I'm here with my colleague, Brendan Marshall, the director of economic affairs for the Mining Association of Canada.
In 2011, the mining industry contributed $35.6 billion to Canada's GDP, employed 320,000 workers, and paid $9 billion in taxes and royalties to both levels of government, an increase in all three areas over the previous year, reflecting the strong performance of the mining industry in recent years.
According to recent MAC research, Canada's mining industry is poised to invest some $140 billion in projects across the country over the next decade.
The government has contributed positively in recent years with policy developments and investments supporting the growth of our sector, including geo-mapping, exploration financing, capital investment in critical infrastructure, and a responsible resource development plan in budget 2012.
To ensure that the mining industry's contribution to Canada's economy remains robust, a competitive and predictable domestic regulatory environment is key. To this end, the government should continue upholding Canada's economic fundamentals by maintaining low inflation, eliminating the deficit, preserving and improving our tax levels, and decreasing the national debt.
Continued forward thinking, such as the promise of regulatory reform displayed in budget 2012, is essential. Canada has the opportunity to capitalize on a growing mining sector and the many economic benefits that flow from it. Though many improvements are anticipated to result from the federal government's responsible resource development plan, uncertainty currently exists over how relevant authorities will work together to enact the legislation. Governments should continue working with each other and stakeholders to ensure that the intended outcomes are achieved.
Further, the government should implement a functional permitting system for the Species at Risk Act and should modernize and complete the environmental legislation governing Canada's north.
On the human resources front, it is estimated that the mining industry will require 140,000 new workers over the next 10 years. Governments must work with industry, schools, aboriginal groups, and other communities to address the skills shortages facing mining and other sectors and to address issues such as mobility and immigration needs.
Despite the abolition of the mining industry human resources sector council, the mining industry, through MAC, will be stepping in to secure the future of MiHR. Replacing government core funding with our own, we are hopeful that MiHR's proposals for specific program funding to support labour market research, labour certification, and aboriginal inclusion will be supported.
The mining industry is the largest private sector employer of aboriginal people, and the recent discontinuation of the aboriginal skills and employment partnership program has created a gap that needs to be filled. The potential for significant aboriginal employment opportunities in our sector is strong, but essential training to develop the requisite skills is needed.
Innovation is key to addressing declining ore reserves, meeting increasing regulatory standards, and managing higher operating costs. To capitalize on a pan-Canadian research program, the Canadian Mining Innovation Council is requesting $18 million per year over five years in support of the industry's R and D priorities. Mining already spends some $500 million annually on R and D in Canada, but not through CMIC's collaborative model. Support for CMIC, which is the Canadian Mining Innovation Council, would bring federal investment in mining R and D closer to levels already enjoyed by other major Canadian economic sectors. It would also bring Canada in line with what some other major mining jurisdictions, such as Australia, Sweden, and Norway, have done, recognizing the potential that exists in their countries for mining but recognizing that more R and D is needed to capitalize on that.
Given the remote location of many mining projects, infrastructure remains a key challenge in making the economics of multiple projects across the country viable for development.
Ongoing investment in transportation and power, including through public-private partnerships, is crucial. Fulfilling the government's commitment to restore market balance between shippers and railways is also critical.
Canadian-based metal reserves have been in decline for 30 years, putting our smelters at risk. Without sustained exploration, mineral production will outstrip reserve additions, which will have serious consequences for our economy.
Given current challenges in raising capital for Canada's junior firms, we strongly recommend, again, that Canada's mineral exploration tax credit and flow-through mechanisms be maintained and extended.
Thank you for your consideration.