Finance Committee on May 8th, 2019

[Peter Fragiskatos, Liberal, London North Centre, ON]

—who saw debt levels very, very high, and what that would mean for a housing bubble and consequently the Canadian economy. Do you have any thoughts on that?

[Matthew Thornton]

On the levels of government question, I think we would agree that other levels have a very big role to play in making sure there are affordable options for all Ontarians, or all Canadians. That's why we were so happy to see the Ontario government step forward just this past week with a really bold plan to increase housing supply. I think that's a really positive step forward, particularly around transit stations and fast-tracking approvals around transit stations. That's going to lend itself to building a lot more transit-friendly communities in the future.

Do I still have more time?

[The Chair, Liberal, Wayne Easter]

Go ahead.

[Matthew Thornton]

Do other levels of government have a role to play there? Yes, absolutely.

On the Bank of Canada question, we're certainly not suggesting that debt levels are not an issue. I think our point is that B-20 has been in place for a little while now. Rates have gone up, I think, 75 basis points since it was introduced. I think it's time to revisit the stress test and whether or not there's a need for balance there.

[The Chair, Liberal, Wayne Easter]

Do you have time for one very quick question?

Go ahead, Pierre.

[Pierre Poilievre, Conservative, Carleton, ON]

My question is about speed and how long it takes to get a house built in Canada. The Building Industry and Land Development Association in Toronto says that it can take as much as seven years from idea to shovel in the ground. They also say that government costs amount to $185,000 per unit of housing in Toronto proper.

Municipal leaders keep telling us they need more government money for housing, but the same municipal and provincial leaders have piled on so much regulation and so many inefficiencies and delays that they, in a lot of cases, are the ones driving up the cost of housing in the first place.

Does anyone want to comment on the damage these regulations do, particularly to poor and disadvantaged people who would love to be part of the private housing market but can't afford it because of the cost of government?

[The Chair, Liberal, Wayne Easter]

Mr. Thornton, you're chomping at the bit to answer this one.

[Matthew Thornton]

I'd love to comment on that question.

The short answer is yes. The government imposed costs on new housing, in Ontario at least, are substantial. They vary from municipality to municipality. Development charges alone can add over $100,000 to the end cost of a new home, so those kinds of things need to be addressed.

I think the question should be: What is the federal government's role in increasing housing supply? We would take the view that the federal government is offering a lot of money for transit and infrastructure in particular. Tying some requirements to municipalities to update their zoning to permit intensification along transit lines, as an example, is a great initiative for the federal government to undertake to speed up some of these approvals and reduce that seven-year time frame that you mentioned, Mr. Poilievre, and to get shovels in the ground sooner.

[The Chair, Liberal, Wayne Easter]

With that, thank you all for your presentations. We had a pretty good round of questions, all things considered.

For our second panel, we should be back in about 15 minutes.

The meeting is suspended.

[The Chair, Liberal, Wayne Easter]

Let's reconvene.

We have a number of witnesses for Bill C-97. I believe five organizations are represented here in the second panel.

I will say there will be bells at about 5:52. At that time I expect we'll get unanimous consent to continue for a little while. If you can hold your remarks to five minutes, it will be helpful.

First on deck will be Mr. Baker from CARP.

Go ahead, Mr. Baker.

[Rick Baker, Ottawa Chapter President, CARP]

Mr. Chair, members of Parliament, ladies and gentlemen, good afternoon—or almost good evening, now.

My name's Rick Baker and I'm the president of the Ottawa chapter of CARP, which stands for the Canadian Association of Retired Persons. It's certainly my privilege to speak on behalf of CARP national and our chief policy officer, Ms. Laura Tamblyn Watts. CARP is a non-partisan, membership-based advocacy organization of more than 320,000 older Canadians in Canada. We have 30 local chapters that engage in their communities as well, and our mission is to advance the rights and well-being of Canadians as we age.

We thank the committee for this opportunity to present to you, and wish to acknowledge the traditional owners of the land and offer our respects to their elders past and present.

It is an important year with the recent budget and the impending federal election. We have a platform that represents comments on the recent budget, but also going forward a platform for all parties to consider. Our goal is to make sure that the federal government commits to specific, measurable improvements in five key areas which matter most to seniors. Most of you may know in this room that seniors now constitute way over 20% of the Canadian population, and we statistically know that over 98% of seniors get out and vote, so they do make a difference.

Our program is called The Faces of Canada's Seniors, which I have a copy of here. If you'd like to get a copy later on, I have some extras for you.

“F” stands for financial security, and a lot of discussions certainly around this table right now are on that aspect. We're extremely supportive of the GIS and we see this as a key win for low-income seniors, particularly older women, who are especially subject to poverty. We are supportive of the changes to the Bankruptcy and Insolvency Act, which provide greater transparency for government over companies that are in dangerous decline into insolvency, including provisions which will inhibit CEOs and other executives from divesting their assets. We believe that these preliminary steps, while important, are not enough to ensure pension security for pensioners. To that end, we adopt the submissions by our colleagues from the Canadian pensioners federation, as submitted by Mike Powell.

The deferred annuities announced in the budget are a positive, and we are supportive of them, but we do not think that allowing a person at 71 years of age to take some 25% of their RRIFs and put that into deferred annuities until 85 is the right answer. It is beneficial to some people, but not to all. What CARP really wants—and what we were very disappointed not to see in the budget—is the elimination of the ageist requirement to withdraw RRIFs at the age of 71. We were also very disappointed to see that the government did not close the loophole and ensure that the ombudsman for banking services and Investments—the public, non-partisan and independent ombudsman—is reinstated as the only ombudsman for Canadian consumers.

“A” stands for abuse prevention. We welcome the increase in the new horizons for seniors program by $100 million over five years. This is an important and needed funding increase for a program that is essentially the backbone of senior service delivery in Canada. We encourage the government to use these funds to be allocated to raising awareness of elder abuse and abuse prevention mechanisms. The new horizons for seniors program has specific calls each year, and we hope that elder abuse will be included in the upcoming 2020 call.

“C” stands for caregiving and housing supports. While we are strongly supportive of the funding for the national dementia strategy, and was pleased to see that caregivers are mentioned in it, we were deeply disappointed that this budget did little for caregivers. Additionally, we would encourage this government—and we support the work of the United Way also being presented here—to invest in a much more modern health and housing continuum, embedding supported housing into the national housing strategy.

“E” stands for exceptional health care. We applaud the government for its steps towards pharmacare in the hope of seeing NACI-recommended adult vaccinations being included in the formula, as opposed to just prescriptions. We are hopeful that funding of a national seniors strategy will be included as well, but cannot locate where any specific funding has been allocated for it.

And “S” stands for social inclusion. We welcome the funding for digital improvements, especially in rural areas, which are critically important to social connections. We also urge this government to fund projects that support intergenerationalism, workplace inclusion and entrepreneurship. Too often, entrepreneur programs are only targeted at younger people, but the majority of investment in Canada in new start-ups come from the 50-plus cohort.

We hope that you join us on October 1 for National Seniors Day in Canada.

Thank you very much.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Rick.

Turning to Collectif pour un Québec sans pauvreté, we have Mr. Petitclerc and Mr. Ducharme.

[Serge Petitclerc, Coordinator, Collectif pour un Québec sans pauvreté]

Thank you very much.

Ladies and gentlemen, good day to you.

Thank you for inviting the Collectif pour un Québec sans pauvreté. This is our first time as witnesses before a standing committee of the House of Commons.

My name is Serge Petitclerc, and I am the coordinator and spokesperson of the Collectif pour un Québec sans pauvreté. Beside me is Olivier Ducharme, our researcher.

I am basically going to tell you three things today.

First of all, the Collectif would like to thank the federal government for this initiative. Just like the Quebec anti-poverty law, the federal Parliament has finally presented a bill that will bring about a national strategy on poverty reduction and establish the National Advisory Council on Poverty, as well as giving itself a general goal of eliminating poverty in the country. The Collectif welcomes the bill and its main goal of establishing the first official poverty line as well as poverty reduction targets. This is music to our ears.

Secondly, despite these positive remarks, the Collectif would like to stress that it is an error to use the MBM, the Market Basket Measure, as the main poverty indicator. The MBM as an indicator is not a bad tool, but it wasn't designed to be used this way. The MBM is to be used solely to measure the income necessary to meet the basic needs of a person or a family in terms of food, shelter, clothing, transport and other basic goods and services. Barely getting by, however, does not mean you can get out of poverty.

In our brief, you will read France's story, which serves as a perfect example. France is a retiree whose income is equal to the MBM. Before retiring, she had to live on an income that was much less because she lived on social assistance. When she retired, this was seen as an important step, because she would now be able to better meet her basic needs thanks to an improved income. For all that, she does not have the impression that she has escaped poverty. Her income does not allow her to cover any unexpected expenses. Despite being on a lower income when she was on social assistance, she could for example count on a partial reimbursement of her dental and denture expenses, as well as what she spent on eye exams and glasses. Since retiring, she has had to pay for most of her healthcare expenses, which has considerably increased her expenditures. After a fall, which left her with broken teeth and a broken arm, she fell into debt because of unexpected expenses.

That's the problem with MBM: it is too low. Getting out of poverty means you have a certain financial security, you are free to make choices and you have stability. That's the reason the Collectif's main recommendation is to raise the poverty line in order to make it more than simply meeting basic needs. For lack of anything better, the Collectif recommends using the low-income measure which is 60% of the median income as an official poverty line. This is the same tool that is used by member countries of the European Union and it does have the advantage of giving a view of poverty which is not limited to meeting basic needs.

Thirdly, the Collectif would like to stress that many improvements could be made to the bill in order to make the Canadian government's fight against poverty more effective. I won't go into details, but I will briefly mention the five suggestions that are contained in our brief.

The first suggestion is that it would be logical to include a definition of poverty in the definitions section of the bill.

The second recommendation is that this definition should be the same as the one contained in the Quebec statute, which reads as follows, “[...] the condition of a human being who is deprived of the resources, means, choices and power necessary to acquire and to maintain economic self-sufficiency or to facilitate integration and participation in society.”

Our third recommendation, if indeed the MBM is used as an indicator despite our opposition, would be to provide a definition in the act such as the list of goods that would be included in the market basket as well as the sources used to establish the price of each of these goods.

The fourth recommendation would be to change the subject in the title of the act that states “the reduction of poverty” and use instead “the elimination of poverty”, given the preamble which states, “Whereas Canada aspires to be a world leader in the eradication of poverty [...]”.

Our fifth recommendation would be to increase the number of members on the National Advisory Council of Poverty. We think that 8 to 10 people representing all the regional and socio-economic realities in Canada is spreading it a bit thin. By ways of comparison, the advisory council of Quebec is composed of 15 members. That would be a good model.

Essentially, the bill is good news for us. It is good news for people living in poverty as well as the organizations that work with them. The bill should, however, contain a more ambitious target and be improved in many ways as per the recommendations contained in the Collectif's brief.

Thank you again for inviting us and listening to us today.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Petitclerc.

We will now turn to Ms. McIsaac, president of the Maytree organization.

[Elizabeth McIsaac, President, Maytree]

Thank you, and good evening.

My name is Elizabeth McIsaac. I'm the president of Maytree, a private charitable foundation in Toronto focused on human rights and poverty.

I want to thank you for the opportunity to appear before this committee to provide recommendations for amendments to Bill C-97, the budget implementation act

My written submission includes recommended amendments to the national housing strategy act and the poverty reduction act. For this presentation, however, my comments are focused on recommended amendments to the national housing strategy act.

I'll begin by saying that you've probably heard a bit of what I'm going to say from the earlier panel, but I think it bears repeating.

Canadians believe that equality, non-discrimination and freedom from fear and want, among other protections and freedoms, are fundamental to a free and democratic society. These values are reflected in our Charter of Rights and Freedoms, and form guiding principles for how we govern, legislate and develop public policy.

While Canadians may believe that we have a strong tradition of upholding human rights, we have in fact been selective about which rights we recognize and protect. To date, our successes have been largely focused on civil and political rights. Civil and political rights, like freedom of religion and the right to vote, are critical and reflect specific movements and political moments in our national and international history. We should be proud of that. However, economic and social rights are just as fundamental. In fact, both are needed and make each other whole as human rights.

While there has been reticence on the part of past Canadian legislatures to recognize and uphold economic and social rights, this is, I believe, the moment to do so. As you heard earlier from Tim, there are currently over 235,000 Canadians who are homeless, and over 1.7 million households in Canada live in unsuitable, inadequate or unaffordable housing. Canadians understand that safe, affordable and secure housing is critical to living life with dignity. Housing is a human right.

With the introduction of the national housing strategy act, we have an opportunity to recognize one of the basic and fundamental rights that we think all Canadians must be afforded. The proposed legislation undertakes a rights-based approach to housing, and provides an opportunity to reset the framework within which we conceptualize, develop and implement housing policy in Canada. We need to get this right. The proposed national housing strategy act needs to be strengthened, so that it clearly recognizes that housing is a human right and includes an effective accountability framework and mechanism for affected groups to claim their rights.

We urge the members of the standing committee to support our proposed amendments, which are outlined in more detail in our submission. Particular emphasis should be placed, first, on unequivocally recognizing that housing is a fundamental human right, as per our international commitments and international law; second, on mandating that the housing advocate receive and investigate petitions identifying systemic housing rights issues; and third, on establishing a process for a review panel to hear and make recommendations on these issues.

Being able to claim your right is essential in a rights-based approach. Without this, it is empty. The housing advocate must also be independent. This accountability and transparency is an essential element of a human-rights approach.

Finally, we feel that it is essential to establish a monitoring role for the housing council. Currently, it is mandated to give advice to the minister. We believe that, in addition to giving advice to the minister, it should monitor how effective the strategy has been. The progressive realization of the right to housing is, again, an essential element in a rights-based approach. Without this, the approach is empty.

We believe these proposed amendments will commit Canada to the progressive realization of the right to housing and set out the framework for an accountability mechanism that meets our obligations under international law, while reflecting a unique made in Canada approach. Importantly, affected groups will have access to public hearings on key systemic issues before an expert panel with at least one representative of affected communities.

All of these elements are critical to the development and implementation of an effective rights-based framework. The proposed amendments to the national housing strategy act will help ensure that Canada gets it right. This is a unique opportunity, and we must get it right.

It has taken several decades for economic and social rights to be at the forefront of the Canadian imagination. The federal government's leadership in this regard is appreciated. Continued momentum towards ensuring that Canadians are protected by economic and social rights is critical.

I'd like to leave you with a quote from our former Supreme Court of Canada Justice Louise Arbour, because I think she puts it best:

The values of freedom, equality and tolerance reflect a very large consensus in Canada. They are values which have been...embodied in our international commitments under the International Covenant on Civil and Political Rights, the International Covenant on Economic, Social and Cultural Rights and the Convention on the Elimination of All Forms of Discrimination against Women, amongst [other conventions]. I want to ask you today, however—perhaps somewhat provocatively—if we have done everything within our power to give those values, and those legal commitments, effect in our day-to-day life as a nation.

My response to the challenge from Justice Arbour would be this: With the national housing strategy act, if passed with the right amendments, which we are proposing, we would finally begin to get there.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Elizabeth.

Next we have the St. John's Board of Trade.

Mr. Ellis.

[Brandon Ellis, Policy and Advocacy Specialist, St. John's Board of Trade]

Honourable Chair, I thank both you and the honourable committee members for giving me the opportunity to present to you today as a witness. My name is Brandon Ellis, and I am a policy and advocacy specialist with the St. John's Board of Trade.

St. John's Board of Trade is a business association. We represent about 800 businesses in the St. John's and surrounding area. We're also members of the Atlantic Chamber of Commerce and the Canadian Chamber of Commerce.

The St. John's Board of Trade is here today to express our grave concern with a number of different issues—deficits, taxes and issues of competitiveness. In the 2015 election it was promised by the current government that modest deficits would be run for the first three years, and then the budget would be balanced in 2019. Not only has the budget not been balanced; it has also since been revealed that the budget will not be balanced until 2040-41. In the 2019 budget as well, a total of over $40 billion in new spending measures was introduced.

A study by the Fraser Institute has concluded that as a result of spending over the past four years, this government has accumulated more debt than any other government in the history of our country—

[Pierre Poilievre, Conservative, Carleton, ON]

On a point of order, Mr. Chair, the members are carrying on a very loud conversation. It's hard to follow what the witness is saying. If they have a conversation, I would suggest they take it outside.

[The Chair, Liberal, Wayne Easter]

That is a valid point of order.

Go ahead, Mr. Ellis.

[Brandon Ellis]

Thank you, Mr. Chair.

As noted, a study by the Fraser Institute has stated that this government has accumulated more debt over the past four years than any other government not in a period of recession or wartime in the history of this country.

The heavy reliance of the government on the federal debt-to-GDP ratio has our membership concerned as well. It is also misleading in the sense that it does not capture the true ratio of a jurisdiction because it does not take into account the debts of the provinces. If it did, the number would be significantly higher. Canada's total debt-to-GDP ratio is roughly around 65% to 67%. My province of Newfoundland and Labrador, for instance, would be around 85% to 90% with combined ratios.

The current pathway to a balanced budget that is projected by the Department of Finance also does not take into account harsh economic times, nor what a recession may look like. Like the Chrétien and Martin governments of the 1990s and early 2000s and the early Harper years, we must have the foresight to pay down the debt and lower our deficit. If we do not have the foresight to save during the good times, we will come to regret it in hindsight if we ever enter the bad times.

What is the outcome of our high debt? We either have to increase revenues or reduce expenditures to pay for it. Reducing expenditures in our belief as a business organization is a logical option. If government decides not to go the route of expenditure reduction, who shoulders the burden of increased revenues? It's people like our members, their customers and their employees, through higher taxes.

Can Canadians pay for this debt? A poll completed in January by MNP Ltd. showed that the number of Canadians who are $200 or less away from financial insolvency at the end of the month has jumped to 46% from 40% the previous quarter. Those Canadians are the customers of our members and of other chambers and boards of trade across the country. The answer is “No, they cannot.” Taking money out of the pockets of the taxpayers, in turn, hurts our members. Canadians will have less disposable income to shop in local stores or to see the attractions of our great province of Newfoundland and Labrador, or in turn, our great country.

Canadians and businesses are on the brink of just being able to pay what they owe and each day we seem to lose our ability to be competitive with the United States. We cannot see more red tape in this country for business. We cannot see more burdensome taxes, as implied by the tax changes suggested on page 207 of the budget.

The last time the government tried to change tax loopholes, they got it wrong. Business pays more than its fair share in taxes. With any further tax changes concerning business, we request that this committee asks the Minister of Finance if he consulted with small business and with tax professionals, and if so, what those individuals told him. The last time there were consultations, our membership—all of our accountants—told the minister that he got it wrong.

This budget and this bill are disappointing for our organization on a number of fronts. The budget itself has little to nothing, in our analysis, for business. On top of that, we see all of this new spending. Our members know that someone will have to pay for all of these deficits and all of this new spending. That will almost certainly be them and their customers.

To be clear, to give an outlook to this committee of what the majority of our members look like, they are small businesses. Roughly 90% of them are small businesses with fewer than 10 employees working for them. They are entrepreneurial businesses and innovators looking to grow, but they are becoming increasingly stifled by the taxation and red tape. As the debt grows, taxation will likely grow with it.

We respectfully request that the government move forward with the recommendations of the Senate Committee on Banking, Trade and Commerce, which are supported by chambers of commerce across the country, and implement a royal commission on taxation. As well, we request that government implement the recommendations of the internal tax committee of the St. John's Board of Trade, which are outlined in your brief, and demonstrate a short-term pathway to a balanced budget, ideally within the next two years. Not addressing our growing debt and weakening position on the world stage will ultimately hurt the best interests of Canadians.

Thank you, Mr. Chair.

[The Chair, Liberal, Wayne Easter]

Thank you, Mr. Ellis.

We will now turn to the United Way Centraide Canada, Ms. Khanna.

[Anita Khanna, National Director, Public Policy and Government Relations, United Way Centraide Canada]

Thank you for the opportunity to comment on Bill C-97 tonight.

My name is Anita Khanna and I'm the national director of public policy and government relations for United Way Centraide Canada. We are a federated network of member offices serving more than 5,000 communities across Canada. In 2019, our movement is marking our 100th year. Across Canada, United Ways and Centraides engage Canadians through a network of individual donors, service agencies and labour and business partners to make poverty and exclusion unignorable.

Today, United Way is an essential part of Canada's social fabric. We inject half a billion dollars into important social programs annually, making strategic investments that are based on local evidence to support the most vulnerable.

My remarks today will focus on divisions 19 and 20 in clause 313 of Bill C-97, the national housing strategy act and the poverty reduction act. Each proposed act is an important social policy milestone for Canada. They represent history in the making and we must get them right, for this generation and for future ones.

Strong evidence shows that federal leadership on housing and poverty is essential to building strong communities. This is why we actively drew on our national network of local experts to ground our policy recommendations for the poverty and the national housing strategies. We are very pleased to see that both acts include many of United Way Centraide Canada's recommendations.

United Way Centraide local members are leaders in evidence-based community investment for lasting social change and impact. As such, we have proposed changes to strengthen the housing and the poverty strategies over the last years. Most recently, we sent a letter to the Hon. Bill Morneau calling for amendments to clarify and strengthen the human rights elements of division 19, the housing legislation.

These included clear recognition of housing as a human right, consistent with international law; outlining a clear monitoring role for the housing council; ensuring the independence of the advocate outside of the national housing strategy; and including through reporting as well as mandating the housing advocate to receive and investigate petitions identifying systemic housing rights issues.

We believe these and other amendments outlined in the letter I distributed, which was sent to the Hon. Bill Morneau, will strengthen the human rights accountability of the national housing strategy act. These are necessary to align with Canada's human rights commitments and also to begin to truly establish Canada as a world leader in legislating the progressive realization of the right to housing.

Within the proposed poverty reduction act, in division 20, we welcome the elements specified: Targets, timelines, robust measurement and the advisory council. In the spirit of continuous improvement, United Way Centraide Canada recommends the following amendments:

Strengthening the overarching target of the poverty reduction strategy outlined in 6(b) so that the stated goal of the legislation is to achieve the end of poverty in Canada. The current 50% reduction aligns with the minimum standard of the UN's sustainable development goals. Given Canada has met its 20% reduction target ahead of schedule, we urge the government to adopt a more ambitious approach to poverty reduction.

Further, in section 11, the poverty reduction act currently calls for the dissolution of the national advisory council on poverty once the, "Minister is of the opinion that the level of poverty in Canada has been reduced by 50% below the level of poverty in 2015." Given the ultimate goal we have outlined for the elimination of poverty, we call for the removal of this clause so that the council can continue its work until poverty is eliminated.

Our final recommendation also relates to the national advisory council on poverty. We are extremely pleased to see the council positioned as an independent body with a membership reflecting the diversity of Canadians, including those with lived experience of poverty and indigenous communities.

We believe that the council's resourcing will ultimately be what determines its independence. Looking back at the experience of the National Welfare Council, we note that that council was eliminated by the stroke of a budgetary pen. For this council to avoid that same fate, we must have an independent source of income sufficient to meet its mandate on an ongoing basis.

In a paper by Michael Mendelson for United Way Centraide Canada, we have identified that this could be done, for example, through the creation of a dedicated endowment fund. This would guarantee public accountability and efficient management of those funds. We further propose that the council be subject to the financial oversight of the Auditor General.

I want to thank you for the opportunity to contribute to this important process. United Way is ever committed to working with all parties and our business, labour and community partners to build stronger, more prosperous communities for all.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Ms. Khanna.

Thank you to you all.

The bells have started to ring, so we will have about 24 minutes or thereabouts. Do we have consent to continue?

[Some hon. members]

Agreed.

[The Chair, Liberal, Wayne Easter]

We will try to go with four-minute rounds, and maybe we can get five and a half questioners in.

Mr. Sorbara, you're first up, then Mr. Richards, and Mr. Dusseault.