I don't think so, no.
Evidence of meeting #44 for Finance in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was program.
Evidence of meeting #44 for Finance in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was program.
12:20 p.m.
Conservative
Bob Dechert Conservative Mississauga—Erindale, ON
Ladies and gentlemen, thank you for your presentations. Mayor Mandel, I'm pleased to be here in this dynamic city of Edmonton. Congratulations to you and your councillors and staff for the way you manage the city.
I've a question for Ms. Manasc and the consulting architects. I take your point about incentives for green building design. I think there's a lot more we can do, a lot more that deserves study.
In our most recent budget, the government provided, on a fifty-fifty basis with the provinces, $1.3 billion over two years to support renovations and energy retrofits for social housing across Canada. Several co-op housing buildings in the city of Mississauga, where I'm from, have taken advantage of that funding and are now doing energy retrofits. I wonder if you could comment on whether you think this is a worthwhile program that should be expanded.
12:20 p.m.
Architect, Consulting Architects of Alberta
I think any energy retrofit program is a worthwhile program. I would suggest, though, that this program is far too narrowly focused to be effective. What's needed is a much broader, more inclusive program that affects all building types and all building owners. The program shouldn't focus solely on energy but also on water use reduction, with a view to creating more healthy environments. This is why we're proposing that you look at things like the LEED green building rating system, which is not confined to energy.
Even if you're looking only at energy, the program that used to exist, the commercial building incentive program, was actually a far more effective program than the current one. The program that exists at the moment funds far too little to be effective. In fact, there is a program that is applicable to commercial buildings. We looked at it for a client and there was about $1,000 worth of funding that might have been available. But we found that it would actually have cost about $10,000 to submit the documentation to get $1,000 worth of funding. Nobody was going to do that.
The programs that exist today are not nearly as effective as the programs that were in place. We need a broader incentive program that rewards people for achieving energy use reductions, for achieving green building certification.
12:20 p.m.
Conservative
Bob Dechert Conservative Mississauga—Erindale, ON
The co-op building program covered all kinds of renovations, not just energy but also other environmental renovations. What would be the cost of the programs you're suggesting? What is the amount we should be looking at?
12:20 p.m.
Architect, Consulting Architects of Alberta
We have some preliminary numbers in our brief, and we said that if, for instance, the government chose to provide a $50,000 incentive for LEED silver, $65,000 for LEED gold, and $75,000 for LEED platinum, we could imagine an investment of about $5 million a year being required to do that. So it's not a huge amount of money, but it would have a very significant impact and ripple effect.
12:25 p.m.
Conservative
Bob Dechert Conservative Mississauga—Erindale, ON
Thank you.
I have a question for Ms. Fleming and Mr. Smith from the United Way. You mentioned that increasing numbers of people are self-employed these days. I certainly see that in my city, and a lot of women, in particular, are self-employed, working from home. In that regard, the lack of parental leave benefits is certainly an issue. It's a proposal that I support. I wonder if you could help me by giving me your views on how you think the program should be structured.
Should self-employed parents pay into the EI program in advance of taking advantage it, and how would you determine who is self-employed and who isn't? How long would they have to be involved in their own business before they can take advantage of this kind of program?
12:25 p.m.
Chair, United Way of the Alberta Capital Region, Success By 6
I think the first two questions have actually been very well-answered in the Quebec parental insurance plan. I think the way that model is set up is that all Quebeckers who are working are contributing. Therefore, the cost is spread across a much larger number. I guess it's like insurance program models. So that's fairly easy to do.
I think what we need to do is probably look at it federally. We need to do the investigation of it. The work that has been done suggests that its potential for implementation is better than trying to amend the current EI program. I think the EI program is suffering given the changing nature of work.
In terms of the cost—
12:25 p.m.
Conservative
Bob Dechert Conservative Mississauga—Erindale, ON
So you wouldn't do it under the EI program, but as something separate?
12:25 p.m.
Chair, United Way of the Alberta Capital Region, Success By 6
Our recommendation would be to study a national equivalent to the parental insurance program in Quebec. It seems to make more sense.
12:25 p.m.
Conservative
12:25 p.m.
Chair, United Way of the Alberta Capital Region, Success By 6
In Quebec, it's a province-wide program. The premiums would cover the traditional EI-type premium and then an additional cost to cover maternity and parental leave structures.
12:25 p.m.
Conservative
Bob Dechert Conservative Mississauga—Erindale, ON
That's paid by all workers, not just self-employed workers?
12:25 p.m.
Chair, United Way of the Alberta Capital Region, Success By 6
Yes, it is paid by all workers, including the self-employed. It seems there has been some costing done for self-employed workers, and it looks like the net cost is $420 per year for a self-employed worker.
Now, there's no option as to whether or not you will contribute; we consider it as part of supporting children of families across the province.
In terms of how long you need to contribute, as soon as you indicate you're self-employed, then you're eligible to contribute to the program.
12:25 p.m.
Conservative
The Chair Conservative James Rajotte
Okay, thank you.
Sorry, Mr. Dechert, but you're out of time.
I want to thank all of you for being with us.
I just want to follow up briefly with the mayor on the question Mr. Pacetti asked about the four or five projects. Mayor Mandel, you can certainly provide the information to the committee, if you want, on what the four projects are and when their start and completion dates are. I don't know if you want to comment further.
12:25 p.m.
Mayor, City of Edmonton
Well, yes.
I mentioned bureaucracy in regard to these projects. The politicians' approval might have to go through the bureaucratic process, and that slows everything down. The projects have support, but you guys in the federal government create a process that's long in every way. Our projects have been approved. We asked that one of them be changed, as a result of that. This is the point. That's all.
12:25 p.m.
Conservative
The Chair Conservative James Rajotte
If we could get more information just for the general committee, that would be good.
12:25 p.m.
Conservative
The Chair Conservative James Rajotte
Okay, thank you.
I want to thank all of you for being here with us today and for your presentations, submissions, and responses to all of our questions. Thank you so much.
Members, we will have a meeting again at one o'clock.
The meeting is adjourned.
1:10 p.m.
Conservative
The Chair Conservative James Rajotte
I call the third panel of the 44th meeting of the Standing Committee on Finance to order. I apologize for our being a little late. We had a very short break and we weren't able to get back here on time. We will extend the session so we will have the full hour and a half before the committee.
We have seven organizations with us here today, so it's a large number of organizations. This is the second day of our tour across Canada. We did Vancouver yesterday, and we're going to Yellowknife later today; we'll be there tomorrow. We're doing nine cities in all, so it's part of the pre-budget consultation, and we very much appreciate your being here.
I'll read the organizations, and we'll have those presentations in order. We have up to five minutes maximum for an opening statement, and then we'll go to questions from all members of all parties.
We have the North American Equipment Dealers Association, Capital Power Corporation, and Grant MacEwan College. That should read “University”, shouldn't it?
1:10 p.m.
A voice
Yes.
1:10 p.m.
Conservative
The Chair Conservative James Rajotte
Congratulations to you on that.
We also have the Wood Buffalo Housing and Development Corporation, the County of Athabasca, NorQuest College, and the Small Explorers and Producers Association of Canada.
You each have five minutes, and I'll give you a signal when you have a minute left so you'll know when you can wrap up.
We'll start with you, Mr. Schmeiser.
September 29th, 2009 / 1:10 p.m.
John Schmeiser Vice-President, Canadian Government Affairs, North American Equipment Dealers Association
Good afternoon.
I would like to thank the committee for the opportunity to make a presentation on behalf of the North American Equipment Dealers Association. Our trade association represents over 800 equipment dealers in Canada. Our dealer members retail equipment that is primarily used in agricultural or farming practices. Our members are sensitive to the changing needs and demographics of farmers and have seen many advances in the equipment offered for sale.
Farming today is vastly different from 30, 20, and even 10 years ago. Increases in farm size and demand for greater production with the same farmable acres have seen significant increases in technology. Tractors, combines, high-clearance sprayers, air seeders, corn planters, and GPS systems today are very sophisticated pieces of equipment that require highly skilled technicians to service. Added to this is that the changes in technology are coming in at an extremely fast rate, making relatively new equipment obsolete. However, it is our perspective that government policy affecting our industry has not moved as fast.
To accurately represent these increases in technology and to fully account for the effective life of today’s farm equipment, we recommend that consideration be given to changes on the capital cost allowance schedule on farm equipment and implements. We believe that the existing CCA rates on farm equipment are not reflective of the current life of the machine, nor respect the substantial increases in technology that have taken place in recent years, nor match the buying and purchasing practices common today in the industry. Our dealer members are seeking quicker turnover of equipment by our customers, which speaks to the demand for the new technologies and the increased usage of the current equipment.
The current CCA rate of 30% is not reflective of today’s environment; therefore, we are requesting that the CCA rate on class 10 equipment be increased to 40% in the first year from the current 30% and the CCA rate on class 8 equipment move to 30% from the current 20%. At the same time, we are requesting that the Department of Finance undertake a comprehensive review of the current determination of what qualifies for class 8 or class 10 types of equipment. Current classifications identify high-clearance sprayers, air seeders, air drills, and corn planters as class 8, but due to the sophistication and useful life of these machines, we suggest they be reclassified to class 10.
It is our understanding that Minister Flaherty commissioned his officials in the Department of Finance to undertake a review of current CCA rates to ensure that Canada’s businesses are competitive in the world economy. Our industry has yet to see any adjustments in CCA rates from this review.
Increasing the CCA rates has been addressed through resolutions that passed unanimously at our annual general meetings. This has become formal North American Equipment Dealers Association policy in both Canada and the United States. There have been recent initiatives in the United States that have seen rapid acceleration of their depreciation schedule. Our organization was successful in leading an initiative in Washington, D.C., to have agricultural equipment fully depreciated over a five-year period as opposed to the previous seven-year period. The American Recovery and Reinvestment Act of 2009 also makes an additional $250,000 of equipment depreciation available, in addition to another measure of a 50% bonus depreciation provision for farm equipment purchases.
Our agricultural equipment industry conducts business in a North America-wide market. It is vital to our Canadian dealers that Canadian taxation policy be as competitive as possible.
Such a change in Canada would see all sectors on the agricultural equipment market benefit, the Canadian manufacturer, dealer, and consumer, and result in a positive effect for the Canadian economy. Farmers will be encouraged to reinvest in their equipment even quicker and faster. This benefits the manufacturer, which will allow for further sophistication and advances in technology.
In our materials that I have provided, we have a current outline of the CCA rates. According to the CCA guidelines, harnesses and sleighs have the same depreciation rate as a $300,000 combine. We hope this illustration alone points to our desire to have the CCA rates updated.
I'd also like to point out that in 2007 the Standing Committee on Agriculture and Agri-Food passed a motion supporting our request to increase the CCA rates on class 10 and class 8 agricultural equipment. Our organization is also one of 14 groups and sectors in Canada that is calling for long overdue changes to the CCA rates. We seek support from the Standing Committee on Finance to finally address this long overdue change.
Our third issue addresses environmental concerns. We are requesting that the committee propose and support the introduction of a program that would see financial incentives to see farmers replace, repower, and retrofit older diesel engines. We base this initiative on a program currently in the U.S. that is successfully reducing emissions from diesel engines.
Recently the Obama administration announced a new directive to reduce carbon dioxide emissions. Soon the State of California will be requiring all tractors to have a tier 4 engine. We don't envision that tractor manufacturers will have tractors with two different engines for the North American market, so Canadian dealers and farmers will be impacted by these changes. We feel that manufacturers, dealers and farming customers are ready for environmentally responsible changes; however, our concern is who pays, and what value will the farmers' old equipment have once new environmental standards are imposed?
In closing, Canadian farm equipment dealers remain committed to selling and servicing quality products for Canadian farmers. We are hopeful that all sectors of the industry will be profitable in 2009, 2010, and beyond.
On behalf of our 800 dealer members across the country, I'd like to thank the committee for the opportunity to make this presentation on their behalf, and I look forward to your questions and comments.
1:15 p.m.
Conservative
The Chair Conservative James Rajotte
Thank you very much for your presentation.
We'll now go to Capital Power Corporation.
