Finance Committee on Sept. 15th, 2009

[The Chair, Conservative, James Rajotte]

I call the 40th meeting of the Standing Committee on Finance to order. We're continuing our discussion on pre-budget consultations.

Colleagues, we have with us here today six organizations for an hour and a half, so it will be a short time period for a number of organizations and their ideas on the next budget.

We'll name the groups in the order in which they will present to the committee: first, the National Association of Friendship Centres; second, Bioniche Life Sciences Incorporated; third, the Canadian Federation of University Women; fourth, the International Association of Fire Fighters; next, the Canadian Association for Graduate Studies; and finally, the Canadian Trucking Alliance.

We would ask each of you to speak for a maximum of five minutes. I will indicate when you have about a minute left in your time. Then we will go to questions from members.

Mr. Dinsdale, we'll begin with your presentation, please.

[Peter Dinsdale, Executive Director, National Association of Friendship Centres]

Thank you very much, Chair.

I'd like to thank the committee for providing the National Association of Friendship Centres an opportunity to present our brief on the upcoming budget.

I'm pleased to be accompanied today by our policy director, Conrad Saulis, who will answer the tough questions when they come during the question time.

First off, I'd like to tell you this bit of context with respect to who we are. The National Association of Friendship Centres is the national representative of 120 local friendship centres across Canada who provide services to urban first nations, Métis, and Inuit peoples. Predominantly we provide services to people who are impoverished in our communities across Canada from coast to coast to coast and who come to community agencies like friendship centres for services and supports.

The big challenge being faced across the country with respect to urban aboriginal people is the fact that 54% of all aboriginal people in Canada live in urban areas. This is a reality that is not reflected in programs and services offered by the federal government. Often because of jurisdictional issues it's not picked up by provinces or territories either. So it's a tremendous pressure for front-line agencies such as ourselves to provide services.

As referenced in the committee's terms of reference, we'll be speaking to two proposed spending measures and give one bit of reflection on the impact of Budget 2009.

The first proposed spending measure we would put forward is increased funding to the aboriginal friendship centre program. This program is funded through the Department of Canadian Heritage. It has been stuck at the same amount of funding, $16.1 million, since 1996. Since 1996, not one cent of increased funding has gone into this program.

The impact is not on a big national organization. The impact of this is on front-line service delivery providers all across Canada who are struggling to provide services to urban aboriginal people, in many cases the most impoverished people who live in our communities.

With the funding that is provided by friendship centres, the service delivery providers are having a tremendous impact with the limited resources they have. Last year alone, the front-line agencies provided over 960,000 points of service. Now, if one person came 10 times to our food banks, to our prenatal programs, to our youth programs, they would count as 10, because they came for 10 different points of service. But it's an example of the increased number of challenges that exist in urban areas. We have a real opportunity to impact on what's happening there.

The average funding that each of these local agencies gets is $130,000 across the country. With that funding, they have to hire an executive director, a bookkeeper, and a receptionist, and keep the building open. On average across the country, executive directors of these front-line service delivery agencies are making between $40,000 and $50,000. They're doing an incredible amount of work with very little resources.

Our challenge is retaining high-quality staff to ensure that we have the best training possible to support the interventions that are required on the ground, making sure that at the end of the day these people are more competitive in Canada's economy and better able to participate more broadly in this country we have.

Before I make our first recommendation, I should say that we have worked with our department, the Department of Canadian Heritage, in developing a business plan for the long-term sustainability of friendship centres. We worked with Minister Oda, and now, more recently, of course, with Minister Moore, on articulating this business case, on talking directly about the funding challenges, and working with the department.

The long-term sustainability of friendship centres will not take place without increased funding. We're recommending a five-year increase to the program, totalling $115 million over those five years.

The second area that we want to talk to with respect to a spending measure is the aboriginal human resource development strategy. As we're all aware, Canada's economy is growing. It requires a greater labour pool to fit the jobs and challenges we have across the country. Urban aboriginal people represent a vast untapped resource for this labour pool.

This program, the aboriginal human resource development strategy, is up for renewal this year. In past years it has not focused on urban aboriginal issues. We don't have targeted interventions, meaningfully targeted interventions, across the country to ensure that urban people are fully participating in the economy. We're suggesting that with the renewal of this program there be a particular measure in place to do that.

The third piece we want to briefly touch on is a reflection upon Canada's economic action plan. In the last budget, of course, there was nearly $1 billion focused on aboriginal people, predominantly spent on reserve. The challenge, of course, is that 54% of all aboriginal people live in urban areas.

There is some hope with the infrastructure program. We have put forward a request for $85.5 million in infrastructure upgrades to local agencies. This would help do two things. Number one, it would spread around the infrastructure spending to small towns and communities all across this country and not focus on the big cities. Two, it would ensure that those investments are increasing Canada's social capacity to serve some of the most disenfranchised in the country.

Hopefully I have enough time left to say thank you. We appreciate the opportunity. We look forward to any questions, should there be any.

[The Chair, Conservative, James Rajotte]

You always have enough time to say thank you.

Thank you very much for your presentation.

We'll now go to Mr. Culbert of Bioniche, please.

[Rick Culbert, President, Food Safety Division, Bioniche Life Sciences Inc.]

Mr. Chair, members of the committee, on behalf of Bioniche Life Sciences, thank you for this opportunity.

Bioniche is an innovative bio-pharmaceutical company based in Belleville, Ontario. Our mandate is to act on innovation and to improve quality of life. We are publicly traded, and we invest heavily in research and development. We currently employ about 200 people around the world in technology-based jobs, the majority of these being in Belleville as well as Montreal.

Today I'm delighted to tell you about an innovative opportunity for Canada to be a world leader in terms of public health and food safety. E. coli O157 is a lethal strain of bacteria that's been in the news ever since the early 1990s, when it was first referred to as “hamburger disease”. This same strain of bacteria continues to be responsible annually for recalls of beef and other food. It was responsible for the huge spinach recall in 2006 as well as the infamous disease outbreak in Walkerton in 2000.

The primary reservoir, or source, of E. coli O157 is cattle, from which it is shed into the environment and can contaminate crops, water, and food. In the estimated 26,000 Canadians infected annually, most experience transient diarrhea. However, in 15% of cases a very severe bloody diarrhea develops. In up to 10% of these, they progress on to kidney failure and/or death.

The good news is that the Government of Canada can take pride in the fact that it supported the research and development that led to the world's first licensed vaccine against E. coli O157. It is named Econiche, and it is designed to reduce the risk of E. coli contamination of food and water. It received full licensing approval from the Canadian Food Inspection Agency last October, in 2008.

Although targeted against a persistent public health risk, Econiche is not given to the public. Instead, it's given to cattle. It's the first of its kind. This deadly strain of E. coli lives within the intestines of cattle without any ill effects to them. Studies have shown that the vaccine significantly reduces colonization in cattle by as much as 98%. A reduction in the amount that is shed helps to reduce the risk of it being present in beef or water, or spread to children who pet cattle at fairs, or via produce, as was the case with last year's outbreak in North Bay, Ontario, that was linked to onions grown here in Canada.

The challenge with adoption is that cattlemen receive no immediate or direct benefit to offset the added cost. As this bacterium does not make cattle sick, the vaccine is not for the health of cattle, like other vaccines. It's for the health of people.

If governments provide the initial funding to encourage adoption, we believe the long-term, far-reaching benefits will become apparent. An independent economic report conservatively estimated that investment of vaccinating Canada's national cattle herd would result in annual savings and benefits of at least 2:1 on investment. The cost to vaccinate the national herd is about $32 million.

Vaccines have been used for decades to address serious public health issues. The concept of vaccinating cattle to reduce public health risk is a perfect fit for the one-world, one-health concept. The challenge with this concept, however, is that it may require the cost to be incurred by one, yet the benefits realized by another.

A poll of urban Canadians revealed that three-quarters of those interviewed were in support of vaccinating cattle to reduce the health risks in our food and water supply. Cattlemen across Canada were also independently surveyed. The data showed that 86% were willing to take action to prevent shedding if the vaccine was just provided to them. Understandably, yet unfortunately, the current adoption levels are very low, as there's no offsetting compensation.

In working toward a national program, we recommend that there be an interdepartmental approach to demonstration projects. The benefits of such projects extend to the departments of health, agriculture and agrifood, as well as international trade. Demonstration projects would encourage primary producers to incorporate technologies--such as Econiche vaccine--that add value to other members of the supply chain as well as the end consumer.

In closing, Bioniche is asking the committee to consider two recommendations. The first is to re-endorse the recommendation that appeared in the final report of this committee last year, which stated that the “federal government develop and implement a program designed to ensure the removal of E. coli from the Canadian food chain”. The second is to ensure that until such time as a national program or appropriate alternative is in place, the Government of Canada provide adequate funding for demonstration projects that encourage adoption. We think $10 million over three years, through programs such as AgriFlexibility, would accomplish this.

Canada is unique. It's the only country with access to a regulated on-farm intervention against E. coli O157. The development of this vaccine is the world's first. Widespread adoption will bolster consumer confidence in Canadian agriculture, reduce the public health risk, and position Canada as a global leader in food safety.

Thank you. I welcome any questions.

[The Chair, Conservative, James Rajotte]

Thank you for your presentation.

We'll now go to Ms. Russell from the Canadian Federation of University Women.

[Susan Russell, Executive Director, Canadian Federation of University Women]

Thank you.

On behalf of the 10,000 members of the Canadian Federation of University Women, I thank you for this opportunity to present today. CFUW is a non-partisan, self-funded organization of graduate women and students in 113 clubs across Canada.

The federal government could, in its budget, create favourable conditions for women's sustained economic security. Today I'll speak specifically to three recommendations that can assist women and their families in these difficult economic times.

First, to address the wage gap, CFUW believes that the 2004 Pay Equity Task Force report could provide the framework for action. It recommends adopting a new stand-alone pay equity law that would cover women, workers of colour, aboriginal workers, and workers with disabilities. Ontario and Quebec provide useful models for proactive pay equity. This report has yet to be implemented by any government, and the recent inclusion of the Public Sector Equitable Compensation Act in the budget implementation bill risked weakening what little recourse women currently have to address pay equity and created two standards, one for the federal workforce and one for the general workforce.

Our second recommendation is to establish a national not-for-profit child care and early learning system. Quality accessible child care and early childhood education is the foundation for lifelong learning and healthy development. Canada remains the lowest spender on early childhood education of any OECD country. Canada ranks last in international assessments of access to and quality of early childhood education and care. The Government of Canada must address and fund an accessible national not-for-profit child care system by restoring multi-year federal funding to the provinces with dedicated capital transfers. This money needs to go to community-based child care services so that the provinces and territories can build critical child care systems.

Third, improve access to employment insurance for women. CFUW supports three changes to improve women's access to employment insurance programs: a cut-off requirement of 360 hours of work across the country to enable women to qualify should they be laid off from part-time or casual work; benefits of up to 50 weeks so that fewer unemployed workers exhaust a claim; and higher weekly benefits based on the best 12 weeks of earnings before a layoff and a replacement rate of 60% of insured earnings.

In closing, I recommend that you consider all of these crucial recommendations in your budget. Thank you very much.

[The Chair, Conservative, James Rajotte]

Thank you, Ms. Russell.

We'll go to Mr. Lee, please.

[Jim Lee, Assistant to the General President, Canadian Operations, International Association of Fire Fighters]

Thank you very much, Mr. Chairman and members of the committee. I appreciate the opportunity to be here today on behalf of the 21,000 men and women of the International Association of Fire Fighters here in Canada.

The IAFF believes that a national public safety officer compensation benefit for the families of fallen firefighters and other public safety workers is long overdue in Canada. It's a matter of dignity for families--a means of ensuring that they don't have to face financial hardship at the same time they're dealing with grief.

What currently exists across Canada is a patchwork of line-of-duty death benefits in each province. A minority of local firefighter unions have been able to negotiate a line-of-duty death benefit at the local level. Of these, only a handful provide an amount of compensation sufficient to assist the surviving family in the long term. Typically, the negotiated benefit is two years' continuation of salary and benefits, which is enough to keep the survivor in the family home for two years. We ask: and then what? Yes, it has happened that a family has had to move out of the family home because of these tragic circumstances, and it will happen again unless some kind of meaningful benefit is established, a national benefit that will apply equally to all Canadian firefighters. The dignity and financial security of a fallen firefighter's family should not depend on the uncertainties of the collective bargaining process, especially at a time when the trend is for employers to attack such benefits and not award them.

I urge you to recommend that the next budget include funding for the public safety officer compensation benefit in Canada. The benefit should apply to firefighters and to other first responders, such as police officers, who are identified under the existing Income Tax Act regulation as members of the public safety occupation.

As a starting point, we propose an indexed benefit in the amount of $300,000 that would be paid directly to the family. It would be paid in addition to any other death benefits that may be available. In the past nine years, an average of 13 IAFF members have died in the line of duty annually and an average of seven police officers. With these figures we can estimate that a national public safety officer compensation benefit of $300,000 would cost the government $6 million annually.

As you consider a benefit of $300,000 for a fallen firefighter's family, I note that the average age of a professional firefighter who was killed on the fire ground in accidents in North America is 43 years of age. If that firefighter had worked until age 60, at an average salary, that's at least $1.3 million in salary that the family would have enjoyed over those 17 years.

I also ask you in your deliberations to recognize the essence of Motion 153 from the 38th session of Parliament. Motion 153 called on the Government of Canada to establish a national line-of-duty death benefit for firefighters. The adoption of this motion by a vote of 161 to 112 was a clear indication that a majority of MPs representing a majority of Canadians believe this benefit should be established.

Canada also needs an office for fire service statistics. Statistics Canada does an excellent job of compiling and reporting comprehensive national crime and justice numbers annually. Similarly, Health Canada tracks diseases such as H1N1 and the West Nile virus, thereby giving local health authorities the information they need to properly protect citizens. For fire protection there is virtually nothing in terms of complete, reliable, and up-to-date national statistics. Currently, the fire data is the responsibility of the provincial authorities. The sad truth is that some provinces are a year behind in statistics and some seem to have given up all together. Someone needs to take charge of this problem and fill the void that exists. We believe there's a clear role for the federal government in this area. In the name of public and firefighters' safety, the IAFF calls on you to recommend funding of the national office for fire service statistics.

In closing, as the Canadian government continues the planning to protect Canadians from the second wave of the H1N1 virus, I wish to emphasize the need to ensure that firefighters are among the first groups to receive the available antivirals and vaccines. Independent risk analyses show that without any precautions, 25% to 30% of firefighters may be unavailable for duty during the height of an influenza pandemic due to illness. Firefighters are part of Canada's critical infrastructure, but a fire department simply cannot provide adequate protection to the public with this level of absenteeism.

Thank you very much for the opportunity, and I welcome any questions you may have.

[The Chair, Conservative, James Rajotte]

Thank you very much, Mr. Lee.

We'll now go to Ms. Watters for her presentation.

[Carolyn Watters, President, Canadian Association for Graduate Studies]

Thank you very much for having invited me today.

I will speak in English.

The Canadian Association for Graduate Studies represents about 165,000 graduate students and post-doctoral fellows in Canada. I'm not going to make the argument today that we need highly qualified personnel. I'm not going to make the argument that Canadian universities aren't doing a good job--we're doing a great job.

However, I will let the science and technology board make the case for me that in order to have “the best-educated, most-skilled, and most flexible workforce in the world”, we are going to need to work cooperatively--the federal government, the provincial governments, and all of the universities--to make this happen. Unfortunately, as the Conference Board notes, we are “strikingly low” in Ph.D.s in math, science, computer science, and all applied sciences, those very sciences that we think are going to bring innovation to our economy.

This doesn't include the humanities and the social sciences, which we are going to be relying on more and more in the next few years as we come out of this recession: social policy, planning, and public works. We need these people.

Unfortunately, we haven't quite closed the gap. We need to work harder on this and we need to work together. There is a lot more work to be done. We're just not there yet.

Our recommendations for how we might get there are based largely on policy and agenda items. The first recommendation is to continue the work that has been done in the last budget in increasing the scholarships for master's students and graduate students.

The last budget also introduced infrastructure money. It's welcome. We clearly needed infrastructure money in the university system. However, education is not only buildings. We need to have the buildings and we need to have the labs, but we need to have the people who are in the labs. Labs need people, students need supervisors, and labs need graduate students to work in them.

The second point in terms of investing is that we need slightly longer long-term planning. A one- to two-year investment in new scholarships is actually not quite adequate to allow the system to turn. A university is like a large ship; it does take a bit to get this thing to turn.

Professors are not that willing to expand their labs for a one-year input of new scholarships. Three- to five-year planning cycles allow people to move their research a little bit so that they can get new agendas to shift, but a one-year shot is really not enough to get a professor off their current path. I'm not saying that in a negative way, of course. What we're really suggesting here in terms of cost would be to simply continue the new master's and Ph.D. scholarships for an additional two to four years so that there would be a longer-term commitment and university professors could actually change their research directions.

Secondly, we urge the finance committee and the federal government to be aware of the need for balance in research. We need to have basic research. There's a lot of emphasis and a clear winning when we can get close to the front. We have things coming out of universities so that companies, such as the one that was mentioned for the cattle, can actually get these things in the field and get them into the economy. That will not happen if we don't actually maintain our money with the basic research. What are we going to do in five years if we've used up all the research? We have to keep that pipeline open. Who does all the work? Graduate students do all of the work. That's my plea here. Eighty per cent of all the money goes straight to graduate students.

The third recommendation is to invest in post-doctoral fellows. The tri-councils currently fund only 500 post-doctoral fellows. Ph.D.s in the sciences and the medicines need another two to four years to become specialists in their areas. We pay a lot of money to get people through a Ph.D. Let's not waste it by having them go somewhere else. Let's not waste it by not having positions to keep them in Canada for when the economy turns around. It takes eight years to get a Ph.D. If the government said tomorrow that we need 10,000 Ph.D.s and we had stopped production, it would take eight years to get there.

These suggestions are not big fund requests. These are largely requests for change in policy and setting of an agenda in the long term. For me--I'm a computer scientist--three to five years is still the long term. Let's have a planning horizon that will put the economy and society in good stead.

Thank you very much.

[The Chair, Conservative, James Rajotte]

Thank you, Ms. Watters.

We'll go finally to Mr. Bradley, please.

[David Bradley, Chief Executive Officer, Canadian Trucking Alliance]

Thank you very much, Mr. Chairman and members of the committee.

On behalf of the 4,500 members of the Canadian Trucking Alliance, I'm happy to present to you again this year.

As in previous years, I just wish to remind you that trucking is a significant leading indicator of economic activity in the country. While there is some preliminary indication, or perhaps I'd better characterize that as hope, that the economy has hit bottom, no one in the trucking industry is anticipating any meaningful improvement or growth at this time. The situation remains extremely fragile.

As an essential component of the supply chain and a key facilitator of Canada's trade, the trucking industry has an important role to play in terms of economic renewal. The 2010 budget needs to ensure not only that recovery is real but that Canadian businesses are able to take full advantage of the recovery when it does come.

The trucking industry doesn't expect government to solve all of its problems. Our industry is a creature of the most competitive market there is. Ultimately, our members' ability to manage their businesses will determine whether they survive. However, the Government of Canada and the 2010 budget have a significant role to play in ensuring that the industry is able to take full advantage of the opportunities that do present themselves through economic renewal, is treated fairly compared to other sectors of the economy, and receives value for the tax dollars it generates.

Furthermore, it's important to note that the industry's economic goals are more aligned now with society's environmental and safety goals than at any other time. CTA's primary goal for the 2010 budget is to establish partnerships with government and mechanisms to accelerate the re-equipping of the Canadian truck fleet when recovery does take hold.

Ours is also an industry where our number one business input cost, diesel fuel, has not been harmonized with the GST in terms of its taxation. It is still subject to the archaic and regressive excise tax. Few other industries, certainly none that I can think of beyond the transport sector, are subject to so severe attacks on their primary business input.

CTA has raised this issue with the committee in recent years. The excise tax on diesel fuel serves no policy purpose other than to generate general revenue.

Perhaps our message has started to sink in. During the 2008 federal election, the current government promised to reduce the federal excise tax on diesel by 50% sometime over the following four years. However, while the fundamental tax policy arguments for reduced or eliminated tax are as, if not more, relevant today than they were a year ago, CTA is open to discussing an alternative approach other than reducing the tax at this time. We're prepared to work with government on a program that would earmark revenues generated from the excise tax to programs aimed at accelerating investment in and increasing the market penetration of new smog-free heavy-truck engines and proven currently available GHG technologies.

The 2010 model year heavy-truck engines that roll out later this autumn represent the final step in the joint mandate of USEPA and Environment Canada to eliminate smog-causing air contaminants from heavy-truck engines. This is great news for the environment, but it comes at a cost. First, the new heavy trucks will cost about $10,000 more to purchase than previous models. Second, to become smog-free the new truck engines have had to give up some fuel efficiency. This is not only costly to truckers, but it also impairs our ability to reduce our carbon footprint.

It is imperative that we at least win back the lost fuel efficiency from becoming clean, but of course we also want to do better than that. Energy efficiency technology on trucks is, according to the National Round Table on the Environment and the Economy, the second-largest single GHG reduction opportunity for Canada, after carbon capture and sequestration.

The fuel efficiency technologies that CTA proposes in its enviroTruck initiative are all proven and available. They are approved by the USEPA SmartWay transport program. The California Air Resources Board is going to mandate them in regulation in that state starting in 2010.

A study by a reputable environmental engineering research firm for CTA found that if the entire Canadian fleet of class A trucks were to adopt the full enviroTruck package of energy efficiency technologies, GHG emissions would be reduced by 11.5 million tonnes a year, the equivalent of taking 2.5 million cars off the road.

The problem is that the industry is in no position to buy new equipment, at least not at a rate that would provide much environmental benefit for many years to come. The industry simply doesn't have the capital, and credit remains extremely tight.

There are a couple of federal programs providing some very modest incentives already in existence. Transport Canada's ecoFREIGHT program provides $65 million over four years for qualified purchases. However, these dollars are split amongst all four transportation modes: rail, air, marine, and trucking. Similarly, last week NRCan announced a pilot demonstration program where funds are available for investing in U.S. EPA SmartWay-approved technologies. However, the total amount of funds made available is only $1 million.

CTA would like to see better coordination and consolidation of the various programs. Moreover, we would like to see an appropriate level of funding provided that would leverage greater industry uptake, and a possible source of that funding is, in our view, the revenue generated from the federal excise tax on diesel fuel. A similar approach could also be used for the latest proven safety devices, such as electronic onboard recorders for monitoring hours of service compliance, and electronic stability control. Mandates for both of these are currently under consideration in the U.S. and Canada.

[The Chair, Conservative, James Rajotte]

Mr. Bradley, could you just wrap up? We're well behind time.

[David Bradley]

I am wrapping up, sir.

Furthermore, in the 2008 federal budget, capital consumption allowances for purchases of new, less polluting railway locomotives were accelerated. Why just one mode of freight transport was provided with this incentive has never been adequately explained. The trucking industry seeks the same consideration.

Thank you very much.

[The Chair, Conservative, James Rajotte]

Thank you for your presentation.

We'll start with Mr. McCallum, please.

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

Thank you, Mr. Chair, and my thanks to all the witnesses for your thoughtful presentations. They were convincing presentations, by and large.

I'd like to begin with Mr. Lee of the International Association of Fire Fighters, and I'd like to say that in particular I strongly agree with two of your proposals. First is the public safety officer compensation benefit. It's $300,000 and I think it is overdue. I think, in the total scheme of things, it is a relatively low cost. I also fully agree with $6 million annually, I believe you said, as an estimate of that cost. Six million dollars is a lot of money, but in the context of the federal budget, it is not a huge sum. I also fully agree with your proposal for a national office for fire service statistics.

As for the third one, I don't really have the expertise to.... I'm not saying I'm opposed to it; I'm just not knowledgeable enough. But certainly the first two we in the Liberal Party would strongly support, and maybe if all parties support these recommendations, that could provide some pressure in the upcoming budget, whichever party happens to be presenting that budget. Thank you for that.

If I may turn now to the graduate students, as a former professor, I'm naturally sympathetic to that, and as a member of the Liberal Party, our leader has said frequently that to create the jobs of tomorrow, we need research and innovation and brainpower and ideas. Everything you say is highly consistent with that. In that sense, I fully support it. It's true that the Conservatives provided some funding for graduate students and some funding for infrastructure, but they actually cut the funding for the research councils and they cut the funding for science. We, in a sense, are going in the opposite direction.

I have two questions for you.

I agree that two-year funding for graduate students is not sufficient; it should be three to five years. One possible rationale for two years is that it's the period of their fiscal stimulus. But if the idea is that we only need funding for graduate students during a recession, and it's right to cut it off after that, that's a very misguided view of the world. Is it your understanding that the two-year limit on funding for graduate students is—as opposed to three to five years—related to this two-year fiscal stimulus plan, or is there some other reason?

[Carolyn Watters]

I might just clarify first. It's a two-year program, so there was a shot of 500 in the first year, 500 in the second year, and none in the third year. Each student at the master's level got it for one year. I believe it is a recession initiative, but the problem is that it's not good value for the money if it's not taken up in the appropriate way.

If we don't have enough students applying because nobody's actually doing that right now and no one is willing to move into that area, then we spend the money, but we may not have spent it in the best way going forward. I'm not one to say that we don't want the 1,000 scholarships, but I think even if it was the same number but spaced out for three to five years, then people can build programs, people can move into these areas, and we will get more bang for our buck.

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

Right. And I assume you agree that the need for graduate funding will continue to exist even beyond the two years that we think the recession will exist.

[Carolyn Watters]

To be honest--of course I have a vested interest--I see no end to the need for graduate funding. If we want to increase and be anywhere close to the rest of the OECD in graduate production, we must step up and increase the number over longer periods of time. But I know that governments work on shorter time periods, so even a three- to five-year window would make a big difference in planning.

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

I fully agree with that.

Can you comment on the implications of these cuts in funding to research for universities--or more importantly for the economy?

[Carolyn Watters]

If we cut research, then we can also cut innovation and the high knowledge-level style of jobs we need. In fact, I love being in Ottawa, because when I look around I believe that short of downtown U of T, the highest proportion of Ph.D.s and master's students in the country are on Parliament Hill. We need them for policy making, we need them in health, and we need them in science and engineering. We aren't anywhere near where we need to be. And the Conference Board...I love “strikingly low”. It kind of hits you there. So how are we going to get there? And if the baby boomers retire, who is going to replace them?

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

Thank you very much. I think we're both either academics or former academics, so I agree with everything you're saying.

If I may turn now to Ms. Russell, I noticed in your presentation you made a contrast between affordable, publicly provided child care versus the $100-a-month Conservative plan. We are on record as favouring the former versus the Conservative plan. Can you describe to me which one you think is better and why?

[Susan Russell]

The $100-a-month plan is really not a lot of help. It's not sufficient to cover child care costs and it is taxable, so if you are over a certain income bracket you don't get anything. You could say that those people can afford it anyway, but it has done absolutely nothing to open up any child care spaces whatsoever. So it doesn't address the issue of having accessible child care, and it doesn't really address quality, standards, or anything else. It is not truly universal.

I really feel we need a real and proper child care system and an early learning system that's accessible to all Canadian children. It is an investment in the future of the nation.

Thank you.

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

Thank you very much.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. McCallum.

Mr. Laforest, s'il vous plaît.