Finance Committee on Feb. 16th, 2016

[The Chair, Liberal, Wayne Easter]

Thank you very much, Ms. Bérubé.

Mr. Obed, and I'll get you to name your organization because I'll not have it right.

[Natan Obed, President, Inuit Tapiriit Kanatami]

Thank you, honourable chair and committee members, for the opportunity to speak to you today.

My name is Natan Obed. I'm the president of Inuit Tapiriit Kanatami, the representational voice of Canada's 60,000 Inuit from Nunatsiavut in the east to the Inuvialuit region in the western Arctic.

We're at a very interesting point in the relationship between the Government of Canada and its indigenous peoples, and we are very excited as Inuit to explore the renewal of the Inuit-to-crown relationship within the overarching nation-to-nation discussion that the Prime Minister has started.

In many ways we can renew this relationship through governance and through working together in different ways that will allow for greater efficiencies and greater access to programs or services or a political voice. That doesn't necessarily cost any money, but major investments are necessary to renew the relationship, and that's what I'm here to talk about today.

First, we have to consider the Inuit-specific lens that we put on any sort of investments that happen in our regions. In every single Speech from the Throne, in every single budget, in every major funding announcement we listen to to see if the Government of Canada understands the complexity of indigenous jurisdictions and indigenous peoples in Canada, time and time again we, as Inuit, find ourselves either left out or only partially covered or covered in a way that does not reflect the realities in which we live.

Whether it's the recent Speech from the Throne talking about first nations education instead of indigenous education or a northern strategy that excludes two of the four Inuit regions in Canada, the terminology used and the specific wording in budgets or in announcements have great implications for Inuit, and if the government would like to do its best for indigenous people, it needs to do a better job on how it phrases the wording and be honest about who is inside and who is outside the funding envelope. I believe Canada can do better in articulating exactly which investments will be for Inuit, which will be for first nations, and which will be for Métis, as well as which will be indigenous in scope.

It isn't as if we are looking for a relationship that is completely exclusive or inclusive. We don't live on reserves. We have four comprehensive land claim agreements that create the governance space for all our interactions with the federal government, so we do not fall under the Indian Act, but it is very important that right from the beginning we have a very clear sense of what investments are made for us and do not have to figure it out after the fact because “first nations” is used sometimes instead of “indigenous”, or “indigenous” is used when it only means certain indigenous peoples in Canada.

I'll speak very briefly about some of our top priorities.

The first is in relation to infrastructure. Canada is still incomplete in its building process. We do not have the infrastructure in our 53 communities in the Arctic that many people enjoy in southern Canada. We still don't have ports in many of our communities, even though all but two of our communities are marine communities.

We still have diesel generation that powers all our communities in an age where we are looking for better and cleaner energy alternatives. This is completely unacceptable.

We have lack of connectivity or decreased connectivity compared to most Canadians because of the expense of connectivity in the Arctic and the limitations of the satellites that provide it. We believe Canada can make investments to ensure that connectivity in the Arctic is just as good as connectivity in southern Canada.

We also have massive infrastructure issues in relation to getting goods and services into and out of our communities. Just about all of our communities have marine access in the summer and only air access in the winter, when it is fly in and fly out. We have some communities that have ice roads and some communities that do have year-round roads, but those are very few in number. The investment that Canada makes in infrastructure in Inuit communities helps build Canada. It helps build sovereignty and the discussion about sovereignty in Canada, but it also allows for economic development to happen.

We also have a housing crisis in our regions. We need large investments to ensure that we do not continue to live in overcrowded conditions, as we currently do, with over half of our people in overcrowded social housing.

That brings me to our social envelope.

There have been many discussions over the past three or four months about improving the lives of indigenous Canadians, specifically Inuit. I will start with the government's commitment to the implementation of the Truth and Reconciliation Commission's 94 calls to action, the implementation of the UN Declaration on the Rights of Indigenous Peoples, and the inquiry into murdered and missing indigenous women and girls. We will expect that the budget will include funding to implement those three very large, very comprehensive, and very much needed different scopes of work that will be reflective of Inuit as well as the other indigenous Canadians in a way that is respectful and comprehensive.

[The Chair, Liberal, Wayne Easter]

Perhaps I could get you to sum up pretty quickly, as we're a fair bit over. Thank you.

[Natan Obed]

Sure.

We also have a number of different mental health and health-related initiatives that we hope to see funding for, especially in relation to suicide and suicide prevention.

The last thing I would like to add is that Inuit organizations have taken huge hits over the last decade. The framework of Inuit organizations from the community level to the international level has been undercut and undermined by funding cuts. This war on our people and on the way we try to help one another and represent ourselves to Canada and the world needs to end. We need funding to be able to ensure that we can provide services at the community and regional level and that we can represent ourselves at the national and international levels.

Thank you very much.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Obed.

Next we have Mr. Chartier, from the Métis National Council.

Go ahead.

[Clément Chartier, President, Métis National Council]

Thank you, Mr. Chairman, for inviting me to address your committee on the upcoming federal budget and the Métis Nation.

The Métis Nation is greatly impressed by the adoption of a Métis Nation policy by the current government. This policy, advancing and achieving reconciliation for the Métis Nation, is a far-reaching plan for the government to work in partnership with the Métis Nation on a nation-to-nation basis to further Métis self-government and economic prosperity.

The starting point for reconciliation, in my view, is a commitment to begin processes for settling land claims and advancing self-government. The Métis Nation policy also rightly recognizes the critical importance of certain programs and services for our people and the proven track record of Métis Nation governments in their delivery.

It makes a number of commitments that we trust will find their way into the budget, including a $25-million investment over five years in the Métis economic development strategy; the renewal and expansion of the aboriginal strategic employment and training strategy, or ASETS; and the enhancement of existing scholarships and bursaries available to Métis students at various colleges and universities, in partnership with the Métis Nation.

The government's policy commitment to convert funding to the Métis National Council's governing members for Métis identification and registration into a permanent initiative will ensure an ongoing and reliable base of funding, and is very much appreciated. We welcome this initiative, and we see its inclusion in the budget as a first step in overhauling the overall federal funding system for the Métis Nation to put it on a nation-to-nation, government-to-government basis.

We also welcome the whole-of-government approach of the new government in its dealings with indigenous people's governments. The Prime Minister has set the stage for our engagement with multiple federal ministers and in the intergovernmental process on such key issues as the health accord and climate change.

While welcoming this opportunity, we are woefully underfunded and underequipped to participate effectively under the current funding system. I believe the government is aware of this challenge and is preparing to boost our capacity to be able to participate meaningfully in the unfolding talks and processes. This critical requirement for expanding resources should also be addressed in the budget.

Past efforts at getting Métis Nation-specific requests into the budget have been few and unsuccessful. For example, while asked by former Prime Minister Harper to submit a stimulus proposal for budget 2009, we ended up completely left out. The federal denial of jurisdiction for Métis served as a barrier, and the Métis had no one in the government to fight for our interests. The Daniels case before the Supreme Court of Canada, and the strong likelihood of its confirmation of federal jurisdiction for the Métis under section 91, item 24, of the Constitution Act, 1867, will likely reinforce the evolution of a new relationship between Ottawa and the Métis Nation, which has already started under the Trudeau's government's Métis Nation policy. At the same time, the long history of our budget requests being overlooked altogether, or, in the few cases when they were put forward, ending up on the cutting floor, makes us naturally vigilant.

We will continue to work with the government to ensure that their bold commitments are put into effect, and we encourage this committee to support us in these efforts.

Thank you. Mahsi.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Chartier.

Mr. McLellan, with the Saskatchewan Chamber of Commerce, the floor is yours.

[Steve McLellan, Chief Executive Officer, Saskatchewan Chamber of Commerce]

Thank you, and I appreciate the opportunity to come. I have our presentation in hard copy in English only, only because of the turnaround time. If you'd like copies of it, they are here.

Mr. Chairman, in recent years Saskatchewan has been one of the primary economic engines keeping the Canadian economy stable while other parts of the country were experiencing reduced economic activity. Saskatchewan's economic growth has temporarily slowed during the current downturn, but given the diversified mix of industries in our province, we will be well positioned to benefit as the global economy and commodity prices recover.

In order to take advantage of this future recovery, however, there are some particular issues that the Government of Canada could greatly help with in the meantime. While we certainly applaud the recent decision and announcement by the federal government to fast-track $300 million towards Saskatchewan-based infrastructure projects, not all of the things we're here to ask for today cost money to make them happen.

While Saskatchewan and most western provinces continue to be impacted by the downturn of commodity prices, long-term growth targets are contingent on businesses being able to access the skilled personnel they need when they need them. That requires a reliable, expeditious immigration system that complements but does not replace our domestic workforce development. As an example, we believe the Canada job grant is an effective government program. Given recent changes, though, to the federal immigration system and the temporary foreign worker program, we must increase our efforts to develop the workforce within our province by expanding this initiative and increasing its flexibility for use by business.

Since Saskatchewan is not currently able to use all of the federal money allocated to the province for the program during each fiscal year, we ask for greater flexibility to be introduced for the province to use the surplus money for other training and labour market development initiatives.

Next, there's a close correlation between after-tax business profits and a number of key economic indicators, including government revenues. It's important that Canada maintain a current tax regime that leads not only North America in competitiveness, but the world.

Increasingly the subsidy for healthy food provided through Nutrition North Canada is another item the Saskatchewan Chamber of Commerce advocates, and we encourage the federal government to focus on it. Our province's remote northern communities currently receive the lowest subsidy available through the program. While there certainly need to be criteria in place to determine the eligibility of the communities to participate in a program like this, using their participation in the previous food mail program as a benchmark for their needs is a flawed process.

Ensuring that the issues that face aboriginal people across the country are being fixed with the necessary level of focus, planning, and funding should also be a priority for the federal government. Creating solutions with clear time frames, implementation plans, and full costing is a critical part of improving the lives of these Canadians. One of Saskatchewan's greatest untapped strengths is our large aboriginal population, but one of our greatest failures as a province and, I would suggest, as a country has been our continuing inability to help them fully participate in our economy across this nation.

A concerted effort is also required on infrastructure renewal. Accompanied by strategic and sustained levels of federal investment, it's fundamental to protecting the future prosperity of our province. Again we applaud the recent decision of fast-tracking the $300 million.

Also, the ability of our producers and extractors to move their commodities is directly tied to economic growth. Farmers must ship their grain in order to purchase new equipment, and mining companies must transport their resources to invest in new jobs and new technologies. The federal government must capitalize on all levers available to improve rail access in terms of frequency, modal choice, and cost competitiveness. The growing role of rail in transporting crude oil is largely a result of our current pipeline access becoming increasingly constrained. For this reason, the Government of Canada must start supporting and promoting Canadian pipeline projects to a much greater extent.

While it's important to give these types of projects appropriate safety and environmental consideration, we cannot continue to play divisive political games with them. If we keep doing this, our caution is that our country will lose out on opportunities for increasing foreign investment, creating jobs, and growing the Canadian economy.

Let's get back to Saskatchewan's north for a second. Further investments into building and maintaining northern roads and high-quality Internet connectivity are additional infrastructure items that the Saskatchewan Chamber of Commerce urges the federal government to focus on. By enhancing the physical and digital connection between our province's northern communities and the rest of Saskatchewan and Canada, we will improve their ability to learn, improve their access to health services, and improve their ability to run businesses from their unique geographic locations.

Our province is one that is built on exports. That's why a fair and reciprocal access to both domestic and international markets is fundamental to stimulate investment, create jobs, and drive long-term growth.

Saskatchewan businesses support the ratification and quick implementation of both CETA and the TPP. We encourage this government to do it.

Saskatchewan businesses are ready, willing, and able to work with the Government of Canada to help build Canada. Please ensure, as we move forward, that we move forward together.

Thank you, sir.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. McLellan.

Thank you all for your presentations.

We'll start the first round, and because we run into a hard stop at two o'clock, we'll go six-minute rounds rather than the usual seven, starting with Mr. Grewal.

[Raj Grewal, Liberal, Brampton East, ON]

Thank you, Mr. Chair.

Thank you to everyone for coming out and presenting today.

My first question is for Mr. Laycraft.

As you mentioned in your testimony, the U.S. is your largest export market. On December 18, 2015, the U.S. passed a bill to repeal the country of origin on beef and pork. Can you elaborate on how quickly the membership of your organization will benefit from the repeal of this legislation, and how important it is to remain repealed in your industry?

[Dennis Laycraft]

Thanks for that question.

It was, first of all, a great victory for the work of the Government of Canada. We fought for close to five years in a legal dispute to get through that.

The rules were unfairly discriminating against the exports of live cattle and hogs to the U.S., which meant that every time we sold an animal, there was a discount of around a $45 a head on Canadian animals going south, either as feeder cattle or as animals direct for processing down there. That reduces the price spread, so there's an immediate price impact there, but for the longer term the demand for Canadian cattle and hogs in the U.S. will increase.

I've visited a number of feedlots where we've talked about the quality of our beef. The quality of our cattle is among the very best in the world. They believe the cattle they import from Canada have the best rate of gain, and they're the most efficient animals they feed all year. That increases the price of every animal in Canada, whether we feed and process them in Canada or export them. Getting back to a functioning and integrated North American market is great for our industry, and we believe it will start to spur more growth in our herds.

[Raj Grewal, Liberal, Brampton East, ON]

As a follow-up, you mentioned there is a shortage of workforce in your industry and that the immigration program should be reformed to accommodate that shortfall. Can you elaborate on what types of programs you are thinking of? Would it be a provincial nominee program or would another skilled category be developed to help address the shortage in the industry?

[Dennis Laycraft]

We've worked on a labour strategy and through CAHRC to come up with a comprehensive strategy, so it's probably all of the above when it comes down to it. We need to have access to a labour pool of people who are interested in the positions. We brought in employees to work in our packing plants, a lot of them from other parts of the world through the temporary foreign worker program, and with those employees we had a retention rate of almost 97%. When we could find people to work in those jobs from the local communities, the retention rate was below 50%, and often it was as low as 15% over the course of a year. If you're going to have quality-based systems, you need people who want those jobs and who are prepared to make an investment.

Our issue with the temporary program was that we were never looking for a temporary foreign workers program; instead, we wanted to fill these jobs with people who wanted to become Canadians and wanted to become permanent employees in these organizations and these processing operations.

There isn't one quick answer to your question. It's all of these solutions. We're hoping, as I mentioned earlier, that as new people who are refugees today become Canadians, a number of them will look to find careers in our industry as well.

[Raj Grewal, Liberal, Brampton East, ON]

Thank you.

My next question is for Annie.

In your report you have some funding allocated to electric vehicle rebates and infrastructure. You're basing it on the model in Ontario. If there were widespread adoption of electric vehicles, there's a report out there that says the grid wouldn't be able to accommodate them and we would have a major crash.

A lot of this is left to the provincial level. Where do you see the federal government playing a role? Do you not think that the infrastructure side should be handled mostly by industry? In America, Tesla has built a coast-to-coast network of recharging stations. I would like your comments on that.

[Annie Bérubé]

You are right about the electrical grid. There is no doubt there needs to be some investment in modernizing the Canadian electrical grid. This is an area of shared jurisdiction.

Our specific recommendation is to give funding to Natural Resources Canada to lead the development of a transition plan, working with the provinces and territories to modernize the electrical grid. We would like to see some more east-west connections to bring renewable energy across the country. The grid needs to be modernized to be able to accommodate electrical transportation and the intermittent nature of renewable energy. This is our recommendation.

Part of our recommendation is also to bring a lot of the renewable energy potential that is in the Canadian north to the major centres. We need some grid extensions there. Whether the funding comes through an infrastructure portfolio really doesn't matter to us. We've made it in the context of the low-carbon economy trust that the government is proposing. Certainly, it could be part of the proposed infrastructure funding that the federal government is going to put forth.

With regard to your comment on Tesla and the private sector, we see electricity generation and the adoption of electrical vehicles as a public good in Canada because of our commitment to reduce greenhouse gas emissions and to improve local air quality. We believe there is a specific role for the federal government to play by providing rebates for the purchase of electrical vehicles and by supporting charging stations across the country.

[The Chair, Liberal, Wayne Easter]

Thank you, Mr. Grewal.

Mr. McColeman is next.

[Phil McColeman, Conservative, Brantford—Brant, ON]

Thank you, witnesses, for being here today.

Mr. Mueller, I would like to start with your suggestions regarding buildings and taking them to a level of zero emissions. I just need a little bit of clarification. Can you tell me what you're thinking of in terms of energy benchmarks? Would these depend on the region of the country, so that each region would have energy benchmarks, obviously depending on the climate in each part of the country? Can you give me a little more detail on how you perceive the outcome of that?

[Thomas Mueller]

That's a very good point. It would vary by region. In some regions, the fuel mix is based on coal and in some regions it is based on hydro, so the benchmarks we would strive for would vary from region to region. That's correct.

One of the first steps would be to define what net zero building emissions would mean by region. We'd have to really establish the metrics. We're talking not only about net zero emission but also about low-carbon buildings. That means we need to define at what point a building would qualify as low carbon, because we have to move the industry slowly towards that goal. We are at about 50% energy efficiency, maybe 60%. We need to get to about 80% or 90% over time. It's really important to define the metric and then to move towards how that can be achieved.

We already have net zero buildings, but we want a larger number of those buildings.

[Phil McColeman, Conservative, Brantford—Brant, ON]

Do you have much knowledge of international experience as to which jurisdictions in the world are leading the way on energy efficiency in terms of construction?

[Thomas Mueller]

I would have to say western and northern Europe. Over the last 20 years, they have been driven mainly by EU regulation. They really systematically work towards low-energy and energy-plus buildings, as they call them.

I can tell you, just as a matter of comparison, that our average home would use roughly, depending where you are, maybe 300 kilowatt hours per square metre per year. In some of the European countries with strong building envelopes and so on, they are getting them down to about 30 kilowatt hours per square metre, so there's a huge jump in innovation, and it continues to drive that usage down in the residential, institutional, and commercial sectors.

[Phil McColeman, Conservative, Brantford—Brant, ON]

I have some experience in the residential industry. Whenever our independent studies were done, Canada always came up as providing the best quality in housing compared to any other jurisdiction in the world. We build better housing in many ways. With the building codes the way they are today, energy efficiency is a very high priority in most areas. I was involved in the residential industry, so it's interesting to hear you say that.

I need to move on because of time. I'd like to ask Annie a fairly practical question.

There's a company in my jurisdiction that consumes about $10,000 a month in electricity costs right now. They did an analysis a few years ago about what a carbon tax would mean to them. This is a company that employs about 600 people, a fairly large-scale manufacturer in the forging industry. At the time of the 2011 election, they figured it would cost $9,000 per employee for the carbon tax that was being proposed during that election. This meant that they had a critical decision to make, which was either to expand in Canada or to move to Michigan, and there were two other locations they could move to.

I look at the aggressive pricing you've put on carbon here, and the other things. Have you looked at the impact on companies and communities like mine that would lose 650 jobs overnight if that happened?

[Annie Bérubé]

I would point to the experience in British Columbia. As you know, they have a carbon price that is currently at $30 per tonne of CO₂. It's been in place since 2008. Some really strong economic data that was published this year on energy policy looked at the effects of the B.C. carbon tax on employment. That has shown a very minimal effect on the province; in fact, the province has enjoyed economic growth similar or equivalent to the rest of the provinces in Canada, and about 10% of British Columbia's greenhouse gas emissions reduction can be attributed to the tax.

Our recommendation to alleviate any potential impact on employment is to make sure that the tax is gradual. We would see a national carbon pricing standard starting at $30 per tonne, like British Columbia, and increasing over time, making sure that it's a very transparent timeline so that industry can adjust.

There has been some concern by several industrial sectors about potential interprovincial competitiveness issues. We're very aware of that. That's why we say it's critical that the federal government show leadership and ensure there is a consistent carbon price across all provinces and territories.

You'll note in our recommendation for a national carbon pricing standard that one of the principles we want to see implemented in all provincial and territorial carbon pricing regimes is that there be funding allocated from the revenues to the transition and retraining of the workers affected by the transition to the low-carbon economy.

[Phil McColeman, Conservative, Brantford—Brant, ON]

Your plan involves foreseeing that there is going to be displacement of certain industries.

[Annie Bérubé]

Yes, exactly.

[Phil McColeman, Conservative, Brantford—Brant, ON]

Certain industries are just going to pick up and leave because they cannot be competitive on a global basis, and—