Evidence of meeting #177 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was funding.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Pam Bryan  As an Individual
Susan Roberts  As an Individual
Margaret Schoepp  As an Individual
Kim Rudd  Northumberland—Peterborough South, Lib.
Ken Kobly  President and Chief Executive Officer, Alberta Chambers of Commerce
Lynette Tremblay  Manager, Government Relations, Alberta's Industrial Heartland Association
Mark Scholz  President, Canadian Association of Oilwell Drilling Contractors
Michael Holden  Chief Economist, Canadian Manufacturers & Exporters
Janet Lane  Director, Human Capital Centre, Canada West Foundation
Wesley Morningstar  Chair of the Board of Governors, Explorers and Producers Association of Canada
Mark Plamondon  Executive Director, Alberta's Industrial Heartland Association
Richelle Andreas  Chair, Board of Directors, Agricultural Manufacturers of Canada
David Malloy  Vice-President, Research, Alliance of Canadian Comprehensive Research Universities
Chief Marlene Poitras  Regional Chief, Alberta, Assembly of First Nations
Isabelle Des Chênes  Executive Vice-President, Chemistry Industry Association of Canada
Martin Roy  Executive Director, Festivals and Major Events Canada
Lindsay Hugenholtz Sherk  Senior Leader, Sport Matters Group
Marc Kennedy  Olympic Athlete, Sport Matters Group
Neville Wright  Olympic Athlete, Sport Matters Group
Chantell Ghosh  As an Individual
Jim Gibbon  As an Individual
Paul Lucas  As an Individual
Min Hyu Lee  As an Individual
Kyria Wood  As an Individual

11 a.m.

Liberal

The Chair Liberal Wayne Easter

Thank you, David.

We'll turning then to Chief Poitras, Assembly of First Nations regional chief for Alberta.

Welcome.

October 17th, 2018 / 11 a.m.

Regional Chief Marlene Poitras Regional Chief, Alberta, Assembly of First Nations

Good morning. Thank you for the opportunity to appear on behalf of the Assembly of First Nations, Alberta Region, which is a regional advocacy body for 44 first nations in Alberta.

I first want to welcome you all to Alberta, the traditional territory of Treaty No. 6.

It is our position that for Canada to reach its full economic potential there first must be a recognition of where the wealth of this country comes from. When our people entered into treaties with the newcomers, we agreed to share the land to the “depth of a plow”—nothing underneath—yet we have not seen the sharing of the lands and resources in our traditional territories to the extent we had hoped.

While first nations do not currently share equally in the $22 billion per year that is produced annually in revenues for governments in Canada as calculated by Natural Resources Canada, there have been some bright spots.

This past April, the Government of Ontario signed a historic resource revenue-sharing agreement with 31 northern first nations. In fall 2019, these 31 partner first nations will receive 45% of the government revenues for forestry stumpage fees, 40% of the annual mining tax and 40% of royalties from active mines. This will increase to 45% for future mines in the areas covered by the agreement.

This type of government-to-government partnership needs to be expanded across the country and is an example of recognizing first nations' economic jurisdiction over their ancestral lands. Promoting these partnerships needs to be on the federal government's radar and shared widely across all provinces and territories.

For action the federal government can take now, the issue of federal procurement is one that requires immediate examination. J. P. Gladu, president of the Canadian Council for Aboriginal Business, CCAB, has said that economic reconciliation occurs when aboriginal communities are no longer managing poverty but are managing wealth.

The CCAB has been a staunch supporter of making the federal procurement system more fair and proportionately inclusive of indigenous businesses. The CCAB found that in 2015 federal government procurement of goods and services totalled $20 billion. Of that total, $63 million on average annually went to aboriginal businesses. Indigenous peoples represent almost 5% of the population in Canada, yet our business and communities receive 0.32% of government procurement revenue. This has to change.

The federal government needs to immediately co-develop a strategy with first nations to set an indigenous business target for all federal government procurement. Through proportional allocation, we will see first nations businesses thrive. Our people are ready, they are able, they are qualified and they have the expertise to get these jobs done.

Addressing why first nations businesses are not receiving the same proportional share is a priority that this committee can move on. Barriers include obtaining capital and adding our businesses to the approved government vendors lists. Let us address those now.

Let's look beyond procurement. We also need to look at continuing to address the massive socio-economic gap between indigenous and non-indigenous people. The Centre for the Study of Living Standards calculated that Canada would add over $36 billion in GDP by 2031 if we closed the gaps in indigenous education attainment, employment and income.

If you want to close that income gap and if you want to reduce poverty amongst our first nations people, you have to invest and fuel economic development for both on-reserve and off-reserve ventures led by first nations. Not only is there an economic argument for closing these gaps, there is also a moral imperative and an international requirement to do so.

Canada's commitment to implementing the 2030 agenda for sustainable development and the 17 sustainable development goals will be key not to just reducing poverty but to eliminating it. I encourage the committee to push for the agenda's full implementation. Again, continued and sustained investments will lead to successful first nations, which in turn will lead to a better Canada.

Let's not take our foot off the gas pedal when it comes to sustained investments in first nations education, housing, water, and economic development. Let's keep going down the road of economic reconciliation.

Thank you.

11:05 a.m.

Liberal

The Chair Liberal Wayne Easter

Thank you, Chief Poitras.

We turn then to the Chemistry Industry Association of Canada, Ms. Des Chênes, Executive Vice-President.

Welcome.

11:05 a.m.

Isabelle Des Chênes Executive Vice-President, Chemistry Industry Association of Canada

Thank you, Mr. Chairman, and thank you, members of the committee. It's good to see some of you again.

I am here today to talk about the major investment and growth opportunities in Canada's chemical industry. I want to present my recommendations for the 2019 budget.

You might have read recently eye-catching headlines last month saying that left unchecked, tax reform south of the border would put about 635,000 Canadian jobs at risk and potentially reduce Canada's GDP by $85 billion, or about 5% of the economy.

The PricewaterhouseCoopers report was commissioned by the Business Council of Canada. It specified that the petrochemical sector will be particularly hard hit by these reforms, which pose a serious risk to chemistry manufacturing in Canada. These are issues that have been on our radar for quite some time, and others are finally starting to take notice.

The chemistry industry is a vital component of Canada's economy. It's the fourth largest manufacturing sector with just over $52 billion in annual shipments, and with 68% of production exported, we are the nation's second largest exporter behind the automotive industry. While few people give thought to the role of chemistry in their everyday lives, more than 95% of all manufactured goods are directly touched by the business of chemistry.

The industry is also a highly skilled sector that employs over 87,000 Canadians, 38% of whom have a university degree. In fact, the sector has the second-highest proportion of university graduates in Canada, second only to IT.

Indirectly, we support over 525,000 thousand jobs across the country. Globally, chemistry is a large, fast-growing industry, and analysts are expecting that the global demand for chemicals will triple over the next 20 years.

While much of the production and growth has taken place in Asia, chemistry manufacturing is also the fastest growing manufacturing sector in North America. In the United States, over $258 billion worth of investments have been announced since 2010, and 60% of those come from foreign investors.

Despite some of the successes and despite many key factors that we have to our advantage here in Canada, including our low-cost feedstocks, Canada has lagged far behind its traditional 10% share of North American chemistry investments. We should have realized about 20 or 30 new investments worth over $25 billion, but have seen only a handful of investments totalling a little more than 2% of that share.

Over the past several years, we have been working very closely with the federal government and have urged them to heed the investment opportunity in our sector and take notice a number of the provinces' determination to capture new investments, particularly here in Alberta.

We continue to stress the importance of ensuring Ottawa's economic priorities align with those of the provinces where Alberta, Ontario and Quebec have all prioritized chemistry investments so that all of their oars are pulling in the same direction.

To that end, last August, we submitted three recommendations to the committee to ensure a robust investment climate for the chemistry sector. As you know, enacted in 2017, the U.S. Tax Cuts and Jobs Act, TCJA, lowered the marginal effective tax rate on capital investment from approximately 35% to 19%. While Canada has historically enjoyed a marginal effective tax rate advantage to overcome construction, utility, labour and logistic disadvantages, the TCJA has eroded some of this advantage.

A key aspect of that legislation is the 100% immediate depreciation rate for capital equipment. You've heard a lot about that this morning.

In Canada, an accelerated capital cost allowance, ACCA, for manufacturing was introduced in 2015 to encourage investment in machinery and equipment. The immediate depreciation of capital investment lowers the upfront capital costs needed to finance a project by allowing a firm to deduct those expenses from existing revenue streams.

Therefore, the CIAC is recommending that the federal government adopt a temporary 100% ACCA to be applied to value-add resource manufacturing for a minimum period of seven years or a full business cycle.

As we aim to grow chemistry and plastic resin production in Canada, we must ensure that there are systems in place to recover the value of plastics as potential feedstocks once they've reached their end-of-life use.

Canada could be a global leader in the recycling and recovery of plastics by investing in chemical recycling technologies and other innovations.

CIAC is calling on the government to invest in programs that will allow Canada to become a leader in the commercialization of technology to recycle, recover and transform all plastics by 2040.

Finally, Canadian chemistry executives now identify rail service as a key factor in deciding whether to locate a new facility or expand their operations in Canada. This decider is second only to feedstock availability. As we've seen in the past few years, work stoppages and delays in our railways have had a huge impact on the stability of the chemistry sector in Canada. That's why we're recommending investments in the effective and safe transportation of goods by renewing the national trade corridor initiative, including investments in rail and ports, and the re-funding of the rail safety improvement project, and expanding it to include education and resources around the transportation of dangerous goods.

Thank you all. I look forward to your questions.

11:15 a.m.

Liberal

The Chair Liberal Wayne Easter

Thank you very much, Isabelle.

With Festivals and Major Events Canada, we have Mr. Martin Roy, Executive Director. Welcome.

11:15 a.m.

Martin Roy Executive Director, Festivals and Major Events Canada

Hello, ladies and gentlemen of the Standing Committee on Finance.

Festivals and Major Events Canada speaks as the recognized voice of the festivals industry in Canada, and works closely with Regroupement des événements majeurs internationaux, in Quebec.

These two associations together represent 45 events right across Canada.

As the only pan-Canadian organization exclusively comprising festivals and events in the country, the scope of FAME's thinking extends to all festivals and events of all sizes in every region and province. There are hundreds if not thousands.

In fact, I would like to acknowledge the presence in the room of one of our members, the Edmonton Heritage Festival, which puts together a true celebration of multiculturalism, and attracted an estimated 345,000 this past August. Jim Gibbon, the festival's executive director, is here with us today as an observer. This year, FAME has come up with a three-pillar plan to create a better business environment for all festivals and events in Canada by keeping them safe, helping them to grow and focusing on creation.

The first pillar of our plan has to do with security. Security costs at festivals have risen by 60% for members of FAME in the last five years alone in light of the increased risk of incidents at public events. This is why we are asking the government to provide additional funding in the amount of $10 million for the communities at risk security infrastructure program, and expand the program criteria to include festivals and events. Our recent meetings with Minister Goodale's team led us to think that it's possible to work closely together in ensuring that modern threats are handled with modern technologies.

The second pillar of our plan involves growth and development.

FAME wants the industry to remain competitive in order to attract international tourists, which is a booming market, and suggests a program designed to increase festivals and events that can generate more tourist and economic activity. I recommend a program with $20 million in funding per year, similar to current programs in Quebec, British Columbia, and Ontario, to some extent.

We have had positive discussions with Minister Joly's team.

In 2011, in its evaluation of the marquee tourism events program, the Government of Canada concluded that the program had responded to the need for economic stimulus to the tourism sector. Today, we strongly believe that a similar program managed by regional development agencies, or by Destination Canada, would have a great impact that we can also measure precisely with studies like the one we conducted with KPMG on 17 Canadian events over the past year.

Finally, our third pillar revolves around culture.

While festivals and events have grown a lot, the budgets of the two Department of Canadian Heritage programs that support them have not increased in over 10 years, despite the fact that the funding in constant dollars is about 15% lower than what it was originally. As a result, these programs are under a lot of pressure and can no longer keep up with demand, which Minister Rodriguez could certainly confirm.

An administrator of the Canada arts presentation fund said that to say that the program is oversubscribed and cash-strapped is an understatement. The only option is for the CAPF to identify funding priorities and give deductions to existing clients. Unless the budget is increased, the CAPF will not be in a position to reverse this trend. We had hoped to receive an increase in last year's federal budget, but unfortunately this did not occur.

Like the Canadian Arts Coalition, we are seeking a major reinvestment in the Canada Arts Presentation Fund, which should be nearly doubled, as the budget of Canada Council for the Arts was. We are talking about $30 million, $20 million of which would go to the programming arts festivals and performing arts series presenters component. On top of that, we recommend adding $10 million for the community development through arts and heritage program.

If it makes this investment, the Government of Canada will be able to say that it has taken action on the entire cultural value chain during its mandate, from creation to exports, and including domestic presentation, which is currently the weak link.

On behalf of dozens of festivals, as well as events, organizations such as TIAC, and cities that support them, I ask you to keep our events safe, help them grow and focus on creation, and to include FAME's requests in your final report and recommendations.

Merci.

11:20 a.m.

Liberal

The Chair Liberal Wayne Easter

Thank you very much.

We'll turn to our last group, the Sport Matters Group, with Ms. Sherk, Senior Leader; and Neville Wright and Marc Kennedy, who are Olympic athletes.

You folks certainly made us proud. Neville, I'm not going to challenge you to arm wrestle today.

Ms. Sherk, go ahead.

11:20 a.m.

Lindsay Hugenholtz Sherk Senior Leader, Sport Matters Group

Honourable committee members, my name is Lindsay Hugenholtz Sherk. I am from Ottawa. I'm the senior leader for the Sport Matters Group, which advocates on behalf of over 80 national sport organizations. Thank you for the invitation to participate today.

I am accompanied by two of our celebrated Olympians, who will take a few minutes to outline our recommendation for budget 2019.

Neville Wright is a three-time Olympian who participated in the sport of four-man bobsleigh. Prior to bobsleigh, Neville competed for Canada internationally as a track and field athlete. He's from Edmonton, is the father of two young children, and works as a massage therapist and performance coach.

Marc Kennedy is a two-time Olympian. He has a gold medal from the 2010 Winter Olympics and is a two-time world curling champion. Marc is from St. Albert, is the father of two daughters, and works as a real estate agent here in Edmonton.

We would like to highlight the recommendations submitted in our brief asking for a 25% increase to the sport support program. This increase will allow national sport organizations to hire the right people, develop the right programs and build the policies we need to keep kids active and make sure Canadians of all ages, backgrounds and abilities are able to access the benefits of values-based sport.

11:20 a.m.

Marc Kennedy Olympic Athlete, Sport Matters Group

Good morning, it's an honour for me to be here. As Lindsay mentioned, I am a father of two young girls, ages 10 and seven. On a daily basis I observe the challenges our community faces in creating opportunities for these children to be active. The Canadian 24-hour movement guidelines for children and youth recommend at least one hour of physical activity per day and two hours or less of recreational screen time. Despite the fact that my girls are very active and compete in multiple sports, my wife and I still struggle with limiting their screen time.

In Canada, 82% of adults and 65% of children are not active enough. This physical inactivity costs the Canadian health care system over $4.3 billion each year. Participation in sport leads to better health and greater productivity. It builds character and self-esteem in our children and youth, strengthens our communities and helps develop the tools necessary to be a positive contributor to our society.

Sport participation can be particularly important for new Canadians, who can use it to help them integrate into our Canadian society and learn our Canadian culture.

I chose to pursue sport because I love to be active, to feel healthy, and most importantly, to feel part of a team. I feel so blessed and fortunate that sport has always been a significant part of my life.

I hope for my daughters' sake that our national sport organizations will be awarded this additional funding. It will allow our NSOs to reach more children and more youth and continue to build a safe sport system where Canadians of all backgrounds and abilities can access the benefits of values-based sports.

11:20 a.m.

Neville Wright Olympic Athlete, Sport Matters Group

Good morning.

While I'm proud to call myself an Olympian, I'm proud to tell you about the road that it took to get to the Olympics. I'm the second youngest of seven children. At a young age, my father passed away, so my mom had to take on the hardship of raising me and my other siblings. Because of that, we didn't have a lot of access to and participation in sports.

It wasn't until I went to university that I met a coach who encouraged me and helped me find ways to excel in sport. My story is not unique to thousands of other youths out there. National sport organizations have been looking for ways to break down barriers for children and youth to gain access to quality and safe sport programming for years.

In addition to developing and governing all aspects of a particular sport, national sport organizations have taken significant new responsibilities in order to adapt to the demands of evolving sport systems and a changing world, for example, creating sport environments free from harassment, abuse and discrimination, which is imperative.

Concussions in sports are a recognized public health issue, and national sports organizations are required to develop concussion protocols and return-to-sport strategies. They also create opportunities for girls and women to participate in sport, as well as programming that is interesting and accessible to indigenous youth, which is also a priority.

Despite these growing responsibilities, national sport organizations have received no additional funding to support the rising costs of hiring staff, conducting innovative research, and developing sophisticated inclusive programs needed to encourage Canadians to participate.

Since 2008, core funding has remained virtually stagnant, even though inflation has risen by 16%. We ask that you consider our recommendation to increase the core funding component of the sport support program by 25%, which is an additional $18 million per year on an ongoing basis.

Thank you.

11:25 a.m.

Liberal

The Chair Liberal Wayne Easter

Thank you.

Thank you all, and certainly thank you to all of those who presented.

We'll now go with seven-minute rounds.

Mr. Fergus, you're up.

11:25 a.m.

Liberal

Greg Fergus Liberal Hull—Aylmer, QC

First of all, many thanks to the witnesses who have appeared today. Your presentations were very interesting. I also note that you have not made huge requests.

Let us begin with the Sport Matters Group.

Thank you very much for your presentations, Mr. Wright, Mr. Kennedy and Ms. Hugenholtz Sherk.

When I was growing up—I am 49 now—, we did an hour of sports at elementary school every day. Now it is about 45 minutes twice per week. I find this strange because we know that people have to be active and that it is increasingly important to participate in physical activities.

The $18 million you are requesting is really for young people, participants or athletes who have reached a certain level. Are you asking for more money? Is that just what you are requesting from the federal government? Are you making a similar request to the provinces?

What do you do to encourage daily physical activity?

11:25 a.m.

Senior Leader, Sport Matters Group

Lindsay Hugenholtz Sherk

Thank you for your question. I will answer in English, if I may.

It's very important to highlight the lack of physical activity and sport opportunities children and youth currently have access to in the place they spend the most time, which is at school. There are several organizations—PHE Canada is one we work very closely with. They're a member of the Sport Matters Group, and they advocate with us. They work across provinces and territories to try to influence the curriculum and physical education requirements in school boards.

Education is a provincial-territorial jurisdiction, and our colleagues who work for government at the provincial-territorial level are working very closely with their education counterparts, trying to encourage the increased opportunity for children to have access to more. From a national sport organization perspective, we can offer programs that are easy for physical education teachers to take into their schools. We have a number of organizations—Athletics Canada is one I would highlight. They have a program called Run Jump Throw Wheel, so they can easily provide them.

Our ask specifically is to allow an organization like Athletics Canada to have more capacity to continue to promote the fact that they have this program, and how easily adaptable it is in a school environment. They could collaborate with PHE Canada and with the Canadian Parks and Recreation Association, which works with municipalities so that when children are out of school and participating in recreational programs, they can have access to these programs.

The majority of national sport organizations have these programs. They have done a lot of modifications so that equipment is not a requirement and kids can try these sports. Really, it is a question of influencing educators about implementing it into the curriculum.

11:30 a.m.

Liberal

Greg Fergus Liberal Hull—Aylmer, QC

Thank you very much, Ms. Hugenholtz Sherk.

Mr. Roy, thank you very much for your presentation. Your requests are very reasonable, as they were last year, and we have had the chance to talk during the year. We certainly know how important festivals and culture are in Canada. They are not only good for the mind, but also create good jobs and stimulate our economy. We agree on that.

My main questions are for the Assembly of First Nations and ACCRU,

the Alliance of Canadian Comprehensive Research Universities.

While I clearly understood the assembly's testimony, it raises the need to ensure that indigenous youth have the same resources and the same individual subsidy that other children get to go to school.

As to ACCRU, its request for an increase in funding to sustain our institutions that subsidize research is in the same category. Canada has really fallen behind in the past decade, and even before then. We need more money to be more competitive with other countries around the world.

Chief Poitras, please explain the importance of guaranteeing that indigenous students receive the same funding as other students, and what that will mean not only for the indigenous community, but for all of Canada?

11:30 a.m.

Regional Chief, Alberta, Assembly of First Nations

Regional Chief Marlene Poitras

First nations youth are Canada's youngest and fastest-growing demographic, and we need to invest in this generation. We need to invest in housing, infrastructure and education to close the socio-economic gap and begin to realize first nations' potential. Investment in our aboriginal youth will reduce the statistics that are related to suicides and the lack of education of many of our youth. It will be a great investment for the fastest-growing segment of our population.

Thank you.

11:30 a.m.

Liberal

Greg Fergus Liberal Hull—Aylmer, QC

Do you have something to add, Mr. Malloy?

11:30 a.m.

Vice-President, Research, Alliance of Canadian Comprehensive Research Universities

David Malloy

What would increased funding mean to—

11:30 a.m.

Liberal

Greg Fergus Liberal Hull—Aylmer, QC

You said it is important to have diversity and equality in the research community as to gender, culture, and so forth, and that research councils have to be called upon to provide more funding for that.

11:30 a.m.

Vice-President, Research, Alliance of Canadian Comprehensive Research Universities

David Malloy

Yes. Essentially, our position is that excellence in research has no fixed address.

11:30 a.m.

Liberal

Greg Fergus Liberal Hull—Aylmer, QC

Yes and no. Excellence might not have a face, but we know very well that there are reasons or systemic barriers that explain why the majority of researchers today are men of a certain ethnicity, white men. We need diversity in research that reflects Canada. To elaborate on what you said, excellence is not defined by a person's face, skin colour or gender.

11:35 a.m.

Vice-President, Research, Alliance of Canadian Comprehensive Research Universities

David Malloy

I agree wholeheartedly with what you say. I think more diversity, in our regions, as well as ethnic groups that have participation in the research agenda, is exactly what we need. In fact, if we look at gender differences, I can speak for my own university—the University of Regina—I think we're 63% female right now. The next generation of researchers is, and should be, much more balanced, rather than the typical white male, old dusty professor, like me.

11:35 a.m.

Liberal

The Chair Liberal Wayne Easter

Thank you all.

Go ahead, Mr. Jeneroux.

11:35 a.m.

Conservative

Matt Jeneroux Conservative Edmonton Riverbend, AB

Thank you, Mr. Chair, and again, thank you, everybody, for being here today.

Before I start my questioning, I do, quickly, want to give a shout-out to Mr. Gibbon, who is in the audience as well. The Heritage Festival is fantastic. Those who aren't from Edmonton definitely have to make a point to come to it. It's one of the most well-attended festivals here in the city over the August long weekend. I look forward to welcoming my colleagues at that time of year.

I want to speak on the competitiveness aspect. Mr. Chair, how do you highlight the competitiveness theme of our trip across the country? You invite two Olympians here to really hammer it home. Quickly, if we could get on record, tell us some of the things that are different about Canada, compared to our neighbours in the south or maybe some other countries, that you've seen in your travels around the world, like things that they're doing right or that we could learn from.

11:35 a.m.

Liberal

The Chair Liberal Wayne Easter

Go ahead, Marc.

11:35 a.m.

Olympic Athlete, Sport Matters Group

Marc Kennedy

I can start on that. My experiences are very much curling-oriented and Canada has the most depth in the world, when it comes to curling. What I love about Canada is the number of young curlers and young athletes that we have and I want to continue to see that. The one thing that I see when I go to a lot of countries is it does get very specialized. They find young athletes and they groom them to be on certain specific teams or to get to the Olympics, but there's not the same depth of activity among the youth. That's what I see.

What I do like about Canada is that we have such a big country and so many young potential athletes. Sport can change life. Sport changed Neville's life. It changed my life. It provides so many opportunities and we've had the opportunity to travel across this country, visit schools, see young people and talk about the benefits of sport. I want to see that grow and see that opportunity expand. I would like to see these young people getting involved in sport at all levels and to see the funding get increased and pushed into that area, so that kids have access to the experiences that Neville and I have had since we were young kids.