Environment Committee on Feb. 10th, 2009

[Christian Ouellet, Bloc, Brome—Missisquoi, QC]

At that point, when you do the evaluation with respect to Kyoto, can you tell us what you will do about such disturbing situations as the manure that emits such huge quantities of greenhouse gas because it is much more virulent? Can we get a picture of what the government is or is not doing in this sector?

[Scott Vaughan]

The work is being done right now. It is hard for me to say, because there are no conclusions yet. The report in May will be the first one. It is the beginning of the application of the Kyoto protocol. It is hard to say

are you on target or not.

For me, right now, it is hard to say.

[Christian Ouellet, Bloc, Brome—Missisquoi, QC]

Let us return to two of Agriculture Canada's programs, first, the one called Environmental Farm Planning. What is the government's success rate in this program?

[Scott Vaughan]

As Mr. Maxwell said, there is a $370 million government program to manage and reduce risks on farms. The government does not know the results of the various programs. It is a monitoring problem, and it is difficult to show specific, concrete results regarding what is happening on farms. But at the present time, no. The answer is no. We do not know.

[The Chair, Conservative, James Bezan]

Thank you.

Mr. Braid, the floor is yours.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you, Mr. Chair.

Mr. Vaughan, thank you again. I want to echo the comments of my fellow committee members and thank you for an excellent and very thorough report. I certainly appreciate the opportunity to start this mandate of the committee by studying and digesting it.

I want to come back to the issue of the public transit tax credit. I wonder if you can start our conversation by agreeing that the premise of supporting public transit and encouraging public transit is good public policy. It's clear that the stated goal of reducing greenhouse gas emissions was not met. The original goal was 220,000 tonnes per year, and the actual achieved was 35,000 tonnes per year.

I presume that the original projected cost of $635 million, which I understand has yet to be confirmed, corresponds to the original stated goal of 220,000 tonnes. Is that correct? If the actual achieved greenhouse gas emission target is less--about 16% of the goal--is it not logical that the actual cost would be less by a corresponding amount?

[Scott Vaughan]

Thank you for the question.

First, just to underscore and echo your comments, what I think is important--and you know, this has been a goal of environmental policy now for 25 years--is that it's sending the right pricing signals to encourage Canadians to adjust their behaviour in favour of more sustainable, environmentally sound practices. I think this is an example. Also, I think behavioural change, especially for climate change, is a long-haul issue. This is not going to be done in a year. This is a long, significant challenge to every country in the world.

Specifically on your question, our understanding is that while the target of reduction in greenhouse gas emissions has changed significantly, the financial target that has been put forward, the $650 million, remains the same. That's why the cost has gone up exponentially between 220,000 tonnes of reduction to 35,000 tonnes. If the cost remains the same, the cost per tonne actually increases.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

But the actual projected costs will not be known or confirmed until 2011. Is that correct?

[Scott Vaughan]

Our understanding, sir, is that's exactly right. Finance Canada with Revenue Canada will come back in 2011 with calculations.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

I presume that it's possible that the take-up for the tax credit may vary across the country depending on the quality and the effectiveness of the public transit system. Is that fair? For example, if it's better in Vancouver, the take-up could be higher in Vancouver. As public transit improves, perhaps take-up may increase or improve.

[Scott Vaughan]

I think just intuitively, if you're giving Canadians incentive to try to increase their use of public transport, they need the choice. They need to have public transit systems in place that they can access. We haven't looked at that, but I think your observations are probably correct. If you're living, for example, in rural communities where there is no public transport or very limited public transport, then chances are there will be fewer people in rural areas who will actually be able to take advantage of this, as opposed to in city centres, where there are systems in place.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Right.

From a purely monetary policy perspective, the tax credit does make the use of public transit more affordable, does it not?

[Scott Vaughan]

That's correct. The intention is to do a reduction on annual passes by, I think, 15%.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Lastly, would you happen to have any recommendations in terms of how we could promote the use of either the tax credit or public transit generally?

[Scott Vaughan]

We didn't look at what the government might do in terms of increasing the awareness of this as an option for Canadians.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you very much.

[The Chair, Conservative, James Bezan]

Thank you. Your time has expired.

Mr. Wrzesnewskyj, five minutes, please.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

I'm deferring to Mr. McGuinty.

[David McGuinty, Liberal, Ottawa South, ON]

Thank you, Mr. Chair.

Can I go back to that very informative line of questioning by Mr. Braid?

When you looked at the tax deductible transit pass and you found out, Mr. Vaughan, that the government had been forewarned that it wasn't good ecological fiscal policy to pursue policies where the cost per tonne for production was over $800, did you come across any documentation that presented alternatives to the government--such as, for example, the well-known fact inside the Department of Finance that it is better for the federal government to take scarce taxpayer dollars and allocate them towards infrastructure costs for transit than it is to try to incent behaviour for those who are already riding transit, particularly when we knew the cost would be well over $800 a tonne?

Did you come across any evidence on that front?

[Scott Vaughan]

We did not look at alternatives that were in play in different departments in looking at policy alternatives. That would be an area of policy that we wouldn't generally look at anyway. So when the policy decision was made, we would look at the management in order to implement--what was the analysis supporting that policy decision--but we would not look at policy alternatives.

[David McGuinty, Liberal, Ottawa South, ON]

When you examined the government's target of...? Was it 220,000 tonnes?

[Scott Vaughan]

For 2007, yes, sir, it was 220,000.

[David McGuinty, Liberal, Ottawa South, ON]

When you examined that, what were the projections the government had? I mean, with a $635 million expenditure, we would assume a government would have done calculations, for example, on how much public transit ridership would increase. What numbers were produced by the government to justify $635 million to increase ridership, as Mr. Braid says, rightly so, depending on the city where transit exists?

[Scott Vaughan]

I think what the team found was that there was a wide scale of projections in terms of assumptions on changes in ridership. It was wide, in terms of the range of magnitude. But as I said before, it was hard to get a substantiation. Part of it was because we did not have full access to the analysis, so we didn't see the assumptions the department was making in terms of actually doing those projections.

If you see some numbers and you see a model that is used, generally what you want to do is to be able to road test it. You want to see whether you can replicate it, actually put those numbers in and come up with the same numbers. But since we didn't have access to that information, we're not able to say what their range of projections were.

[David McGuinty, Liberal, Ottawa South, ON]

Sorry, I'm confused.

Is it because the calculations weren't performed, or the calculations that were performed were not made available to you?