Finance Committee on Sept. 20th, 2006

[The Chair, Conservative, Brian Pallister]

Order, please.

Anyone who happens to have a cell phone would be invited to turn it off now.

We will begin in the absence of a couple of other committee members, who will be joining us very shortly. I welcome our guests on behalf of the finance committee.

We are mandated by the House of Commons on an annual basis to consider and make reports on proposals regarding the budgetary policies of the government. This process is, of course, one that will assist us in preparing a report to the finance minister. The theme of the pre-budget consultation this year is Canada's place in a competitive world, and we look forward to your presentations today. I will be limiting you strictly to five minutes. As our committee has been made aware, and you are, I expect, aware, we will be limited to an hour today, and I do want to leave time for the committee members to have an exchange and to ask questions and for you to respond.

So we'll begin now with a presentation from the Canadian Child Care Federation. Madame Dionne, you have five minutes. Please proceed.

[Yvonne Dionne, Director, Development, Marketing and Communications, Canadian Child Care Federation]

Thank you, Mr. Chair and honourable members of the committee. Thank you for the opportunity to appear here today.

Child care is a key component for securing Canada's place in a competitive world. I'm very pleased to represent the Canadian Child Care Federation, Canada's largest early learning and child care organization. The federation is a vibrant partnership of 21 affiliates--provincial and territorial organizations--representing over 11,500 members. These members are primarily child care practitioners, working in centres and family child care settings across Canada, who are focused on excellence in early learning and child care.

The Conference Board of Canada has said that improving Canada's productivity is the country's top policy challenge. High quality child care can help to meet the challenge in two ways. First, it frees parents to enter the workforce and to focus on work while maintaining a work-life balance. Second, it contributes to children's early learning, setting them on a path of a lifetime of learning and success.

Quality child care is an integral part of the infrastructure that allows Canadians to work. Just like highways and transit systems, you can't get to work without it.

Families are increasingly relying on non-parental care in the early years. According to Statistics Canada, 54% of children age six months to five years are in some form of non-parental child care so that parents can work or study to improve the lives of their families.

We know there's a commitment to capital funding to create 125,000 spaces over five years, and consulting is under way on how to make the child care spaces initiative successful. This commitment acknowledges that families across Canada face a shortage of spaces. However, there need to be measures in place to ensure that these spaces are high quality and that they are sustainable. With this in mind, we'd like to suggest six areas where specific programs could support and encourage this initiative.

Number one is building awareness of quality. Most people agree that quality child care is important, but surprisingly, many are unaware of all the elements of quality. Quality goes beyond price, location, and nutritious food; it includes, among other things, a good child care practitioner, a strong program, and a solid partnership with the parents. To make a good child care choice, parents need information on how to find quality child care. What does it look like? What questions should they ask? What options are there out there for them? This points to the need for tools for parents such as interview questions and guidelines.

Businesses and organizations also need help to understand quality child care. The success of the child care spaces initiative depends on them. This points to the need for tools to help businesses and parent-citizen groups outline the startup and operational steps and the associated costs to create and maintain quality child care spaces.

The second area I'd like to address pertains to national standards for child care. While we have national standards in Canada for everything, from car seats to light bulbs, the level of quality of care varies widely from province to province, as do training requirements for child care practitioners. Those trained in one province may have difficulties having their qualifications accepted in another province. This is in a field already suffering from major recruitment and retention problems.

National standards, created and ratified by the child care field, currently exist. However, they need to be broadly disseminated and used in legislation and training.

Third, I'd like to highlight the child care workforce. It's a major component of quality child care and it's critical to the sustainability of new child care spaces. However, the child care field suffers from problems with retaining and recruiting workers due to poor wages and working conditions and a lack of opportunity for training and professional development. There must be a concerted effort to address these challenges in order to ensure that we have 25,000 new practitioners to staff the promised 125,000 new spaces. This could be achieved, in part, through a national strategy to address HR issues across the country.

Our fourth area of concern deals with fair access to funding under the child care spaces initiative. It's a concern that funding for this initiative will go first to the organizations and groups that are most sophisticated in their fundraising capabilities, rather than where it is most urgently needed across the country and across rural and urban settings.

Some spaces should be reserved for children with special needs. A matching service could be created so that companies and child care organizations and groups can find each other.

The fifth area we'd like to address is federal-provincial collaboration. In order for businesses and organizations to take up the funding, they need assurances that there will be some provincial-territorial matching.

Finally, the sixth and last area we'd like to address is the bigger picture. Debate around child care initiatives in recent years shows that it's an issue that inspires passion. Canadians care deeply about their families, whatever their employment situation. Perhaps it's time to articulate a broad vision of family policy in Canada, with quality child care as a cornerstone, along with extended maternity and parental benefits and employer incentives to adopt family friendly policies. The federal government could lead a national discussion to develop a coordinated national family policy that will support Canada's objectives in terms of securing its place in a competitive world.

I trust I've left you today with ideas for concrete programs that will support quality child care. It's a key component of the social infrastructure that will enable Canadians to build a successful country, a country that values them as citizens and recognizes their contributions as families.

Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you very much, Madame Dionne.

We'll continue with Judy Watson, from the Canadian Mental Health Association. You have five minutes.

[Judy Watson, Vice-President, Canadian Mental Health Association]

Thank you.

Good afternoon, Chair and members of the committee. My name is Judy Watson. I'm national vice-president of the Canadian Mental Health Association.

Thank you for the opportunity to address this important matter. As a family member of someone who experiences a serious and persistent mental illness, I understand firsthand the challenges presented by mental illness and the opportunities for Canada in joining the other G-8 countries in developing and implementing a strategy on mental health and mental illness for the people of Canada. The health and well-being of Canada's workforce is critical to Canada's competitiveness.

Mental illness affects at least one in five at some point in their lifetime. This means that some six million people, the majority of working age, have a personal and direct experience with mental illness. The productivity of Canadian businesses is affected. The lack of attention to mental health issues limits Canada's potential in the world market. This neglect has an impact on Canada not only at home but also on the world stage. Ensuring Canada's place in a competitive world must be based on all the elements that promote innovation and productivity. Maximizing human capital provides the key to a knowledge-based economy. A healthy population is critical to a strong economy.

Depression and other mental health issues have surpassed cardiovascular disease and are now the fastest-growing category of disability, at an enormous cost to society and to businesses.

The Honourable Michael Wilson, when he was vice-chairman of RBC Dominion Securities, noted that 30% of the absenteeism in the financial world sector is directly caused by mental health issues. It is so significant that the banking sector has become a leader in dealing with mental health issues within its work environment.

To put the problem in context, Health Canada estimates the financial burden on Canada's economy is now close to $30 billion a year. In 2001, there were more than 1.8 million working-age Canadians between the ages of 25 and 64 with a physical or a mental disability, or other serious health problem, according to Statistics Canada. Of this total, more than 780,000, or about 45%, were employed.

Mental health problems account for 30% to 40% of disability claims reported by Canada's major insurers and employers. A Harvard Medical School study shows it costs employers $10 to $35 U.S. per day for each employee with undiagnosed and untreated depression. With proper treatment, within a year all costs are recovered and the firm actually makes an extra $1,100 to $1,800 per year, per employee.

The economic as well as the social implications are both obvious and of concern to everyone. There is an urgent need for leadership.

Too often people refer to the health system's poor cousin. Mental health needs are often among the first in line when funding cuts are made, thereby increasing the pressure on the health care system. Further exacerbating this is the lack of consistency in the way we address mental health services across this country.

A positive step would be to implement recommendations from the Standing Senate Committee on Social Affairs, Science and Technology's final report on mental health, mental illness, and addiction in Canada. One key recommendation is the creation of a Canadian mental health commission as a means to develop and implement such a strategy.

The whole complex pervasive problem of mental illness and addiction in Canadian society has been neglected for many years. The Canadian mental health commission would provide a much needed nationwide focus to develop effective solutions.

We must ensure a positive contribution to economic growth. Employing talented Canadians, no matter the disability, is good business and contributes to Canada's prosperity.

According to Mental Health Works, a program developed by CMHA Ontario, when employees get early access to treatment and services, employers save $5,000 to $10,000 per worker per year in the cost of prescription drugs, sick leave, and wage replacement.

[The Chair, Conservative, Brian Pallister]

You'll have a few seconds to wind up your presentation. Thank you.

[Judy Watson]

Okay.

We must optimize our contribution of the workforce. We recommend that a key area to look at is affordable social housing and adequate income for individuals, because we know the impact the social determinants of health have on mental health, and this affects our economy in Canada.

Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you very much, Madam Watson.

We will continue with Mary-Martha Hale and the Alliance to End Homelessness. You have five minutes.

[Mary-Martha Hale, Chair, Alliance to End Homelessness]

Good day, everyone.

I am here to speak to our brief, “Canada's Homeless in a Competitive World: Policies and Funding Proposals to Ensure Health, Skills, and Incentives for Homeless People and Those at Risk of Homelessness”. My name is Mary-Martha Hale and I am the chair of the Alliance to End Homelessness in Ottawa.

The alliance is a coalition of over 70 organizational members who have worked to prevent and end homelessness in Ottawa for the past 11 years. I would like to thank you on behalf of our members for this opportunity to speak before you.

The alliance is known across Canada as both an effective and a collaborative coalition of community stakeholders who work together to end homelessness. Today we are here with five proposals to help prevent and end homelessness.

We recognize that a long-term federal public policy commitment is required to meet the challenges confronting homeless people and those at risk of homelessness. On a daily basis we see the continuing need for strengthened federal support for communities such as ours.

I am the director of Anglican Social Services/Centre 454, a day program for people who are homeless. We serve on average over 300 different people daily, providing support programs that enable individuals to stabilize their housing and employment situations.

With me is Marion Wright, the executive director of the Canadian Mental Health Association's Ottawa branch, a leader in Ottawa at providing housing first, along with the mental health supports and services people need to stay housed.

Here in the nation's capital, many members of Parliament will have seen the alliance's annual report card on homelessness in Ottawa, released at the end of February, and will be aware of the Community Forum on Homelessness, linking research with action, that we host on National Housing Day, November 22.

The report card on homelessness uses sound data sources: the federal homeless individuals and families information system in place in Ottawa and across the country, housing data tracked by the city of Ottawa, the rental market survey done by Canada Mortgage and Housing Corporation, and federal employment insurance and old age security rates.

The report card's conclusions are inescapable. Current government income policies and programs for affordable, appropriate housing in Canada meant that in Ottawa 8,853 people--families, including those with children, youth, women, and men--had to stay in an emergency shelter in 2005. This number does not include those who are living on the street; those who are living in places not fit for human habitation, such as a car; and those who are couch surfing, moving between the homes of friends, families, or strangers.

There is no doubt that federal policies and contributions are a critical component of successfully responding to the crisis of homelessness at the community level. It is both necessary and important for the Government of Canada to take the leadership role in solving homelessness. Our coalition members know firsthand that policies and programs implemented at the community level produce the best economic advantage to help individuals and families out of homelessness. In this way, they are more able to be contributing members of their community.

Long-term federal policy commitments are required to meet the challenges confronting homeless people and those at risk of homelessness. Most importantly, the Government of Canada can expect to have a successful impact if federal programs and funding are dedicated to sustaining community collaboration.

We have five concrete proposals.

The first is to create immediately a long-term sustainable program that commits Government of Canada support for effective, innovative solutions to homelessness at the local level.

Second is a direct and significant increase in affordable and supportive housing.

The third proposal is to increase rates and access to income support programs, such as employment insurance, old age security, and the guaranteed income supplement programs, to enable individuals receiving these benefits to pay their rent and feed themselves and their families.

Fourth is to reduce the lowest tax rate and increase the exemption rate to reduce the risk of homelessness. The increase of 0.5% of the lowest tax rate in the last budget placed a tax burden on those with the lowest incomes. For low-income Canadians who were recently required to start paying income tax, the risk of homelessness has increased.

According to the 2001 census, one in five, or 20% of Ottawa residents earn less than $10,000 and another 17% earn between $10,000 and $20,000.

[The Chair, Conservative, Brian Pallister]

Could you end your presentation now, please?

[Mary-Martha Hale]

And fifth, amend the Canada Health Act to uphold the portability clause of the act to include out-of-province mental health care provided in a psychiatric hospital institution. We need homelessness to be made a priority by this government.

Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you very much, Madam Hale.

We'll continue with Luc Vinet, who's the rector at the University of Montreal.

Welcome.

[Luc Vinet, Rector, University of Montréal]

Thank you, Mr. Chairman, members of the committee, for inviting me here today.

I'm told that I'm the first university representative to appear before your committee. That being the case, I would like to underscore the important role played by federal programs such as the granting agencies, the Canada Research Chairs Program, the Canada Foundation for Innovation and the Indirect Costs Program for universities, colleges and research hospitals in ensuring the success of Canadian universities in the research field. These programs have all achieved admirable results in the field, which largely justifies their continued existence and development.

You're wondering about Canada's place in a competitive global economy. All of the studies that have been carried out show that countries that make substantial, sustained investments in education and research are assured of a competitive position. Canada has a small population and enjoys very modest demographic growth. The quality of our human resources and training programs represents the strategic key to our future. Therefore, our goal should be to have some of the best universities in the world to ensure that Canadians receive the best possible training available and go on to generate R & D of major significance. In my view, to achieve this objective, we need to formulate a national strategy that is mindful of respective jurisdictions.

The University of Montreal is playing a major role in Canadian higher education and research. The second largest university in Canada trains by itself 25% of all the Quebec university students. Studies also strongly show that in our global knowledge economy, growth is often generated by the presence of industrial clusters. These are generally of a regional nature in major urban areas but typically are networked nationally and internationally. They always involve the government, the private and voluntary sectors, as well as the universities.

The University of Montreal is much involved in the aerospace, life science, IT, design, and cultural clusters, to name a few. Studies show that these clusters thrive on three elements: talent, technology, and tolerance. These attributes are also common to universities, which in fact usually contribute much to them within clusters.

We propose a few financial measures to ensure a competitive development of these pillars within universities and hence clusters. With respect to talent, it is key to ensure that Canadian universities have the resources to compete in attracting and retaining talented Canadian and international students. It is has been suggested that this matter be addressed through transfer to provinces. It is also key to attract and retain the best researchers in Canada. Here, growth in the following programs is critical: research funding; infrastructure funding; and indirect research cost. It is very important to fund fully, and not partially, our programs and to compensate for the severe deferred maintenance costs that the indirect costs shortfall have generated over the years. It's also important to offer competitive scholarships and fellowships for post-graduate studies. Let me mention that the support through transfer of university operations will also optimize the return on research investments.

Under technology--remember, talent, technology, tolerance--it is key that universities have the funds to afford state-of-the-art...or that private sector partnerships be fostered. To that end, we recommend tax exemptions on any contributions to a university research project and that indirect cost funding be provided by the federal government for grants offered by private foundations.

Finally, on the tolerance front, to support international networking, we suggest that there be scholarships for Canadians to go abroad and for international students to come to Canada. Finally, to augment local networking, we propose in our brief a number of tax deductions and incentives.

You've given me a very short time to cover such a critical cornerstone of Canada's competitiveness. Others will come to complement my points, no doubt. Nonetheless, I trust you have heard my message: higher education is a national urgency.

Thank you.

[The Chair, Conservative, Brian Pallister]

Merci beaucoup, monsieur.

I appreciate the cooperation of all the witnesses in their presentations. I know the challenge we've given you is a daunting one.

Susan Manwaring will now present on behalf of the Canadian Association of Gift Planners, for five minutes.

[Susan Manwaring, Chair, Government Relations Committee, Canadian Association of Gift Planners]

Thank you, Mr. Chair.

Mr. Chair and members of the committee, good afternoon. I'm Susan Manwaring and I'm here on behalf of the Canadian Association of Gift Planners.

The CAGP is comprised of 1,300 charitable gift planners across Canada who adhere to strict standards of ethics in working with Canadians to generate donations that support that vital sector of our community, the charitable sector. The purpose of the Canadian Association of Gift Planners is to support philanthropy by fostering the development and growth of gift planning. The association creates awareness, provides education, and is an advocate of charitable giving. This activity really helps to strengthen the charitable sector, which helps to strengthen all of the communities in Canada and adds to Canada's competitiveness. It is, in our view, very critical that this sector and the ability to generate charitable giving from average Canadians is very important to the competitiveness of Canada's economy.

This afternoon CAGP wishes to start its presentation with a note of thanks to the government for the introduction and extension of the exemption from tax on gifts of publicly listed securities to registered charities in Canada. CAGP applauds the contribution to the charitable sector and further applauds the contributions to the charitable sector by the government and this committee in recent years through the creation of new tax incentives for gifts as assets by individual taxpayers.

The charitable sector in Canada and the rules that particularly relate to charitable giving and tax incentives for charitable giving have been overhauled and continue to work to increase the charitable giving in Canada to support the sector. CAGP is here today to encourage this committee to continue this support for philanthropy and is recommending, to that end, four additional changes that could be implemented and recommended by this committee.

The first recommendation is a recommendation that CAGP has brought forward to this committee in the past and has been supported by other sector organizations in their briefs before this committee this year. This is asking the committee to recommend that the Department of Finance move forward quickly to implement changes to the Income Tax Act to clarify the laws surrounding the use of what we call a charitable remainder trust as a charitable giving tool. In response to requests from the Department of Finance and the Canada Revenue Agency, the CAGP tabled a proposal with those departments in 2003 that outlines how the charitable remainder trust could be implemented into the Income Tax Act to enhance charitable giving. This is a trust that would allow taxpayers, particularly middle-income taxpayers and donors who want to support the sector, to give property to charity during their lifetime, but it's a remainder interest in the property. They can continue to earn income from the property during their lifetime, but it eventually goes to charity. It is seen as something that would help charitable giving in the country. It would be an incentive to increase charitable giving that would support all of the associations before you today and many of the associations this committee will hear about.

The second recommendation that we have brought forward to the committee is the extension of the nil capital gains inclusion rate for all gifts of real property. This again is an asset. Real property is an asset owned by most Canadians--not all Canadians, as obviously there are many who don't--but it's an asset that can be used for gifts to charity. We applaud and encourage the extension of the nil capital gains inclusion rate to that.

Finally, we support the Philanthropic Foundations Canada's request for the extension of the nil capital gains rate to gifts to private foundations. We believe the abuses that are perceived to be a possibility in that area can be addressed by Philanthropic Foundations Canada's recommendations, and we feel that would be an excellent incentive as well for charitable giving in Canada.

We thank you very much for the opportunity to be heard today.

[The Chair, Conservative, Brian Pallister]

Thank you very much for your presentation.

We'll continue with the Association of Canadian Academic Healthcare Organizations, and Glenn Brimacombe, for five minutes.

[Glenn Brimacombe, Chief Executive Officer, Association of Canadian Academic Healthcare Organizations]

Thank you, Mr. Chair.

Good afternoon. My name is Glenn Brimacombe. l am the CEO of the Association of Canadian Academic Healthcare Organizations.

ACAHO is the national voice of teaching hospitals, regional health authorities, and the research institutes responsible for the three following integrated activities: we provide Canadians with access to a range of quality specialized and some primary care services; we represent all of the principal teaching sites that train the next generation of Canada's health care professionals; and we provide the large majority of infrastructure to support and conduct health research, medical discovery, and innovation across the country. We also employ in excess of 200,000 Canadians.

There are no other organizations in the health system whose members provide this unique combination of health services. We consider our institutions as vital hubs in the system, in addition to being a national resource.

The association is of the view that there are a number of areas where the federal government has a significant and natural role in improving the health and health care of Canadians and also continuing to position Canada as a global leader when it comes to harnessing the full economic and social benefits that come from investing in research, innovation, and commercialization. In short, it's about strengthening the linkages between health and wealth.

The future of the health care system remains the most important public policy issue on the minds of Canadians. It's clear that wait times are the barometer by which Canadians perceive the performance of the health system. If patients have to wait, then they are looking for certainty in terms of how long they will have to wait for care. Yet, as important as wait times are, their very existence is linked to a range of other policy issues.

Notwithstanding the progress that has come from the first ministers agreement in 2004 and the development of wait time benchmarks, the association is of the view that there is an important and legitimate role for the federal government: to invest in and improve the capacity of the health system to meet current and future needs of Canadians.

To improve the overall responsiveness and flexibility of the health system and to build on the important gains that have been made at the local level when it comes to managing wait times, the association is of the view that there is a strong complementary and collaborative role for the federal government to invest in capacity-building in three strategic areas. The first is to create a national health human resources fund to expand the country's capacity to train a growing number of health care professionals. The second is to accelerate the introduction of interoperable electronic health records through Canada Health Infoway. And the third is to introduce a health delivery infrastructure fund to assist teaching centres to build, and in some cases rebuild, delivery capacity to provide timely care to Canadians. These three strategic investments should be viewed as being time limited and targeted in nature.

ACAHO also views research as the oxygen of an evidence-based health system. It is the basis upon which many sound public policy decisions are based. It is the backbone of a health system upon which cost-effective clinical and administrative decisions are made.

Research is the foundational building block that facilitates innovation in at least three dimensions. It contributes to improving the individual and collective health status of Canadians; it impacts on the architecture of the health system and the manner in which we deliver cost-effective health services; and it produces leading-edge, world-class discoveries that provide opportunities to leverage major economic benefit as well as health gains.

From the perspective of ACAHO, research, innovation, and commercialization processes are an essential component and a distinguishing feature of our members' mission and mandate. Given the breadth and depth of health and research investments by the federal government, one might be tempted to say the time has come to address other more important national priorities.

ACAHO maintains that while the tide has turned through enhanced investments in Canada's health research enterprise, we must continue to sustain the momentum we have created so that we can continue to participate in the benefits that come from future world-class research findings. Understanding that the research and discovery process can take time, we must ensure that we till the soil if we are to fully harvest the fruits of our labour and remain as a world leader.

With this in mind, ACAHO understands that there are a number of strategic pieces that need to work effectively if we are to maximize our investments in Canada's health research and innovation value chain. In this context, the association would bring to the attention of the standing committee the need to resource the different dimensions of the research equation: infrastructure, basic and applied health research, personnel, indirect costs, as well as maximizing the full economic benefits of world-class, breakthrough health research.

Given that we are on the threshold of a biotechnology revolution, not to mention other advances in health research, can we afford any retrenchment in funding the health research enterprise without it having serious consequences on our ability to attract and retain world-class researchers, not to mention our ability to advance the process of discovery and innovation? We believe it cannot.

Finally, a move away from commitments to funding research, innovation, and commercialization will result in Canada falling out of step with those countries that place tremendous value on the linkages between creating knowledge and its spinoff effects, particularly in a global economy that relies on the advancement and translation of knowledge.

In closing, our brief is about building a modern and dynamic society that is up to the challenges of the 21st century. It's about investing in a vibrant and healthy population, and it's about competing and winning in an increasingly interdependent and global economy that places a high value on the creation and translation of knowledge where speed wins.

Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you, sir.

We will move immediately to questions, and given the compressed timeframe, we'll go with five-minute rounds.

We'll begin with Mr. Savage, who I understand may be sharing some of his time with Mr. McCallum. Please proceed, sir.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Yes, and hopefully he gets more of a chance than when that's reversed and I'm sharing with him.

Thank you all very much. Considering the timeframe, I think the presentations were all very useful.

I would particularly like to chat with Monsieur Vinet--nice to see you again--and Mr. Brimacombe.

Some of the recommendations you are calling for were in fact introduced into Parliament less than a year ago. For example, the indirect costs going to 40% was part of the economic update in the fall. I hope the new government does something to follow that.

Monsieur Vinet, the last time we chatted, we were having lunch a couple of days before a big football game between your team and the Saint Mary's Huskies in Halifax. Considering the lack of time I have, I don't want to talk about that, but I do want to follow up on a different issue.

You've talked a lot about research. In the last five years, Canada has invested a lot in publicly funded research. We've gone from the second lowest in the G-7 to the highest, and we are very high in the OECD nations--I think second in publicly funded research. We've done a lot, and we've done a lot of it directly to universities.

You call for what I refer to as the “dedicated transfer”, which is a concept that I think has a lot of merit and which I think all the parties have considered. I just wonder, though, considering the success the federal government has had by investing directly in universities--notwithstanding that tuitions at the University of Montreal for first year students are around $2,000, compared to $6,000 or $7,000 in my province of Nova Scotia--do you see a role for the federal government in directly investing in students, particularly those students who are unable, for cost reasons, to go to university now?

[Luc Vinet]

Well, I was talking about the fact that we need to have the best universities that there can be. I think it's very important, and I will insist on that. I really believe our future relies on that. The quality of our human resources is at stake here.

The challenge is very large. Money is not everything, but it contributes significantly to our capacity to offer the best education and to carry out the best research.

AUCC has provided numbers showing that, on average, state universities in the U.S.--state universities, not the Princetons and the Harvards--are getting $8,000 more per student than the Canadian universities. That is a lot of money. You could figure out how much it would require nationally. My point here is that it will require a concerted effort from all involved parties, and I would submit that the federal government has a significant role to play.

I called for a national initiative respecting the various jurisdictions, so it is very important to me that the federal government sustain its effort and its support for research--very, very important. It involves supporting the graduate students.

Also, for universities to be able to carry out their mission, and for the research effort to be carried out, the operations also need to be well-supported. We're not able to do that. This is why the transfer solution has to come into play, because I don't believe it is possible for the federal government to intervene directly in determining what should be done at the university administration level.

I also believe that tuition should be addressed; it varies across the country. We're in the jurisdiction where it is low. I happen to believe that it should be increased, but we should never forget that in doing so we need to provide for the needy students so that we achieve quality and accessibility for all students in the country.

[Michael Savage, Liberal, Dartmouth—Cole Harbour, NS]

Thank you.

[The Chair, Conservative, Brian Pallister]

Mr. Savage, you've left Mr. McCallum with about the same amount of time he left you with yesterday. There is 20 seconds of time, sir. If you would like to make a remark or ask a question, please proceed.

[John McCallum, Liberal, Markham—Unionville, ON]

I would just congratulate Mary-Martha Hale for her wisdom in noting that it was an income tax increase and not an income tax decrease in the last budget.

That's my 20 seconds.

[The Chair, Conservative, Brian Pallister]

Indeed. We'll proceed now.

Mr. St-Cyr, for five minutes.

[Thierry St-Cyr, Bloc, Jeanne-Le Ber, QC]

Thank you very much for coming here today. As I've already said -- and my colleagues must be getting tired of hearing it --, since this is your first appearance before us, you must be very frustrated to have only five minutes to present your viewpoint. However, you can take some consolation in the fact that it is even more frustrating for us to have only a few minutes to put questions to witnesses.

My first question is for Mr. Vinet who, as he mentioned, is the first person from the academic community to make a submission. He is also the first person to deliver part of his presentation in French. I'm delighted to see that, even though I would have preferred it if he had spoken entirely in French. I'm sure my colleagues who are learning French would have appreciated the opportunity to get in a little practice.

On a more serious note, I read your recommendations. You talk about keeping the best students here in Canada as well as about the need to invest in post-secondary education by transferring sufficient funds to the provinces. Most Quebeckers would agree with you. However, you also say that funding should target specific areas and that recipients should be held accountable for the way in which funds are spent. In essence, are you encouraging the federal government to move into an area that is the exclusive domain of the provinces by asking them to be accountable for education issues?

[Luc Vinet]

It's quite simple. No doubt we have our own interests at heart, but given the importance of post-secondary education, we want assurances that the funding allocated will be used for that intended purposes. We want these funds to be used strictly for post-secondary education.