Finance Committee on Oct. 17th, 2006

[Carol Hunter]

That's correct. In the last budget, $132 million was committed. In some provinces, like Ontario, it was just the waiting for the ink to dry on the contract with FedNor.

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

I think it's very important.

Just on the off chance that somebody in Atlantic Canada, for example, has nothing better to do than to tune into the finance committee of the House of Commons, could you talk about how you would have used that money in places like Atlantic Canada, but assuming in the other parts of the country as well?

[Carol Hunter]

First of all, I would agree on the concept of social economy. We've spent a lot of time on it. The phrase that we prefer to use is “community enterprises”. I think that is something that resonates and is better understood.

One example could be a home care worker co-op in a community where there are disabled people or seniors in a community who need access to some home care services. People come into their homes and look after them.

It could be a program for street kids, to get kids off the street and working in a restaurant. We have one in Toronto, with the River Restaurant.

It could be a health care co-op in a community where there are no services. It would allow people to access health care services.

So if we think about community-based enterprises, that helps people to better understand the many different ways that these small organizations, both for-profit and non-profit, can help to meet community needs.

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

I have heard from not-for-profit organizations as well about how this is going to affect them.

Mr. Bomben, did you want to say anything?

[Frank Bomben]

I was just going to say that in addition to just providing the funding, this program also would have provided technical assistance and supported research in those various communities right across the country. It's not just for funding specific programs.

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

The concept of a social economy or investing in communities—I forget the exact term—is not an alien concept around the world. Some of the most progressive economies in the world have gone through investments in the social economy in the last 25 years, correct?

[Carol Hunter]

Yes.

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

Thank you very much.

Mr. Johnston, we've heard from a lot of people about investing in research, and I congratulate you on your brief. I think it's well put together.

We've heard from a lot of different organizations—universities, researchers, and granting councils themselves—about the work we've been able to do in Canada in the last number of years, in fact reversing the brain drain and bringing researchers back. That's largely through, as you indicate, investing in university research. I guess what you're talking about is making sure we take advantage of that and take the next step in terms of going into commercialization and actually really giving a further boost to the economy through the investments and research.

In one of your recommendations, you state:

Clarify the mandates of government research institutions to ensure their relevance...re-invest in those that are essential to meet the government’s regulatory responsibilities, that provide the government with the capacity to respond to global or national emergencies....

Can you be specific at all? Are we talking about granting councils, like NSERC, SSHRC, CFI, CIHR? Who do you think is significantly worthy of this?

[The Chair, Conservative, Brian Pallister]

Unfortunately, Mr. Johnston, you have only seconds.

[Paul Johnston]

In that particular recommendation, we were discussing the role of government laboratories. They are not universities or industries, but they have specific roles to play in the national interest. The government needs to make sure that the roles defined for its labs across the country, operated by the National Research Council or Natural Resources Canada, are within the mandate of those departments and serve the interests of the government as a whole.

[The Chair, Conservative, Brian Pallister]

Thank you, sir.

The floor is yours, Mr. St-Cyr.

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

Thank you, Mr. Chairman. I am sorry that I was late, I had another committee meeting.

My question is for Ms. Carleton. I am told that you spoke about the two orchestras whose plans to tour New York, or elsewhere in the United States, were put on hold following the recent funding cuts. Yet, this afternoon, in the House of Commons, when the Bloc Québécois asked Minister Oda whether the funding cuts would affect such touring plans, her answer was a categorical no.

I realize that I was a little late, but I would like you to address this point to give me an idea of what is actually happening.

[Katherine Carleton]

I apologize for not being able to respond in French. I actually understood very well what you said, but I do not yet have the courage to speak back to you.

We have been advised by a couple of our members who had planned to pursue international touring this spring that they've been told that their applications are on hold. They have not yet been forced to cancel. They are, however, hitting the panic button. They are extremely concerned, because at a certain point a late cancellation is really fatal to future touring prospects.

I'd be pleased to provide you with more details as they become available, but at this point we simply know that the applications are on hold.

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

If the minister was correct in what she said in the House, you have nothing to worry about. As to whether she was correct, that is a whole different matter.

My next question is for Mr. Shapcott and concerns housing. Housing is a matter of great concern in my riding, Jeanne-Le Ber, which lies south-west of Montreal. You recommended a $2 billion-investment in social housing. The Bloc Québécois fully supports this recommendation.

Another issue that worries me gravely is the availability of land to build social housing. Land for building social housing is becoming increasingly rare and increasingly expensive. Would you be in favour of a process whereby the federal government or a Crown corporation could divest themselves of land they no longer require and make it available for housing in areas where there is a real need, rather than simply selling it to the highest bidder? Do you think that would be a good idea?

[Michael Shapcott]

The cost of housing is significant in Montreal and almost everywhere in Canada, and the cost of land is a significant component of the cost of housing. The federal government, back 1999, announced a program to make available surplus federal lands for housing. But it's been used only sparingly, in a just a few parts of the country.

I don't know your particular riding, and I don't know what federal or other government properties might be available there. In urban areas, though, the most important way to develop housing is by intensification, that is to say, by adding more homes in existing neighbourhoods. There are lots of examples of successful intensification projects across the country, including some in Montreal that you may be familiar with.

[The Chair, Conservative, Brian Pallister]

Merci, Monsieur.

We'll continue now with Madam Ablonczy.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Thank you.

I appreciate your presentations.

I want to start with Mr. Williamson, since we hardly ever get somebody in front of us not wanting to spend money.

The Taxpayers Federation—and I assume you speak for at least some taxpayers—must know that in this country there's a wide range of people with needs, requests, and activities, all clamouring for federal dollars. What do you have to say to the committee about this? I ask because some of these people are engaged in good and useful activities. You seem to be saying not to take the money to spend on these activities. What's your message, when you see what we're dealing with and what the options are?

[John Williamson]

My message is straightforward. The government made certain promises in the election campaign. They heard from Canadians far and wide, voters at election time, and some of those promises include spending in priority areas to stop the practice of having budgets rise across the board just because they rose last year across the board. It was to pick and choose your priority areas in the coming years, rather than just agreeing to all funding requests because the money is there.

There was another promise made to hold spending growth at inflation plus population, something we have not seen since the early and mid-1990s, when the Chrétien government was attempting to balance the budget, and they were ultimately successful at doing that.

The bottom line is to go back to what Jean Chrétien used to talk about, a balanced approach, whereby you spend in priority areas, you reduce some debt, and you cut some taxes. That's all taxpayers are looking for.

What we're not looking for is to have surpluses rung up throughout the course of the year and budgets to be blown. For example, in Paul Martin's first budget, program expenditures were supposed to increase by 2% or 3%. It sounded very, very responsible. At the end of the year, program spending was in the double digits. Why? Because those surplus dollars just came tumbling in.

In fairness, that's a challenge all governments face. The current government is also facing these pressures.

One thing I thought was very interesting was when the government made its $1 billion spending cut, members were saying this wasn't necessary because we were running a surplus. The Government of Canada should be using tax dollars efficiently, whether we're in a deficit situation or a surplus situation. Because we're in a surplus situation today doesn't mean we ought to be spending on priorities that don't achieve value for money or don't achieve measurable public policy outcomes.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

I wanted to let you have your say on that. We have so many other areas we want to look at, housing being one.

Mr. Shapcott, I toured the Calgary homeless shelter fairly recently--tremendous work being done there. The question I have I had for people at the shelter, but I'll ask you as well. So many people are homeless who are not really capable of owning or operating within a separate home environment, people with serious substance abuse problems, people with serious mental illnesses. What is your strategy for dealing with that portion of the population, who, if you gave them a home or an apartment or a condo, would still find it very difficult to operate in society even with that assistance?

[The Chair, Conservative, Brian Pallister]

I do regret, Mr. Shapcott, that the preamble has consumed the time available, and I hope you get another question.

Mr. Pacetti.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Thank you, Mr. Chair.

Thank you to all the presenters, always interesting. The problem is we lack time, so I'm going to try to get straight to it.

Mr. Williamson, just quickly, in your brief you said the tax rate went from 15% to 15.25%, and 15.5% to 16%, but all I know is that my tax form said 16%--and it went from 15% to 16%. I know there was an averaging, so perhaps this year it was at 15.5%.

[John Williamson]

You're right, but the effective rate for this year is 15.25%, and next year the effective rate will be 15.5%, up from--

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

But the rate will be 16% for 2006.

[John Williamson]

No. The Conservatives initially said they would put it to 16%, but in the budget they split the difference and went for 15.5%.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

You didn't address the GST; it's a question we've been asking most people who come forward asking for lower taxes or lower GST. What is your preference, if you had to choose?