Thank you very much.
First of all, I would like to thank committee members for inviting me to appear today to discuss Bill C-288, which is intended to create a tax credit for new graduates working in remote areas.
The main objective of the bill is to attract young graduates to remote areas. It is also intended to mitigate two problems affecting these regions—an exodus of young people and a serious labour shortage. It is important to encourage young graduates to move to the regions to take up their professional activities and ensure, in the best interest of the regions, that they are able to recruit skilled workers.
As mentioned, the youth exodus is a growing problem in terms of the economic vitality of regions located some distance from the major urban centres. They need the contribution of young graduates to stimulate regional development and increase their capacity for innovation. There is no doubt that providing a $3,000 annual tax credit, up to a maximum of $8,000 over a three-year period, to new graduates working in the regions would help to revive the local economy and meet labour requirements.
Many students leave their home region to pursue post-secondary studies in the major urban centres. Young people who leave their regions to study in these centres establish ties there, develop friendships and build networks. It is thus more likely that, when they complete their studies, they will have many more reasons and opportunities to establish themselves in their new environment, as opposed to returning to their home area. According to Statistics Canada, people with the highest educational attainment generally migrate to the major urban centres. The tax credit proposed under Bill C-288 would give young graduates an incentive to go back to the regions and establish themselves there.
The youth exodus has negative consequences both socially and economically. There is an acceleration of population aging and a decrease in average educational attainment among those who remain, which undermines the capacity for innovation. The most remote regions are those losing the most people. Often, they depend on a particular type of industry—the so-called single industry regions. Often there is little room for skilled jobs in the traditional economic base of these regions, which tends to be extraction or primary processing of natural resources. The time when resource regions could rely solely, for their prosperity, on the extraction of natural resources intended to be processed elsewhere, has come and gone. In order for the regions to develop, they must make the technology shift and further develop their processing industry.
My riding of Laurentides—Labelle clearly illustrates the disparity between a remote region and one close to an urban centre, as well as the impact of a resource crisis in a single-industry region. I am referring here to the crisis in the forest industry. The most southerly part of the Laurentians region has, for some years, seen an increase in its population because of quite significant interregional migration, primarily from Montreal and Laval. However, in the RCM of Antoine-Labelle, which includes the municipalities north of the Municipality of Labelle, the population is experiencing considerable decline. The forest industry crisis has hit that RCM with full force. Although its decreased population cannot be attributed to the forest industry crisis alone, many young people have had to leave the area due to inadequate job opportunities following the closure of forest companies and related businesses.
Of the 17 forestry companies in my riding, 14 have been forced to shut down their operations. More than 1,250 jobs have been lost. Heavy machinery operators, engineers, technicians and truckers are the ones most affected by these job losses. The people with the most education, with skills or with special expertise—engineers, for example—have been forced to leave this beautiful region in order to seek employment in their field elsewhere.
As for the Government of Quebec, it believes that diversifying the economies of these regions will mean developing new business activity in other areas.
This is a significant brake on development of secondary processing activities and high-tech industries in the region.
In all the studies that have been done, many entrepreneurs have said that they could only keep their business operating in the region if they were willing not to expand. As long as the business remains small, they can handle anything requiring professional or technical expertise. However, if the business expands, they have no choice but to hire skilled personnel. The problem associated with finding that kind of personnel in their region could mean they might have to move their business to urban centres, where they would be more likely to find skilled labour.
Bill C-288 would be a beneficial tax measure for all eligible young Canadian graduates. The youth exodus phenomenon does not only affect Quebec. All across Canada, economic activity has gradually been moving from the so-called rural areas to the major urban centres. Some provinces, including Quebec, Saskatchewan, Nova Scotia, New Brunswick and Manitoba, have developed a tax credit for young graduates. The government of Quebec created its own such tax credit in 2003. It was subsequently amended and now resembles the one proposed in the bill I am discussing with you today.
Many young graduates have taken advantage of this tax credit and, according to the most recent available statistics, more than 16,000 people used it in 2007. In the Saguenay—Lac-Saint-Jean region alone, as of April 2009, 22,074 individuals had claimed it since it was first introduced. So, the tax credit is enjoying tremendous success. In Saskatchewan, the government introduced a tax credit to encourage graduates with a post-secondary degree to remain in the province. The provincial government also created a tax exemption of up to $20,000 for graduates, depending on their educational level.
Bill C-288 has received support from many different groups and generations across Quebec, including the Fédération étudiante collégiale du Québec, or FECQ, and the Fédération étudiante universitaire du Québec, or FEUQ, which represent 40,000 and 125,000 students, respectively, all across Quebec. The FADOQ network, with 255,000 members, as well as the Fédération québécoise des municipalités, representing 972 municipalities across Quebec, have voiced their full support for this bill. In addition, the bill is supported by many RCMs, chambers of commerce and Carrefours Jeunesse.
When we toured Quebec to promote Bill C-288, people expressed strong support for this bill. The youth exodus is only too real for the people of Abitibi-Témiscamingue, Saguenay—Lac-Saint-Jean, the North Shore, Gaspésie, the Magdalen Islands, the Lower St. Lawrence region and northern Quebec.
According to the reference scenario used by the Institut de la Statistique du Québec in its most recent publication on population prospects from 2006 to 2031, there could be slightly negative growth by the end of that timeframe, one of the factors behind the decline being higher levels of regional migration in the later years.
The federal tax credit for young graduates could prove to be an effective means of countering too significant a population decline in the regions. The challenge today is to keep our young people in the regions and encourage others to establish themselves there.
I am therefore calling on the finance committee to help the regions of Quebec and Canada and support our young people. We must put a stop to population decline and the youth exodus, which are far more significant in the regions than in the urban centres.
What is at stake here, gentlemen, is the future of our young people and our regions.
