Finance Committee on Dec. 7th, 2007

[The Chair, Conservative, Rob Merrifield]

I'll call the meeting to order. This is our last day of pre-budget consultation as far as listening to witnesses is concerned, and then we'll be deliberating and looking after our report.

We want to thank the witnesses for coming forward. We're looking forward to your presentations. We have full panels all day long, so we do ask that you respect the five-minute time limit, and we'll try to keep it as close to that as we possibly can.

That's not the end of the time. After that, we'll get into the questions and answers. It's just that if we give more time for presentations, there will be less time for questions and answers, and my colleagues get a little nervous when I don't give them enough time, so we will respect that.

I'll introduce you and yield the floor to you in order. I think that works out the best.

We have, first of all, BIOTECanada, with Mr. Peter Brenders, who is the president and CEO.

Thank you. You have five minutes.

[Peter Brenders, President and Chief Executive Officer, BIOTECanada]

Bonjour et merci to the committee for the opportunity to appear before you today.

Here with me today is the chair of our emerging companies advisory board at BIOTECanada, Dr. Paul Wotton, who is the CEO and president of Topigen Pharmaceuticals, located here in Montreal.

This is our third presentation to this committee in recent years, and we appreciate the attention and support that you have offered our recommendations in the past. In particular, we appreciate the leadership this committee has offered in terms of LLC recognition and the scientific research and experimental development, or SR and ED, representations.

Biotech now comprises one-third of the global economy. That's according to Dr. Gurinder Shahi, from the University of Southern California. It initially kind of caught us a off guard, but we thought about it a bit, and taking a look at the breadth of the technology, we've come to realize that in fact this is the reality that technology is bringing to the world.

The biotech industry is the 21st century catalyst for a breadth of all our industries. For example, in the auto industry, we're now seeing soybean oil used to make car seat foams and plastics for bumpers. The forestry industry is finding new technologies to improve their environmental footprint and actually make new products such as nutraceuticals. In health care, we hear of new vaccines and new treatments for debilitating diseases, but also new diagnostics; in food processing, healthier foods with omega-3s and alternatives to things such as trans fats; and in the energy sector, renewable supplies for energy. Biotech is a driving force in modernizing our traditional industry and allowing them to grow their ability to be competitive.

As a country, Canada has long been regarded as an early innovator in leading biotech research and capacity. What we see today is every country in the world racing to catch up and exceed what we have built. Nations that a few short years ago were deemed to be developing economies have launched into capturing the potential of biotech. China has 200 government programs comparable to those of our CIHR and Genome Canada, employing 20,000 researchers. Malaysia has created a research tax incentive program offering 100% tax exemption for 10 years. South Korea has launched a $60 billion investment into its R and D infrastructure.

We cannot afford to be complacent about our ability to compete and win attention. This is why we've focused on modernizing and improving our competitiveness with the SR and ED program.

We are a research-intensive industry. Our biotech industry contributes more than 12% of the entire Canadian business expenditures in research and development. Other countries want this activity. In fact, more than 30 other nations have created research-based investment incentives within their tax regimes. Our Canadian government needs to signal to the world that it means business when it states that it wants to make our economy more globally competitive. Simply put, let's align our incentives with our objectives.

We're recommending two changes on the SR and ED tax credit program: one, remove the Canadian-controlled private corporation, or CCPC, restrictions; and two, increase the expenditure limits that were set in 1985 at $2 million, raising them to $10 million.

Let me explain in a little more detail.

Today the CCPC restriction for refundability is counter-productive to the original goals of the SR and ED program to build capacity here. Our life sciences industry forecast earlier this year highlighted that more than 40% of our companies are looking to secure more than $20 million in their next round of financing. Canada's capital market is simply too small and too risk-averse to provide this assistance directly, so our companies look for other forms of financing such as going public or getting foreign investors. As a result of that, they lose their CCPC status and their refundable credits. So the irony is, just when they get the capital they need to succeed, they lose the business case to keep the jobs here in Canada.

Our second recommendation focuses on the expenditure limit. As I said earlier, this $2 million expenditure limit for refundable credits was established in 1985. It does not accurately reflect the cost of research today, 20 years later. We're recommending that this be raised to reflect inflation and other costs of research, to $10 million.

In summary, a tax system that is entrenched in 1980s economic models is not what Canada can offer the world. We can do better. We must do better.

Thank you.

[The Chair, Conservative, Rob Merrifield]

Thank you very much. You beat the five minutes. We appreciate that very much.

From the Canadian Association of Research Libraries, we have William Curran, for five minutes, please.

[William Curran, Director of Librairies, Concordia University, Canadian Association of Research Libraries]

Good morning, ladies and gentlemen. I am William Curran, the Library Director of Montreal's Concordia University. This morning, I am speaking on behalf of the Canadian Association of Research Libraries.

I want to thank the committee for this opportunity to address issues of importance not only to the research libraries but to the government's own agenda of ensuring competitiveness and fairness.

The Canadian Association of Research Libraries, known as CARL, compliments the Government of Canada on its continued commitment to enhancing research and research infrastructure. The government recognizes that Canada's edge in this global economy is tied to its investment in education, to its support for the way knowledge is transmitted, and to how it helps enable Canada to adapt to changing technologies.

To maximize these investments, CARL proposes modifications to the tax system to enhance access to research materials and to promote the development of a skilled and knowledgeable workforce through the promotion of e-learning.

As Canada moves towards a knowledge-based e-economy, it will be increasingly important to create first-class, pan-Canadian networks of online learning resources. It's important to support the increasing demand for online education, instruction, and training and to increase Canada's competitiveness internationally.

The use of e-learning, or technology-assisted learning, by Canadian institutions has increased by as much as 30% over the past five years, and library participation, of course, has kept pace. Academic librarians, faculty, and staff are providing direct access to many thousands of online journals and databases and are increasingly integrating curriculum development, electronic library resources, and learning technologies in online courses.

In its Advantage Canada document, the Government of Canada demonstrated its understanding that talented, creative people are critical to a successful national economy over the long term. In this context, lifelong learning is vital to skills development and personal upgrading. E-learning is a dynamic way of providing these skills. It provides the key to access and delivery of high-quality educational materials anytime, anywhere.

CARL proposes that the government implement tax credits as an incentive for individuals to pursue their education by electronic means. To make e-learning accessible to all Canadians, the government must also continue its commitment to initiatives such as CANARIE, a not-for-profit corporation that manages CA*net, a sophisticated research broadband network that links Canadian universities, research hospitals, and other science facilities in other countries. The budget of 2007 provided money to allow CANARIE to maintain the CA*net for the next five years, and CARL strongly supports this investment in this first-class Canadian network of online learning resources to serve the needs of the country's learning communities.

CARL supports the position put forward by the Association of Universities and Colleges of Canada that the government must continue its investments in university research in a balanced manner that addresses equally basic research, human capital, leading edge infrastructure, and support for the indirect costs of research. Canadian research libraries benefit from the indirect costs program. Funds are used to access information resources that are vital to any researchers in any given field.

Previously, the indirect costs program covered approximately 25% of the overall research grants made to universities. The increased investments in budget 2006 and 2007 have raised the average reimbursement rate. However, for Canada to be internationally competitive, a 40% reimbursement is the target to aim for. CARL asks the government to continue to increase its investment in the indirect costs program.

On tax fairness, the government has the opportunity to make a small but significant tax change to make Canada's research community more competitive. Currently a university library receives a full rebate on the GST it pays on printed books and subscriptions to magazines and periodicals containing less than 5% advertising. However, scholarly research material is now overwhelmingly delivered in the electronic format. Because of the way the scholarly research material is defined in subsection 259(1) of the Excise Tax Act, such material in electronic format does not qualify for the full rebate. There is no evident justification for this discrepancy. The funds that could otherwise be freed up could be used for the acquisition of additional information resources, thus supporting the government's agenda to develop a skilled and knowledgeable workforce. The government can ensure tax fairness by providing the GST rebate to scholarly material in electronic format, as it presently applies to printed material.

On delivering value to Canadians, this government has shown in its past two budgets that it is committed to delivering new opportunities to ensure a brighter future for Canadians. In its Advantage Canada document, the government stated that by creating these choices it was also providing the educational opportunities Canadians needed to thrive in a knowledge economy.

[The Chair, Conservative, Rob Merrifield]

Okay, be very quick.

[William Curran]

This comes down to the right investments and the right incentives.

It was Roger Martin of the Rotman School of Management who stated that for every 64 cents of investment in education and infrastructure, there's a return of one dollar. The government can be assured that its investment in research and education delivers value to Canadians.

Thank you for your time today.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

From the Canadian Institute for Neutron Scattering, we have Dominic Ryan, president. The floor is yours.

[Professor Dominic Ryan, President, Canadian Institute for Neutron Scattering]

Good morning, and thank you.

The Government of Canada uses part of its tax revenue to put in place the infrastructure that supports the quality of life that we enjoy here in Canada. My submission today addresses the need for an investment in a piece of our infrastructure that is critical for both science and industry.

Since I wrote my original brief back in August, events have overtaken us. The current crisis in the medical isotope supply, especially for moly-99, now underlies the critical role that the NRU reactor has been playing for at least 20 years. The maintenance-related shutdown that has precipitated this crisis highlights the urgent need for a replacement.

Although NRU is now 50 years old, the world depends on it for one-half to two-thirds of all of its medical isotopes. The innovative and flexible design of the NRU has enabled it to dominate an industry that was invented by Canadians and that barely existed when NRU was originally built.

A new research reactor will provide medical isotopes, enable cutting-edge materials development and engineering research, and provide a solid knowledge-based foundation for the development of next-generation power reactors. It is a national issue that transcends the mandates of individual departments or agencies. It relates to science, energy, health, environment, international relations, and education. It is a fundamental piece of Canada's infrastructure for science and industry, and it represents an opportunity for leadership in vision from the centre of government.

I believe that we now stand at a crossroads in neutron research. Science and technology are poised to change in many fields, and we have an opportunity to be leaders, building on the legacy of those who designed and built NRU.

Generation IV is an international collaboration to develop advanced fuel cycles and radically new reactor designs to increase our utilization of nuclear fuels by up to 100 times. The proven uranium reserves in Saskatchewan will last us 60 years at the current usages, but under a Generation IV system they could be supplying our electricity power needs for thousands of years. A flexible research reactor would provide a crucial test environment for the development of fuel elements and materials that would withstand the extreme conditions that will exist in a Generation IV core. We have led the world with CANDU; we can be at the front with Generation IV.

We have already dominated the world supply of cobalt-60 and moly-99, providing treatments for up to 20 million patients per year out of Canadian reactor-derived isotopes. The new compounds and isotopes are constantly being developed for more targeted treatment and diagnoses. We invented the medical isotope business, but we need to continue to innovate if we are to continue to create new markets and develop new products. A flexible research reactor capable of both production of existing products and development of new ones will keep us at the forefront of this critical field.

The foundations of neutron beam research were laid by Canadians working at the NRU. The triple-axis spectrometer, which earned Professor Brockhouse his Nobel Prize in 1994, and the engineering stress scanner were both invented at NRU and are now to be found in every single neutron beam research facility in the world. Canadians are taking the lead in new fields, using cold neutrons to study biological systems, using reflectometry to investigate corrosion and bio-compatible codings for medical implants, and developing neutron holography to study the structure of proteins in their native functional state. A powerful state-of-the-art facility is essential to keep this research alive and in Canada.

Eight hundred million dollars is a lot of money. If we build the CNC, it will generate 2,500 person-years of engineering design work, 2,500 person-years of manufacturing work, 4,000 person-years of construction and administration work that will appear here in Canada, generating tax revenues and jobs within Canada. Approximately $160 million of business will be generated for small and medium-sized enterprises developing and producing reactor components. This is expertise that is technically advanced, and that will be developed within Canada, allowing us to compete in the growing world market for nuclear power reactors.

NRU cost $500 million in current money and has clearly paid back its investment very handsomely. When the CNC is operating, Canada will have a state-of-the-art research facility that will enable innovation in reactor design, medical isotopes, and materials research. Thousands of researchers, scientists, engineers, and students will bring their products and ideas to the new facility. They will build on the strong tradition of excellence established at the NRU.

Where will the CNC lead us? To be honest, I have no idea, but when the NRU was built, nobody was thinking about advanced fuel cycles. Nuclear power was just starting to be adopted, and nobody was concerned about global warming or the environmental impact of our overuse of fossil fuels, yet it has underpinned the development and export of CANDU nuclear reactors that generate clean, reliable electricity around the world.

The CNC will continue Canada's leadership in the peaceful use of nuclear power, a role we adopted when we became the first nuclear-capable nation that did not build a nuclear bomb.

When NRU was built, Canadians were just inventing the medical isotope business. The world had never heard of moly-99. Now everyone knows at least one person who has benefited from either treatment or diagnosis from medical isotopes. The CNC will enable both the production of existing products and the development of new ones.

When NRU was built, most of the materials and technologies that have transformed our lives were unknown. The first silicon transistor was made the year before NRU came online. High-Tc superconductors would not have been believed. The shape-memory alloys, central to many medical implants, were unknown. Plastics were just junk.

[The Chair, Conservative, Rob Merrifield]

Very quickly, please.

[Prof. Dominic Ryan]

The time has come to build on the remarkable legacy of NRU. The $800 million investment in the CNC will inspire a new generation of Canadian scientists and engineers. It will enable them to develop and study the materials that will shape the 21st century and lead to the new industries that will emerge from their discoveries.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

We'll now move the Catholic Women's League of Canada, with Lorette Noble, national president.

The floor is yours.

[Lorette Noble, National President, Catholic Women's League of Canada]

Good morning, and thank you for inviting us to present our brief.

The Catholic Women’s League of Canada, founded in 1920, is the largest national organization of women in Canada, with nearly 98,000 members represented in every province and territory and in the military. The league is organized and committed to serve all citizens and has often received the commendation and keen appreciation of federal, provincial, and municipal authorities for the voluntary services ably performed by its nationwide membership.

The league’s main concern is justice for all, being mindful of the needs of the most vulnerable in society. League members believe that the guiding principle behind taxation law should be the welfare of each and every Canadian citizen. The goals of our tax law would be to ensure that the basic needs are met for each citizen, including a healthy standard of living and a sustainable ecology. Taxation should be based on the idea of, from each according to means, to each according to needs. There must be a just balance between personal and corporate tax. Corporations do not need to be gouged, but neither should they be given tax breaks at the expense of individual taxpayers. In terms of activities funded by the government, social programs that benefit citizens and that care for the voiceless and the marginalized need to be priorities, not the improvement of bottom lines.

A country as rich as Canada should not have the level of poverty that it has, especially among children, single parents, and the elderly. Child benefits should not be taxable in order to ensure that the money goes to families and is not clawed back through income taxes.

We would like to suggest a tax credit for stay-at-home parents. Such benefits and tax credits would put more money in the hands of parents, thus ensuring that children do not go hungry. Unfortunately, in Canada today too many families are forced to rely on food banks and clothing depots.

The same is increasingly true for seniors. We have serious questions as to whether the guaranteed income supplement and the old age security pension meet the needs of seniors. The lack of adequate affordable housing for low-income families, the disabled, and many seniors is another concern that needs to be addressed by the federal government.

Literacy is a major factor in breaking the poverty cycle. Literacy programs in schools are all very well, but there is a high rate of illiteracy among adults, particularly with recently arrived refugees and in aboriginal communities. Literacy programs for adults are essential. Literacy skills can lead to job opportunities, self-sufficiency, and thus more people contributing to the tax base. In a related matter, the league supports tax exemption for post-secondary school textbooks.

Poverty and poor health often go hand in hand in Canada. Canada’s publicly funded health care system must be maintained for all. One enhancement of the system would be an effective, cost-efficient national pharmacare program. National home care standards and a tax credit for caregivers should save health care dollars in the long run. Palliative care must be an integral part of the health care system. Quality palliative care does not call for costly high tech intervention and respects the dignity of the dying.

The statement in the second question by the committee, “given that corporations provide employment… and contribute to the economic growth of the nation” raises some flags. What kind of employment is being provided--full-time with benefits and a decent wage or part-time at minimum wage and no benefits? If the latter, such employment is of little or no benefit to Canadians and does nothing to enhance family life and health. The proliferation of part-time employment saddles many Canadian workers with the burden of multiple jobs at long hours for little pay. Family life inevitably suffers.

There appears to be a connection between the deteriorating health of the environment and rapid economic growth. Tax incentives for fostering environmental protection, reducing greenhouse gases, and using renewable energy sources would be of great benefit to both the Canadian environment and ultimately the economy. Care for the earth at the present time will ensure a viable future for our children.

While much concern relates to Canada, the league recognizes that members live in a global world and that they have a responsibility towards their neighbours and other countries. Once again, the league stands in solidarity with the marginalized, requesting debt relief with burdened developing countries, and the re-establishment of funding to MaterCare International, for example. A resolution adopted at our 85th annual national convention in August this year asks the government to link financial support, i.e., tax breaks, to Canadian registered mining companies adhering to international and Canadian standards of mining practices while doing business in developing countries. The premise “do no harm” should be kept in mind in all financial considerations in connection with underprivileged countries.

Be assured that league members across the country will continue to follow these issues closely to ensure that the most vulnerable in society are protected. It is our hope that the outcome of these pre-budget consultations and the resulting effect on our tax laws will reflect these concerns.

Thank you.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

We will now move on to the Independent Media Arts Alliance. We have Jennifer Dorner.

The floor is yours.

[Jennifer Dorner, National Director, Independent Media Arts Alliance]

Good morning, Chairman and members of the committee.

I would like to start by thanking the Standing Committee on Finance for this opportunity to present on behalf of our members in the diverse communities that we represent. The IMAA is a non-profit national arts service organization that promotes and advances the interests of a vibrant media arts community. We represent over 80 independent film, video, and new media production, distribution, and exhibition organizations in all parts of Canada, serving over 12,000 independent media artists and cultural workers.

First and foremost, I would like to acknowledge the federal government for recognizing the value and importance of the arts in Canada through its investment in the Canada Council for the Arts, with the additional $30 million in annual support. This is an encouraging first step towards accomplishing the many vital goals held by the arts and cultural sector. Still, the IMAA wants to underline the fact the $30 million does not go far enough to relieve the pressures faced by the smaller artist-run organizations and independent artists.

To prove this, we can look at how the supplementary fund was allocated in this 2007-08 fiscal year. These funds barely addressed the needs of the larger traditional performing arts organizations and did not even come close to addressing the needs of the smaller organizations outside the urban centres, specifically organizations that support media arts practices. This is highly problematic, considering that the stated plans and priorities for both the Canada Council for the Arts and the Department of Canadian Heritage are for cultural and creative development in the 21st century, with an investment in new practices. The current reality is that more artists are working within the media arts, with a new focus on mediums such as electronic, Internet, video, and multi-disciplinary practices.

We urge the federal government to increase funding to match the needs of these diverse practices. Therefore, our first recommendation is for the increase of funding to the Canada Council for the Arts by an additional $100 million annually.

The second point I would like to make is our often-stated claim that cultural funding must be made statutory. Cultural spending should be acknowledged in all aspects of Canadians' lives, from health to education, leisure, technology, and the economy. Arts organizations are the backbone of the independent arts sector and provide a multitude of services within our communities. These include access to equipment, resources, and training, provision of dissemination and exhibition opportunities, as well as help in creating healthy, thriving communities.

Programs such as the Tomorrow Starts Today program help to create stability within the Canadian arts and cultural sector. As we approach the end date of this multi-year funding initiative, we emphasize that these funds are indispensable to the arts in Canada. We strongly recommend that the federal government make permanent the Tomorrow Starts Today initiative.

This fund supports programs such as Cultural Spaces Canada. This support must be sustained and developed further. The Cultural Spaces Canada program is essential for assisting organizations to establish permanent venues for the creation and presentation of artworks, be they theatrical plays, exhibitions of visual arts, musical performances, or cutting-edge screenings of media art. We need to create stability within our cultural organizations.

Arts funding contributes positively to the economy in many different ways, including through creation of cultural vibrancy in cities and towns that attract corporations to these centres. Given this, by instituting a portion of the federal budget as statutory funding, the government would be making a significant move towards showing its commitment to and investment in the arts in Canada.

The 2006 report by the Standing Committee on Finance identified that a region's artistic and cultural life is an important factor in attracting and retaining employees and businesses, who may be drawn to locations with artistic and cultural amenities that enhance well-being, quality of life, diversity, and prosperity. As the finance committee this year examines the Canadian tax system for its 2007 report, it is essential that you be reminded that businesses and corporations directly benefit from a healthy arts and cultural community.

We would like to see the level of taxation, fees, and other charges take into account the benefits a corporation receives within the global picture. By funding arts organizations and art activity across the nation, the government is stimulating increased economic activity while enhancing the cultural vibrancy of a community.

Arts organizations do not solely depend on federal funds to operate. An incredible amount of time is spent seeking alternative sources of funding, such as corporate sponsorships, foundation support, and other funding initiatives. However, there is not enough incentive for donors to fund arts and cultural organizations.

The IMAA thus urges the federal government to provide a cultural donation tax initiative for donors, to encourage the funding of arts and cultural organizations. This tax initiative should be supportive of the arts and culture communities of Canada, should not require undue pressure on the part of the staff of these organizations to maintain that support, and should not limit or lessen the amount given to any funding body for the purposes of supporting the arts.

Our final recommendation speaks about the urgent need for support for the preservation and archiving of media artwork. The preservation of film, video, and new media work is a major concern among all organizations that have media art collections, including the National Gallery of Canada. The works in question are audio, video, and film collections and include experimental, narrative, and documentary works by artists. The vast majority of these works have been financed by public money and are degenerating rapidly. It stands to reason that public money should be invested in the preservation of these works.

So we urge the federal government to increase support to the Audio-Visual Preservation Trust of Canada, the Canada Council for the Arts, and the National Library and Archives Canada, specifically to expand the process of preservation, archiving, cataloguing, and collection maintenance of Canadian artworks.

Thank you. I would be happy to answer any questions you have.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Now we'll move on to the Regional County Municipality of Montmagny, with Pierre Thibaudeau, mayor of St-Fabien-de-Panet.

[Pierre Thibaudeau, Mayor of St Fabien de Panet, Regional County Municipality of Montmagny]

My name is Pierre Thibaudeau, I am the Mayor of Saint-Fabien-de-Panet and I am speaking on behalf of the Regional County Municipality of Montmagny. I want to share with you a problem which is common to every community throughout Canada.

I will wait a moment until the chair is ready.

[The Chair, Conservative, Rob Merrifield]

Carry on.

[Pierre Thibaudeau]

I am here to talk about a major problem which affects every community with fewer than 2,000 inhabitants and who live in areas which do not have access to an important tool today, namely the cellular phone.

To truly occupy the land, a country must really be everywhere and work with the tools of its time. Today, working with the tools of the time means having access to computers, amongst other things, cell phones, and means of communication for visitors, residents, workers and people who want to move to the area. But in our area, which is the Regional County Municipality of Montmagny, located close to the U.S. border, we cannot use cell phones, we cannot communicate that way.

We received funding from the federal and provincial governments under phase I of the Internet project. That was under phase I. So there is only one connection in the village. They did not connect people's homes, but only the municipalities and the schools. Perhaps you were told that everyone across the country would be connected, but that did not happen. Municipalities and schools are not citizens. That was under phase I, and we were happy with it, but it's not enough.

Today, I want to focus on cell phone communication. Small communities are making super human efforts to keep people, to get them to live there, which many people do, but professionals who want to create their own businesses and work from home are leaving, because of a lack of access to Internet and cell phone connections.

We created a regional park, and people come from everywhere to hike, canoe on the rivers and indulge in other sporting activities. There is one tool which would make these people feel more safe, but it is unavailable, and I'm referring to cell phones. Something might happen while you're out hunting, hiking in the woods or canoeing. Today, everybody carries a cell phone. But when you don't have a cell phone, it's too bad, but you won't get any clients. This situation did not exist in the past, but it does now, and it is preventing our municipality from growing.

We are asking the federal government to develop a program to help small communities attract businesses. We are not asking for cooperatives, or our own antennae, or for the government to change the world or to change technology. That's not what we want. We want to attract businesses to places where they would normally not come because it would not be profitable enough. But these places are not profitable right now and that is not about to change. There are not enough people and we need help. We believe that it is in the federal government's interest to make every part of its territory accessible. If it does not do so, people will leave these areas, which is quite understandable.

People are concerned about security. As you know, everyone wants to live in affordable housing, have access to health care services, to good roads and communication. If one of these things is missing, people will leave small communities. You need to provide a minimum of basic services. People need access to these services, otherwise they will leave our area. Politicians can work and give as many speeches as they like, but that won't help. We need these basic services, and the federal government must help us, otherwise people will leave. In the RCM, we can support each other, we can invest some money, but on our own we cannot really make a difference.

Today, strange as it may seem, I have done the federal government a favour. The government must make basic services available everywhere. It would cost less money than buying a large frigate for the Arctic, and it will allow people to stay in their communities.

Thank you very much.

[The Chair, Conservative, Rob Merrifield]

Yes, especially about the politicians. We want to make sure they do their work.

We'll now move on. We have, from the National Council of Women of Canada, Catharine Laidlaw-Sly, policy adviser. The floor is yours for five minutes.

[Catharine Laidlaw-Sly, Policy Advisor, National Council of Women of Canada]

Thank you, Mr. Chairman.

The National Council of Women of Canada thanks the committee for the opportunity to present some observations about our brief. We've been making annual briefs to this committee for years, so I will refer to the fact that some issues have recurred year after year.

The National Council of Women, founded in 1893, is a non-denominational federation of women's organizations, taking in organizations and individuals. It works on a very broad, holisitic approach and has presented to the government steadily. We were known as the Parliament of Women when women had no vote and no representation.

We also wish to congratulate our sisters in the Catholic Women's League on the excellent presentation they just made. We agree with everything they said this morning. You'll be interested to know that women present a very unified front on some very basic issues.

On taxation, the National Council of Women notes that the government has once again forecast a large surplus in revenue but has only incrementally increased the basic personal income tax for all taxpayers. I note that it's around $8,800 for the coming tax returns. There's been no real attempt to address the growing gap between the well-to-do and the lower-income citizens. The reduction in the GST, which is a consumption tax, benefits higher-income persons more, since only the most basic needs--food and children's clothing--are not subject to this tax. NCWC would like to see the basic exemption increased to $15,000 per year.

We remind the government of the continuing case of our aboriginal peoples. Their housing, health care, and educational needs are not being met. We urge that the Kelowna accords be reinstated. Prolonged and continuing negotiations while aboriginal children live in third world conditions will not meet their needs and is unacceptable in a country as rich as Canada.

Recently publicized reports also establish that a child raised in poverty will have more illness as an adult, costing our taxpayer-supported health care system more.

We also repeat our support for the Canada Health Act. We remind this consultation that we wish to have a single-payer system, a one-tier system.

On child care, the National Council urges most forcefully the reinstatement of the early learning and child care agreements. Canada, as a state party to the UN Convention on the Rights of the Child, has a binding obligation to facilitate the implementation of such programs for all children, regardless of their parents' level of income.

On the social safety net, the National Council strongly supports maintaining the gun registry. We also urge greater and assured support for a comprehensive approach to alleviating the causes and effects of violence on women and children in Canada.

Speaking on the environment, the National Council has asked for programs designed to assist and encourage individual citizens in alleviating air and water pollution. We are aware that Canadians are the greatest producers of greenhouse gases per capita in the world. We believe that strong action is needed, with government leadership setting firm goals now for all players and stakeholders to reach.

Pay equity is an issue that concerns us greatly. We note that Canada still falls short in this important step to implement its commitment under the UN Convention on the Elimination of all Forms of Discrimination against Women. Statistically, we know women still earn 72¢ for every dollar earned by a man for work of equal value.

Connected to the whole issue of pay equity is that of maternity leave benefits. The National Council reminds the government again that self-employed women and those in part-time or seasonal employment do not have equal access to this benefit. This does not maintain an equal earning field for them.

The recognition of unpaid work in the national accounting system is also part of this whole question of pay equity. National Council deplores the failure to recognize the value to the economy of unpaid and often uncounted work, which is done mostly by women, to the gross domestic product. It is a grave shortcoming. We need pro-rated benefits for part-time workers.

I wish to call particular attention to the justice issue. We're part of a stakeholder group examining the treatment of women in Canada's federal justice system. We repeat our support for the recommendation of the stakeholder group that an independent, external oversight mechanism be established for federal prisons for women. We note that although there are fewer than 500 federally sentenced women, almost 50% of that group are aboriginal, an indicator of racial prejudice in our society.

Thank you, Mr. Chair.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

We'll now move on to the question and answer portion.

We'll start with Mr. Pacetti. You have seven minutes.

I think we have seven minutes for everybody. We'll be able to do that, and I may even get seven minutes.

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

Thank you, Mr. Chairman.

Thank you to the presenters. Welcome to Montreal. I know some of you are not from Montreal, so welcome. I appreciate all of you coming forward. It's nice to have a diverse group, because it gives us a chance to debate.

Mr. Thibaudeau, I agree with what you say. The same problem has been raised in our national caucus, in Nova Scotia, in Ontario and in other such places.

I have a fairly brief question for you. Under which program, or from which department, did you receive funding for the first phase of the service to schools? Was it from Industry Canada?

[Pierre Thibaudeau]

The funding came from Industry Canada.

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

Is the program finished? Is there no more funding?

[Pierre Thibaudeau]

It was called the Broad Band Program.