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Evidence of meeting #23 for Finance in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was first.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Mark Carney  Governor, Bank of Canada
Tiff Macklem  Senior Deputy Governor, Bank of Canada
Richard Jock  Chief Executive Officer, Assembly of First Nations
Darwin Durnie  President, Canadian Public Works Association
Garth Whyte  President and Chief Executive Officer, Canadian Restaurant and Foodservices Association
Clarence T. Jules  Chief Commissioner and Chief Executive Officer, First Nations Tax Commission
Mary Simon  President, Inuit Tapiriit Kanatami
Shannon Bittman  Vice-President, Professional Institute of the Public Service of Canada
Ann Decter  Director, Advocacy and Public Policy, YWCA Canada

11:15 a.m.

Governor, Bank of Canada

Mark Carney

This is a test of public sector productivity. I'll try to meet it.

First, fiscal decisions are for the Minister of Finance, so we'll defer to him on those and not provide advice. We'll take those decisions as given and adjust monetary policy accordingly.

Second, we want to avoid, in the extreme, being in the situation of European governments, where the scale of fiscal austerity being required of a large number of countries is now materially affecting the growth outlook in those countries and, furthermore, is not yet having the effect on confidence.

I'll make the general point that the measures that have already been enacted by the Spanish and Italian governments are in the order of magnitude consistent with long-term fiscal sustainability in those economies--and here I refer to enacted measures, not announced, muted, or debated ones. Just as Canadians learned with difficulty in the 1990s, you don't get credit for announcing measures and passing the budget. You only get it when you actually implement them. Even then there's a lag. So the tough measures are taken. You're getting a slowing in those economies. You'll get further slowing because of these measures, but not the credit in terms of market confidence or market interest rates. That's an important point to recognize, and that's part of our dynamic there.

On crude and gas prices, I'm glad you raised that technical box. As you know, we're trying to draw out how the relationship between Canadian gas prices has changed from an historic one. One would usually have looked to WTI oil prices and a margin off those for Canadian gas prices. The fact is that WTI used to move quite tightly with Brent crude. Depending on where you live in Canada, are you getting refinery oil that's a blend of either Brent or WTI, or out in Alberta? It's a very different feedstock into the refineries. Because of supply constraints in the United States—which, in part, some pipelines might help alleviate—a bigger differential has grown between WTI and Brent. So even though WTI has come down, as we've all seen, Canadian gas prices have not come down as much as they historically would have. Some of it is margin expansion, which goes to your question, but a large part is this actual dynamic, which I hope is relatively well explained in the box.

On the balance of payments and the current account, we obviously watch this. The current account deficit has increased. A large part of it—not all of it but a large part—has been due to an increase in investment in imported machinery and equipment. So that is a good current account deficit. If you're going to have a current account deficit, you want to be importing investment machinery and equipment that will ultimately make your businesses more productive—and one expects to build exports over time to pay back that deficit over time. But it is something we watch, and we'll be happy to have further discussions on that in subsequent meetings.

Thank you.

November 1st, 2011 / 11:15 a.m.

Conservative

The Chair Conservative James Rajotte

Thank you very much, Mr. Julian.

I want to take the next round, Mr. Carney. I want to raise two issues with you.

First of all, obviously Canadians are well aware of the strength of our financial system and the strength of our financial institutions. Two of the main factors are our capital ratios and our leverage ratios in terms of the policies that we've adopted in Canada.

You mentioned the Basel III accord, and that there are going to be both higher quality and higher levels of capital. There have been international concerns, American concerns, raised about both, which I think you've responded to very well. In terms of some of the Canadian concerns that I'm hearing, the institutions here are not concerned about the level unless they're asked to do it on an asymmetrical basis. If other countries do not adopt the Basel III levels but Canadian institutions are forced to, how will that impact them? That's one concern.

The second is with respect to the quality. Frankly, they say they're at or near the required levels now, but they do have a concern in terms of whether what they have now in capital is of the same type of quality or how that will be impacted. That's an issue.

A second issue is with respect to core inflation and the 2% target. Most people I talk to do not quibble with the 1% to 3% range or the 2% midpoint, but some do raise concerns with respect to what is actually included in core inflation. Gasoline, natural gas, fuel oil, and mortgage interests are just a few of the variables that are not included in core inflation. So these people ask the question.

Obviously at the bank, you regularly debate what should be in core inflation and what should not. Could you give us some background as to whether you're looking at that specifically now with respect to your core inflation target, or is this something we should look at changing?

11:20 a.m.

Governor, Bank of Canada

Mark Carney

Thank you, Chair.

I'm going to answer the second part first and then ask Mr. Macklem to answer the question on the bank capital.

To be absolutely clear—and I'm glad you raised the question—the bank does not target core inflation. The bank's target is for total CPI inflation, which includes gasoline and all food prices. I hope that's absolutely clear.

We have a target of 2% total CPI inflation because that's the representative basket of what Canadians consume. That's what Canadian households have to go out and spend. Of course it would be folly to suggest that Canadians don't put gas in their cars, or eat, or any of these things. We have to achieve—and we have achieved over the target's lifetime, including over the course of the last five years—2% total CPI inflation through tough and easy times.

What we do use with core inflation, or the difference between core and total CPI, is that we take out the eight most volatile items from total CPI. What core inflation is useful for—it's reported by Stats Canada, and I referenced this in my opening remarks—along with a number of other measures, is as an operational guide for where total CPI inflation is going to be.

Take the example of gas prices. They spike up because of conflicts in the Middle East, supply constraints in the United States, and other factors. They spike up. They're at a high level. We're aware they're at an elevated level. But unless they continue to increase, it's not additional inflation. We have to take into account what's happened to gas prices in terms of Canadian incomes and activity. The better guide of where inflation's going to be one year out, or one and a half years out, tends to be measures like core inflation and other measures, such as mean standard deviation and weighted means, all of which we report.

Just to be clear, we do not target that and we would not recommend that.

11:20 a.m.

Conservative

The Chair Conservative James Rajotte

I appreciate that. That is a question we get often.

11:20 a.m.

Governor, Bank of Canada

Mark Carney

I'm glad you raised it because we need to be absolutely clear about it.

Mr. Macklem will answer the Basel question, please.

11:20 a.m.

Senior Deputy Governor, Bank of Canada

Tiff Macklem

The first part is also a very important question. Clearly, the first step was getting the new capital, the new liquidity, rules agreed to, including a limit on leverage. That's been done. Now emphasis is increasingly focused on implementation. Obviously, rules are only as good as their sound implementation. As you stressed, what's important is both the full implementation and the consistent implementation across jurisdictions. Let's face it, while we certainly think the rules before the crisis were inadequate, one of the problems was that even the rules that were in place were not being followed in all jurisdictions. We have to get to a world where there is consistent implementation across jurisdictions.

What are we doing about it? Through the Financial Stability Board, which is the coordinating mechanism, both the standards setters.... So in the case of capital and liquidity and leverage, it's the Basel committee. The Basel committee, together with the FSB, has recently put out a couple of documents outlining how this will be done. The Basel committee has put out a document that outlines how they will verify that countries are living up to their commitments, looking first at whether the rules in each country--in some countries it's legislation, in others it's through regulation--are fully consistent with the new Basel III standard. The second part is whether those rules are being implemented in a consistent fashion across jurisdictions. The key issue there is to make sure the risk weighting is being done on a consistent basis across jurisdictions.

The FSB--

11:25 a.m.

Conservative

The Chair Conservative James Rajotte

Unfortunately, my time is up, because I cut everyone else off. But if you want, you can briefly wrap up.

11:25 a.m.

Senior Deputy Governor, Bank of Canada

Tiff Macklem

I'll just say a few more words. The Financial Stability Board, as the coordinating mechanism, has put out a document describing how the FSB is going to work together with the standards setters to ensure rigorous implementation.

11:25 a.m.

Conservative

The Chair Conservative James Rajotte

Thank you very much for that.

We'll go to Mr. Goodale, please.

11:25 a.m.

Liberal

Ralph Goodale Liberal Wascana, SK

Thank you, Mr. Chairman.

I have two brief points, I hope. With respect to the European plan to deal with vulnerable countries like Greece and others, you mentioned earlier that the modalities, the details, are yet to come, and it will be probably after the G-20 meetings, not before. I wonder if you see any risk of slippage there, delays that would allow the problem to just go on into never-never land.

The second question is on a totally different topic. You have spoken frequently and very effectively about the need for trade diversification--and that's been discussed around the table today--especially into emerging markets, especially Asia. You've also on occasion spoken about the need for sustainable resource development, because perceived unsustainability is not only an environmental issue, it is also an economic and market access issue.

On that last point, is there anything directly within the purview of the bank that comes to bear on that issue, or is that purely a matter for government policy to deal with? Are there ways the bank can influence the long-term sustainability of Canadian resource development, or is it something that is entirely dependent upon government policy?

11:25 a.m.

Governor, Bank of Canada

Mark Carney

Thank you for that.

On the first question with respect to Europe, what we have said, and it's still relevant, is that we expect the measures to contain the situation, but there are clear downside risks to that assumption. When we first said that we didn't have the actual plan, but we expected to have something similar to what was announced. But we need the details and then, obviously, we need implementation. There are always risks around both those aspects.

I'll be slightly more specific. With respect, for example, to the recapitalization of the European banking system, where the objective is to raise the capital ratio of that banking system, we would advocate that a component of that be met through new capital, so that it is not all met through a reduction in assets. I say that because it's a reduction in assets that's going to intensify the pressures on financial conditions, not only in Europe but elsewhere in the world, and it's going to displace new credit creation in Europe and elsewhere as assets are sold. If there is a better opportunity for a financial institution to buy an asset out of a European bank rather than make a new loan, that's going to have an impact, for example in the United States, if it's a U.S. dollar asset. So we would put emphasis on at least a component being met through new capital. There are ways to do that relatively efficiently, including with contingent capital that would reduce the dilution of existing shareholders, given current trading levels.

So, yes, we're monitoring this closely and we're in close discussion with our European colleagues. There will be meetings later this week, through the week and early next week, as part of the normal course, in Basel and other places, but this will clearly be one of the issues there.

As to your question about sustainable resource use, it is a very important one. I would say that from the bank's perspective, these are issues that ultimately go to the medium- and longer-term potential growth of the economy, on which we have to take a very cold-eyed, objective view and adjust our perspective of where that potential growth can go, because that is ultimately one of the key determinants of how fast we can run the economy without generating inflationary pressures.

We have reduced our outlook for potential growth in the last couple of years. We have re-confirmed it in this projection. These issues will have an effect. It was referenced earlier. Both in Fort McMurray and Saskatchewan, you see some of the pressures that do come on when paces of development becomes too large.There are broader issues around this, though, which have to do with national balance sheets, and other issues that we don't have time to get into.

11:30 a.m.

Conservative

The Chair Conservative James Rajotte

Okay. Thank you very much, Mr. Goodale.

A final round by you, Ms. Glover, please.

11:30 a.m.

Conservative

Shelly Glover Conservative Saint Boniface, MB

Thank you Mr. Chair. I don't envy you your job having to cut these fine people off, but you may have to cut me off as well because I have lots to say.

From listening to the questions put forward by some of my colleagues across the way with regard to page 12, I want to make it very clear that on page 12 you cite a variety of reasons that may lead to a predicted recession in the euro area at the end of 2011. For whatever reason, some of my colleagues across the way want to selectively hear only a small portion of what is listed there, namely what you've said about austerity measures. Then they also offer an alternative perception and interpretation of what it means in terms of stimulus.

I'd like you to confirm, Mr. Governor, that we are not Europe, that we do not have the same pressures or the same situation, and neither do we have the same economic view as the rest of the world. We are seen as leaders economically in the world, of course.

I'd like you to be very clear about what may cause the brief recession you are predicting for Europe, and then talk about stimulus in Canada, which is a whole other bowl of wax. TD Economics had said very clearly that stimulus spending right now is not a good idea. They have said, and I say the same thing, that timing is everything. We need to be very cautious right now in Canada.

What would the consequences be of prolonged deficit spending here in Canada? Again, it's a very different situation here from that in Europe.

So please clarify the first issue and then explain what the consequences would be of the second.

11:30 a.m.

Governor, Bank of Canada

Mark Carney

To explain the difficult situation in Europe, one has to go back to the functioning of the European Monetary Union. In effect, a number of countries in the so-called periphery, although they are some of the affected countries--particularly Portugal, Greece, and Spain specifically--ran very large current account deficits within the monetary union. Part of the reason they ran those deficits is that the relative rise in unit labour costs in those countries was quite high, of the order of magnitude of 20% to 30% higher than at the Franco-German core of Europe.

So they lost a lot of competitiveness over the course of the first 10 years of monetary union, and the challenge that these economies face is to regain that competitiveness. This is not a good place to be in, but one of the advantages of a flexible exchange rate is that the exchange rate does some of the work for you in regaining that competitiveness. The other alternatives are large structural reforms to improve or build productivity and product in labour markets, and other aspects. They're the right things to do, but those take time to pay off—over the course of several years at least. And then second is to reduce wages. I don't mean stagnant wages, but outright reductions in wages so that unit labour costs come down, which, of course, in and of itself reduces demand and has a self-reinforcing aspect on any slowdown. That means a direct hit to confidence, and lower spending. And then, because of lower spending, higher unemployment, etc., will result.

That is the situation these economies find themselves in. The lower growth further worsens the fiscal positions of the countries, which forces additional austerity. Because they face budget constraints, the markets are only willing to lend them certain amounts of money, and that is amplifying the downturn. So you have more severe recessions in an increasing proportion of the eurozone, which in our opinion is now going to result in an overall recession in Europe.

11:30 a.m.

Conservative

Shelly Glover Conservative Saint Boniface, MB

So anyone who leaves this room stating that a recession in Europe is likely caused by governments not spending on stimulus is grossly misinformed and not understanding this situation. Am I correct?

11:35 a.m.

Governor, Bank of Canada

Mark Carney

I would say that there are deeper fundamental causes of the situation in Europe that have built up over a number of years that can only be resolved over a number of years. That is why the measures that the European authorities are putting in place must have that time horizon, so they can facilitate those adjustments in those economies, while at the same time the Europeans reconstruct or “re-found”, to use our terminology, the monetary union and how it works, so that they don't fall back into this situation a decade or two decades hence.

11:35 a.m.

Conservative

The Chair Conservative James Rajotte

Thank you very much, Ms. Glover.

Thank you very much, Mr. Carney and Mr. Macklem for being here. As you can tell, the members of this committee very much appreciate this discussion. Thank you so much, and we look forward to continuing our conversations.

Colleagues, I will suspend for a couple of minutes, and we'll bring our next guests forward.

11:40 a.m.

Conservative

The Chair Conservative James Rajotte

I call this meeting to order. I apologize for the lateness. We had some technical difficulty this morning in getting the microphones working, which is why our previous session went over time.

I want to thank all of our witnesses for coming in to participate in our pre-budget consultations for 2011. We have seven organizations presenting to us during this panel.

We have first of all the Assembly of First Nations, the Canadian Public Works Association, the Canadian Restaurant and Foodservices Association, the First Nations Tax Commission, the Inuit Tapiriit Kanatami, the Professional Institute of the Public Service of Canada, and YWCA Canada.

Thank you all for being with us. You will have up to five minutes for opening statements. As we have a very full panel, I will ask you to keep to that five minutes, and then we'll have members' questions after that. We'll start with the Assembly of First Nations.

11:40 a.m.

Richard Jock Chief Executive Officer, Assembly of First Nations

Thank you, Mr. Chair.

Our presentation is called “Structural Transformation and Critical Investments in First Nations on the Path to Shared Prosperity”.

First nations communities and individuals are poised to make ever-increasing contributions to the overall economic prosperity of Canada and to their own economies. Fundamental structural change is part of the uncovering of the full potential of these individuals and communities.

Investments in first nations continue to make sense, especially in a climate of fiscal restraint and reductions. Accordingly, AFN recommends that the Government of Canada transform the fiscal relationship through examining existing funding mechanisms and to move forward to change those, based on a set of shared principles: that there be critical investments made in education, infrastructure, and skills development in order to increase productivity and participation in the future economic opportunities; and that there be investment made in safe and healthy communities through supporting overall infrastructure, housing, and health care.

I have some comments on transforming the fiscal relationship. The current mechanisms for funding are inadequate, unsustainable, and too unpredictable to allow for any long-term planning, and also to encourage any long-term investment by external banks and organizations. First nations are the only governments in Canada whose budgets for core and essential services are discretionary and subject to unilateral or arbitrary change. In fact, since 1996 an arbitrary 2% cap has been applied to funding for first nations' core services. Therefore, stable and predictable fiscal transfers, with built-in escalators related to population and inflation, should be used for first nations governments, as they are for other governments. For example, provinces and territories receive a guaranteed annual growth of 6% per year for health services, but that's not the case for first nations.

With regard to investing in first nations education—just by way of background—in Budget 2010 there was a commitment to achieving comparable education outcomes for first nations students. In our view, achieving comparable outcomes requires, at minimum, comparable investments. A funding framework is needed based on real costs, indexation, and appropriate treatment for northern and remote communities, with such a framework being used for a permanent allocation of resources based on standards and real costs. The estimated outcomes of this, as related by the Centre for the Study of Living Standards in 2010, are such that achieving a comparable education outcome could save the government $1.9 billion in a single year by 2026.

In transforming the approach, any action taken should be founded on the set of principles that I mentioned earlier. Those principles would be equity, fairness, security, stability, predictability, and accountability. I want to emphasize appropriate authority, relative autonomy, flexibility, and also an opportunity to have access to external capital.

In terms of opportunities for change, within the current context of the strategic operational review, there are some important considerations that we feel should be borne in mind, especially if we're looking at aligning programming and services across government. We feel that basic services and the elements and costs affecting health and safety should take priority. We also feel that another principle to be included is that community-based services be set as a priority and be guaranteed a sustainable rate of growth in funding. Redeployment of resources should be done in areas of greatest need, and there should be a rebuilding plan to look at refocusing resources and to enable investment in areas of greatest need.

In our view, transforming the approach and doing the critical investments I talked about will achieve both short- and long-term savings, and it will also result in changing the nature of the relationship.

Thank you. Those are my opening comments.

11:45 a.m.

Conservative

The Chair Conservative James Rajotte

Okay. Thank you very much, Mr. Jock, for your opening comments.

We'll now hear from Mr. Durnie, please.

11:45 a.m.

Darwin Durnie President, Canadian Public Works Association

Thank you, Mr. Chairman.

Good morning. My name is Darwin Durnie, and I'm the president of the Canadian Public Works Association. I'm delighted to be here representing our 2,000 members. I'm Alberta-based, and I represent our chapters from sea to sea to sea.

I'm joined in the audience today by Mr. Peter King, the executive director of the CPWA, and also the executive director of our sister organization, the American Public Works Association.

By way of brief introduction, the CPWA represents the men and women in every community across Canada who plan, build, repair, and maintain our communities. From sustainability planning through to waste collection, snow removal to disaster response, our practitioners deliver services to the communities of our nation 24/7, thus providing liveable communities that are the envy of the world.

We appreciate the challenge ahead for the members of this committee. Economic realities and global pressures will require a delicate balance between continuing the good track record that has been achieved with infrastructure renewal and investment while ensuring that Canada's economy continues to recover and lead on the world stage.

Our submission focuses on two areas that we believe present great opportunities to protect our existing infrastructure and develop a comprehensive plan for the years ahead.

The Government of Canada committed last year to undertaking a comprehensive review of the current approach to financing first nations infrastructure. We support that review and recommend that CPWA work in partnership with the first nations communities and the federal government to provide training, certification, and membership programs to first nations public works employees through a pilot project. This will leverage the vast resources we have developed and are in use throughout North America and that have been applied to linear infrastructure, such as roads and bridges, and vertical infrastructure, such as schools and recreation centres.

CPWA members have lifetimes of knowledge that can be shared through mentorship. There are new opportunities for employment now, as current public works employees near the end of their careers. CPWA knows that now is the time to put the skills and knowledge transfer opportunities in place to ensure that young people are able to take advantage of these opportunities. As well, the benefits of well-trained first nations members maintaining their own community infrastructure are both personal and economic. The jobs and economic boost to the community are clear, as is extending the life cycle of existing assets.

CPWA members have already collaborated with American Public Works members to develop an accreditation and certification program that is portable throughout Canada and the U.S.

In working together with the first nations, we can ensure that these programs are adapted to the unique challenges of first nations while providing training and credentials that will allow employment opportunities on and off the reserve.

Our second recommendation is simply to continue the best practices that were developed during the rollout of Canada's economic action plan. We encourage the Government of Canada to allocate funds to allow for continued consultations between government and the infrastructure community, with the goal of developing a framework of basic principles for the next generation of infrastructure programming.

This should include, as a goal, the evaluation of the current state of key infrastructure assets. This could also include the integration of the tools that we have developed for use in Canada, and also those we have developed in partnership with the American Public Works Association, through the Institute for Sustainable Infrastructure's model that evaluates linear infrastructure.

We witnessed the benefits achieved when all stakeholders came together during the early stages of the action plan.

We're very pleased to be able to present today, and we look forward to any questions.

Thank you, Mr. Chair.

11:50 a.m.

Conservative

The Chair Conservative James Rajotte

Thank you very much for your presentation.

We'll now hear from Mr. Whyte, please.

11:50 a.m.

Garth Whyte President and Chief Executive Officer, Canadian Restaurant and Foodservices Association

Thank you, Mr. Chair.

The Canadian Restaurant and Foodservices Association represents the nation's $61-billion restaurant industry, one of the largest industries in the country. We're pleased to have the opportunity to put forth some recommendations that will advance the committee’s goals of high levels of job growth and business investment, with a view to ensuring a shared prosperity and a high standard of living for all.

We have many recommendations. For example, we favour eliminating the $40 million in credit card fees on sales taxes, but I'm just going to talk about two recommendations.

First, our overarching recommendation is to establish a private and public sector task force to study the central role of restaurants in Canada and to make recommendations to promote and grow this industry. This recommendation would have limited cost implications, but would create an opportunity to break down the agriculture and tourism silos in Canada and unleash the potential of one of Canada’s most important industries.

Our second recommendation concerns reducing the burden of profit-insensitive, job-killing payroll taxes, which has always been a priority for the labour intensive restaurant businesses.

Our proposal is for the introduction of a $2,000-a-year basic exemption, YBE, modelled after the YBE in the Canada Pension Plan, as the most efficient and effective way to deliver payroll tax relief to the groups most affected—the entry level workers and labour intensive businesses. It's estimated that a $2,000 YBE would reduce EI revenue by approximately $1.4 billion per year.

With respect to the restaurant industry task force, during the recent federal election, food and agriculture policy received a great deal of attention from all political parties. Although the economic and employment contributions of restaurants exceed those of agriculture and all supplier groups, the restaurant industry is treated as secondary in food policy discussions.

Similarly, over 50% of the jobs in the tourism industry, by far the largest component of tourism jobs, are restaurant jobs. Yet the restaurant industry is an afterthought in Canada’s tourism strategy. Canada’s restaurant and food service industry is one of the largest industries in Canada. We employ more than a million Canadians, making our industry one of Canada's largest private sector employers. The industry’s workforce represents 6.4% of the country’s employment, more people than agriculture, forestry, automotive manufacturing, mining, and oil and gas extraction combined. An additional 250,000 Canadians are indirectly employed by the industry as suppliers, distributors, and consultants.

A Decima poll commissioned by Kraft Foodservice Canada showed that the industry is the number one source of first jobs for Canadians, and that 80% of Canadians recognize restaurants as a vital source of employment.

Every $1 million in restaurant sales creates nearly 27 jobs, making our industry one of the top four job creators in Canada. The diverse nature of our industry means the benefits are felt in every community, not just in major centres.

The industry is much more than a huge contributor to the Canadian economy and a major job creator. It is at the heart of what Canada is about—food, youth, multiculturalism, agriculture, health, and community.

We're faced with some daunting challenges. The high Canadian dollar relative to the U.S. dollar and weak economic conditions internationally have discouraged visitors from coming to Canada and have significantly reduced tourism. A full 74% of the respondents to our restaurant outlook survey indicated that rising food costs are having a negative impact on their business; two-thirds said that rising labour costs are having a negative impact; and one of four operators said that they are struggling to find qualified labour. Given the competitive nature of the business and the price sensitivity of restaurant consumers, it's difficult for operators to pass on higher costs.

In recent years, the federal government has focused resources on capital- and resource-based sectors, which are a fraction the size of the food service industry, together with the agriculture and tourism sectors. We're not asking for grants or handouts. We're just saying the government should recognize the significant social and economic contributions of the food service industry and its growth potential. Since food service is a touchstone for so many government priorities, it's important that the government take a more holistic approach to this industry, beginning with the establishment of a task force to study it and make concrete recommendations to promote and grow Canada's restaurant and food service industry.

Second, on payroll taxes, we want you to consider--

11:55 a.m.

Conservative

The Chair Conservative James Rajotte

You have five seconds, Garth.

11:55 a.m.

President and Chief Executive Officer, Canadian Restaurant and Foodservices Association

Garth Whyte

Okay.

We want you to consider the $2,000-a-year basic exemption, YBE. It will help low-income earners. It will help employers. We see it as a win-win proposal that will really help job creation. Thank you.