Finance Committee on Oct. 27th, 2011

[Ray Orb, Vice-President, Saskatchewan Association of Rural Municipalities]

Mr. Chair, I'll take a stab at that one.

We consult with the federal government whenever we get a chance, and we have some priorities, particularly with business risk management. This ties in with the whole idea of Growing Forward, which we believe is really like a national farm program. It fits in with the infrastructure asks as well; we believe these should be tied together, so that we can make sure we have good roads and good infrastructure so that our farmers can compete on an international basis.

We think there are some ways the federal government can save money and streamline some of their programs. We've asked that AgriInvest be looked at. We think farmers like AgriInvest because it's very simple to administer, it's very easy for them to understand, and it's something that's bankable and that they can rely on in cases of emergencies at seeding and harvest time. We see ways the federal government could actually save money.

We've also asked for such things as a better definition of AgriRecovery. Now, it seems, this is more of an ad hoc program.

We certainly appreciate that the federal government helps farmers from time to time. We saw it last year and we saw it this year. We're asking them to put a package together that we can work with—and can help develop, actually.

[The Chair, Conservative, James Rajotte]

Thank you, Ms. Block.

We'll go to Mr. Marston, please.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Thank you, Mr. Chair.

Mr. Russell, I think you may be a little bit surprised, but the NDP supports a decrease in tax for SMEs. We have called for that.

We also certainly understand the problems of raising capital. We don't have the sources of capital in this country that they have in the U.S., for example.

But beyond that, I want to talk a moment about the pooled registered pension plan. I'm the pension critic for our party, and one of the concerns I have is that the risk level to that plan is the same as for an RRSP. If the market goes down, you take a pounding.

We've had a position now for a number of years to, as we say, double the CPP, but certainly to increase it. It's owned by Canadians; it's portable; it's national across the whole country. Doing that would take some pressure off the businessmen who cannot really start a pension plan for their workers.

What is your response to that?

[Ian Russell]

My response would be that the current architecture of the pension funds probably provides enough flexibility and scope for small business to have pension funds without expanding the CPP.

I agree with you, I think the CPP is well-managed; it's a well-run fund, it's fully funded—far better than social security in the U.S. But my concern would be that if expanding it is going to result in payroll taxes or increases in federal tax—

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Just to be clear on the expansion, it would be a phased-in expansion. It wouldn't be an immediate one.

[Ian Russell]

That's understood.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

I'm not overly surprised at your response, but I wanted to give you the opportunity.

[Ian Russell]

I just wanted to say that group RRSPs, for example, which are a pretty effective plan for very small companies, whereby they use an administrator and offer group RRSPs, offer one vehicle that we think we could improve upon.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Thank you.

Mr. Hames, I want to thank you for your suggestion about freezing the ag budget and using the money for R and D to get some of that return back into the system in a fashion that takes some pressure off, to be truthful about it. I'm not sure whether government members will agree, but if you reduce the liability to the federal government by doing so, that's a very innovative way of looking at it, and I appreciate it.

I'm not really looking for a response. I just want to say I agree with you; I think it's a good idea.

Mr. Marit, we've taken a position that the capital vote is rather locked up right now. We hear there is $500 billion that businesses are holding on to, and understandably so, because they're afraid of a downturn and of the banks freezing up again. We've suggested that now is the time for the federal government to take leadership on infrastructure and social infrastructure.

Something that struck me during your presentation, and that struck me particularly in the Yukon, where there are infrastructure problems—their hydro lines are 50 years old, and whatnot—is that we don't have the population in our rural areas to sustain and pay the costs of the very infrastructure that's needed to get produce through your areas into market, or a variety of flow-through types of activities that would go through the area. In a sense, there's more of an impetus on the federal government to do the investing in infrastructure in rural areas than in the more urban areas.

What are your thoughts?

[David Marit]

I'm only going to speak for Saskatchewan, because I think we've done our homework. We have actually prioritized our municipal system as far as what is a municipal road, what has a provincial interest in it, and what also has a federal interest in it.

Unfortunately, as I talked about, when we talk about our bridge infrastructure we're living under federal rules, and that's what really is driving the cost for rural municipalities, whether it's navigable waters, whether it's the Department of Fisheries and Oceans, whatever the case may be. We have to live within the parameters of federal and provincial rules.

We think that because of that there is a federal interest, and there is a provincial interest and a municipal interest, and we agree with that. We think there should be some cost-sharing on those types of infrastructures where there is a federal interest.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

In 30 seconds, Mr. McCulloch, on the relationship with labour in training for apprenticeship programs, do you have a red seal level of training?

[Dr. Robert McCulloch]

Yes, in Saskatchewan it's a three-way partnership for our apprenticeship training. We would see an apprentice, depending on the program, between eight and twelve weeks of the year. They are supervised by the Saskatchewan Apprenticeship and Trade Certification Commission. The other key partner, of course, is the industry, the business leader. That has been working very successfully. And yes, absolutely, we cover all the steps of apprentices, including red seal.

[The Chair, Conservative, James Rajotte]

Thank you.

Ms. McLeod, please.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

Thank you. I would like to start with a brief comment.

I noticed our first two presenters did talk about the red tape reduction commission and the importance.... I am a member of that particular commission, and of course we tabled the What Was Heard Report, but the more important piece is going to be what we're going to do about it. So the commission is working very actively and we hope to have that presented to cabinet in the next few months. Again, this is just to reassure you that the government puts a high priority in terms of moving forward with that particular initiative.

The questions I'd like to talk about first are actually perhaps both for the Saskatchewan Institute of Applied Science and Technology and the university.

It is interesting. I have children between 20 and 25, and I have always thought the baby boomers would be retiring and the world would be their oyster in terms of job opportunities, and probably in 10 years it will be for the new graduates, whether it be from apprentice programs or from universities. We seem to have a disconnect, and it's going to go on for a few years. Can you talk about whether that is really accurate? Are our students having a bit of a challenge right now in terms of the job market, both the apprentice and the university students? Will it be for a few years? Is it for 10 years? Maybe you could give your vision on that particular area.

[Dr. Robert McCulloch]

Thank you for the question.

Right now, perhaps Saskatchewan is in a unique situation across the country. Our students are not having any difficulty getting employment. Our graduate employment rate is in the middle 90% within six months of graduation. We recently did a survey. Two years after graduation, 97% of our graduates were employed.

To give you an idea of the positive pressure that students are feeling, we have industries coming in and talking to students, covering their tuition if the student will commit to working for that company. We are perhaps in a unique situation compared to other parts of the country, but in the apprenticeship areas--health, technology--we have 160 programs, and almost without exception the opportunities for our students are tremendous.

[Dr. Karen Chad]

Maybe I'll just quickly add to that.

I would concur with Bob. I don't necessarily see that there is a blip, but rather it's almost a change in our students. Our students are wanting to stay within our educational institutions longer. Why do they want to do that? It is probably for two reasons.

One, unlike many of us when we went through, we did one thing only. They like to mix and match. So many of our students, both for their outside pleasure as well as in terms of the financial viewpoint, are working.

Two, they like to mix and match the different courses and classes they are taking. They like to add on an extra year or two, so we're finding a four-year degree is now five years and six years, and similarly with our graduate students. It is not so much that they can't find the job, but they're really finding the stimulation there.

They are also looking for jobs that provide that mixing and matching in terms of the types of things they want. So one thing I think we need to do a better job of is providing them with those internships, those cooperative opportunities that continue to link the students not in their final months but right from the get-go. Start with our first-year students. Start to really expect more of the experiential learning and our connect with industry, business, etc., a lot earlier.

[Cathy McLeod, Conservative, Kamloops—Thompson—Cariboo, BC]

What we have is sort of a mobility issue with the students. I believe Alberta is certainly in the same situation. When we talk about youth unemployment, to some degree it sounds like a bit of a mobility....

My next question is to the Saskatchewan Association of Rural Municipalities. We did make some changes to actually facilitate the Navigable Waters Protection Act. Certainly with the stimulus program, I don't think I've ever seen major projects go through so quickly and so well at all levels of government. But we haven't quite got there yet then. Was that some improvement there?

[David Marit]

Yes, the changes that were made were very important to getting projects done, but the next step now is really to open that act up, redo it, and come out with a clear definition of what a navigable waterway is.

[The Chair, Conservative, James Rajotte]

Thank you, Ms. McLeod.

Mr. Giguère, you have five minutes.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

My first question is for Mr. Russell.

Presently, inside of your industry you have the possibility to make an indemnization fund province by province, profession by profession, for all victims of fraud inside your industry. Are you interested in the development of a Canadian indemnization fund to regroup our capacity for the support of victims?

[Ian Russell]

What we have in the securities industry right now is a national fund, the Canadian Investor Protection Fund, that protects investors in the event of defaults of member firms.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Yes, but the indemnization is limited.

[Ian Russell]

Well, it is limited, but it's comparable, certainly, to the CDIC. It's $1 million for each account within CIPF in those circumstances.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

The problem for the victim is.... The indemnization is so limited. It is so limited for the fund and the accessibility.

[Ian Russell]

What we have in the industry, in addition to the protections in the event of bankruptcy.... Where you're going is consumer redress for victims. Again, there is a national program, the ombudsman for the banking and securities industries. In those circumstances, there is an opportunity for aggrieved clients to seek redress through that mechanism.

I can't speak for others, but it turns out that in our industry certainly there has not been any large-scale malfeasance. There has been in some other industries, but certainly not in the securities industry, and there are very few complaints that actually even come up through the OBSI, and most of them are settled in advance.

I should also add that the OBSI itself has just had a consultant review it, and there are some recommendations to move to a second stage, so if there's an OBSI decision, there can be mandatory remediation with the client.