Finance Committee on June 5th, 2012

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you very much.

First off, I would like to mention that, during the 2011 election, the Conservative government made only one promise about health care, which was to keep the increase in transfers at 6% per year.

This decision goes back on the election promise that the Conservatives made. We have discussed it and heard from witnesses who talked about the impact that decision would have. The two sides see that impact differently. We think that we need to think about health care. Furthermore, that's what the provinces are currently doing. The federal government could play a leadership role and try to gather together all the ideas in order to control health care costs. However, limiting the increase of the health care transfer to only 3% in the fourth year, in a non-negotiated and non-negotiable federal-provincial agreement, is a problem.

There is no magic formula. We cannot simply establish a 3% ceiling for increases in the funding of expenditures per year. There is no magic way of doing that. It is clear to us that this will mean reductions in services and, possibly, in insurable care in the health care systems of the various provinces, including Quebec.

It's unfortunate in several respects. In fact, year after year, and even today, the public health care system is probably the government system that is the most prized by all Canadians. Chances are that shortly, probably after the next election since this measure won't come into effect until about 2015, we will start to see the repercussions of this decrease in transfers, with respect to the federal government's promise during the election. At that point, we may see a decrease in the quality of health care and, possibly, the amount of insurable health care in the provinces.

During the consultations and testimonies, the government said that the provinces themselves had started decreasing their health care budgets. We are saying that, even if that is indeed the case, we mustn't put the cart before the horse. The provinces made the decision based on the signals the federal government sent them. Also, establishing ceilings without necessarily looking at the systemic nature of the growth in the cost of health care will be a problem for most of the provinces.

There is one other thing we have discussed very little in our discussions with the witnesses and officials from the department, and that is the fact that the non-negotiated and non-negotiable agreement that was announced will have different impacts depending on the province. When it comes to health care, at the end of 10 years, Quebec will have lost $9 billion compared with what would have been provided in the previous agreement. Nova Scotia will lose $157 million; British Columbia will lose about $250 million a year, for a total of $2.5 billion over 10 years; Ontario will lose about $20 billion over 10 years. The impact on the provinces will be major and massive, and those provinces should have been around the table to discuss this matter, just like the government and the provinces should have been around the table to discuss the best ways to control the growth of health care costs. Obviously, I haven't mentioned Alberta. It's the only province that will come out ahead in this, with probably about $11 billion dollars more over 10 years.

That aspect is fundamental to that decision, which was made by the federal government, pure and simple.

We were disappointed with another aspect. With respect to the Canadian Social Transfer, which affects social assistance and post-secondary education, among other things, this government decided to establish a growth ceiling of 3% per year until 2024. This corresponds roughly with the current cost of living. The problem is that, currently, we are supporting the provinces and contributing less to the funding of these programs than we did, in constant dollars, prior to 1995, when there were massive reductions in the Canada Social Transfer.

We are extremely disappointed that the government has gone back on its election promise to maintain an annual 6% rate of increase in transfers to the provinces and that it is showing no leadership in controlling the increase in health care costs. This is a very real problem: the costs are rising more quickly than the cost of living. There is also a desire to maintain the status quo in the Canada Social Transfer. That actually means that the government is providing less assistance to the provinces to fund those programs than it did up to 1995.

For those reasons, we are going to vote against most of the clauses from 390 to 410. My colleague here is going to move an amendment.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Caron.

We'll go to Mrs. McLeod and then Mr. Brison.

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

Thank you, Mr. Chair.

I think I'd like to perhaps just quickly repeat some things that have been said many times, both in the House and here at this table. The first is that only in the NDP's mind would an increase of 6% to 2016-17 be a decrease in funding. Also, there is a commitment thereafter for a baseline, an absolute minimum, of 3% but also potentially more.

Our government continues to maintain a commitment to a sustainable health care system.

It's always very interesting to me that we forget about jurisdictional issues—who's responsible for delivering the services and actually what they're planning to do. Also, what some people have not noted is that within our government we've made other measures in terms of supporting Canadians with some of the challenges they have—things like the caregiver tax credit, lifting the medical expense ceiling on that just recently, and the $100 billion announced for brain research.

It was interesting, you know.... The report came out today from the Health Council of Canada. We heard from one of our witnesses that the issue is not money; the issue is innovation. There are many countries that spend less money and have better outcomes. Clearly we can be doing things differently.

I think I'll just quote from Dr. Jack Kitts today:

Real progress is being made when comprehensive strategies with concrete targets are put in place.... An improved approach to goal-setting and performance measurement in the health care system will provide greater impetus to change and achieve higher levels of progress.

I would look at those comments and say they absolutely reflect the commitment our minister made in terms of how we're going to move forward in partnership with our provinces and territories to deal with one of the issues that's a big challenge and something Canadians clearly care about.

[The Chair, Conservative, James Rajotte]

Thank you, Mrs. McLeod.

Mr. Brison, please.

[Scott Brison, Liberal, Kings—Hants, NS]

Thanks, Chair.

The government's approach.... Again, this is another case where this government does not consult and engage provincial and territorial governments. The Minister of Finance basically said “My way or the highway”. He laid this plan in front of the provincial and territorial governments and didn't engage in a meaningful way. This is why I will be moving an amendment later that simply requires that these clauses would come into force on a day to be fixed by order of the Governor in Council after the government has consulted with first ministers and aboriginal leaders on this division.

I'm certain that all members of the committee will support the amendment, since it simply requires that the minister meet with provincial, territorial, and aboriginal leaders on these changes, which will have a significant effect on the resources available, particularly at a time when we see a deepening of lines in terms of prosperity or lack of prosperity between Canadian provinces and regions and a bifurcation of the Canadian economy.

[The Chair, Conservative, James Rajotte]

Thank you.

Before I move to the amendment, I'll deal with clauses 390 to 392.

Go ahead, Ms. Nash.

[Peggy Nash, NDP, Parkdale—High Park, ON]

Excuse me, Mr. Chair. Could we separate out clause 390?

[The Chair, Conservative, James Rajotte]

Yes, that's what I was going to do.

(Clause 390 agreed to)

(Clauses 391 and 392 agreed to on division)

I will move to clause 393. That's where we have amendment NDP-44.

[Peggy Nash, NDP, Parkdale—High Park, ON]

I move amendment NDP-44.

[The Chair, Conservative, James Rajotte]

Thank you, Ms. Nash.

I have a ruling on NDP-44.

Bill C-38 amends the Federal-Provincial Fiscal Arrangements Act to provide for the Canada health transfer growing at 6% for 2014-15, 2015-16, and 2017 and then growing in line with the equalization-sustainable growth track, which is based on a three-year moving average of nominal gross domestic product growth, starting in 2017-18.

The amendment seeks to amend the bill so that after March 31, 2014, the transfer formula will be “negotiated between the federal government and the government of each province and territory, in meetings that must begin within 90 days after this act receives royal assent”.

House of Commons Procedure and Practice, Second Edition, states at pages 767-768:

Since an amendment may not infringe upon the financial initiative of the crown, it is inadmissible if it imposes a charge on the public treasury, or if it extends the objects or purposes or relaxes the conditions and qualifications specified in the royal recommendation.

In the opinion of the chair, therefore, the amendment proposes a new scheme that seeks to alter the terms and conditions of the royal recommendation. Therefore, I rule the amendment inadmissible.

(Clause 393 agreed to on division)

(Clauses 394 to 410 inclusive agreed to on division)

We have the next amendment, which proposes a new clause. This is amendment Liberal-6, and I ask Mr. Brison to move it.

[Scott Brison, Liberal, Kings—Hants, NS]

Mr. Chair, I move amendment Liberal-6.

[The Chair, Conservative, James Rajotte]

Thank you. That amendment is admissible.

(Amendment negatived)

We will now move to division 18, clause 411, the Fisheries Act. Is there any discussion on this particular clause?

Go ahead, Mr. Martin.

[Pat Martin, NDP, Winnipeg Centre, MB]

Thank you, Mr. Chairman.

I suppose I am concerned that this regulatory change wasn't included in part 3 of the bill, where it would have been reviewed by the appropriate subcommittee, which is I presume why it's before this committee now. That subcommittee would have had the expertise and the background and the information on perhaps the other associated changes to the Fisheries Act.

I note that today press conferences were held. It's kind of appropriate we should be debating this now, because in response to the cuts to DFO that affected the Experimental Lakes Area of northwestern Ontario and the Freshwater Institute in my home riding of Winnipeg Centre, in fact press conferences were held in Vancouver, Edmonton, Winnipeg, and Ottawa on this very day to draw the attention of the public to some of these very regulatory changes we find in clause 411.

In the case of the Experimental Lakes Area, there has been a huge international hue and cry and outrage. I understand this has more to do with science and research than it has to do with regulation under the Fisheries Act, but I think the two really are linked in a way they can't be separated.

The question that's being asked and that the government should explain to us is what is the business case for eliminating some of these research facilities when they in fact have paid for themselves time and time again in the 40 or 50 years they've been in place?

This one particular example is $2 million a year. They saved the Province of Manitoba $400 million a year through one piece of research they did. Lake Winnipeg had all these algae blooms. They were worried about the phosphates and the nitrates going into that lake. It was going to cost $400 million to eliminate them both. The research at the Experimental Lakes Area found it's actually counterproductive to eliminate the nitrates simultaneously and may even encourage more algae blooms. So they only went after the phosphates and saved $300 million or $400 million. The Baltic Sea copied them and saved 3 billion euros.

The dedicated work of 17 scientists in the Experimental Lakes Area at $2 million a year has saved the world in terms of the freshwater resource and the costs of ensuring the integrity of our freshwater resources tens and hundreds of millions of dollars.

It's inexplicable. The public are kind of shaking their heads at some of the changes to the Fisheries Act and the elimination of the scientific research that's being done on our freshwater resources.

I can't support a clause that makes regulatory changes to the Fisheries Act, first of all because it has no place in the budget bill, and secondly, I think it's wrong-headed, it's counterproductive, and they can't even point to a business case.

It's more like they're trying to pre-emptively shoot the messenger. If they don't like the information coming out of scientific research, don't even wait until that research is done and then reject it, but do away with the research facility altogether. You know, what you aren't measuring you can't object to.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Martin.

I have Mr. Hoback and then Mr. Brison.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, Chair.

I want to speak to what actually is happening here.

Mr. Harrison, correct me if I have my facts wrong, but from what I understand, before 2006 it was a quite common practice that while they were going about their research and in their joint ventures or projects, they would take the catch and actually sell off the catch. Those funds would actually be used up. A court case in 2006 prevented the minister from doing that. This just allows the minister to basically accept the proceeds from the fisheries.

Is that correct, or would you clarify?

[Nigel Harrison, Manager, Legislative and Parliamentary Affairs, Department of Fisheries and Oceans]

I maybe wouldn't typify it quite that way. I guess prior to 2006 and the court appeal, the minister would maybe pay a contracting party with the proceeds of the sale of fish. In some cases it would just be allocating a quantity of fish such as this bill proposes, to carry out certain scientific research.

It wouldn't necessarily be the minister receiving the funding himself, but it may be funding that goes toward—

[Randy Hoback, Conservative, Prince Albert, SK]

The project. It's a way of reimbursing the partners in the project.

[Nigel Harrison]

Exactly.

[Randy Hoback, Conservative, Prince Albert, SK]

So it's a fairly basic legislative change that came about because of a 2006 court action. Is that correct?

[Nigel Harrison]

That's correct.

[Randy Hoback, Conservative, Prince Albert, SK]

I think I'll leave it there, Chair.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Hoback.

We'll go to Mr. Brison, please.

[Scott Brison, Liberal, Kings—Hants, NS]

A case was made quite compellingly by the former Progressive Conservative Minister of Fisheries, Mr. Siddon, that these changes ought not be part of a budget bill.

This committee has not yet heard from witnesses, including those who make their livelihoods in the fishing industry, but a lot of changes were made to the Fisheries Act and governance that simply ought not to be part of this, so we can't blindly support these changes.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Brison.

(Clause 411 agreed to on division)

We'll now move to division 19, the Food and Drugs Act.

I have Ms. Nash, please.

[Peggy Nash, NDP, Parkdale—High Park, ON]

Briefly, Mr. Chair, on division 19, these clauses, as we understand them, would grant the Minister of Health the power to exempt products from the regulatory process, and we have concerns about the potential impact of this change. Again, you have to ask why this would be before the finance committee, as opposed to the health committee or some other committee, industry perhaps, but here it is before finance.

We think at a minimum the public should know when there is an exemption and when a product has been exempted by the minister rather than going through the full regulatory process. We're concerned that this is one more example where power is being shifted from a regulatory process with clear rules into the hands of one specific minister who has the power to skirt the rules for commercial interest.

So we will not be supporting this change.