Evidence of meeting #82 for Finance in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was tfsa.
A recording is available from Parliament.
Director, Personal Income Tax, Tax Policy Branch, Department of Finance
Well, there must be a gap, but, as I was saying, the relative position counts too.
NDP
Pierre Dionne Labelle NDP Rivière-du-Nord, QC
You say that 40% of Canadians have no spouse. So that is saying that 40% of working Canadians have no way to access this possibility of paying less tax.
Director, Personal Income Tax, Tax Policy Branch, Department of Finance
The objective of the credit is to reduce the differences in the amount of tax paid by couples.
NDP
Pierre Dionne Labelle NDP Rivière-du-Nord, QC
In other words, 40% of the population can't take advantage of this measure. Is that 40% an approximate figure?
Director, Personal Income Tax, Tax Policy Branch, Department of Finance
I don't have the exact number with me, so it's approximate.
NDP
Raymond Côté NDP Beauport—Limoilou, QC
Thank you, Mr. Chair.
My question is for all the witnesses.
Are you authorized to use the term “income splitting”?
Director, Personal Income Tax, Tax Policy Branch, Department of Finance
Could you please repeat the question?
NDP
Raymond Côté NDP Beauport—Limoilou, QC
I would like to know whether you are authorized to use the term “income splitting”.
Conservative
The Chair Conservative James Rajotte
Okay, this is for members to question on, not on.... For policy decisions, we will have the minister present to the committee, and it's fair to ask the minister policy questions as to why certain decisions were made.
This meeting is to get background information on the measures in the budget bill. Let's keep focused on that. That is why we're here today with the officials, so let's keep focused on the measures in the budget bill and any background information the officials can help us with.
Monsieur Côté, I don't see how that relates to the measures in the budget bill in terms of background information.
NDP
Raymond Côté NDP Beauport—Limoilou, QC
Mr. Chair, it's still important to mention it since the term is not used in the bill, which talks about “split adjustment” or “split-adjusted income”. Yesterday, during the meeting of the committee of the whole, the Minister of Finance carefully avoided using the term “income splitting”. In fact, he always used the term “family tax cut”.
I still think it's important to know whether there is a directive within the department to avoid using the term “income splitting”.
Conservative
The Chair Conservative James Rajotte
That's a question we can ask the minister when he appears here on the budget bill. It would be a very good question for him.
Conservative
The Chair Conservative James Rajotte
Okay, then I will thank our officials for part 2. Thank you very much for being here.
Colleagues, we'll bring forward the officials for part 3.
The way we're going to do this, I recommend, is we have about 40 minutes, so we'll do division 1, division 6, and division 7 at the same time. Then the second panel, if you want to call it that, will be on division 18 and division 20.
We'll do part 3, division 1, division 6, and division 7.
I want to welcome all of you to the committee. Thank you so much for being with us.
We have division 1, the federal balanced budget act. We have division 6 regarding the Export Development Act. We have division 7 regarding the Canada Labour Code.
I would ask one official to address each division, and I would ask you to be very brief to allow time for members' questions.
We'll start with division 1.
Mr. Recker, I believe you'll be addressing that, please.
Brad Recker Senior Chief, Fiscal Policy Division, Economic and Fiscal Policy Branch, Department of Finance
Yes. Division 1 of part 3 of the budget implementation act introduces the federal balanced budget act. The act is consistent with balanced budgets during normal economic times and requires concrete timelines for returning to balance in the event of a deficit. It is consistent with the plan to return to balanced budgets followed by the government in the wake of the great recession, and is relatively straightforward, transparent, and easily verifiable.
Specifically, the proposed legislation requires that should a deficit be published for any reason, the Minister of Finance must appear before this committee within 30 days to present a plan to return to balanced budgets with a concrete timeline. Should that deficit be due to a recession or extraordinary situation, the plan must include an operating budget freeze and a salary freeze for ministers and deputy ministers. The operating freeze and the salary freeze will be put in place after the recession or extraordinary situation ends. However, should the deficit not be due to a recession or extraordinary situation, the plan must include an operating budget freeze and a 5% salary reduction for ministers and deputy ministers. The operating freeze and salary freeze would be automatic and would stay in place until a return to a balanced budget is recorded.
Conservative
The Chair Conservative James Rajotte
Thank you very much for that.
We'll go to division 6. Who will be presenting that?
Monsieur Bertin.
Marc-Yves Bertin Director General, International Assistance Envelope Management, Strategic Policy, Department of Foreign Affairs and International Trade
Thank you, Mr. Chair.
Division 6 of part 3 amends the Export Development Act to add a development financing initiative to EDC's current trade-related mandate. EDC will be able to provide development finance and other types of development support in accordance with Canada's international development priorities. This will enable EDC to provide financing to projects in high-impact sectors in developing countries that would normally face challenges in securing financing. This new financing support would enable more effective partnering with the private sector in developing countries on projects that support development results and thereby complement Canada's official development assistance.
Amendments will also provide that the minister responsible for EDC, essentially the Minister of International Trade, will consult the Minister of International Development on matters related to EDC's development financing initiative.
Conservative
The Chair Conservative James Rajotte
Okay, thank you very much.
We'll do division 7.
Ms. Hill, please.
Margaret Hill Senior Director, Strategic Policy and Legislative Reform, Department of Employment and Social Development
Thank you, Chair.
Division 7 of part 3 would amend part II and part III of the Canada Labour Code in order to protect interns in the federal jurisdiction.
Currently there are no specific provisions in the Canada Labour Code related to interns. The policy intent of the amendments is to ensure all interns in the federal jurisdiction receive full occupational health and safety protections under part II of the code as well as appropriate labour standard protections under part III.
Under the proposed amendments, an intern is considered to be a person who is not an employee, but who performs activities for an employer, the primary purpose of which is to enable the person to acquire knowledge and experience.
The proposed amendments would do three things.
First, they would amend part II of the code to ensure all interns in the federal jurisdiction are entitled to full occupational safety and health protections, including the right to refuse dangerous work.
Second, the amendments would clarify that part III of the code applies to interns, subject to specific exceptions. The amendments would specify two exceptions when part III protections, such as minimum wage, do not apply to interns. In practice, this would establish when an intern can be unpaid. The first exception would be if the internship is formally part of an educational program. The second exception would be if the internship meets all of six specific criteria.
Last, the amendments would permit regulations to be made to apply and adapt part III labour standard protections to interns who could be unpaid because their internship meets one of the two exceptions I've noted. It's expected that labour standard protections related to maximum hours of work and sexual harassment at a minimum would be provided to unpaid interns through these regulations. The regulations would be put in place as quickly as possible following consultations with stakeholders as part of a normal regulatory process.
Conservative
The Chair Conservative James Rajotte
Thank you very much for that overview.
Colleagues, I suggest we do four five-minute rounds and then we'll bring the other officials forward.
We'll start with Mr. Cullen, please.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
I may have missed it, Chair. We did part 3, division 1 as well. Yes?
Conservative
The Chair Conservative James Rajotte
This is part 3. We're doing division 1, division 6, and division 7.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
Right. I just missed division 1.
On division 1, on the balanced budget legislation, can officials point us toward any other country models that were specifically used for academic works and that were used to base this legislation on?
Senior Chief, Fiscal Policy Division, Economic and Fiscal Policy Branch, Department of Finance
The legislation is quite unique. It's not modelled after what most other jurisdictions have in terms of balanced budget legislation. We had a look at the balanced budget acts of many European countries. We found them largely to be rather opaque and the targets not easily verifiable.
We also looked at Canadian jurisdictions and found a lot of them had to be amended during the great recession, which was something we wanted to avoid.