Finance Committee on Oct. 3rd, 2006

[The Chair, Conservative, Brian Pallister]

Welcome to all of you, and thank you for taking the time to be with us today. We appreciate it and appreciate the time you've taken also in preparing your briefs, which, if they haven't all been distributed, will be following their translation.

As you know, we're mandated by the House of Commons to consider your input and the input of Canadians, as we are doing in the next few weeks and have for the last couple, in preparing recommendations to the finance minister for the upcoming budget.

I appreciate the fact, as I said, that you are here today, but I also want to remind you that we are limited in terms of time, so you have been asked to confine your remarks to five minutes. I will give you an indication when you have a minute remaining and will become increasingly agitated in the last minute, which will become apparent to you. But I will give you an indication that you have a little bit of time left, and I will cut you off at five minutes. I just want to give you that advance warning.

There will be a couple of other committee members joining us, and you should be aware that they also review your briefs. We keep minutes of our discussions, so they will be reviewing those after the meeting as well.

We'll begin with the B.C. Child Care Advocacy Forum representative, Rita Chudnovsky.

Welcome. You have the floor for five minutes.

[Rita Chudnovsky, Facilitator, B.C. Child Care Advocacy Forum]

Thank you very much.

I'm actually sorry to ask this, but I'm wondering if we can skip to Michael, because I gave my speaking notes over for copying to the translator and I don't yet have them back.

[The Chair, Conservative, Brian Pallister]

I don't think we have a problem.

Michael, will that be fine with you? Good.

[Rita Chudnovsky]

My apologies.

[The Chair, Conservative, Brian Pallister]

That's not a problem.

From First Call: BC Child and Youth Advocacy Coalition, Michael Goldberg, chairperson.

Welcome, Michael. Please proceed.

[Michael Goldberg, Chairperson, First Call: BC Child and Youth Advocacy Coalition]

Thank you.

I thought we only had two and a half minutes so I made my notes short, but I can always elaborate.

We're very pleased to be here. I'm the chair of First Call, and First Call is a coalition of provincial and regional organizations. Combined, the partner organizations have over 100,000 members, so we represent a sizable part of B.C.

All the partners are committed to the UN Declaration on the Rights of the Child, which says children and youth should have first call on society's resources--hence, the name, First Call.

Our brief, which was sent ahead of time and which I believe all of you have in front of you, has six recommendations. In the two and a half minutes I thought I had, I knew I couldn't read all six of them, so I'm going to let you just take a look at either the executive summary or the arguments around the particular recommendations. Many of them will be familiar to you in terms of raising the child tax benefit, child care, etc.

I did want to say that we note in our paper that the Global Competitiveness Report of the World Economic Forum shows that there is no one way to achieve productivity and economic growth, which was at the heart of the questions you had asked us to comment on.

For example, in the report that was just released last week--we give you the previous year's data in our brief--Switzerland is now ranked as the number one country overall this year, but the report also notes that, “Scandinavian countries remain among the top performers with Finland, Sweden, and Denmark ranked 2, 3, and 4th respectively.” And the U.S. now ranks sixth, and Canada now ranks 15th.

The report notes that the Scandinavian countries have strong public institutions, budget surpluses, and low public indebtedness--critical factors in terms of issues around productivity and competitiveness. At the same time, we know that they have relatively high levels of taxation, but it is smart taxation.

One of the important things to think about is how we begin to pay for the programs that we desperately need if we're going to begin to grow from our rank of 15th to somewhere higher up on the competitiveness chart. Canada clearly has the capacity to have similar outcomes compared to the Scandinavian countries if, as we note in our brief, much more attention is paid to eliminating wasteful tax expenditures, thereby increasing revenues, and no longer pursuing tax cuts that make little difference to ordinary Canadians but wind up costing the federal treasury huge sums of money.

For example, in the last budget--and in previous budgets, as this is not about any one particular party--there was the equivalent of some $10 billion annually in tax cuts that were offered. That would have been more than enough to eradicate child poverty in this country.

[The Chair, Conservative, Brian Pallister]

Now, Rita, I guess we will put you on the spot. I gather you have your notes back.

[Rita Chudnovsky]

I do. Thank you.

[The Chair, Conservative, Brian Pallister]

Please continue.

[Rita Chudnovsky]

Thank you very much for allowing us to present our ideas.

I'm here on behalf of the B.C. Child Care Advocacy Forum. As our brief outlines, we are an alliance of six provincial organizations that bring together thousands of parents, caregivers, professional groups, and concerned citizens on child care in this province.

As our brief outlines, we know and the research confirms that child care is a multi-purpose program that supports social and economic goals, but given the focus of this year's pre-budget consultation and the focus of this committee, our brief and my even briefer comments are going to focus on the reasons that child care is part of the solution for Canada's place in a competitive world.

I want to briefly make four points.

The first is that the Canadian economy currently faces a growing labour shortage. This labour shortage has to some degree been offset over the last two decades by the unprecedented entry of mothers of young children into the Canadian labour force. Families and the economy are dependent on and count on women's economic participation, but without investments to support women's essential role in the home and in the labour force, the shortage will only worsen. Access to child care is part of the solution to this problem.

Secondly, the committee is concerned about a healthy and skilled workforce. The research is absolutely clear that the quality of the experience that children have in their early years matters. Our key trading partners recognize this and make significant investments in early childhood services. The recent OECD report highlights this and indicates that Canada is at the bottom of 14 OECD countries in terms of public expenditures on services for young children. Quality child care is clearly part of the solution to a healthy and skilled citizenry.

Thirdly, child care is part of the solution to regional and local economic development. A series of cost-benefit studies demonstrate a benefit over cost in public investment in child care, and those don't even take into account the regional and local stimulant. We know that given the small-scale nature of most child care and the wages paid in child care, these dollars are spent in the community. So investment in child care is part of the solution to regional economic development.

Finally, we would suggest that the market approach to child care, which has been evident in this country for over 30 years, has not worked. Families do not have access to the services they need, and those who do are paying more for early childhood than for university. The reason for this is that the broad social and economic benefits of child care are beyond the ability of individual families to pay. We are asking them to make the highest expenditure at the time in their life when they're earning the least. Focused public investment in quality, accessible, affordable child care is part of the solution.

Our recommendations to the committee are the same as they've been in our previous submissions. We're looking for federal sustained multi-year funding that moves child care away from a user fee system to a publicly funded one. As a starting point, we're asking for a $5 billion commitment over five years, tied to provincial and territorial action plans.

Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you very much.

We'll move to the presentation from the Forest Products Association of Canada, Avrim Lazar.

Thank you, sir.

You're welcome to proceed. Five minutes is yours.

[Avrim Lazar, President and Chief Executive Officer, Forest Products Association of Canada]

Thank you.

Thank you so much for holding these hearings. Many of the members of the committee have forest product mills in your ridings, and those of you who don't have them have spinoff jobs. There are 250,000 direct jobs, and then there are another 750,000 jobs, many of them in Toronto, Montreal, and Vancouver. We're talking here today about jobs and what it takes to keep jobs in Canada.

The bottom line is pretty simple: keeping jobs in Canada requires investment in Canadian facilities. Investment comes if two things are present. Investment comes if the industry is doing its job and becoming more productive and more efficient. We've been doing that year after year--more than the rest of Canadian manufacturing--and we've become more productive than the U.S. industry. We've been doing our part.

The second thing that draws investment into Canada to keep our mills operating is a competitive business climate. A key piece for a competitive business climate is not punishing investment. In Canada, we have a higher tax rate on investment in forestry than any of our competitors. No other forestry nation in the world taxes investment as high as Canada does. In fact, we tax investment in forestry more than we do mining and oil and gas.

If you want something, you shouldn't punish it. We are asking the government, and we're asking the committee to recommend to the government, that we change the tax regime to reward rather than punish investment.

We have three specific suggestions. The first, which we share with most manufacturers in Canada, is an accelerated capital cost allowance--two years, straight line. You have of course all the details in our submission. It's a beautiful measure because it doesn't cost you a penny, unless we invest. It's specific: you want to see investment, accelerate the write-off, and the investment will come. It doesn't cost anything unless you get the behaviour you want, which is investment in Canada.

The second suggestion is that we make the SR and ED tax credit for research refundable. Why refundable? Because when business is bad, companies should still invest in research. But when business is bad, the tax credit is eliminated. We're not allowed to have access to it because we have no profit. We want investment in research, year in and year out, at the bottom of the cycle, at the top of the cycle, so we can stay competitive. Let's not cut off companies that are not making a profit from the tax credit, let's make it refundable.

The third suggestion is to create a tax regime that encourages getting off fossil fuels and on to biomass. Biomass gives you zero Kyoto greenhouse gases and cleaner air; it reduces the mills' dependence on fossil fuels, allowing us to keep the mills open.

With those three things, we would have a more competitive business climate, there would be more investment in Canadian mills, and we'd keep more jobs in Canada.

Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you very much, sir.

We continue now with a representative on behalf of Hydrogen and Fuel Cells Canada, John Tak, president and CEO.

Welcome, sir. Please proceed.

[John Tak, President and Chief Executive Officer, Hydrogen and Fuel Cells Canada]

Thank you very much.

Hydrogen and Fuel Cells Canada is the national industry association representing companies and institutions operating in this sector. We have 75 members across Canada, and that's up from 65 members at the start of this year. This is made-in-Canada technology that is primarily driven by clean air, economic development in innovation jobs, greenhouse gas reduction, and energy reliability and security.

The state of the industry. Currently, our companies are investing over $200 million a year in Canada in R and D; $290 million in 2004. The entire energy sector is spending about $650 million. This small group of companies is investing one-third of Canada's entire energy R and D. It's pretty significant and it's also a statement of what's happening in R and D expenditures in this sector in Canada.

It started out with Ballard Power Systems in the early eighties--everybody's heard of them--but not really much has been heard since. Since then, we have created over 2,000 jobs in the sector; R and D expenditure is about $100,000 per employee; 90% of the product sales of over $200 million are outside of Canada, and we have commercial products now. I think that's something people don't know. They're still expecting the cars, which are a few years down the road, but you can buy fuel cell forklifts right now, you can buy back-up power for data centres, which is critical. There are currently 100 fuel cell buses operating outside of Canada, and 60% of those have Canadian technology in them. So that's the state of the nation.

The investment by the private sector is about $1 billion over the last five years. We have received, in terms of partnership support from the government, about $100 million. That's a 1:10 ratio, and that's only in the last five years. Over the last 15, it's about 3¢ of public support for every dollar the private sector invests. That's great. We're happy with that, but it's not going to get us to where we need to go. In the biotech sector, for every dollar of investment, there's $1.20 to $1.30 of public sector investment to support it, and it's a big success across Canada.

What's happening overseas? We're not alone anymore. We started, and we are the leaders, but we're not alone. The U.S. is investing heavily in the sector, and Japan, China and Korea. That's good. It validates the sector. It also creates markets for us, because we export, but it also creates competitors and we are in danger of losing our lead.

In a nutshell, what we need to do is deepen the partnership. I already showed you how the private sector has been leading this. It isn't the government. I often have meetings in Ottawa and I've been told, “Oh boy, we spend so much money on this sector and what have we got to show for it?” Well, it's the private sector that's leading this, with $1 billion of R and D investment over the last five years and about $100 million in public support. Clearly, the private sector.... We've got the jobs, over 2,000, but what we need now is to continue, over the next five years, support in terms of research and development for the technical challenges we need to solve for the bigger-volume commercial or consumer products. We need to continue doing demonstration projects. We run the Hydrogen Village in Toronto and the Hydrogen Highway in B.C., but we need to continue demonstrating this technology.

We need to stimulate demand, and that can happen through government procurement. If the government buys Toyota Priuses, there's no reason why it can't buy a hydrogen forklift from Canadian technology.

And we need access to capital. In terms of access to capital, we're talking about scientific research and experimental development, or SR and ED, credits. Currently, if you go public, you basically lose all your SR and ED credits, and that's a critical way to raise capital. So the definition of a Canadian-controlled private corporation needs to be revised and the limit needs to be raised from $2 million, which is not sufficient to fund the capital that innovation-based companies need in Canada.

We are also supporting the implementation of flow-through shares for the hydrogen fuel cell sector. We have a proposal forward to Finance Canada, and it's being considered.

Those two things will maintain Canada's lead.

The Minister of Energy in P.E.I. met with them last week and was very proud of the fact that they had recently sent their first cheque for $10 million to Denmark as a downpayment for a wind turbine. Wind is very good; it's mature, it's clean technology. But you're sending that $10 million to Denmark. Let's do what Denmark did--foster the growth of this sector so we can maintain our leadership. We'll recoup our costs through exports and through the jobs we create here in Canada.

Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you very much, Mr. Tak.

We continue with Ken Kramer, who is with us today on behalf of Muscular Dystrophy Canada. Welcome. Five minutes to you.

[Ken Kramer, Chair, Muscular Dystrophy Canada]

Good afternoon, Mr. Chairman, honourable members. My name is Ken Kramer and I am the chair of the national board of directors of Muscular Dystrophy Canada, and a lawyer and president of KMK Law Corporation, a law firm located in downtown Vancouver.

Since 1954, Muscular Dystrophy Canada has been committed to improving the quality of life for the tens of thousands of Canadians living with neuromuscular disorders. Our organization provides funding for leading research for the discovery of therapies and cures for neuromuscular disorders. We also provide various services to Canadians with neuromuscular disorders, including assistance in the purchase of wheelchairs. I'm here to make you aware of a lamentable situation with regard to the funding available for persons with disabilities and to offer solutions that I hope you will strongly consider.

There are currently major inconsistencies in the levels of service, funding, and accessibility offered between provinces when it comes to wheelchairs. The result of this lack of funding is that non-profit organizations such as MDC are obligated to use a significant portion of their limited funds to pay for people's wheelchairs, instead of allocating it towards the research that will find a cure for degenerative disorders.

While some provincial programs will cover the entire costs associated with purchasing a wheelchair, others will only provide funding for children or for those who are on social assistance. While some provincial programs boast wait times of six to eight weeks to obtain a wheelchair, others take over six to eight months to provide medically necessary equipment. Some provincial programs offer readily accessible information about their program requirements and processes. Others, however, don't even have an official wheelchair program in place, making the necessary information very difficult to find.

Wheelchairs are a fundamental need for those who require them. Those in need should not have to deplete their savings before receiving funding from the government. If the government state is willing to pay for someone to obtain a hip replacement so that they are able to walk, then it should also pay a person's wheelchair if that is what he or she needs to get around.

To that end, MDC, along with five other like-minded organizations, has recently launched a national wheelchair strategy in which we ask the government to implement the following three important pillars: one, national standards to ensure that the levels of service and funding provided to those in need of a wheelchair are consistent across provinces; two, federal transfer payments to enable all provinces to provide full funding for the residents' wheelchair needs; and three, the creation of a one-stop-shop information venue whereby information about the various provincial programs, requirements, processes, and contacts would be available through a national phone service and website.

MDC believes that these measures are directly linked to helping Canada secure a prominent place in this emerging global economy. By implementing the above-mentioned ideas, Canadians with disabilities will have an increased chance of obtaining the necessary skills to contribute meaningfully to society. Without a national wheelchair program, as is the case now, some Canadians with disabilities will find it more affordable to rely on social assistance rather than working, since being employed would mean that they would have to deplete their entire savings to obtain a wheelchair, a purchase that can cost tens of thousands of dollars.

For example, the chair that you see me now in cost approximately $25,000. Because I can be independent through the use of this highly sophisticated electric wheelchair, I am able to run a successful law firm in downtown Vancouver where I employ three other people. Without this chair, I could not contribute to Canada's economy nearly as much as I do now. The notion that a person with a disability cannot afford to work because of what he or she will have to pay for a chair is wrong and certainly does not further Canada's economic situation. The time has come for wheelchairs to be a core part of our national health care strategy.

We call on you esteemed members of the finance committee to help make the national wheelchair strategy a reality. Every Canadian deserves to live with dignity, independence, and the opportunity to contribute to his or her community. Without a prescribed mobility device, however, many Canadians cannot participate in making Canada stronger and more productive.

Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you very much, Mr. Kramer.

We continue now with Michael Loo, who is representing the British Columbia Council for International Cooperation.

Welcome, sir, you have five minutes.

[Michael Loo, British Columbia Council for International Cooperation]

Good afternoon. Thank you.

My name is Michael Loo, and I am the director of the B.C. Council for International Cooperation. We are a membership-based organization for over 20 B.C. civil society organizations.

We are part of an international campaign called Make Poverty History. I am among the over 225,000 Canadians who signed on to the Make Poverty History campaign, believing it's time for Canada to do its part to end poverty globally and at home.

In my presentation, I will concentrate on two points. The first one is on more and better aid, and the second one is on ending child poverty in Canada.

Globally, 50,000 people die every day from poverty-related causes. It simply does not have to be this way. More and better aid is needed to help end extreme poverty and hunger, to enable every child to attend elementary school, and to create decent jobs.

As many of you know, the UN set a target of 0.7% of gross national income for foreign aid. Prime Minister Stephen Harper made an election promise to match the OECD donor performance average, which was 0.42% of gross national income in 2005. We believe it's time for the next federal budget to deliver on this election promise and to meet the 0.7% aid target by 2015.

The Canadian Council for International Cooperation has calculated that Canada could meet the 0.7% aid target by 2015 if there were an increase of 18% in the aid budget. The BCCIC and its members believe its time for the government to increase foreign aid so that we reach both the UN target and the millennium development goals by 2015.

We also need better aid. Canada needs to improve the quality of its aid, focusing on poverty eradication and on the promotion of human rights.

The BCCIC welcomes the passing at second reading of Bill C-293. We applaud the work of Mr. McKay and the bill, which calls for Canadian foreign aid spending to focus on ending poverty.

My last point is this. It's time to end child poverty in Canada. The next federal budget could take a big step towards eliminating child poverty by increasing the maximum child tax benefit to $4,900 per child. It's also time for the federal government to develop a national poverty reduction strategy.

To conclude, it's time to make poverty history. Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you, Mr. Loo.

Our next presenter will be from the Tenants' Rights Action Coalition, Martha Lewis, executive director.

Welcome, Martha, please proceed.

[Martha Lewis, Executive Director, Tenants' Rights Action Coalition]

Thank you.

My understanding was that the theme today was Canada's place in a competitive world, so I've tried to place housing within that context. Housing is a basic need for everyone in the world, for the man who's just paid off the mortgage on his dream house and for a child who's in a temporary shelter because her family's looking for housing.

The problems about a lack of housing and the effect that has on individuals and the economy are well known; the research has all been done. In your package, I have provided copies of some papers, some excerpts of papers that were already submitted to pre-budget consultations in Ontario, one from landlord organizations, one from the Wellesley Institute. Rather than your having to read everything twice, I'm here in support of what other people have submitted.

The other two documents were not submitted for this session: one was a background paper for Diane Finley's round-table discussion on housing that was held last month, and the other from the Ontario Non-Profit Housing Association. All these offer possible solutions. We don't need to reinvent the wheel; the solutions have also been identified, and there's certainly a role for the federal government to play in coming up with these solutions.

For the last 20 years there's been a 25% decrease in the funding provided by the federal government for housing. We're the only OECD country that doesn't have a national housing policy. We've just been slapped by the UN rapporteur for what's happening with housing in this country. It affects our trade or our competitive position by sending a message to people who may be considering coming to live in Canada that it might be a less than ideal place to live. I know we're considered very safe and we're not a war-torn country; however, housing has become increasingly expensive, and a quarter of a million Canadians each year go through a period of homelessness. These stats are laid out in the Wellesley Institute paper.

Visible homelessness is already affecting tourism in Vancouver and Victoria--I don't know about the other provinces because I tend to focus on the local papers--and conferences have been cancelled by American groups because they don't like the aggressive panhandlers they see in Vancouver. There's a reason for these people being out there; they're not housed in a stable place.

It does take all levels of government to tackle the problem, but there's a huge role for the federal government, and our government does have responsibilities. In an ideal world, the market and individuals would solve every problem, and there wouldn't be a need for government policy, but we all know that's not the case. We're calling for a national housing policy, for tax policies that will encourage rental landlords, market landlords to build more housing: There's a real shortage of rental properties, and that's all a result of tax policies that were put in place in the seventies and eighties. We need a commitment of funds for social housing as well.

If we don't, there's a pressure on wage rates, and it's not going to help our competitive position if we have to keep providing higher wages for our workers. In the paper I handed in earlier, I gave the example of Holland, where after the war social housing was built so wage rates could be kept down and the country could compete internationally.

That's all I have to say. Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you, Ms. Lewis.

The next presenter is from Results Canada, Blaise Salmon, president. Welcome, sir; five minutes to you.

[Blaise Salmon, President, Results Canada]

Thank you.

Results Canada is a citizens' advocacy group with chapters across the country. We work to generate the political will to end hunger and the worst aspects of global poverty.

We are a member of both the Canadian Council for International Co-operation and the Make Poverty History campaign, which my colleague Michael just mentioned and which has the support of almost a quarter of a million Canadians pressing the government to take more action against global poverty.

Canada's foreign aid is currently about 0.3% of gross national income, far below the 0.7% that is needed to reach the millennium development goals. These goals are intended to cut extreme poverty by 50% by the year 2015.

As Michael mentioned, during the election Prime Minister Harper promised to bring Canada's aid up to at least the average of other donor countries. However, this will require increases beyond those currently planned, so it seems that Canada, despite a long string of budget surpluses, will not reach even the average level of generosity promised by Mr. Harper. Clearly, we must do more.

In addition to more aid, of course, we must provide better aid. We also welcome the initiative of Mr. McKay with Bill C-293, the Development Assistance Accountability Act, which will bring Canada closer to better and more poverty-focused international aid.

In addition, we believe Canada should focus aid on those actions that have the greatest impact. I'd like to focus on two today: disease and microcredit.

Together, the three diseases malaria, tuberculosis, and AIDS kill six million people a year. This is a holocaust of preventable death each year. Malaria and tuberculosis in particular need additional funding from both CIDA and the World Bank. Canada has made important contributions to the global fund to fight AIDS, TB, and malaria, but more is needed to reach our fair share. More details and numbers are in the brief.

For the rest of my time, I'd just like to speak about microfinance, a topic that I hope will be of special interest to this committee.

As we sit here today, over 1.2 billion people struggle to survive on less than one U.S. dollar per day, a massive tragedy of human suffering and lost potential. Microcredit is probably the single most important solution to this problem. Microcredit provides the very poor with a no-collateral loan from as little as $3 to no more than a few hundred dollars to start or expand small self-employment businesses, such as selling clothes, making food to sell, operating bicycle rickshaws, or renting out cell phones. Repayment rates are typically over 98%.

In the harsh conditions of the informal economy that employs millions around the world, microcredit has proven to be a powerful tool to help people lift themselves out of poverty and improve their nutrition, their housing, and their education. Experiences from countries as diverse as Bangladesh and Bolivia show that extreme poverty among microcredit borrowers can be reduced by 70% within five years of entering a loan program.

In contrast to charity, which becomes more expensive with every person helped, microfinance becomes self-sustaining once it reaches a large scale. This is one of the unique strengths of microcredit as a force for ending extreme poverty. However, start-up funding is required.

Both CIDA and the World Bank give far too little to microcredit, well under 1% of their respective budgets. In CIDA's case, microcredit spending has actually declined 25% over the past five years, to about $30 million per year.

To raise the profile of microcredit, our group has organized the Global Microcredit Summit, to be held next month in Halifax, from November 12 to 15. The microcredit summit campaign was originally launched in 1997, and so far it has resulted in a tenfold increase in the number of poor people with access to microcredit around the world, from seven million people in 1996 to over 92 million people by 2005. Over 2,000 microfinance practitioners and borrowers from over 100 countries will attend the Global Microcredit Summit next month, which will be convened to share best practices and set a new goal for 2015, the target date for the millennium development goals.

I'd like to extend an invitation to the members of this committee to join me in Halifax to learn more. Microcredit is short-term aid that becomes self-sustaining after a start-up period of donor support. As such, it's one of the best examples of effective aid and must receive much more attention from Canada's aid program.

Thank you.

[The Chair, Conservative, Brian Pallister]

Thank you very much, Mr. Salmon.

We continue with Alan Winter, who is here on behalf of Genome British Columbia. Welcome, sir, and proceed.

[Dr. Alan Winter, President, Genome British Columbia]

Thank you, Mr. Chairman, distinguished members of the finance committee, and my colleagues.

First of all, thanks for travelling to Vancouver.

I want to address the question you asked--Canada's place in a competitive world--in three ways: first, around life sciences; second, around Genome British Columbia, which is the organization I represent; and third, with recommendations to the finance committee.

First of all, in terms of life science and the business sectors they support, they're increasingly important to the prosperity of British Columbia and Canada. These sectors include such areas as health; forestry, as we've heard; fisheries; agriculture; livestock; wine; environment; and also bio products increasingly for mining, energy, and other industries. I understand the committee is going to Fort McMurray at one point, and one of the interesting things is that we have a project starting with the province of Alberta around microbes in that area to reduce the viscosity of the tar sands. To some extent, life science permeates a lot of the industry and the competitiveness of that industry, as we see it now.

As you know, all living organisms, whether bacteria, microbes, or viruses, have genomes, and this describes to some extent their whole and complete set of genes and genetic material. It's really this underlying molecular understanding of life sciences that's critical to us in Canada, as we look at the universities developing skills for the 21st century, or our innovation capacity that requires infrastructure, or even our industry sectors in Canada that are trying to compete in a global-based economy.

To quote Henry Friesen, for example, “Genomics and proteomics will be to the next 20 years what computers and the Internet have been for the last—a quantum step into new frontiers of knowledge, transforming how we view disease, how we manage our resources, and how we generate energy.” That's life sciences.

Turning for a moment to Genome British Columbia, we've been quite involved in the economic sectors in British Columbia. We started in 2000, and motivated by Dr. Michael Smith, who was a Nobel laureate here in life sciences, we've really become a tenet or an anchor franchise, if you like, for genomics research in British Columbia and key to the province's life science strategy. The province, to some extent, is a life science province. We don't have automobile manufacturing and other things like that necessarily here.

We have now an approved $300 million program from 2000 on, including 28 large-scale projects in each of these areas of life science, and they're all supported by substantial community infrastructure, technology and science platforms at universities, teaching hospitals, and industry. It's an effort that to date has created more than 500 jobs, trained more than 700 researchers, produced over 1,000 scientific articles and papers and so on, and is critical to the success of the province in this knowledge-based economy.

I've told you about Genome British Columbia because I think you should feel proud. In fact, all of this has been possible really only because the federal government some time ago made a strategic investment in Canada's future in research and development. Genome Canada was created six years ago. This is an independent organization, but we're linked by contract.

Half of the $300 million coming into British Columbia comes from Genome Canada in national competitions. We have to compete for it. With the help of partners--the provincial government, industry, foundations, and so on--we've raised the other $150 million, all being put into these areas of genomics. This is one of the largest targeted research programs in British Columbia's history.

That's Genome British Columbia.

Thirdly, in terms of recommendations, our request to you today is fairly direct. We're asking you to recommend to the Minister of Finance and his department to fund Genome Canada in the 2007 budget. Genome Canada has been successful, and as a result, Genome Canada has few uncommitted funds remaining.

In the last six years Genome Canada and the genome centres like ours have leveraged $600 million in federal funding into more than $1.4 billion of research. That has led to a significant number of links with biotech companies, inventions, and so on. If we just look at one company, Genentech, in California, which was created in 1976, that company today is worth more than the Royal Bank, Alcan, Bombardier, and Noranda combined. The time has come for Canada to generate its own Genentech.

Mr. Chairman, we would urge investment in Genome Canada this year because it is accountable and results-oriented; because it's critical to the success of organizations such as mine, Genome B.C.; because it enables Canada to be on the leading edge of genomics research and to address the commercial and social challenges we face; and because it's critical to competitiveness in the life science sectors of health, fisheries, forestry, agriculture, mining, energy, and the environment--in other words, in our global knowledge-based economy.

Thank you very much.

[The Chair, Conservative, Brian Pallister]

Thank you, sir, and thank you all for your presentations. Well done.

We begin with Mr. McCallum. You have seven minutes, sir.