Canadian Heritage Committee on Nov. 2nd, 2017

[The Chair, Liberal, Hedy Fry]

I will call the meeting to order.

Pursuant to Standing Order 108(2) and the motion adopted on Monday, October 2, 2017, the minister is here to give us a briefing on the government's new cultural policy.

Minister, you've been around this block before, so you know you are going to say a few words, and after that there will be questions and answers. Without any further ado, please begin.

[Mélanie Joly, Liberal, Minister of Canadian Heritage]

Thank you, Madam Chair. I'm pleased to be here today to talk about a Creative Canada, our government's vision for the future of Canada's creative industries. I'm joined by Graham Flack, my deputy minister, and also Guylaine Roy, the associate deputy minister.

Let me start with two questions. Why has culture always mattered to Canadians, and why should it matter now? The answers to these questions are fundamentally about who we are and who we want to be. We are a small diverse population spread over a large land mass. We're a country bound by reconciliation and shaped by the rich cultures and traditions of indigenous people.

We are a country rooted in our official languages, English and French—

We celebrate the fact that 8 million francophones live surrounded by hundreds of millions of English-speakers.

We are a democracy that believes in gender and racial equality and human rights. We are a culturally diverse country that looks like the world. All of these things make our culture and our identity dynamic, and this strength is reflected in our creative industries. Our arts and culture sector is a $54.6-billion industry that boasts more than 630,000 jobs. Behind each of those jobs is a talented, hard-working individual.

It is because of these people that we invested $1.9 billion in our arts and culture in our very first budget, budget 2016, the highest investment among G7 nations at the time. This investment included commitments of $675 million to CBC/Radio-Canada, $550 million to the Canada Council for the Arts, and increased funds for Telefilm Canada and the National Film Board of Canada, among others.

This is just a first stage. A lot remains to be done. So I decided to bring together the players in our creative industries in order to better understand the challenges facing us and to determine what is possible.

More than 30,000 Canadians took part in that process. They shared with me the challenges they have to face, their ideas, and many opportunities that are open to us.

So here is the major question: how do we protect and promote our culture in a digital world with no borders?

The comments I heard first-hand shaped our government's vision for a Creative Canada. In addition to the consultations, we took action in a number of areas. There were, of course, some concrete steps we could take.

First, our historic investments, as I have already mentioned. Let me give you a little background here. When I took this position, a bond of trust had to be re-established with the cultural community. After 10 years of underinvestment and budget cuts, we wanted to show the cultural sector how important it is. That is why we have made historic investments in culture.

Last August, we also referred two broadcasting decisions back to the Canadian Radio-television and Telecommunications Commission, the CRTC, for its reconsideration, and we asked it to consider how it can help us in achieving the right balance between two necessities: investment in content and our creators' ability to compete.

We also committed $35 million over two years to help export our culture. This area had seen budget cuts and we wanted to continue our efforts in cultural diplomacy and international trade in the creative industries.

We invested $4.15 million over two years in the Canada Music Fund. One hundred musicians have been able to reap the benefits of this investment alone. We also launched an independent process for the appointment of the President and CEO of CBC/Radio-Canada, as well as the members of its board of directors.

Last September 28, I delivered a speech outlining this new vision, Creative Canada, along with the first initiatives to help us get there. This vision has a clear goal: for Canada to be a world leader in the quality of our creative industries, with our creators empowered to make great content that stands out at home and around the world, and for Canada to be a pioneer in ensuring a space on all existing digital platforms for our Canadian content.

We want to retain our incredible talent at home and encourage our people to develop their ideas into great stories. We want to entice them to take risks and innovate on many platforms.

We want to help them distribute their work at home and abroad.

We are going to support the creation of high-quality content in French because of the excellent work our creators do.

Our vision rests on the three pillars.

First, we want to invest in our creators and their stories. We will do this in a number of ways. For example, to combat the declining revenue for cable distributors in the Canada Media Fund, we will increase the federal contribution to this fund by several million dollars, ensuring that one third of the funding goes to French-language projects.

We are going to support cultural hubs, like the Cape Breton Centre for Arts, Culture and Innovation, the 312 Main project, or the Société des arts technologiques, or SAT. We are going to modernize programs like the Canada Music Fund and eliminate red tape for tax credits. We are going to reform the Copyright Board Canada and modernize the Copyright Act.

These measures will help us build on our strengths and our unique content, a content that reflects our linguistic duality, indigenous expression and rich cultural diversity.

Our second pillar is making sure our content is discovered and distributed across Canada and around the world. In this area we ask ourselves two main questions. First, we ask how we ensure that we have a strong domestic market. Second, in the global hunt for stories, we ask how we make sure that Canadian content stands out and can reach audiences around the world.

We are responding to these questions in a number of ways. We're investing $125 million over five years to support Canada's first-ever creative export strategy, which will put boots on the ground at embassies and missions, increase our presence at international events, and help our creative industries access new markets.

As part of this strategy, I will be leading Canada's first creative industries trade mission to China in April, 2018. In addition, we're launching a review of the Broadcasting Act and the Telecommunications Act. We have asked the CRTC to look at how new models will support the creation and distribution of Canadian entertainment and information, and we will be launching a Creative Industries Council to foster collaboration and innovation within our creative industries. We will use the tools we have to ensure that companies coming into Canada contribute to our goals, including supporting content in both official languages.

Since our existing tools do not take into account the existence of digital platforms, our government thought it necessary to subject the Netflix investment to a review under the Investment Canada Act. The investment encompasses the following: first of all, the creation of Netflix Canada, the first production company of its kind for Netflix outside of the United States; second, a minimum net investment of $500 million for original productions in Canada in English and French over five years; and third, $25 million for a French-language market development strategy that targets creators and producers inside and outside of Quebec and helps them fund things like pitch days for producers and recruitment events. These investments will help showcase our Canadian productions on their platform, representing a guaranteed minimum investment from a foreign platform in our creators and in our stories.

I'll turn now to our third pillar, which is strengthening public broadcasting and supporting local news. I want to recognize the hard work of this committee on this issue. Thanks to all. Your rigorous review, witness testimony, and findings helped identify clear concerns and confirmed that Canadians care deeply about the issue. The measures announced included renewing and strengthening the mandate of our public broadcaster; reviewing the Canada Periodical Fund to provide the support that our publications need to innovate, adapt, and transition onto the platforms Canadians choose; and supporting local news by encouraging innovation, experimentation, and the transition to digital.

We continue to work on a whole-of-government approach to these issues facing local news, which we know is critical to our democracy.

In conclusion, Creative Canada is a new strategy that puts in place investments in our creators and our creative industries. It is a plan for reform, a transition plan. It is the logical continuation of the leadership that our government has always demonstrated on this important file. So we are half-way through it and a lot remains to be done.

I recognize that the change brings with it some anxiety, there is no doubt. That is why we are embarking on this great reform in all humility. Our government's objective is to improve the lot of the French and English cultural sectors and to allow them to grow.

We owe it to our creators, to our incredible talents and to the many middle-class families across this country who work in this booming industry, to come together and help us forge a distinctly Canadian path forward.

I will be happy to answer all my colleagues' questions.

[The Chair, Liberal, Hedy Fry]

Thank you you very much, Minister.

As always, we will begin with a seven-minute question-and-answer round. We'll start with Julie Dabrusin for the Liberals.

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

Thank you, Minister, for coming today to talk about your Creative Canada vision. In my community, this is something that has generated a lot of interest and excitement, so I'm happy to be able to talk with you a bit more about it today.

Today, in fact, is a great day, because we have the Canadian Arts Coalition here for its Arts Day on Parliament Hill. I know you have many people here who are listening with regard to that. One of the recommendations that I believe they made was with respect to cultural hubs and creative hubs. You mentioned it in your opening statement, but I wonder if you could talk about your vision for creative hubs in Canada.

[Mélanie Joly, Liberal, Ahuntsic-Cartierville, QC]

Thank you, dear colleague.

Of course, we believe there are different ways, new and innovative ways, for our artists and creators to do their work and create. In the context of our reinvestments in cultural infrastructure, which are up to $300 million, we've decided to set aside part of that money to make sure we would be supporting these great creative hubs, projects such as Artscape Daniels Launchpad in Toronto; the Cape Breton Centre for Arts, Culture and Innovation, the new hub that was just announced by your colleague two weeks ago; and 312 Main in Vancouver. These hubs are key infrastructure in our creative sector that will help our creators and our creative entrepreneurs to actually take ideas and create great content with them and create great businesses, SMEs. That's why we believe this infrastructure is extremely important, to grow the sector and scale it. Not only that, but they will also help different sectors from the arts and creative industries to partner, and there will be a lot of cross-pollination happening. It's great news.

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

Perfect. Thank you.

I've talked with a lot of people in the design and architectural field over the past years. One of the things they talk about is that sometimes when they're dealing with the federal government, it's not clear where those industries fall, whether within innovation or within heritage. When you put forward your vision for creative Canada, where do architecture and design fall?

[Mélanie Joly, Liberal, Ahuntsic-Cartierville, QC]

That's a great question. When we decided to embark on this great adventure to create a new cultural policy for the country, we looked at different models across the world. One of the models that we thought was very interesting was the U.K. one. We were inspired by the U.K. model whereby, rather than including in the cultural sector only sectors such as music, performing arts, film, and television, which are much more traditional sectors, we decided to broaden the definition of our sector to include design, fashion, and architecture.

We'll be creating a new creative industries council with people from all the sectors across our great milieu to ultimately advise us on how we could improve our policies and programs to reflect that change in definition.

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

That's wonderful. I think that's going to be very well received by people I've been talking to in the design industry, so thank you for that.

I mentioned that today is Arts Day on the Hill, but yesterday we also had another group on the Hill. The Canadian Association of Content Exporters were here to talk with members of Parliament about the work they're doing to export screen productions to international markets.

You touched on it briefly, but I would like to hear a little bit more from you about what is in Creative Canada as a vision to help our cultural industries when they go to export markets, and to export their products.

[Mélanie Joly, Liberal, Ahuntsic-Cartierville, QC]

When you look at what we've done with the policy, we've actually made a big shift. We decided that our creators were the most important players in the industry, in the sense that we wanted to focus all our policies toward creators. We believe that by supporting a great idea, there's going to be great content that will be developed. It may be a book, it may be a film, it may be music. By doing that, we want to support risk-taking and also excellence in the sector.

Once there's great production, of course we know there's a global hunt for stories. We know, with the Internet being international by nature, that there are great markets that our creators can access and seize opportunities within. We've reinvested $125 million over five years. That will put boots on the ground in embassies, whether that means hiring people who are from the city or the region who know the market, to help our artists and creators actually enter these markets and seize their opportunities.

We also want to make sure that Canada is really present in international affairs. Content exporters need to be supported by the government to actually access these markets, meet the right people, and make these deals happen. That's why we were present at the gamescom conference for video games in Cologne this year. My colleague Sean Casey was there, well representing our country. That's why we'll be there for the Frankfurt book fair. We'll be the host of honour at the Frankfurt book fair in 2020. That's also why we're doing our first cultural trade mission to China in April. We want to bring lots of great representatives of the industry—from Cirque du Soleil, for example, to Cavalia, as well as people in the performing arts and virtual reality and video games sector—to make sure we can help them seize opportunities in the Chinese market.

[The Chair, Liberal, Hedy Fry]

Thank you very much, Ms. Dabrusin and Minister.

Mr. Van Loan, for the Conservatives, you have seven minutes.

[Peter Van Loan, Conservative, York—Simcoe, ON]

Mr. Clarke will be doing most of the questions. I have one question. It's very quick.

It actually doesn't really relate to the cultural policy, but there's an ice rink being built outside. It costs a fair bit, as I understand, to build. Most of those costs, I presume, go into the set-up and the tear-down. It's going to be open for only three weeks. Why won't it be open for longer? Would you consider opening it for longer?

[Mélanie Joly, Liberal, Ahuntsic-Cartierville, QC]

Well, we're extremely happy about the Canada 150 celebrations and how people from across the country have reacted. When we started this project, there was a very big and costly project that was going to be organized on the Hill, and we decided to make it more community focused, to make it much more a place where people in Ottawa and from across the country could engage and have fun. That's why we're really happy to have this skating rink. This is a first on Parliament Hill. I hope, Mr. Van Loan, we'll have the chance to skate together.

[Peter Van Loan, Conservative, York—Simcoe, ON]

That's why I want it to be for more than three weeks.

[Voices]

Oh, oh!

[Mélanie Joly, Liberal, Ahuntsic-Cartierville, QC]

Ultimately, I think it will be providing a lot of fun and will be a great way to close the Canada 150 celebrations.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

Madam Minister, I am really pleased to be able to ask you some questions for the first time as your counterpart.

I would like to go back quickly to the agreement with Netflix. You caught my attention when you said that an amount of $500 million has been allocated to the production of anglophone and francophone content. Since the agreement is confidential, I understand that you cannot go into the details.

Why was an amount of $25 million needed if there is $500 million for initiatives to produce content in French and in English?

[Mélanie Joly, Liberal, Ahuntsic-Cartierville, QC]

Thank you for your question.

I would be happy to answer it, but given that Guylaine Roy is the person who represented the government under the terms of the Investment Canada Act, she can explain the precise nature of the negotiations.

[Guylaine Roy, Associate Deputy Minister, Department of Canadian Heritage]

In order to answer your question, I would like to give an overview of the way in which the investment application process under the Investment Canada Act works. I will be very brief.

I am the associate deputy minister of Canadian Heritage, but I am also the Director of Investments within the meaning of the Investment Canada Act and I have been in that position since September 2011. What does that mean? My role is to support the minister in administering the Investment Canada Act in relation to the foreign investments in the cultural sector. The Minister of Canadian Heritage has had those powers since 1999; she therefore reviews foreign investment in the cultural sector.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

Does the $500-million investment already provide for some of the funds to go to francophone content?

[Guylaine Roy]

I will answer your question right away.

The commitments that have been made public include two key elements. First, a minimum investment of $500 million will be made in original productions in Canada, including the production of francophone and anglophone content.

Second, the $25 million is intended to recognize the efforts that will be made in francophone markets. We want to make relations easier between francophone producers in Quebec and those outside Quebec, and to encourage interaction with Netflix and to give producers the opportunity to have what are called pitch days, giving them more direct contact. This is a recognition that, beyond the $500 million, a special effort has been made to accommodate francophone markets. The fact that we have two markets in Canada was a point we raised with Netflix.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

I understand completely, madam. Thank you.

So it is not possible to find out the part of the $500-million fund that will be set aside for francophone production because that information is confidential.

[Mélanie Joly, Liberal, Ahuntsic-Cartierville, QC]

No question that Netflix has a responsibility.

For the first time in its history, Netflix has decided to establish a production company outside the United States. In those circumstances, the review provisions in the Investment Canada Act were triggered. What we have also been able to do is obtain guarantees from a foreign investment company in Canada, while all the existing legislation does not allow us to go and seek funding for digital platforms generally.

The current act contains no mechanism that allows us to seek that money. That is why we are amending our legislation, but it is also why we have introduced a transition plan. We ratified an agreement for an investment of $500 million over five years. Regardless of the tax credits that the company may subsequently receive as a result of a coproduction agreement with a Canadian company, the investment remains at $500 million.

I am equally convinced that francophone producers, with their great skill and the high quality of their content, will be able to get their piece of the pie. Essentially, what I hear from francophone and Quebecois producers is that discussions about the platform have already begun.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

Madam Minister, I really have to ask you about this: you were supposed to introduce the five-year plan for official languages before Christmas, and, basically, it will not be introduced until the winter.

Can we expect the amounts to be as significant as the ones in the roadmap for official languages 2013-2018? Would you venture so far as to index that amount, as language groups are asking?

[Mélanie Joly, Liberal, Ahuntsic-Cartierville, QC]

Of course, the issue of the official languages is paramount for us and we are working very hard on an action plan for the official languages.

Minority language groups often share their concerns with us about the lack of indexing under the previous government and the fact that there was no emphasis on funding organizations. The language communities must be facing enormous challenges in immigration and early childhood.

I have had the opportunity to meet thousands of people and to hold consultations on this matter across the country. I will also have the opportunity to announce a very good plan that will contain very good investments.

[Alupa Clarke, Conservative, Beauport—Limoilou, QC]

I would like to go back over what you said this morning but I see that my time is up.