Evidence of meeting #184 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was proposed.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Manuel Dussault  Senior Director, Framework Policy, Financial Sector Policy Branch, Department of Finance
Justin Brown  Director, Financial Stability, Financial Sector Policy Branch, Department of Finance
Peter Fragiskatos  London North Centre, Lib.
Yuki Bourdeau  Senior Advisor, Capital Markets Division, Financial Sector Policy Branch, Department of Finance
Eleanor Ryan  Director General, Financial Institutions Division, Financial Sector Policy Branch, Department of Finance
Jean-François Girard  Director, Consumer Affairs, Financial Institutions Division, Financial Sector Policy Branch, Department of Finance
Brigitte Goulard  Deputy Commissionner, Financial Consumer Agency of Canada
Kim Rudd  Northumberland—Peterborough South, Lib.
Mark Schaan  Director General, Marketplace Framework Policy Branch, Innovation, Science and Economic Development Canada
Ian Wright  Director, Financial Crimes Governance and Operations, Department of Finance
Darryl C. Patterson  Director, Corporate, Insolvency and Competition Policy Directorate, Marketplace Framework Policy Branch, Department of Industry
Martin Simard  Director, Copyright and Trademark Policy, Marketplace Framework Policy Branch, Department of Industry
Andrea Flewelling  Senior Policy Advisor, Marketplace Framework Policy Branch, Department of Industry
Patrick Blanar  Senior Policy Analyst, Patent Policy Directorate, Department of Industry
Dale MacMillan  Vice-President, Corporate Services and Chief Financial Officer, National Research Council of Canada
Christopher Johnstone  Director General, National Programs and Business Services, National Research Council of Canada
Eric Grant  Director, Community Lands Development, Lands and Environmental Management, Lands and Economic Development, Department of Indian Affairs and Northern Development
Leane Walsh  Director, Fiscal Policy and Investment Readiness, Economic Policy Development, Lands and Economic Development, Department of Indian Affairs and Northern Development
Susan Waters  Director General, Lands and Environmental Management Branch, Lands and Economic Development, Department of Indian Affairs and Northern Development
Michèle Govier  Senior Director, Trade Rules, International Trade and Finance Branch, Department of Finance
Katharine Funtek  Executive Director, Trade Controls Policy, Department of Foreign Affairs, Trade and Development
Bev Shipley  Lambton—Kent—Middlesex, CPC
Nicole Giles  Director, International Trade and Finance, Assistant Deputy Minister's Office, Department of Finance
Deirdre Kent  Director General, International Assistance Policy, Department of Foreign Affairs, Trade and Development
Mark Lusignan  Director General, Grants and contributions Management, Department of Foreign Affairs and International Trade (International Trade)
Michelle Kaminski  Director, Office of Innovative Finance, Grants and Contributions Management, Department of Foreign Affairs, Trade and Development
Chantal Larocque  Deputy Director, Development Finance, Grants and Contributions Financial Policy, Foreign Affairs Canada
Danielle Bélanger  Director, Gender-Based Analysis Plus and Strategic Policy, Policy and External Relations Directorate, Status of Women Canada
Alison McDermott  General Director, Economic and Fiscal Policy Branch, Department of Finance
Derek Armstrong  Executive Director, Results Division, Expenditure Management Sector, Treasury Board Secretariat
Lori Straznicky  Executive Director, Pay Equity Task Team, Strategic Policy, Analysis and Workplace Information, Labour Program, Department of Employment and Social Development
Don Graham  Senior Advisor to the Assistant Deputy Minister, Compensation and Labour Relations Sector, Treasury Board Secretariat
Bruce Kennedy  Manager, Pay Equity Task Team, Labour Program, Department of Employment and Social Development
Richard Stuart  Executive Director, Expenditure Analysis and Compensation Planning, Expenditure Management Sector, Treasury Board Secretariat
Colin Spencer James  Senior Director, Social Development Policy, Strategic and Service Policy Branch, Department of Employment and Social Development
Andrew Brown  Director General, Employment Insurance Policy Directorate, Skills and Employment Branch, Department of Employment and Social Development
Barbara Moran  Director General, Strategic Policy, Analysis and Workplace, Labour Program, Department of Employment and Social Development
Rutha Astravas  Director, Employment Insurance Policy, Special Benefits Policy, Department of Employment and Social Development
Charles Philippe Rochon  Senior Policy Analyst, Labour Standards and Wage Earner Protection Program, Workplace Directorate, Department of Employment and Social Development

7:15 p.m.

Director General, Grants and contributions Management, Department of Foreign Affairs and International Trade (International Trade)

Mark Lusignan

It's not quite a loan, but no, we would be structuring our contributions, or whatever funding—depending on the vehicle, whether it's a guarantee, a loan or an equity position—in a manner such that we are looking to provide risk-adjusted rates of return that would encourage the private sector to invest in areas where it would not otherwise go. We're also looking to protect against the sweet deal. We understand it's taxpayers' money. We are deploying that money carefully to ensure that, if returns are generated, once thresholds are attained, which are negotiated deal by deal, we would also be repaid.

7:15 p.m.

Liberal

The Chair Liberal Wayne Easter

My question really relates to this. Is taxpayers' money at risk to guarantee the private sector that put up their money, to guarantee they don't take a loss?

November 5th, 2018 / 7:15 p.m.

Director General, Grants and contributions Management, Department of Foreign Affairs and International Trade (International Trade)

Mark Lusignan

Taxpayers' money will be at potential risk. We will obviously employ risk mitigation measures and look at the structure of the transaction and obtain security interests to mitigate those risks. There is an assumed accrual profile. We are getting the authority to deploy $1.5 billion at a net cost to the fiscal framework of $553 million. While we are prepared to absorb and to take risk up to that accrual profile, we wouldn't be prepared to go beyond. Once again, on a transaction-to-transaction basis, if we made the investment, we would be looking to make sure that the private sector's obligations are clearly understood, that all the conditions for repayment, the triggers for repayment, would be respected.

7:15 p.m.

Director, Office of Innovative Finance, Grants and Contributions Management, Department of Foreign Affairs, Trade and Development

Michelle Kaminski

I will just add on again by contrasting that with what we currently do, which is where we provide grants and non-repayable contributions that are fully expensed upon disbursement. Again, what we're looking to do is to have a tool kit that allows us, where it makes sense, to actually bring back some money for the Canadian taxpayers. This is value for money and it has a lower hit on fiscal framework than does the traditional funding model.

7:15 p.m.

Liberal

The Chair Liberal Wayne Easter

As a politician, if this government or a future government ends up paying out to the private sector, I know what the political spin will be, and that's different from doing international development work and providing monies up front as a grant. There, we know what we're getting into. If you end up guaranteeing, the private sector's not at risk and the taxpayers' money is. It's a completely different scenario, from where I sit as a politician on the government side.

7:15 p.m.

Director General, Grants and contributions Management, Department of Foreign Affairs and International Trade (International Trade)

Mark Lusignan

In the design of the program that we are contemplating right now, we would never issue full guarantees, only partial guarantees, and we would always make sure that the private sector had skin in the game.

The challenge we're facing is literally to mobilize private sector money on the sidelines into the fight against poverty, and to do that, especially for those who are less familiar with developing country markets, contexts or whatnot, either through our participation or our provision of assurances to get that money off the sidelines and into the fight against poverty.

7:15 p.m.

Liberal

The Chair Liberal Wayne Easter

There is no question there is need and we understand the intent. I'm just looking at the risk.

Mr. Julian.

7:15 p.m.

NDP

Peter Julian NDP New Westminster—Burnaby, BC

I want to clarify because we have to deal with what's in the bill. That's our responsibility and yours—which you accomplish very well—to explain the reasoning behind it. On page 572 it says:

4 Subject to the regulations, for the purpose of supporting a federal program that promotes international assistance through the use of innovative financing, the competent minister may, directly or indirectly,

(a) guarantee, in whole or in part, any obligation undertaken by a person or entity;

My reading of this law is that we are giving the ability to the minister to guarantee in whole an obligation undertaken by the private sector. That may not be the intent, but that's the power we are giving to the minister.

Would you agree with me?

7:20 p.m.

Director General, Grants and contributions Management, Department of Foreign Affairs and International Trade (International Trade)

Mark Lusignan

Yes, that's correct.

7:20 p.m.

NDP

Peter Julian NDP New Westminster—Burnaby, BC

Okay.

7:20 p.m.

Director, Office of Innovative Finance, Grants and Contributions Management, Department of Foreign Affairs, Trade and Development

Michelle Kaminski

May I add to that? When the legislation was being drafted, all the drafters took an approach to provide broad language, and the intention is for parameters and limitations to be put on during the regulations, which will be put in place subsequently. As my colleague was saying, the intent is that we would be providing partial risk guarantees.

This is a best practice, and this also ensures that the recipients of the guarantees have skin in the game and do proper risk assessments, etc., so it would not be our intention to provide whole ones but again the legislation was drafted to provide flexibility. Parameters would be put around that in the regulations.

7:20 p.m.

Liberal

The Chair Liberal Wayne Easter

Is there anything else?

7:20 p.m.

Director, International Trade and Finance, Assistant Deputy Minister's Office, Department of Finance

Nicole Giles

A useful context on this piece as well might be to add that there are international best practices on this. There are OECD-blended finance principles that OECD countries have signed up to and endorsed, including Canada. That provides the framework for this program under which these decisions will be taken, and those blended finance principles have been used very successfully by our like-minded partners to deploy these types of tools, so there is an international framework that will help guide the decision-making.

This isn't an ad hoc piece that has just been developed for Canada in the context of this legislation and regulations. The government will be guided by these international best practices that have a proven track record.

7:20 p.m.

Liberal

The Chair Liberal Wayne Easter

Okay, are there no further questions?

Thank you all for coming forward and answering our questions, and for the work you do.

We'll suspend for five minutes to give people a chance to stretch their legs. It's been a long day.

7:30 p.m.

Liberal

The Chair Liberal Wayne Easter

We'll reconvene.

We're on part 4, division 18, with the department for women and gender equality act.

Ms. Bélanger, the floor is yours.

7:30 p.m.

Danielle Bélanger Director, Gender-Based Analysis Plus and Strategic Policy, Policy and External Relations Directorate, Status of Women Canada

Thank you very much.

I'm going to be speaking to clauses 661 to 674. My name is Danielle Bélanger. I'm from Status of Women Canada.

The department for women and gender equality act, which is proposed in these clauses, formalizes the important role of the former Office of the Coordinator at Status of Women and its minister and legislation by creating this new department and minister for women and gender equality. Budget 2018 pledged to formalize into law the important roles of these two, and this is what is being proposed at the moment.

Status of Women Canada was originally created through an OIC and through the appropriation act of 1976. The appropriation act was a procedural budget bill of the type that is no longer used today.

In terms of this proposal, the minister will have a mandate for women and gender equality, including advancing social, economic and political equality with respect to sexual orientation, gender identity or expression, and promoting a greater understanding of the government's gender and diversity lens.

By the gender and diversity lens, we mean gender-based analysis plus, which is commonly referred to by the Government of Canada. It is the government's approach to ensuring that all decisions have taken into account how people experience government activities and decisions differently based on the way sex and gender interact with other identity factors such as race, indigenous identity, national and ethnic origin, age, sexual orientation, socio-economic status, geographic location and disability.

In order to promote gender equality, and in particular to continue to improve the lives of women, the minister responsible for women and gender equality will rely on the previous work of the office of the coordinator of the status of women and of organizations that promote equality by developing and implementing policies and programs, carrying out research, and awarding grants and contributions.

Finally, in carrying out this mandate, the minister may conclude agreements with provincial and territorial counterparts and establish advisory boards.

I am now ready for your questions.

7:35 p.m.

Liberal

The Chair Liberal Wayne Easter

Who wants to be the first to roll?

Mr. Julian.

7:35 p.m.

NDP

Peter Julian NDP New Westminster—Burnaby, BC

Anyone else can go first.

7:35 p.m.

Liberal

The Chair Liberal Wayne Easter

Does anybody else on this side want to go?

You're the only one so far, Mr. Julian. If you ask the right question, it might twig some more.

7:35 p.m.

NDP

Peter Julian NDP New Westminster—Burnaby, BC

How many ministries are established by statute?

7:35 p.m.

Director, Gender-Based Analysis Plus and Strategic Policy, Policy and External Relations Directorate, Status of Women Canada

Danielle Bélanger

Do you mean how many departments?

7:35 p.m.

NDP

Peter Julian NDP New Westminster—Burnaby, BC

Yes.

7:35 p.m.

Director, Gender-Based Analysis Plus and Strategic Policy, Policy and External Relations Directorate, Status of Women Canada

Danielle Bélanger

I don't know the number off the top of my head. In terms of Status of Women Canada going from an agency to a department, it is certainly one of the first in recent history.

7:35 p.m.

NDP

Peter Julian NDP New Westminster—Burnaby, BC

I think that would be relevant for our study and perhaps for the analysts, too. I understand the framework and I've read through the legislation, but I'd be very interested to know how many statutory ministries we have.

7:35 p.m.

Liberal

The Chair Liberal Wayne Easter

We can have the analysts look into that and get back to the committee.

Are there any further questions?

Mr. Kmiec.