Finance Committee on Nov. 9th, 2017

[Corinne Pohlmann]

It's the federally regulated employers, and we recognize that not a lot of small firms are federally regulated. There are some, but not many. What happens is that the federal regulations often then get copied by provincial regulations, and therefore they end up spreading across the country. We worry, again, that it would tend to limit the ability of smaller firms to work out flexible arrangements that work for them and their employees. We know they're offering a lot of that informally already, and we worry that it would limit what's already out there. The other piece of this is that it brings in more administrative burden and more rules the employers have to make sure they're following when they're going through this process.

As to the adjustments we would make if we're going to move forward with some sort of legislation, at the very least, we would like to see this. The amount of time the employer has to respond to a request is only 30 days in the legislation right now, and we'd like to see that go to three months. Actually, that is the case in the U.K., which we know is part of what this has been modelled after. Also, there's not a lot of detail in this legislation around enforcement, what that's going to look like and how that's going to impact employers, and employees, for that matter. Is there going to be an appeal process? That's also not clear at this point in time. Those are things that are still question marks and worries for us.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Just to go back over the types of members of yours that would be affected, trucking companies are, obviously.

[Corinne Pohlmann]

Federally, yes they are.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Federally, and then would there be anyone else that would be a smaller—

[Corinne Pohlmann]

Small airlines.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

Small airlines?

[Corinne Pohlmann]

Yes, there are small airlines that are all over the place. But mostly it will be the smaller trucking companies that might be federally regulated. And there might be some small broadcasters and that kind of thing.

[Tom Kmiec, Conservative, Calgary Shepard, AB]

There might be small broadcasters as well.

One of the things you mentioned, as well, is that smaller employers really know the people who work for them, because they work so closely together and, typically, employees work for them for a long time. Parliament is an employer. We all work here. I have my daughter with me today. I call her the junior member for Calgary Shepard. She's just sitting in the back.

I've worked in human resources before. In my experience, smaller members already make a lot of accommodations for the people who work for them. It cost thousands of dollars to replace an employee who leaves for whatever reason. Is it your experience that most small and medium-sized employers will do what they can to accommodate their current employees?

[Corinne Pohlmann]

Absolutely, because they know that by doing that they will attract more and retain the ones who are there. It's very expensive to hire and train new people, so you're going to do everything you can to keep the good people you already have at your organization.

Part of that is about being flexible when you need to be flexible. There are many stories you hear from small business owners about that, and also from their employees, who talk about going through a tough time and how their employer helped them through it. There are many of these stories, and often it's not just that they know their employees, but that their own family members are working for them. There's a combination of that, and they become a family. I would suggest that smaller companies are already doing quite a bit on the flexibility front. It's just not formalized.

[The Chair, Liberal, Wayne Easter]

Okay. We will have to end it there. No more comments from the witnesses...?

Mr. Grewal.

[Raj Grewal, Liberal, Brampton East, ON]

Thank you, Mr. Chair.

Thank you to the witnesses for coming. I really appreciate it.

Not that we're picking on the Canadian Federation of Independent Business, but I just wanted to get your take on this. When we travelled across the country for pre-budget consultations, government red tape.... I just spoke at the Loblaws carriers conference. These are a lot of small businesses and trucking companies that carry for Loblaws across the country. They were really excited when I talked about the Canada free trade agreement. What else can we do that could really reduce the red tape to make sure the Canadian economy continues to grow at a record pace?

[Corinne Pohlmann]

When it comes to the Canadian free trade agreement, I think a key piece of it is the regulatory co-operation and the table that they've created, right? Right now, we have some concerns that it hasn't really been moving forward the way it should. We really would encourage the government to take some leadership and get the provinces moving to make this table work. The point of the table is for the provinces to work together with the federal government to align a lot of the rules and regulations that exist. Trucking is a perfect example.

[Raj Grewal, Liberal, Brampton East, ON]

Yes, it's actually comical. There are different standards across the country in the 10 provinces and two territories.

[Corinne Pohlmann]

That's correct. For something as simple as changing the colour of the warning flag on the back of your truck, you have to stop at a border and change it.

[Raj Grewal, Liberal, Brampton East, ON]

Yes.

[Corinne Pohlmann]

That's the kind of the thing we'd like to see, that kind of co-operation. This is the key part of the whole Canadian free trade agreement that needs to get up and running. It needs to be active, it needs to show that it's going to have results, and we need the federal government to be part of that.

[Raj Grewal, Liberal, Brampton East, ON]

Thank you.

For the Canadian Alliance of Student Associations, I was an intern, so I know how important it is to give students an opportunity to gain work experience, but at the same time we have to ensure that they don't get taken advantage of by their employers. You had a statistic showing that those who graduate with co-op experience have a better chance at a full-time job. I came out of Laurier's co-op program, so yes, I had a better chance at a full-time job. I was employed a year before I graduated.

What more could the federal government do to ensure those opportunities exist? Even though we're doing a lot to ensure that we're empowering young Canadians, I'd love to hear your perspective on that.

[Michael McDonald]

That's a fantastic question. I think this government has shown a commitment with some of its investments in work and creative learning, which were announced just at the end of August. These are creating opportunities for STEM and business students and are an excellent jumping-off point. We think these kinds of programs are a great start, where you create sector relationships among academic institutions at both the college and the university level and with sector partners in order to create work integrated learning opportunities that are worked into programs.

The second thing that we think could be really valuable is something that we've included in our pre-budget submissions. I know that our chair spoke to you as well earlier this year. It was about changing the Canada summer jobs program as it currently stands to provide part-time opportunities for the remainder of the year. This is a program that provides people with experience in the field and provides small businesses and not-for-profits financial support to hire students. We think these are the kinds of models to move forward with and to use to find those kinds of partnerships that support the industry, the academics, and the students in general, and that really meet everybody's needs.

[Raj Grewal, Liberal, Brampton East, ON]

Thank you.

[The Chair, Liberal, Wayne Easter]

That will be the last question.

On Bill C-63, just for committee members, the deadline to submit amendments to the bill is 12 noon on November 16. We'll start clause-by-clause on November 21 at 8:45 in the morning and, if we have to, we'll go through until 9 o'clock that night. That will be on Tuesday the 21st.

Thank you, witnesses. We really appreciate your coming forward and answering questions.

We'll now turn to your motion, Mr. Dusseault. The floor is yours.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Thank you, Mr. Chair. With your permission, I would like to thank the witnesses who are now leaving us.

Thank you for coming.

Mr. Chair, thank you for setting time aside for us to discuss the motion that I gave notice of last Tuesday. It is very appropriate, given what is in the news these days. I am going to read it again, so that we are fully aware of what we will be deciding on today.

That, given ongoing media revelations that could implicate some Canadians in aggressive tax avoidance or tax evasion, the Committee invite Stephen Bronfman, Revenue Chair for the Liberal Party of Canada; and Leo Kolber, former Senator and former chief fundraiser for the Liberal Party of Canada, to appear before the Standing Committee on Finance before November 30, 2017, to answer questions relating to their offshore assets in jurisdictions that are considered to be tax havens.

The goal of this motion is quite simple. I quickly explained it on Tuesday when I submitted the notice of motion.

The intent is to enlighten the committee on the tax strategies that have been used by these two individuals. The goal is not to put them on trial here, or to determine whether it is legal or illegal, but rather to have the facts and the strategy explained to us.

Of course, all Canadians whose have seen that information were shocked to learn that some strategies, like the ones these two individuals have used, foreign trusts, allow them to hide some of their wealth and their assets and to make profits from those assets. The investments bear fruit and are invested in all kinds of places around the planet, while the assets generate income in foreign countries with tax rates that are practically nonexistent.

It would let us hear what they have to say in explaining the way in which, legally, in their view, they can move their assets abroad to generate income tax free. The ultimate goal is to find out about their strategy. That would then allow the committee to address the shortcomings in the Income Tax Act, as well as the fundamental problem: that these individuals can use strategies of this kind and avoid paying their fair share in our society.

The individuals benefit from our health care system. I do not know Mr. Bronfman or Mr. Kerber personally, but I would not be surprised to learn that they have been to hospitals in Canada at one time or another. They benefit from our health care system. As they are in Canada, they travel on our roads and highways and they use our infrastructures. But they pay little or no tax. So they get along fine by taking advantage of our society and of the services that our government provides.

Our governments are having difficulty providing quality services to Canadians because of a tax system that is quickly eroding. That does not come from me. A lot of work is being done internationally on the issue of the eroding tax base and the transference of profits to foreign countries. For the committee then, this is an opportunity to learn more about it. This study has no set end date, but I would like them to appear before November 30. However, the motion does not set a deadline. In my opinion, the deadline is when we find possible solutions that will put the situation right.

I feel that Canadians would be happy to see the House of Commons Standing Committee on Finance tackle this situation, which is very much in the news. Above all, they would be happy to see the committee identify solutions that would put an end to these scandals, which pop up from time to time in Canadian news, and even international news.

So I hope I will get the support of my colleagues so that we can respond to a concern shared by Canadians, including the constituents of my colleagues. To do so, I hope that I can count on the support of all my friends around the table, so that solutions can be found.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you, Mr. Dusseault.

First on my list is Ms. O'Connell.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

Thank you, Mr. Chair.

I move that the debate be now adjourned.

[The Chair, Liberal, Wayne Easter]

The motion is in order.

[Pierre Poilievre, Conservative, Carleton, ON]

A point of order, Mr. Chair.