Environment Committee on Oct. 17th, 2023

[Mark Cauchi]

I don't. Unfortunately, I can't provide you with that, but the work is ongoing.

[The Chair, Liberal, Francis Scarpaleggia]

Mr. Kram, you have five minutes.

[Michael Kram, Conservative, Regina—Wascana, SK]

Thank you to all of the witnesses for being here today and for participating in the most recent audits.

My question is about the “Forests and Climate Change” report, which was released on April 20 of this year. Throughout the report, the program is consistently referred to as the “2 Billion Trees Program”. I'll start with an easy question for the department: How many trees is the two billion trees program supposed to plant?

[Monique Frison]

The commitment to plant two billion trees is a whole-of-government commitment. The two billion trees program will plant the lion's share of those, between 1.85 to 1.9 billion of those two billion trees.

[Michael Kram, Conservative, Regina—Wascana, SK]

Okay, so the two billion trees program is not going to plant two billion trees. Is that no longer the intent of the program?

[Monique Frison]

Because it is a whole-of-government commitment, the intent all along was to include trees that were planted not only under this program but also under other government programs where the planting was incremental to business as usual and where we could reliably count them. The low-carbon economy fund was always part of the plan.

We intend to ensure that a lot of the benefits we report on, including the GHG estimates, are only based on those trees where we are getting sufficient information to calculate that, which would be largely under the two billion trees program.

[Michael Kram, Conservative, Regina—Wascana, SK]

Why is it called the two billion trees program? Why not rename it the “billion and a half trees program” or the “one billion trees program”?

[Monique Frison]

It's a good question. For us, we were trying to be clear about the intent and the whole-of-government commitment to rally interest among Canadians. We certainly see that in the applications we get from indigenous governments, cities, smaller municipalities, conservation areas and individual Canadians wanting to organize their communities around planting two billion trees. It has worked as a rallying point around that commitment and in trying to make that commitment happen.

[Michael Kram, Conservative, Regina—Wascana, SK]

Page 6 of the report says that only 16.5 million trees were planted in 2022, which is well short of the goal of 60 million trees for that year. I would like to draw your attention to a CBC article from August 2, with the following headline: “Ottawa announces its 2 billion tree program is surpassing targets”. That is not well short of what was in the auditor's report from just three and a half months earlier.

Could you explain the cause of this miraculous turnaround in just three and a half months?

[Monique Frison]

There were two things. One was that the audit period ends a few months before the audit report is actually released. It would have been released prior to our getting a lot of the reporting from the previous planting season, the 2022 planting season. For us, when we are putting all the numbers together in August, we're including planting seasons from 2021 and 2022, as well as the LCEF numbers from planting in 2021 that we were able to get reporting on.

[Michael Kram, Conservative, Regina—Wascana, SK]

The LCEF numbers, that's the low-carbon economy fund program and not the two billion trees program?

[Monique Frison]

Yes, it is.

[Michael Kram, Conservative, Regina—Wascana, SK]

Is the low-carbon economy fund program part of the two billion trees program?

[Monique Frison]

We had always designed for the low-carbon economy fund to form part of the two billion tree commitment and the commitment to plant those trees. The low-carbon economy fund was going to ensure that tree-planting by the provinces and territories was incremental to business as usual, and it was going to receive from the provinces and territories sufficient reporting for us to rely on the numbers it had.

[Michael Kram, Conservative, Regina—Wascana, SK]

Minister Wilkinson's press release from August 2 says, “The planting of trees through the Disaster Mitigation and Adaptation Fund,” which is from Infrastructure Canada, “and with provinces and territories, to plant millions of new seedlings under the Low Carbon Economy Fund are captured in this effort.”

Mr. DeMarco, why were trees from these programs not included in your audit of the two billion trees program?

[Jerry V. DeMarco]

Thank you for that question.

We're still considering whether to do a follow-up on it, because of the vast change in numbers from what our audit team was provided and what was publicly released in the summer.

If I can turn your attention to exhibit 1.3, I think this will help to clarify things. As you know, in an audit, the department signs off on the factual accuracy of our materials at the draft stage, before we provide it.

This exhibit showed what they had planted in 2021 and what the estimate was for 2022. They did not say that they had the equivalent of what you would call “trees receivable” or “accounts receivable” from the low-carbon economy fund in the number of 50 million, which would have doubled the numbers in here. They did not say, “Oh, we're just waiting for the numbers. Hold on and we'll have this.” We were told that this is what they were planting, and we were told that the program was about incremental trees, not double counting trees from other programs.

If I could just finish on this, Mr. Chair—

[The Chair, Liberal, Francis Scarpaleggia]

Yes, just a couple....

[Jerry V. DeMarco]

We fully recognize that the constating documents, the originating documents for the program left it open and that they could double count from other programs. However, we specifically asked them what they were counting for 2021 and 2022, and there was no word about these other 54 million trees that they have found since then.

[The Chair, Liberal, Francis Scarpaleggia]

Go ahead, Madame Chatel.

[Sophie Chatel, Liberal, Pontiac, QC]

Thank you very much, Mr. Chair.

First, I'd like to move away from the trees to get a better view of the forest and talk about report four.

Mr. DeMarco and Mr. Tardif, I'd love to hear you talk about the importance of green finance and transition finance, which are both very important for Canada, especially transition finance. It's going to play an absolutely essential role in directing the capital of major Canadian and international banks and pension funds, which are huge investors, towards businesses so they can position themselves in the 21st-century economy. This is really a very central aspect of our transition to a green and sustainable economy.

I'd love to hear from you on this. What do you have to say to Canadians watching right now about the importance of your assessment of the report and, Mr. Tardif, about the importance of the Office of the Superintendent of Financial Institutions in this absolutely fundamental role?

I'd like to hear from you first, Mr. DeMarco, and then from Mr. Tardif.

[Jerry V. DeMarco]

Before turning the floor over to Mr. Tardif, I want to say that I'm glad to hear your question because it's not only important that we have a green and equitable transition, it's crucial. In fact, there's a new expression for this type of finance in a bill.

As I said earlier, we can't keep putting the same volumes of carbon into the ground and atmosphere without causing disasters like wildfires and so on. The green transition is therefore important, and it affects all sectors. It's not just an environmental issue, now it's also become a social and economic issue that impacts the financial sector.

Mr. Tardif can tell you about the progress that the Office of the Superintendent of Financial Institutions has made since tabling its report in April about the transition of institutions regulated by the office.

[Stephane Tardif]

I will try to answer your question, Mrs. Chatel.

At the Office of the Superintendent of Financial Institutions, we recognize that climate change and the global response to the threats it poses can have a significant impact on the safety and soundness of Canada's financial system.

The office's mandate, in accordance with the legislative framework established by Parliament, allows it to act to ensure that federally regulated financial institutions manage the risks that climate change may pose to their safety and soundness.

When it comes to green investments, we know that Canada's financial system will play a key role in this transition. The office has an obligation to ensure that the financial institutions and pension plans subject to its regulation are able to manage the risks arising from this transition, but it does not manage the investment plans of these institutions.

Now I'll talk a little about the taxonomy that's developing within government. Anything that helps inspire pride in the markets and among investors will provide greater transparency in investments. All these efforts will bring stability and foster Canadians' confidence in the financial system.

The office's guideline B‑15, which came up earlier, is about risk management and quantification. It's not intended to encourage or discourage certain investments.

[The Chair, Liberal, Francis Scarpaleggia]

Thank you very much.

That brings us to the end of the second round. We still have enough time for a full third round.

Mr. Leslie, you have the floor for five minutes.

[Branden Leslie, Conservative, Portage—Lisgar, MB]

Thank you, Mr. Chair.

I'd like to start by saying that I think nature-based climate solutions are a good thing. It's something that is not really political. I'm glad to see that the program looks to private landowners as partners, and I suspect it's an area that could be expanded. Folks who live in rural areas—farmers and landowners—enjoy living with nature. They enjoy having wildlife around, and they have voluntarily planted and protected trees on their properties for decades. In fact, when I was very young, my own family planted about 10,000 trees on old marginal land—an old railbed—because we wanted that. We wanted to have habitat for wildlife around us.

In some ways, I feel bad for the departments trying to implement this program because, as my colleague Ms. Pauzé mentioned, this is very much political. I suspect the campaign war room in 2019.... When they were deciding this, it went something like, “Let's plant 200 million trees. That's a good idea. Let's plant 500 million. Let's plant a billion,” and they landed on two billion as the number.

Aspirational as that may be.... I think that is something worth trying to do, but the department would have to talk to the nurseries, as you outlined in your report, Commissioner. How do we gear up for two billion saplings over the next couple of years? You talked about the labour shortages in planting a lot of these trees. You talked to real people and realized it's a very difficult task to find somewhere in Canada an area the size of P.E.I. that's not on natural gas lines, arable farmland or tundra, to plant successfully mixed, effective forests.

Commissioner, my question to you is this: Do you think the department has a plan with enough detail to figure out where we can plant all these trees successfully, without doing the funny math of counting other programs' trees?

[Jerry V. DeMarco]

You can ask them whether they have a plan.

I think they have agreements in place—agreements in principle to get them to 300 million or 400 million at this stage of the two billion. There are still plenty of years left, so they could do it.

Is there enough land in Canada to accommodate two billion incremental trees? Yes, there definitely is, but it should not be done in a way that replaces natural grasslands, fills in wetlands or things like that. Obviously, it should be in areas that have already been degraded and that could benefit from not only tree-planting but also, as we emphasized in our report, ecological restoration. Planting a forest is much more important than planting a tree farm. There have been recent scientific studies about the adverse impacts of tree-plantation approaches that, sure, can maximize carbon sequestration in some cases but might also have a net detriment for local biodiversity and human well-being.

If they could dovetail the two billion trees program with the new global commitment to the restoration goal that arose from the United Nations Convention on Biological Diversity conference in Montreal in December, we could have reforestation and habitat restoration, as opposed to just counting trees and carbon.