus, or possibly in the case of increased draws from the plan or reduced revenues. The federal government would do well to remember that any surplus that may be realized will have been built on employee contributions. Before any move is made to use that surplus for government spending, it is essential that members be consulted and that inequities be rectified.

One such inequity is the differential treatment for public safety occupations. The PSAC has long called on the federal government to provide border officers, federal defence firefighters and fisheries officers with pension provisions equivalent to their peers in public safety divisions of other departments and governments. Right now, CBSA officers, federal firefighters and fisheries officers must work at least five years longer than their peers, leaving them at increased risks for occupational diseases and injuries, and making recruitment and retention increasingly difficult as well. The fact that the federal government continues to refuse to implement the simple legislative changes that would correct this inequity is deeply insulting to our members. Budget 2024 is a chance for the government to change this.

We also have questions about proposed changes to the corrections act to permit the housing of immigration detainees in federal correctional facilities. As the bargaining agent for CBSA, Correctional Services and immigration workers, PSAC must be consulted on any changes to job classifications, locations of work and responsibilities. Who will provide what service to detainees under this new framework? How will jobs interact and overlap, and will the government confirm that services will not be contracted out? Public safety duties should never be offloaded to the lowest bidder, and private security companies have no role to play in these or any public institutions if we wish to ensure the integrity of sensitive public safety processes.

I thank the committee and look forward to your questions.