Finance Committee on May 17th, 2016

[The Chair, Liberal, Wayne Easter]

Order, please.

We are continuing our discussions under the order of reference of Tuesday, May 10, on Bill C-15, an act to implement certain provisions of the budget tabled in Parliament on March 22, 2016, and other measures.

Welcome to our witnesses. We have quite a number this morning.

I'll just mention that the committee will be disrupted by a vote sometime between now and the next hour. When the bells go, I will ask if there is the unanimous consent of the committee to stay until we're down to 15 minutes before the vote. We'll come back after that to continue our hearings. We know that people have travelled a distance and put a lot of work into their presentations, and we certainly want to hear from them.

We'll start with the Fonds de solidarité des travailleurs du Québec. Mr. Gaétan Morin is the president and chief executive officer, and Mario Tremblay is the vice-president.

The floor is yours.

[Gaétan Morin, President and Chief Executive Officer, Fonds de solidarité des travailleurs du Québec]

Thank you, Mr. Chair. I thank the committee for having us here today.

The Fonds de solidarité FTQ contributes to two main public-policy objectives: encouraging middle-class workers to save, and channelling these savings to businesses in order to stimulate economic growth. Every year, we invest more than half a billion dollars to support SMEs in all economic sectors, at all stages of development. We invest directly in businesses and indirectly in private venture capital funds, in the form of unsecured venture capital.

Since 2005, the Fonds has contributed $1.2 billion in financing to 55 private funds, which has helped sustain the venture capital ecosystem not just in Quebec, but also across Canada. That's why we have the unwavering support of the Canadian Venture Capital and Private Equity Association, or CVCA.

The decision by Mr. Trudeau's government to maintain the 15% tax credit for our investors is backed by strong economic evidence. A number of chambers of commerce and business associations, including the Canadian Chamber of Commerce, have said as much to the Minister of Finance, and have been doing so since 2013.

Furthermore, according to CVCA data, the Fonds was the most active non-governmental venture-capital investor in Canada in 2015. We invested in each of the most active private and independent funds, including Real Ventures, iNovia Capital, Relay Ventures, Cycle Capital Management, and Lumira Capital.

In addition, private, independent funds in Canada collected about $8.4 billion from 2004 to 2015. Forty-one private funds, for a total of $4.6 billion, benefited directly or indirectly from investments from us or from one of the two other tax-advantaged funds in Quebec.

When it comes to retirement savings, studies have shown that the behaviour of our shareholders helps improve individual saving habits. Through the use of deductions at source, they develop healthy saving habits and then go on to save money at other financial institutions.

Strengthened by its renewed partnership with the Government of Canada, the Fonds is opening a new chapter in its history. In recent months, we have been doing some strategic planning to identify the best ways to contribute more to economic development and job creation, objectives we share with the Canadian government.

On April 22, I made a public announcement, before the Board of Trade of Metropolitan Montreal, that the Fonds will invest $3 billion by 2020 to support certain sectors of the economy, such as life sciences, agri-food, aerospace, and forest products. Of this amount, $900 million will be new money that we will raise by selling shares and bonds we hold on large markets and that we will reinvest in the economy here.

Other than the sectors I mentioned, we also plan to invest more in innovative businesses. To stimulate innovation, the Fonds has launched some new initiatives. For example, the Fonds has partnered with Manufacturiers et Exportateurs du Québec to go on a big regional tour. We also plan to stimulate innovation with our business partners. We've already started targeting those that want to innovate and that could benefit from personalized support.

The development of socio-economic real estate infrastructure is also a big issue for governments. That's why the Fonds plans to invest $400 million to fund small and medium-sized real estate infrastructure projects, such as schools, libraries, sports complexes, and student residences. The projects we are considering will be developed in partnership with the cities, school boards, and governments. Eventually, as a result of the leverage effect, we estimate that our investments will generate more than $2 billion in new real estate projects.

As you can see, the Fonds has the means and the expertise to invest in businesses in all economic sectors and in all stages of development. We also have the means and the expertise required to stimulate innovation and invest in infrastructure. However, we do not work alone. We work with our shareholder-savers, with our business partners, and, of course, with governments.

We also work with our colleagues in the financial sector, including Investissement Québec, the Caisse de dépôt et placement du Québec, the Business Development Bank of Canada, and the venture capital funds across Canada we work with.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you, Mr. Morin.

With Restaurants Canada, we have Ms. Reynolds.

[Joyce Reynolds, Executive Vice-President, Government Affairs, Restaurants Canada]

Thank you for the opportunity to be here today to provide comment on the budget on behalf of Canada's $75-billion restaurant industry.

Restaurants Canada is a national association, representing a growing community of 30,000 businesses in every segment of food service, including restaurants, bars, caterers, full and quick-service restaurants, and food service management companies. With 94,000 locations and 18 million customers every day, the restaurant industry has a more personal, direct, and frequent connection with Canadians than just about any other industry. The restaurant and food service industry is one of the largest private sector employers in the country, with 1.2 million employees. We are most proud of the first job opportunities we provide for youth, which is more than any other industry in Canada. Restaurants also open doors for many new Canadians as they seek to establish themselves in a new country and to gain work experience and contacts in the Canadian job market.

With regard to the budget, some of the things that we like include the following:

First, there is the renewed youth employment strategy, with additional funding for vulnerable youth and for an expanded Canada summer jobs program. We are grateful for your commitment to youth and youth employment, and we look forward to working with your government on a youth employment growth strategy.

Second, we see $50 million in additional funding to promote Canada as a tourist destination. Restaurants account for 27% of total tourism jobs, the largest of any sector. Dining out is something that almost every tourist will do when they are here in Canada. Our cuisine can compete with the best in the world. We need to promote Canada as a culinary destination.

Third is a commitment to review spending and the tax system to make it more efficient and effective. Our members find the tax system overly complex, taking valuable time away from running their businesses. A more streamlined system, with an objective of more broad-based tax reduction, is something that we support.

Fourth are the tax breaks that will lead to an increase in disposable income for the middle class, and hopefully more spending in restaurants.

Fifth is higher permanent resident admissions, with more funding to process permanent residents and for settlement programs. Our diverse multicultural industry was built and continues to built by immigrants.

On the flip side, Restaurants Canada is very disappointed about the deferment of the small business tax reduction beyond 2016. This was one of the government election commitments that was strongly supported by restaurants. In fact, all parties committed to reduce the small business tax rate to 9% by 2019. While the rate will decrease this year from 11% to 10.5%, future cuts remain up in the air.

We were even more disappointed when the government's election commitment to implement an EI youth hires initiative was missing from the budget. Employers of youth were promised an EI premium holiday from payroll costs for youth hires beginning in 2016. Recognizing that the youth unemployment rate is more than double the unemployment rate for Canadians over the age of 25, we think that payroll tax reduction for youth employers should be the cornerstone of any youth employment growth strategy.

CPP enhancements were also part of the government's election platform and were touched on in the budget. As with EI, Restaurants Canada recommends that enhancements to CPP be targeted to Canadians needing additional retirement earnings support, without jeopardizing youth jobs. I'd be happy to expand on this during the question period.

Finally, I'd like to touch on one other issue that we included in our pre-budget submission that wasn't included in the budget, which is the high cost of credit card acceptance fees. These fees have long been a major source of concern for restaurant operators. Canadians are being incented to use their cards for all types of purchases, from their morning coffee to basic groceries, to take advantage of generous rewards points and cash-back deals. These rewards and deals are financed through the high processing fees charged to merchants.

We are encouraged that there is a private member's bill before Parliament, sponsored by MP Lapointe, which we will support and hope will lead to a regulatory cap on credit card acceptance fees. We hope that this committee will support this bill as well.

To conclude, I'm here representing the industry that's in every Canadian community, urban and rural. We build neighbourhoods, attract tourists, and provide more first jobs than any other industry. With the right measures in place, we can contribute even more to the employment of youth and to a strong and growing economy. I look forward to a productive discussion with you during question period.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Ms. Reynolds.

From the Office of the Veterans Ombudsman, Mr. Parent.

If any of you want to indicate the sections of the budget implementation act you're speaking to, we'd appreciate that, as well.

I expect, Mr. Parent, that you're certainly on division 2 of part 4.

Go ahead.

[Guy Parent, Veterans Ombudsman, Office of the Veterans Ombudsman]

Thank you.

Mr. Chair, committee members, thank you for giving me the opportunity to share with you my thoughts on Bill C-15, budget implementation act, 2016, No. 1, as it pertains to Canada's veterans.

In my five and a half years as Veterans Ombudsman, I have met with and listened intently to the concerns of thousands of Canadian veterans and their families across Canada.

On October 1, 2013, I released my evidenced-based report on the new Veterans Charter and, for the first time with any report of this nature, it was supported by an independent actuarial analysis that pinpointed exactly where benefits were failing veterans, and would continue to fail them unless changes were made. In addition, on August 19, 2014, I published another evidence-based report on the permanent impairment allowance and the permanent impairment allowance supplement and recommended changes to better support our severely injured veterans.

Bill C-15 addresses several of my key recommendations in both of these reports. Although it is too early to provide you with an evidence-based analysis on the effectiveness or fairness of the proposed legislative changes—because we do not have all of the details yet—it is not too early to say that it is movement in the right direction.

Division 2 of the budget implementation act takes steps to help veterans and their families, first of all, by increasing the earnings loss benefit to 90% of an eligible veteran's military salary. According to Veterans Affairs Canada's numbers, this will provide increased short-term financial support to approximately 3,000 veterans while they participate in the department's rehabilitation programs. It will also provide increased long-term financial support to around 2,000 of the most seriously injured veterans.

The budget implementation act will also change the permanent impairment allowance grade determination. Although I do not as yet have the details of what this change will look like for veterans, I am hopeful that it will better support the more seriously impaired veterans with career-limiting service-related injuries. Also, I am pleased to see the program renamed “career impact allowance” in order to better reflect its original intent.

Moreover, the act will replace “totally and permanently incapacitated” with “diminished earning capacity”. There is no definition yet of “diminished earning capacity”, so it is difficult to assess at this point. However, I am hopeful it will lower the threshold for access to certain benefits.

The disability award will be raised to $360,000. This change will align the disability award for veterans with what Canadians can receive through courts. It will also provide retroactively to approximately 55,000 veterans to receive a one-time increase to the disability award that they have already received.

Another measure will increase the death benefit to $360,000. Once implemented, this will provide better support to the family members of those who have paid the ultimate sacrifice.

These changes, especially those to the disability award, will have a positive impact on all veterans receiving benefits under the new Veterans Charter. Other changes, such as those to the earnings loss benefit and permanent impairment allowance, will provide greater lifetime financial security to relatively few veterans, but they are the veterans who are the most vulnerable and have the greatest need of support.

I believe it is important for you in your deliberations to put veterans programs spending into context. Expenditures on veterans are approximately 1% of current federal expenditures, and current estimates suggest that these these expenditures will decline over the next year due to a decrease in the veterans population.

As the Veterans Ombudsman, my office evaluates fairness through the principles of adequacy. Are the right programs and services in place to meet the needs? In terms of sufficiency, are the right programs and services sufficiently resourced? On accessibility, are eligibility criteria creating unfair barriers? Can the benefits and services provided by VAC be accessed easily and quickly?

While it is difficult to evaluate the fairness of the proposed changes without more detail, as I said earlier in my remarks, they do reflect the recommendations I have previously made regarding the financial benefits in the new Veterans Charter.

In closing, I believe that the proposed changes represent an important step forward in Canada's support of veterans and their families. They deserve no less in return for their service and sacrifice to Canada and Canadians.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you, Mr. Parent.

Welcome, Ms. MacEwen, from the Canadian Labour Congress.

[Angella MacEwen, Senior Economist, Canadian Labour Congress]

I'm here on behalf of the 3.3 million members of the Canadian Labour Congress, and I want to thank you for the opportunity to present our views on this budget implementation act.

The CLC brings together Canada's national and international unions, along with provincial and territorial federations of labour and 130 district labour councils whose members work in virtually all sectors of the Canadian economy and in all occupations in all parts of Canada.

There are many elements of Bill C-15 that will affect our members, but due to the time constraints here, I will focus my comments on old age security and guaranteed income supplement changes, the Employment Insurance Act, and PPP Canada.

We're very glad to see several elements of this bill that will increase simplicity and fairness in taxation, and we expect the Canada child tax benefit to have a very positive impact on lower-income families with children.

With regard to old age security and GIS—I'm sorry I didn't write down their division numbers in the act—Statistics Canada's low-income measure shows that nearly 600,000 Canadian seniors were living on low incomes in 2013. The proposed increase to the guaranteed income supplement top-up for the lowest income seniors will directly help many who are struggling to get by. It's an important part of a wider strategy that includes affordable housing, home care supports, and an expanded Canada Pension Plan. Here I want to thank the government. It looks very much like something we put in the alternative federal budget, and we're glad to see that you're taking our advice.

With regard to employment insurance, we are happy about some things and critical about others. Reducing the 910-hour threshold for new entrants and re-entrants as of July 2016 will be a meaningful change in access for young workers, recent graduates, and new Canadians. Investments in front-line staff will reverse substantial cuts that had been made to administrative staff in EI, and we expect that will reduce delays and confusion for unemployed workers, improving access to the program.

Extending the length of work-sharing programs from 38 weeks to 76 weeks will help workers and employers who are facing tough times or who are going through some kind of structural transition. We encourage the government to work with employer and worker groups to increase awareness of this program because it can be very effective, but the take-up is often low.

Extending benefits to some workers was helpful, but the rationale for limiting benefits, the way that it was done, is difficult to understand. There was sufficient funding in the account to temporarily extend benefits to all unemployed workers in a fair and transparent way and that would have helped more unemployed workers.

Unfortunately some of Harper's changes to employment insurance remain in play. This includes the definition of the long-tenured worker, which Bill C-15 brings into the EI act instead of getting rid of it. Since one of the requirements to be long-tenured is seven years of EI contributions this automatically excludes young workers. The difference between benefits from a long-tenured worker and others is dramatic.

In 2014 the former government created additional regions for Prince Edward Island, Nunavut, Northwest Territories, and the Yukon. These new regions created significant discrepancies in access and duration of benefits for workers who are effectively operating in a single labour market. We would ask that the government immediately reverse these new regions.

I want to take this opportunity to repeat our long-standing call for a single national entrance requirement for employment insurance that will increase fairness of access to EI.

With regard to PPP Canada, we feel transferring responsibility to the Minister of Infrastructure and Communities will improve transparency and oversight, and we're encouraged by that move. However, the budget contained further signals that Ottawa intends to open up public infrastructure to private ownership, including through pension funds and asset recycling.

Along with the Ontario government, Ottawa is laying the groundwork for a major expansion of private investment in and ownership of infrastructure assets. We believe that public infrastructure should be publicly financed and operated. Therefore, we call on the federal government to completely eliminate PPP Canada incorporated and redirect its funding to public infrastructure projects.

We would also like to see comprehensive P3 accountability and transparency legislation to protect Canadians from high cost and high risk P3 projects.

Thank you again for your time.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Ms. MacEwen.

Mr. Galimberti.

[Joseph Galimberti, President, Canadian Steel Producers Association]

First and foremost, thank you, honourable members, for the opportunity to present in front of you today on behalf of the Canadian Steel Producers Association.

Our association represents 10 primary steel producers and steel product manufacturers in Canada, with member facilities located in Quebec, Ontario, Manitoba, Saskatchewan, and Alberta. These operations directly employ over 22,000 Canadians and support an additional 100,000 Canadian jobs through indirect economic impacts associated with our operations.

We welcome the government's budget 2016 commitments to taking steps to improve Canada's ability to effectively remedy dumped and subsidized imports, as this is an area in which steel is particularly exposed. In light of the increased frequency of market-distorting trade in Canada, the CSPA views modernization of Canada's trade remedy system as critical to ensuring that our members and their employees are able to compete fairly in the global marketplace.

I'd like to provide some context, if I may, for the importance of these measures. The global steel sector today is facing an unprecedented overcapacity problem. Put simply, more steel is being produced than is required by the global market. This phenomenon is driven largely by China, where demand has declined while state-supported production has increased significantly. Through the maintenance of more than 425 million metric tons of surplus capacity, which is almost 30 times the size of the entire Canadian steel market, China's state-owned and state-supported steel sector has disrupted established trade patterns and degraded the pricing of steel products globally.

The result is the significant increase in market-distorting dumping and circumvention practices, both from China directly and from a host of other global producers whose home markets have in many cases suffered as a result of Chinese competition. Left with no choice but to export, these nations begin doing so aggressively, dumping yet more product on the global markets and further degrading global prices.

At the recent OECD high-level symposium on excess capacity and structural adjustment in the steel sector, the CSPA was encouraged to see the development of a consensus position from the governments of the European Union, Japan, Mexico, the Republic of Korea, Switzerland, Turkey, the United States, and, importantly, Canada that overcapacity and adjustment challenges facing the steel industry have an important global dimension that needs to be addressed through ongoing international dialogue. Unfortunately, China refused to participate in this joint statement or support its content.

The impasse here underscores Canada's need to fortify our domestic trade remedy system. Increasing instances of market-distorting trade in steel globally have been accompanied by an historic escalation in the number of new anti-dumping and countervailing duty cases initiated in 2015, with a continued escalation foreseen in 2016.

Understanding this trend, Canada should take immediate action to ensure that we do not as a jurisdiction become an attractive place to dump product. Our NAFTA partners in the United States have take significant action through the passage of the Trade Preferences Extension Act in June 2015 and the Trade Facilitation and Trade Enforcement Act in February 2016 to discourage dumping and circumvention in that market. Canada needs to keep pace.

With this in mind, the CSPA would express our appreciation for the inclusion in Bill C-15 of amendments to the Special Import Measures Act ensuring that investigations will no longer be terminated at the preliminary stage, which will allow investigators to more fully consider whether dumping and subsidizing are harming Canadian producers. We also welcome amendments that will address the timing of and process around expiry reviews, resulting in measures remaining in place for up to ten months longer before a decision is made as to whether to extend or rescind that measure.

Similarly, we're encouraged by the recent initiation, which was also promised in the budget, of a public consultation on potential future changes to the Special Import Measures Act, and we are hopeful of near-term legislative action to address: the calculation of dumping margins in situations where data in a given export market understates the degree to which products are being dumped; the enhancement of enforcement options available to the Government of Canada in instances of circumvention; and clarification in regard to the type and amount of evidence the domestic industry is required to put forward to get cases initiated.

The CSPA supports trade. We believe that with our efficient facilities and innovative workforces we can thrive in a free trade environment, but in order for trade to be free, it also has to be fair. Bill C-15 takes important steps to ensure fairness in Canada's trade remedy system, and we are hopeful that the consultation process will generate additional positive near-term results.

[The Chair, Liberal, Wayne Easter]

Can I just interrupt you for a second?

The 30-minutes bells are going. I do have to ask if there's unanimous consent to stay until there are 15 minutes left on the bells. Are we agreed on that?

[Some hon. members]

Agreed.

[The Chair, Liberal, Wayne Easter]

Good.

Could we also get unanimous consent basically to change the agenda so that the witnesses who are here in the first section will go until 1 o'clock? There are considerably fewer witnesses in the second section, so if we could have unanimous consent for the first section to go until 1 o'clock, it would give us the opportunity to question witnesses. Are we agreed?

[Some hon. members]

Agreed.

[The Chair, Liberal, Wayne Easter]

Good.

Thank you, Mr. Galimberti. You can finish.

[Joseph Galimberti]

We would like to note that strong and consistent action defending Canada's fair market principles generates the needed confidence that investments in Canada will be protected against anti-competitive behaviours from other jurisdictions. In a highly capital-intensive and technology-intensive industry like steel, our members are in a constant competition with global affiliates to attract foreign direct investment into Canada. Maintenance of a free and fair market through WTO compliant policies, such as the modernization of our domestic trade remedy system and the continued enforcement of evidence-based, non-market economy provisions to applicable jurisdictions like China where state intervention in the economy is well established and harmful to Canadian industry, is crucial to securing future direct investments in Canada.

The CSPA and its members were also pleased to see domestic policy measures in budget 2016 that we believe encourage both continued investment and production in Canada. We welcome the government's $120-billion, 10-year infrastructure commitment, and our members look forward to the ability to contribute to the needed modernization and rehabilitation of Canada's public infrastructure. The CSPA shares the government's view of long-term infrastructure investment as an opportunity for contributions to national economic growth, and we believe that Canada's steel producers will play a substantial role in supplying critical inputs required by projects associated with infrastructure challenges of national significance. This is especially true since Canadian-sourced steel and Canadian infrastructure projects provide significant climate change benefits relative to imported alternatives.

Similarly, we are encouraged by budget 2016's extension of the automotive innovation fund through the end of 2021. We believe that this type of partnership between the federal government, the Government of Ontario, and the Canadian automotive industry for the purpose of attracting strategic, large-scale research and development projects is an important component of a collaborative effort to raise the profile of Canada's strong manufacturing capabilities.

In closing, I would like to thank the committee for the opportunity to appear today on this important legislation, and I'm happy to take any questions you may have.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Galimberti.

Mr. John with the National Pensioners Federation, the floor is yours.

[Herb John, President, National Pensioners Federation]

Good morning. Thank you for the opportunity to present on behalf of Canadian seniors, the fastest growing and largest segment of the Canadian population.

My name is Herb John, and I'm the president of the National Pensioners Federation. With me is our counsel, Susan Eng.

The National Pensioners Federation is a national, non-partisan organization of 350 seniors' chapters, clubs, groups, organizations, and individual supporters across Canada, with a collective membership of one million seniors and retirees devoted entirely to the welfare and interests of aging Canadians. Seniors and those who care about them will welcome the measures announced in the federal budget, which are contained in Bill C-15, but more needs to be done.

Bill C-15 returns the OAS eligibility age to 65, which will be welcome news to those who were facing having to wait two extra years for the OAS benefit after struggling in their careers. An estimated 600,000 seniors live under the poverty line today, and this is not expected to change unless more is done to provide better income supports and reduce their critical expenses like home care and drug costs.

Bill C-15 increases the GIS for single seniors beginning in July 2016. Single seniors, especially women, face a far greater rate of poverty compared to their counterparts in couples. That will benefit 900,000 single seniors across Canada. While absolutely welcome, it is a maximum of just $2.60 per day.

Much more needs to be done to prevent poverty among seniors. The budget announced a proposal to introduce a seniors' index for OAS and GIS to help seniors keep pace with their cost of living. While that is a welcome change, the index should help seniors keep pace with the standard of living and should be tied to wage rate increases.

Also welcome is the announcement in the budget of $200 million over two years to fund seniors' affordable housing without requiring a cost match from the provinces, which has been a major barrier in the past. Secure housing, as we know, is a major social determinant of health. The funding of the Canadian Foundation for Healthcare Improvement and the Canadian Institute for Health Information is a welcome investment, provided that the Naylor report's call for a patient-focused approach to innovation is the centrepiece.

Unfortunately, the budget and Bill C-15 do not address several important election promises. There's no mention of the promise to remove the requirement for a terminal diagnosis to qualify for the EI compassionate care benefit, or an increased flexibility in how the benefit may be used. The requirement for a terminal diagnosis has in the past stopped people from applying for the compassionate care benefit. In addition, the flexibility in using the benefit better reflects how chronic illnesses play out.

There's no mention of the promise to invest $3 billion in home care and palliative care. There is an immediate need for sustained funding and national standards on home care. The patchwork of palliative care must be addressed immediately, and this new funding will be a major first step.

The promise to join the pan-Canadian Pharmaceutical Alliance will incrementally reduce the cost of many drugs, but a comprehensive national pharmacare system is necessary in order to ensure every Canadian is able to access needed medications regardless of income or postal code.

I will now turn it over to Susan Eng who has further recommendations for the committee.

[Susan Eng, Counsel, National Pensioners Federation]

Thank you, Mr. Chair and members of the committee.

As Herb John has already indicated, the changes in the budget and in the budget bill will go a long way to making sure that no senior ages into poverty. However, a lot more can be done.

For the immediate purposes of this committee study, there is an opportunity to both increase the amount of GIS increase beyond the $78 per month, and to make the change retroactive to January 1 rather than starting that change on July 1. That's an immediate step that this committee can take.

As this committee has mentioned in the past, there's a need to really look at a guaranteed minimum income. I encourage you to start immediately on the research of that. I know that this committee has recommended it in the past. I think there are some positive indications from the government at this point. It should happen as soon as possible. We want every Canadian not to face poverty, at whatever age they happen to be.

One of the measures that would helps us prevent poverty in old age is to make sure people have a good retirement income. As you know, we have been on the record that Canadians support an increase to CPP. At this point, while there has been a lot of talk, there has been very little action. There are a lot of promises at this point, which are also important, but we need to see some kind of action.

At this point, it also seems that the problem is with the provinces. This committee may have full-throated support for the increase to the CPP, but it will mean that each of the committee members and your caucuses will have to ask your provincial counterparts to step up. It has been quite a number of years that we have been talking about this, and even if there were change, it would take at least three years before it could be implemented. We're not getting any younger.

It is important for us to look at these issues when we're talking about the changes that are in the bill. They are targeted, after all, at making sure that people live without poverty at any age, and especially not in retirement.

Thank you very much.

[The Chair, Liberal, Wayne Easter]

Thank you to all the witnesses.

We have time for the first question of the first round.

Mr. Ouellette, you have seven minutes, and then we will have to suspend for votes.

[Robert-Falcon Ouellette, Liberal, Winnipeg Centre, MB]

Thank you very much, everyone, for coming here today.

I have a few questions, so we'll move to Joyce Reynolds from Restaurants Canada.

You talked about business tax. On the one hand, I understand that people want their taxes to be as low as possible, but there are so many other issues in our country that need to be addressed, and we have to try to balance these out. Often, many of these demands are costly. For example, with child poverty, there's Canada's child benefit, which is expensive. It's a major program. It's probably the largest expansion of the social safety net in living memory for many people. That's my comment on some of your testimony.

Have you ever thought about working with the convenience stores people? They've also been here previously, complaining about the high cost of credit cards and the rates. Have you considered looking at setting up your own co-operative using technology today, in order to create, not a regulatory framework but a competition in the market? You could actually challenge Visa and Mastercard and other major credit card companies—I believe those are really the only two. You could use the weight of your, I think, 29,000 members and combine it with the convenience stores—27,000—and all of a sudden you would have a very large group of people who could be working together.

[Joyce Reynolds]

We have worked very closely with the Retail Council of Canada, with CFIB, with the Convenience Stores Association, with the jewellery store association, in one of the largest coalitions to ever come together to try to take on Visa and Mastercard. It's a duopoly, and we have not been able to have any success.

The answer that we often get is to just say that you won't accept Visa and Mastercard. The fact of the matter is, there's always somebody that's going to accept them, and we can't afford to allow the business to go out the door.

We were very supportive of our competition commissioner, who took the case of unfair business practices by Visa and Mastercard to the Competition Tribunal. After studying it for some time, and those two companies putting in millions and millions of dollars, they ended up coming out with a ruling saying that a regulatory approach is the best approach on this issue.

There are 31 other countries around the world that have taken a regulatory approach, a different approach. Canada is still the country with one of the largest interchange rates in the world. It is five times higher than some other countries. We've been banging our heads against the wall for so long on this one that we're appealing to government for help.

[Robert-Falcon Ouellette, Liberal, Winnipeg Centre, MB]

The next question is for Mr. Galimberti of the Steel Producers.

I was just reading one of your presentations previous to this. You talk about China steel and how it's entering the marketplace and that there's an oversupply of steel. You highlight in one of your presentations here that the United States has taken significant action with the Trade Preferences Extension Act and the Trade Facilitation and Trade Enforcement Act.

Also, you quote Barack Obama, who on February 23, 2016 said, “What is possible is making sure everyone is playing on a level playing field and that people are operating fairly, and, frankly, I don't think it is any secret that China in the past has not acted fairly.... [This bill] allows us to take more aggressive actions, so you are going to see firm, tough enforcement of our existing trade laws.”

Since you highlight this in your report, can you comment on the American experience?

[Joseph Galimberti]

Certainly they've taken some strong legislative action. It's an area to which the U.S. administration has really turned its attention from a trade perspective. The U.S. sent two very senior political representatives from the Obama administration to the OECD meeting that I mentioned earlier to try to get a deal done. The U.S. has a specific steel dialogue ongoing with the Chinese and they are trying to address the problem gradually. The pain in the U.S. market is extreme. They are a destination of preference for a lot of imports from China. We don't want Canada to become a back door for the Chinese into the United States. Without needed reforms to our own remedy system, we are a viable landing. We've certainly seen the administration grow quite serious about it very recently.

[Robert-Falcon Ouellette, Liberal, Winnipeg Centre, MB]

You also talked about how because they are our NAFTA partners, if we don't strengthen ours and if we don't work in conjunction with the people from Mexico, the U.S. and here, we could become the back door.