Thank you, Mr. Chair.
I wish to begin by thanking you and the committee members for inviting the Canadian Co-operative Association to appear before the finance committee as you undertake your pre-budget consultations.
As you are undoubtedly aware, the Canadian co-operative sector has received a lot of attention over the past months. In May, the House of Commons debated a motion to establish a special committee to look into the co-op sector.
To our surprise, the committee was formed in June and they held numerous hearings over the summer. In September, the special committee tabled their report in the House. The report and the recommendations from the special committee have been very well received by the co-operative sector, and we see this as an opportunity to develop and grow our partnership with the federal government.
The special committee report made eight recommendations; however, CCA believes that there are three that stand out.
The first recommendation was that the government study the possibility of consolidating the responsibilities for cooperatives under a suitable department such as Industry Canada. We are not looking for another study, but rather we would like to see co-ops housed in Industry Canada. Currently co-ops are housed under Agriculture and Agri-Food Canada—not a natural fit.
So why should we go to Industry Canada? Cooperatives are businesses—businesses in your riding. They employ Canadians, they pay taxes, and they create jobs. Cooperatives can be found everywhere, including your riding, small villages, big cities, and every region of Canada. They exist in virtually every sector of the economy, from retail and financial services to agriculture, housing, and health care.
Cooperatives are more durable than other types of businesses. Research has shown that new co-ops are more likely to remain in business than other new enterprises and are more resilient in economic downturns.
Finally, cooperatives are rooted in their communities and in your ridings. The jobs and wealth they create remain in the communities in which they are located.
These are a few reasons why we believe the co-op sector can help Industry Canada deliver on its efforts to create jobs, stimulate growth, and invest in the future.
The Special Committee on Co-operatives also recommended that the government explore the feasibility and cost of allowing Canadians flexibility to invest RRSP funds in cooperatives. The current RRSP rules do not encourage investment in the cooperative sector. The so-called 10% rule prevents members of certain cooperatives from using their RRSPs as investment vehicles to recapitalize their co-ops. Therefore, in the spirt of the committee's recommendations on RRSP contributions, I would suggest that you revoke the RRSP measures enacted in the 2011 federal budget.
The third recommendation revolves around capitalization of cooperatives. Co-ops are businesses. However, because of their unique business model, co-ops often find it difficult to raise capital.
The special committee recognized this and suggested that potential solutions could be found. One solution could be a national investment fund. The fund would be a national pool of financing available to support the growth and development of existing and new individual co-operatives.
Our sector is already moving forward with the development of a national investment fund. This would be a great opportunity for a partnership between co-ops and the federal government.
Finally, if you remember nothing else from my submission, I want you to remember our three recommendations that would create jobs, stimulate growth, and invest in the future: first, the co-op sector belongs within Industry Canada; second, we suggest that you revoke the RRSP measures enacted in the 2011 federal budget; and third, the development of a national investment fund.
Thank you, Mr. Chair.