Evidence of meeting #152 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was provinces.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

John Moffet  Associate Assistant Deputy Minister, Environmental Protection Branch, Department of the Environment
Pierre Mercille  Director General (Legislation), Sales Tax Division, Tax Policy Branch, Department of Finance
Gervais Coulombe  Director, Sales Tax Division, Tax Policy Branch, Department of Finance
David Turner  Tax Policy Analyst, Sales Tax Division, Tax Policy Branch, Department of Finance
Philippe Giguère  Manager, Legislative Policy, Department of the Environment
Sonya Read  Senior Director, Digital Policy, Treasury Board Secretariat
Marie-Josée Lambert  Director, Crown Corporations and Currency, Financial Sector Policy Branch, Department of Finance
Justin Brown  Director, Financial Stability, Financial Sector Policy Branch, Department of Finance
Yuki Bourdeau  Senior Advisor, Financial Sector Policy Branch, Department of Finance
Galen Countryman  Director General, Federal-Provincial Relations and Social Policy Branch, Department of Finance
Gigi Mandy  Executive Director, Canada Health Act Division, Strategic Policy Branch, Department of Health

1:10 p.m.

Liberal

The Chair Liberal Wayne Easter

Okay.

Dan, go ahead.

1:10 p.m.

Conservative

Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC

On that point, how does this integrate with the Shared Services Canada model? Do they have any reporting duties to this new chief information officer?

1:10 p.m.

Senior Director, Digital Policy, Treasury Board Secretariat

Sonya Read

No, Shared Services Canada is a separate department. They're responsible within the Government of Canada for certain services related to primarily the infrastructure around technology, including data centres, networks, and end-user technology primarily. The role of the chief information officer would support Shared Services Canada in the prioritization of investments that require Shared Services activity or action on behalf of Shared Services Canada. But it would not be a direct reporting relationship. It would be, I would say, a coordination function and a working-together function.

1:10 p.m.

Conservative

Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC

So there will be an alignment between the two roles.

1:10 p.m.

Senior Director, Digital Policy, Treasury Board Secretariat

Sonya Read

Yes, absolutely.

1:10 p.m.

Conservative

Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC

Okay.

1:10 p.m.

Liberal

The Chair Liberal Wayne Easter

With that, thank you very much.

We turn to division 2, part 6, dealing with the Canada Deposit Insurance Corporation Act.

We have four witnesses, I believe, if they're all here. For the record, Mr. Rossi is a special advisor to the Canada Deposit Insurance Corporation. Ms. Bourdeau is senior advisor, Finance Canada. Mr. Brown is a director, financial stability, Finance Canada; and Mr. Sample is acting director general in the capital markets division.

The floor is yours. I'm not sure who is giving an opening statement but go to it.

Mr. Brown.

They'll get to you, Justin.

1:10 p.m.

Justin Brown Director, Financial Stability, Financial Sector Policy Branch, Department of Finance

Good afternoon.

Part 6, division 2 proposes amendments to the Canada Deposit Insurance Corporation Act to modernize and enhance the Canadian deposit insurance framework.

Deposit insurance is an important element of the financial safety net. It contributes to maintaining public confidence in the financial system by protecting depositors' savings in the unlikely event that a deposit-taking institution fails.

The proposed amendments modernize the scope of deposit insurance coverage to better reflect products currently offered in the market. For example, these amendments would remove travellers' cheques as an eligible deposit, as travellers cheques are no longer issued by CDIC member institutions. They would eliminate the five-year-term limit on GICs, as longer-term products are now available, and they would extend coverage to foreign currency deposits, which are widely used by Canadians.

These amendments would also improve the rules for trust deposit accounts by clarifying record-keeping requirements, which would facilitate more timely payouts in the event that a bank fails.

This suite of amendments seeks to modernize and clarify the deposit insurance framework so that it can contribute to meet its objectives of protecting depositors, promoting competition, and supporting financial stability.

Thank you.

1:10 p.m.

Liberal

The Chair Liberal Wayne Easter

Mr. Albas.

1:10 p.m.

Conservative

Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC

Just quickly, with regard to what's being amended here, I would assume that for foreign currencies that are being held in banks, there would be some sort of language in the bill that is specific to actual currencies, and not cryptocurrencies that are not sovereign-backed.

1:10 p.m.

Liberal

The Chair Liberal Wayne Easter

Who wants to take it?

Ms. Bourdeau.

1:10 p.m.

Conservative

Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC

It's just for simple currencies, like the euro, etc., right?

1:10 p.m.

Yuki Bourdeau Senior Advisor, Financial Sector Policy Branch, Department of Finance

We haven't amended the definition of currency. We've simply removed the requirement that to be eligible, the deposits must be in Canadian currency. The definition of currency has not changed.

1:10 p.m.

Conservative

Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC

Okay.

1:10 p.m.

Liberal

The Chair Liberal Wayne Easter

Is Bitcoin or cryptocurrency included in our definition of currency?

1:10 p.m.

Senior Advisor, Financial Sector Policy Branch, Department of Finance

Yuki Bourdeau

No, it is not currently.

1:10 p.m.

Liberal

The Chair Liberal Wayne Easter

Okay.

Is there anyone else?

1:15 p.m.

Conservative

Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC

I have just one point to make, because the gentleman did mention travellers' cheques no longer being accepted. This is something that I think the committee at some point needs to look at, because there are constituents who have purchased those travellers' cheques expecting that they could be redeemed, including by their going back to the institution that issued the cheques to them in the first place, but from which now cannot receive Canadian funds back.

This is an issue that I think we need to take a look at, although it's not directly related to the BIA that's in front of us.

1:15 p.m.

Liberal

The Chair Liberal Wayne Easter

Noted. We can talk about that another time, because that is an issue if there are some people who have what they thought was money, but is no longer considered money. That's kind of a problem.

1:15 p.m.

Conservative

Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC

Yes.

1:15 p.m.

Liberal

The Chair Liberal Wayne Easter

Thank you very much, folks. That was much easier than part 5.

Part 6, division 3 is on the Federal-Provincial Fiscal Arrangements Act.

Mr. Countryman is director general of federal-provincial relations in the Department of Finance, and from Health Canada we have Ms. Mandy, the executive director of the strategic policy branch.

I'm not sure who is leading the discussion.

Mr. Countryman, go ahead.

May 8th, 2018 / 1:15 p.m.

Galen Countryman Director General, Federal-Provincial Relations and Social Policy Branch, Department of Finance

Thank you.

Part 6, division 3 proposes amendments to the Federal-Provincial Fiscal Arrangements Act in two areas. One, it proposes to renew the equalization and territorial formula financing program for the next five years. Second, it proposes to legislate a new reimbursement policy for deductions made from the Canada health transfer with respect to the extra billing and user-charge provisions of the Canada Health Act.

Following consultations with provincial and territorial governments, the government is proposing to renew the equalization and territorial formula financing for another five-year period, beginning April 1, 2019. Technical changes will be made to improve the accuracy and efficiency of the calculation of entitlements. The technical changes themselves will be implemented through regulatory amendments.

The government is also proposing to make transition payments to Yukon and the Northwest Territories over the renewal period to offset the projected negative impacts of the changes in territorial formula financing entitlements.

With respect to the reimbursement policy, this proposal recommends that the Federal-Provincial Fiscal Arrangements Act be amended to permit reimbursement of amounts that were previously deducted, as directed by the Minister of Health, when the provinces or territories can't transfer payment due to violations of the Canada Health Act provisions for extra billing and user fees. This legislative amendment will enable the Minister of Health to direct the reimbursement of such a deduction when a province or territory has taken corrective action to align their public health system with the principles of the Canada Health Act. It creates a fiscal incentive that recognizes jurisdictions that have taken the necessary steps to address issues of non-compliance.

My colleague and I will be pleased to answer any questions.

1:15 p.m.

Liberal

The Chair Liberal Wayne Easter

Mr. McLeod, you're first.

1:15 p.m.

Liberal

Michael McLeod Liberal Northwest Territories, NT

Thank you, Mr. Chair.

Thank you to the presenters here today.

I raised the issue of the borrowing limits with the minister. It's an issue that all three territories, I think, are being challenged by. As we move forward and start to see more investment coming from the federal government to the territorial government, especially in the area of infrastructure, the cost-sharing component of it is really starting to challenge us. We have a borrowing limit of $1.3 billion that has been set, and our deficit is huge. What would it take to have that amount discussed, renegotiated, and a new number put in place?

I see there's been a lot of work done in balancing out some of the agreements, renewing them, and reimbursing them. Has this issue been on the table for discussion?

1:15 p.m.

Director General, Federal-Provincial Relations and Social Policy Branch, Department of Finance

Galen Countryman

There's nothing in the BIA concerning the borrowing limit. I appreciate your question. The territorial premiers did meet with Minister Morneau last week, and they raised that issue on the borrowing limit. The message back, and the message I would certainly communicate, is that we would welcome proposals from the officials of the territorial governments to present the rationale for what kind of increase they're looking for, and we would take that into consideration.