Finance Committee on Nov. 1st, 2011

[The Chair, Conservative, James Rajotte]

Be very brief, Mr. Jock, and Mr. Jules.

[Richard Jock]

Thank you.

We have done a detailed pre-budget submission, and I would refer the committee to it. But I would say that there has been a clearly identified gap in the need for water. I believe it's $6.85 billion. It was done through a very detailed engineering report. An additional 85,000 homes are also required to clear the backlog.

I would say that, increasingly, items such as general infrastructure and emergency services should be seen as core supports to the community, and we're seeing increasingly that there is a need to be able to respond effectively. We have provided some detail on that and see that transforming the relationship over a long period is also—

[The Chair, Conservative, James Rajotte]

I'm sorry, but we're way over time, and I want to give Mr. Jules a chance.

[Clarence T. Jules]

Right now the present system is on a rationed basis, and that has to change. We're proposing a focus on the fiscal administration and capacity that will allow first nations to be responsible for planning, financing, building, operating, maintaining and, ultimately, replacing infrastructure. The dependence here is just like the aid that is given to other countries: it fosters more aid. What we need to do is to build the capacity within first nations to sustain and build infrastructure on their own.

[The Chair, Conservative, James Rajotte]

Thank you.

Thank you, Mr. Mai.

I'll just gently remind colleagues that if they ask a really good question, you should leave time to answer that really good question.

I'll go to Ms. McLeod, please, for five minutes.

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

And, of course, all our questions are really good questions.

[The Chair, Conservative, James Rajotte]

They're awesome.

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

I would like to focus my questions to Mr. Jules, with a bit of a preamble because there are many new members on this committee.

Sometimes a picture is worth a thousand words. We had the opportunity last year as part of our travels to hear from a number of chiefs in the interior of British Columbia, to see what some of the aspirations were and what was happening in a couple of those communities. It was a really great opportunity.

I'm going to ask Mr. Jules if he can talk first of all in a little more detail about this first nations property ownership act and the fact that it's voluntary. What is it actually going to look like? What would it mean for the communities that decided...? First of all, if what you're proposing as legislation goes through as proposed, what would it actually look like in terms of the communities and their future?

[Clarence T. Jules]

First of all, what we're proposing is specific legislation that would optional, so that communities could choose to opt into it. What it would do is to transfer the ownership. Right now, the federal government.... Try to imagine what it would be like if Canada tried to build an economy with no individual private property rights; it just couldn't be done. What we're proposing is the transfer under the Indian Act of ownership from Her Majesty—I don't think Elizabeth would object—to first nations, so that we in turn would be able to have the underlying jurisdiction and title to those lands. Also, individuals would be able to have and enjoy, like every other Canadian, individual property rights so as to be able to build and own their own home.

To give you an idea, I served as an adviser to the Auditor General. In the 2004 report, she said the backlog in 2004 was between 20,000 and 35,000 units, growing at 2,200 units annually. If Indian Affairs had built 2,300 units annually from 2004 onward, reducing the backlog by 100 units a year, at that rate it would take 200 to 350 years to reduce the backlog. So again, you're throwing water on a bonfire.

It just isn't enough to wish these problems away. What you have to do is to create the fundamentals of building an economy. The fundamental economy builder in this country is individual private property rights. With those we could can enter into partnerships with our friends at Public Works to build the infrastructure, and we could work with our friends in the restaurant industry to build restaurants within our communities. In other words, we want to be able to empower the individual, but also to create government institutions so that we can be accountable and be part of the fiscal and governmental makeup of the federation of this land.

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

Thank you.

There are two things. One I'd like to note is that the Tk'emlúps Indian Band has, I think, 70% of its own revenue now, which has really reduced its reliance. And significant infrastructure projects have gone through with federal government support, but also band support, to deal with some of the lands that were used for commercial development.

You have a second part of your proposal that you didn't get a chance to speak to. Could you do so quickly?

[Clarence T. Jules]

Yes.

One of the problems with the government's rationing of funds for infrastructure is that it doesn't take into account the overall infrastructure needs to build an economy. Without infrastructure you can't adequately build an economy. Right now the focus is on the local needs, which doesn't allow for the size of pipe that's required to facilitate economic development and growth.

What we're proposing is that we use not only real property tax, but also other areas, particularly the first nations goods and services sales tax, as part of the local tax revenue base so that we can use the First Nations Fiscal and Statistical Management Act to facilitate greater issuance of bonds and debentures to put in infrastructure. This again would be a new way of trying to tackle the infrastructure deficit that first nations have, and would provide a model that other first nations would be able to utilize.

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

Thank you.

[The Chair, Conservative, James Rajotte]

Thank you, Ms. McLeod.

We'll go to Mr. Cuzner, please.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Thank you, Mr. Chairman. It's a pleasure to be with you and the finance committee as you try to sort through issues in preparation for the presentation of the budget.

As a gesture of my appreciation, I'd like to share with the committee a report that was tabled by the National Council of Welfare on September 28 this past year. The council is an advisory council to the minister of HRSDC.

The report, called The Dollars and Sense of Solving Poverty, loops into what Ms. Decter and Ms. Simon were saying.

I wouldn't want to quantify this—there are some great recommendations from all presenters here today—but, certainly, Ms. Simon, your points are very concerning and compelling, given the way the government has decided to go with the crime agenda, with its disproportionate impact on first nations, Inuit, and those who suffer week to week from poverty. There's a disproportionate burden that is going to be shouldered by these groups.

One quick example, which loops back to the presentation by the YWCA, is of a woman in Calgary being incarcerated at a cost of $1,400 a day because she can't pay a $150 fine. If we were to attack the problem and invest in the problem of poverty and look at providing shelter for women such as those you talk about, there would in fact be a savings to the government over the long run.

I encourage all members of the committee to secure a copy of that study and have a look at it.

Let me go to Ms. Simon. Speaking to that point, when we look at the millions to be spent incarcerating your people, where should the money be invested instead?

[Mary Simon]

Mr. Cuzner, thank you for your question, which is extremely important to us.

As I said in my presentation, the investment should be targeting the mental health services infrastructure. It should be targeting the education of our children, who are not getting through school. It should target housing, which is a very serious problem in the four Arctic regions, not just in the territories. In fact, in my region of northern Quebec, the housing problem is most severe—although Mr. Charest has said that through Plan Nord, they're going to build some housing. I'm not sure how that's going to go.

But it's clear that the current health infrastructure is not sufficient to address the problems that our young people especially are facing. If a person has a mental health issue, they commit petty crimes. Violent crimes are on the increase in the Arctic, and putting the perpetrators in jail is not the answer. The answer is to build the prevention side and give them the services they need to get better in terms of their mental wellness.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Thank you very much.

[The Chair, Conservative, James Rajotte]

Mr. Jock wanted to comment.

[Richard Jock]

Yes, I just have a brief comment.

Education is very clearly one of the primary determinants of well-being, and that's why one of our areas of emphasis is for investments to be made in education and skills training. That will pay off many times over. if you look at what the cumulative savings would be if those kinds of social elements were reduced and if the gaps were eliminated in terms of social well-being, there would actually be savings of $14.2 billion a year by the year 2026.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

I'd like to get in one more question if I can.

[The Chair, Conservative, James Rajotte]

You have 30 seconds.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

For Mr. Whyte if I could, when we look at 19% unemployment among young people in this country, when we look at new Canadians seeking that first experience, it's usually in your sector where they gain that.

You say that the income tax is a job-killing tax. Could you elaborate a bit more on the recommendation that you made?

[Garth Whyte]

We're talking about the year's basic exemption. It's applied to QPP and CPP, and we'd like it applied in EI.

Currently an employee who makes less than $2,000 can apply for an EI premium refund, but many of those employees that make just a dollar more can't apply. Even those who do apply, only two-thirds of them get it, and employers don't get it. So we're trying to propose something that's easy to implement, that parallels CPP—

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

So you don't have to set up another regime.

[Garth Whyte]

Yes. It makes it easy. It's going to spur that first-time job credit.

Many of these people never ever claim EI; they have no hope of claiming it. Often they're students, and it's a first-time job. We are the number one employer of people in first-time jobs.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Cuzner.

We'll go to Mr. Hoback, please.