Finance Committee on Dec. 6th, 2007

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

Thank you.

I want to thank you all for being here. My first question is for Mr. Gleberzon.

As you know, seniors' issues have always been a concern of the Bloc québecois. We have several proposals about that.

I would like you to explain your ninth recommendation which I do not really understand. You talk of raising from 3% to 10% the threshold for non-refundable tax credits for medical expenses. In your executive summary, you mention 10% but, later on, in the brief and in the explanations, you mention 6%.

Whatever the case may be, I do not understand the point of this recommendation. Unless I am mistaken, it seems to me that this threshold is the minimum amount from which one is entitled to claim tax credits. If, at this time, people spend 5% of their income on medical expenses, they cannot claim the first three percentage points but they can claim the next two. If the threshold was raised to 6%, they could not claim anything in terms of tax credits. So, I do not understand how such a step would benefit seniors.

[William Gleberzon]

As I said in my presentation, we amended the one you're referring to. Unfortunately, time did not permit that to be incorporated. I'll send the amendment to the clerk so it can be translated and sent to the members of the committee.

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

As far as old-age pensions are concerned, you want them to be increased according to the Consumer Price Index. If I am not mistaken, the last increase based on the CPI was $18. Let me underline that, at the Bloc québecois, we believe that it should have been $130. Had it been so, at least the low-income cutoff would have been reached.

Furthermore, there have been lots of debates in Quebec--and I wonder if that is also the case in other regions-- about the fact that the price of the average basket of consumer goods is higher for seniors then for a typical family since it includes products the prices of which increase more rapidly, such as medicines, health products, special items and so on. Some groups in Quebec claim that we should make establish a specific CPI for seniors and that their pensions should be increased on that basis.

Have you looked at this type of suggestion?

[William Gleberzon]

Yes, we have. We contacted Statistics Canada and met with them. They dismissed the idea, although we agree with what you've said that the basket for older people is quite different. Often, for example, they don't have to worry about mortgages, which is part of the basket, simply because they've lived in a house for 30 to 40 years and paid off their mortgage.

We agree with you entirely. We'd be very happy to work with you to approach Statistics Canada once again.

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

I want to tell you immediately that, even if the figures do not exist, you have the right to ask the government to calculate them. Statistics Canada is controlled by the government. If the old-age pensions have to be adjusted on the basis of real needs, it is up to the government to ask Statistics Canada to produce the required figures.

Thirdly, I would like to talk about the guaranteed income supplement which you referred to in your presentation. In particular, you talked about refunding the amounts due to people who have been shortchanged by the GIS. Indeed, some people who had been entitled to this supplement for many years did not claim it, either because they did not know about it, or because they lived in isolated areas, without external contacts, or because the forms were too complicated. We have launched a big campaign to let people know that they can claim those amounts which they are entitled to. We have also put pressure on the government to simplify the forms and to make the program more accessible. This has been done.

However, now that the time has come to pay people who had been entitled to this supplements for many years, the government has decided to make the payments retroactive for 11 months. This limit had been set up by the Liberals and now the Conservatives, who had promised full retroactivity, are going back on their promise. Do you find that acceptable?

If it was seniors who owed money to the government, because they had not paid their income tax for five years, for example, the government would certainly ask them to pay back with interest for those five years.

[William Gleberzon]

I think if you haven't paid your taxes for one year they'll come after you too, anyway they have to.

We agree entirely. We believe the 11-month retroactive payments that apply to CPP and GIS should both be done away with. We think people should be given the full amount, plus interest, at whatever age they apply. In the case of CPP, it would be back to age 70, because you can apply legitimately, if you will, without forgetting, up to age 70, with benefits. After age 70, a lot of people, for a variety of reasons, don't apply until they're much older. It's the same thing with GIS.

These are the most vulnerable people. These are the ones who need the money the most. We think they should be reimbursed entirely, with interest; however, there should be no penalties applied to the reimbursement. Of course, what would happen is if they were to suddenly get a windfall, they'd either lose most of the GIS and/or pay taxes on it. So I think you have to be very careful.

One other point I'd like to make is that we have written to the Minister of Finance and the Prime Minister, both in the current government and previous governments, about the issue you raised regarding the clawback issue, and also the basket of goods that make up LICO, and in both cases they've said no.

[The Chair, Conservative, Rob Merrifield]

Thank you very much. The time has gone.

Over to Mr. Keddy. You have seven minutes.

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

Thank you, Mr. Chairman, and welcome to our witnesses here this morning.

I have half a dozen questions, and I'm trying to figure out how to ask them all in seven minutes.

I'll simply put my first two questions in the way of a comment and someone may want to enlarge on those later.

To the gentleman from CARP, one of the things I see you asked for last year was income splitting. That's one of the things the government introduced. It was the same with the chambers of commerce. We've lowered the personal income tax to 15%; we've lowered the corporate income tax to 21% by January 1, and it's to go to 15% by 2012, which will give us the second-lowest corporate income tax in the G-7.

Those are carefully targeted tax breaks put in to help individuals, families, and Canadians. They're also meant to help corporations, quite frankly, to do more business, to hire more people, and to supply more jobs. That's one end of the spectrum here.

On the other end of the spectrum we have groups that are trying to find more revenues, such as those represented, for instance, by Ms. Nasser. There is always a balance between revenue generation and revenue output. That's something we shouldn't take lightly, and it is a difficult balance to find.

My first question will go to Phil Pacey. Mr. Pacey, it's nice to see you here this morning, and I appreciate the work you and your group do for Nova Scotians.

One of the challenges, again, is finding the dollars to do a number of the things you've asked, but you made one point that really intrigued me. It was about the Scottish concept of the five-sided dormers. In Lunenberg County we would call that a Lunenberg bump, and we generally attribute them more to a Dutch or German ancestry and not to a Scottish ancestry. It's interesting, and I'll follow that up another time when we have time to chat about it.

I'll just try to explain some of the obstacles we face as parliamentarians. Under the heritage lighthouse protection bill that I sponsored in the House of Commons, what we attempted to do was to actually begin a concept to make lighthouses into heritage buildings and allow community groups to take responsibility for them, especially if they were adjacent to that lighthouse. Those groups would then preserve them and protect them.

Then you get into what I talked about earlier--some of these other jurisdictional and not necessarily financial issues. Heritage buildings are actually under Environment Canada because they fall under Parks Canada. Before that they started out under Transport Canada and were transferred to DFO. So there are some really tough jurisdictional issues here that we have to sort through as parliamentarians and try to get that money to flow into all these areas. A great deal of responsibility goes with that.

I know I'm making more comments than asking questions. I'm moving over to DFO because, as the member of Parliament for South Shore--St. Margaret's, I represent a big fishery riding. Every day we face these very obstacles you talk about for rural and coastal communities. How we keep those communities alive and how we stop the out-migration of those communities is no different in parts of Halifax and Lunenberg and Queens and Shelburne counties than it is in the outports of Newfoundland. It's a big responsibility, and we continue to fund that through DFO.

For instance, there is the small craft harbours program for the harbours and wharves that are the infrastructure of these small communities. The previous government cut the funding for small craft harbours. We reinstated it. It's still not enough, and we recognize that, but how do you find more?

What I wanted to ask you concerns the Species at Risk Act, which you mentioned. How do you bring in that Species at Risk Act and find the financing for it and at the same time maintain a diverse fishery, with bycatch and all the issues surrounding it?

I know that's a rambling question.

[Mark Power]

I guess from our perspective, we're trying to appeal to parliamentarians and to perhaps dip into senior levels of this department, somewhat, to hear from them what their solution is for new, attendant legislation, such as SARA. Those cells have been fitted into the department, certainly, and have been fitted into the organizational chart properly, no doubt, and have been billed properly and have had a rationale made for them. But where there is an argument for funding that runs to that cell in that area and that new business line, what we would like, I guess, is that parliamentarians listen to the department and hear about where, in the early days of those branches, they are perhaps underfunded, or a bit shallow—excuse the pun—and can be funded better. So what we want I suppose, is to listen to the department itself.

My presentation here today is appealing to the public service aspect of it, the heritage aspect of it, for sure. Recently, we commissioned a survey, a poll, of Canadians. About 97% felt strongly about natural resources such as fisheries, a figure that was higher than the percentage of those who had regard or consideration for things like arctic sovereignty. That's called the Our Fish campaign. It is a lobbying campaign that—if you'll allow me a second, Mr. Chair—dovetails with this, because it was designed in the wake of our submission to the committee. So I think we have to listen to the department itself.

This is a public service union presentation. But it's not unlike public service unions, and private sector unions, for that matter, to want to support the community and to support rural Canada.

So I kind of steer away from that, because at times we've been questioned about our motives for having that campaign. The Our Fish campaign fits into the Public Service Alliance of Canada's Defending Quality Public Services, DQPS, campaign that we had.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Ms. McDonough, the floor is yours.

[Alexa McDonough, NDP, Halifax, NS]

Thank you, Mr. Chair.

I'm sure that if, as committee members, we're frustrated, you must be even more frustrated. I don't know whether the presenters sat through the previous presentations, but my calculation is that of the 13 groups that presented this morning, 11 made very strenuous, well-documented cases and arguments for greater investment in the whole range of public provisions: public services, public pensions, public community services, health services, infrastructure, and our built heritage. And two voices have pleaded for bigger tax cuts.

The spokesperson for the North End Community Health Centre, it seems to me, summed it up quite well when pleading for a national anti-poverty strategy. I asked how we should go about this, and he said, please, no more studies, because the government knows what to do, but they keep choosing to do the opposite.

My concern is how we can move forward with what clearly is a near consensus on having people investment that is being placed before the finance committee, while the finance committee members on the government side keep hearing only one voice, which is asking for deeper and faster tax cuts.

I guess my question, to anyone who might want to dive in on it, is whether you see the way to help build consensus around the need for public investment of our massive surplus dollars and whether you can suggest some strategies for how those overwhelmingly increased numbers of voices can pull together to make that happen.

[The Chair, Conservative, Rob Merrifield]

Who are you directing the question to?

[Alexa McDonough, NDP, Halifax, NS]

It is to anyone who wants to answer. That's one of the problems with putting six people together, with chopping it up into moments of questioning. It's just very problematic and frustrating.

[The Chair, Conservative, Rob Merrifield]

Fair enough. Does anyone...?

Yes, go ahead, Susan.

[Susan Nasser]

Again, there are lots of good examples to look to now for poverty reduction strategies that are in place that seem to be working quite well. I've discovered recently that the National Anti-Poverty Organization is actually going to be directing a lot of its efforts towards working on negative social attitudes towards poverty. It doesn't have much to do with taxes, but I think it has to do with creating the understanding among people and the political will that's necessary to bring about changes. If we begin to understand better what it means to live in poverty, who is living in poverty, how they got there, and the concrete steps that can be taken to help people get out of poverty, I think it actually will go a long way towards making it more possible to make those investments that we all think are necessary to reduce poverty.

[William Gleberzon]

Talking about the constituency that I'm here to speak on behalf of, people over 50, one thing is that there must be a recognition that poverty is more extensive than the statistics we have from Statistics Canada will let us believe. Statistics Canada says, for example, that 6.1% of seniors are in poverty, and yet about 38% of current seniors—that would be about 1.5 million people—are receiving the guaranteed income supplement, which only goes to poor people.

While it's true we don't need any studies because the evidence is out there, I agree entirely that what we need is a change of attitude. We need a change of recognition that poverty is extensive in this country, and should not be, because we are a wealthy country. Not only are we a wealthy country, but we have the distinction...because in fairness to both the current and the previous governments, they have managed our money very well, and we've enjoyed surpluses.

Our organization represents 400,000 people. As you can imagine, we cut across the gamut of political opinion, so I have to be careful of what I say when I speak on behalf of the organization. I will say personally—and this is only my personal opinion, and I suppose you should never express that before a parliamentary committee—I agree with you entirely, we do have surpluses, and those surpluses should be spent on assisting to raise the level in our country of non-poverty, bringing people out, and that we do have to change attitudes.

For many seniors, they are in poverty because—and I don't want to go into a long song and dance because you don't have the time—like a lot of people they could not afford during their working years, even though two people were working, to put money aside and save for pensions. Many, about 40% to 50% of Canadians, either don't have a pension or have a totally inadequate personal pension, which is another issue that will bite us in the near future.

The question you are asking I think is one that you have to spend more than five minutes to think about and answer.

[Alexa McDonough, NDP, Halifax, NS]

I guess adding insult to injury is the already inadequate pensions that many seniors have been receiving have been shortchanged, and this needs to be remedied using some of the surplus to do it.

[The Chair, Conservative, Rob Merrifield]

Go ahead, Art. Did you want to speak to it as well?

[Art Sinclair]

Yes.

[The Chair, Conservative, Rob Merrifield]

Okay.

We'll go to Art first, and then we'll go to Phil, for thirty seconds each.

[Art Sinclair]

Okay. Great. Thank you very much, Mr. Chair.

We referenced the study that the Federation of Canadian Municipalities released recently, which obviously, as you're all aware, generated a significant amount of media attention.

Our concern, and I think a lot of business communities or organizations share this as well, is with infrastructure conditions in Ontario. I have a statistic here. The Ontario Chamber of Commerce holds an annual Ontario economic summit every year, and this year it was held in Niagara Lake, which is near Mr. Dykstra's riding, and might be in your riding. At that particular summit, 91% of the attendees identified public infrastructure as being the most critical issue facing their organizations at this time.

[The Chair, Conservative, Rob Merrifield]

Very tight. Is that it?

[Art Sinclair]

Yes.

[The Chair, Conservative, Rob Merrifield]

Phil.

[Philip Pacey]

I would comment that I think an important role of the government is to hold the centre, to support community values, and that means spending money sometimes. We do have to recognize that often by spending money we make money and we create wealth for the community.