Finance Committee on Oct. 21st, 2009

[John McKay, Liberal, Scarborough—Guildwood, ON]

That's what I thought. You're asking for a $145 million increase of money that you don't get.

[Linda Franklin]

We'd like the whole pot increased by 5% and we'd like all of that 5%.

[John McKay, Liberal, Scarborough—Guildwood, ON]

How does it divide out? How does that $2.7 billion, whatever, divide out among the various groups?

[Paul Charette]

It's actually $2.9 million of federal funding for research innovation across Canada. Colleges get less than 1% of it.

[John McKay, Liberal, Scarborough—Guildwood, ON]

[Inaudible—Editor]...the vast majority. Shouldn't your ask be a more equitable division between you and the universities?

[Paul Charette]

We don't want to be putting ourselves against the universities. Obviously the research being done at the university level is vitally important to our economy. What we're asking for is some additional funding, 5% of that $2.9 billion, to be allocated in addition to the current financing to the college systems across Canada so the colleges can do applied research to help our industries.

[John McKay, Liberal, Scarborough—Guildwood, ON]

I buy the argument that the colleges actually do applied research probably better than the universities. I buy the argument that our industries, for whatever reason, don't do their own applied research. If they're not going to do it, somebody has to do it; and if it's not you, it's got to be somebody else. It seems to be the structure of the thing.

Ann Buller is the president of Centennial College in my riding, and she's beaten me over the head on this issue. I'm a convert.

[Paul Charette]

I think I'd like to address the industry.

Of the applied research being done at the colleges today, a great portion of it is being funded by industry in order to get their programs reviewed by the colleges. I know, for example, that at Red River College in Manitoba they did a tremendous amount of research with Manitoba Hydro to build a LEED platinum building in the downtown core of Winnipeg. Most of that research was done at the CARSI facility at Red River College. Industry does a huge amount of funding.

[John McKay, Liberal, Scarborough—Guildwood, ON]

There are free-standing labs there, there are pools for experimentation, there's cheap labour with the students, and everything works for an SME. So I buy that argument. Unfortunately, I'm moving on.

Mr. Manahan, you have an interesting point about Highway 407 and P3. The 407 in this community is an absurdity, because we charge people to drive on the 407. I have a choice between the 401 and the 407. Where am I going to drive? I'm going to drive on the 401. So we load up the free road and empty the other road.

I'm keen to know how you would address that issue, because in one of your paragraphs here you start to hint at how that could be addressed.

[Andy Manahan]

I'm not going to name the corporate interest, but there is an outfit in Toronto that's looking at satellite-based technology that could be used for the entire road network. I've been having some discussions with this group, because we're interested in a dialogue towards funding for infrastructure, not that we're for any one particular technology or anything like that. This particular group recognizes that for many of you around the table, it would be political suicide to introduce road pricing. Their strategy right now is to have some testing done with parking pricing in limited areas in the GTA.

[John McKay, Liberal, Scarborough—Guildwood, ON]

What's parking pricing?

[Andy Manahan]

There's an academic in Los Angeles that says there are people who spend too much time driving around the block. So if you have a satellite GPS-based system in your car, you park where you're allowed to park. You don't have to run out at the end of a meeting, just five minutes late, and get a ticket for $30 or $40.

Parking pricing is one thing. There's distance-based insurance pricing, and then once the public becomes comfortable with that, certainly they'll become very comfortable with the 407. Then I think we need to get into road pricing, because congestion, certainly in the urban areas across Canada, is becoming unwieldy.

[John McKay, Liberal, Scarborough—Guildwood, ON]

That's interesting.

Thank you.

[The Chair, Conservative, James Rajotte]

We're going to go to Mr. Laforest.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Thank you, Mr. Chair.

Good morning to all the witnesses.

First of all, I have a question for Ms. Litzenberger or Ms. White. In your recommendations, you both asked for the tax credit to be increased to 39% from its present 29%. On the first $200 of charitable gifts, it is 15%. This is clearly a major source of funding for the arts, as Mr. McKay said.

Have you costed it out? Would it not be preferable, a better source of income for the arts, to instead ask for an increase in the credit on the first portion, say, an increase from 15% to 25% on the first $200? Would that not be of greater benefit to the arts? Would it not get more people participating?

[Shannon Litzenberger]

Isn't it really a question of stimulating the kind of private giving that we're interested in? We want to encourage individuals to give at a more substantial level. I think that's the motivation behind looking at the tax credit between the $200 and $10,000 levels.

Certainly we wouldn't be opposed to looking at an increase of the first $200 from 15% to 25%, but I think it's also acknowledging where the majority of giving comes from, which donors are most significantly contributing to the bottom line for arts organizations.

Just to give a bit of context, in the arts, typically the way our budgets look, on average 50% of income is earned, 25% comes from public funding, and the other 25% comes from private giving. For most organizations, that private giving is in that $200 to $10,000 range for most donors.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Thank you.

Mr. Manahan, one of your recommendations dealt with building. In your first recommendation, you say that infrastructure programs like the present one do not take sufficient account of the priorities established in collaboration or in conjunction with those in the field. You mentioned the development of an infrastructure simulation platform that would focus, maybe even correct, the consultation and prioritization process.

What would a platform like that look like? It is more of a theoretical concept, as I understand it.

[Andy Manahan]

Yes, that's correct. It would be more mathematically based in terms of the modelling that is done.

The group we've been talking to over the last few months has actually done some H1N1 modelling for the federal government, so a lot of it has to do with risk management. But essentially it's a way for loading the appropriate data onto a platform, let's call it. And whether there's a disagreement as to one infrastructure project or another, as long as there's agreement on the data that are being used, we think that there would be a more objective way to determine what would be the priority infrastructure project.

I'm not the modeller so I probably can't explain it as well as the person I've been speaking to, but it is a much more objective-based way to do things.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

You said first that there has not been enough consultation or that there is a problem with prioritizing projects that should have been funded. Is it your impression that there are projects where money has been wasted? Are there infrastructure projects that are not really necessary, when it comes right down to it, while there is a really pressing need for others that will not get done?

[Andy Manahan]

Thank you for the question.

I'm not going to comment on any specific projects per se, although anecdotally our groups do hear that a number of projects that are released are perhaps not viewed as the best. They were viewed as more expedient in the sense that this is what could be done within a certain deadline.

Take, for example, the MetroLinx regional transportation plan. That particular plan has been funded, to date, $9.5 billion by the province. I believe there has been some funding for non-RTP projects by the federal government; for example, the Spadina subway station. But those are long-term projects that require many years of public consultation, engineering design, removal of utilities, and construction phases before you even get to completion. We've been talking about the Spadina subway, for example, for seven or eight years. It's been through two EA processes. So we're concerned that if all of the stimulus money goes out the door, there'll be little money left over for those types of priority projects.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Thank you.

Mr. Charette or Ms. Fralick, you are very concerned about the shortage of skilled workers in the coming years. But do you see any room for optimism? Are there areas where there is no shortage?

[Paul Charette]

To answer that question bluntly, I think the skilled worker shortage across Canada is pervasive across most industries. There are sector councils that consult with most industries. Our construction sector council has been putting out reports for the last five or ten years. This problem isn't new. It's not going away. We have college capacity problems; we have an integration program that doesn't help a lot of our industries to bring immigrants into Canada with the necessary skill sets; and we're having, frankly, a drop in fertility rate, which is exacerbating the problem even more. This problem is not going away.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

I think that you misunderstood my question; I want to know the opposite. You tell me that there is a serious shortage in the steel industry, but is there a sector where we can say that we have enough workers?

[The Chair, Conservative, James Rajotte]

A very brief response, please.

[Paul Charette]

I don't know of industries that have a surplus of workers. We represent over 20 national associations, and not many of those associations have surpluses. Otherwise we wouldn't be here today.