Finance Committee on May 9th, 2019

[The Chair, Liberal, Wayne Easter]

We will call the meeting to order.

Pursuant to the order of reference of Tuesday, April 30, 2019, we are dealing with Bill C-97, which is the budget implementation act.

We have several witnesses here.

I hope you can hear us, Mr. Milligan. You're by video conference. Can you hear us?

[Professor Kevin Milligan, Professor of Economics, University of British Columbia, As an Individual]

Mr. Easter, I can hear you loudly and clearly across the country.

[The Chair, Liberal, Wayne Easter]

Great. We have everybody on deck.

We'll start with the Canadian Alliance of Student Associations. Adam Brown is the Chair.

Go ahead, Mr. Brown.

[Adam Brown, Chair, Canadian Alliance of Student Associations]

Good morning, Mr. Chair, esteemed committee members, fellow witnesses and members of the gallery.

I would like to start off by acknowledging the traditional and unceded territory of the Algonquin Anishinabeg people, where we have the privilege of gathering today.

My name is Adam Brown. I am the Chair of the Canadian Alliance of Student Associations, or CASA. I'm also the vice-president external of the University of Alberta Students' Union, and a fifth year student completing a business degree, majoring in business, economics and law.

CASA is a non-partisan, not-for-profit organization that represents over 360,000 students at colleges, universities and polytechnics across the country. Through a formal partnership with the Union étudiante du Québec we are entrusted a national student voice. We advocate for a post-secondary system that is accessible, affordable, innovative and of the highest quality.

Thank you for your invitation to appear before the committee to discuss our impressions of Bill C-97. I'm thankful to be here representing students at a time when there is a threat to student organizing especially here in Ontario. When students are unable to speak for themselves, it jeopardizes representation, accountability and democracy. Everyone suffers, especially post-secondary institutions. I'm hopeful that in the future, students will continue to have opportunities like this one.

Broadly speaking, we are very pleased to see budget 2019's investments in young Canadians, especially the government's commitments to student financial aid, indigenous students, graduate student research and work-integrated learning. I will spend the remainder of my time briefly overviewing our impression on the proposed changes within these areas.

Budget 2019 brings important changes to the Canada student loans program. We are especially excited to see the lowered interest rates and the new interest-free six-month grace period.

Furthermore, we are pleased to see the additional changes made to help modernize the Canada student loans program to better respond to the needs of vulnerable student loan borrowers. This includes the expanded grants for students with disabilities and the interest-free, payment-free, stackable leave for borrowers taking temporary leave due to parental or medical reasons, including severe mental health issues. This recognition and inclusion of students struggling with mental health challenges in the Canada student loans program is a welcome adjustment and will certainly support many students throughout their studies.

In 2016, the National College Health Assessment survey of Canadian post-secondary students reported that 46% of students felt, and I quote, “so depressed that it was difficult to function”.

The Mental Health Commission of Canada further reports that about a half of post-secondary students with mental health disabilities will experience the onset of their condition over the course of their post-secondary education. Our campuses are experiencing a mental health crisis and this recognition by the federal loans program is an important first step in addressing it. We are eager to see how this will continue to be applied across other areas of the program.

We were also very pleased to see tremendous investments in first nations, Métis and Inuit students through individualized education strategies, specialized skills and employment training, mental wellness initiatives, increased grants and bursaries, and investments in Arctic and northern education. We hope this will be a first step in adopting all of the Truth and Reconciliation Commission's calls to action, especially in providing adequate funding to end the backlog of first nations students seeking post-secondary education.

In 2018, the Assembly of First Nations identified 36,901 students who were eligible but unable to access government funding to attend a post-secondary institution. Increasing meaningful and sustained access to post-secondary education for first nations, Métis and Inuit communities is an important first step in the ongoing journey towards reconciliation.

Students are also pleased with the investments in graduate student research, including those to the Canada graduate scholarships program, which will create 500 more master's level scholarships and 167 more doctoral scholarship awards annually. These investments will give more students the chance to contribute to Canada's growth and prosperity through innovative research.

[The Chair, Liberal, Wayne Easter]

Could I get you to slow down a little, Adam. They're having a job trying to keep up in the booth.

[Adam Brown]

We hope this will open the door for further support for graduate students for grants to those who need them.

Finally, we were encouraged to see investments in paid, work-integrated learning opportunities. This includes the projected increase of 84,000 new job placements, as well as the expansion to offer opportunities for students in the arts, humanities and social sciences fields. In our recent paper, “Shared Perspectives: A Joint Publication on Preparing Students for the Workforce”, student organizations across the country shared their expertise on the benefits of work-integrated learning, including the added skills and long-term salary benefits for students who participate in these programs. We trust the implementation of this program will support marginalized students who encounter additional barriers in accessing these opportunities.

In an effort for further inclusion, these opportunities must also include streamlined access for international students. As stated in our pre-budget submission, Canada recommends that the federal government remove the requirement for international students to seek an additional work permit to pursue co-op and internship opportunities, and instead allow this work under the international student study permit.

I would like to thank you again for the opportunity to discuss Bill C-97, and students' impressions on budget 2019's investments in student financial aid, indigenous students, graduate students and work-integrated learning.

I look forward to your questions.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Adam.

We'll turn now to Mr. Bourque, CEO of the Canadian Real Estate Association.

Welcome.

[Michael Bourque, Chief Executive Officer, Canadian Real Estate Association]

Thank you, Mr. Chair.

Adam, you'll be happy to know that in our organization we hired five students this summer because we can use students, but also because I strongly believe that we have to give opportunities to students during the summer.

I am pleased to be here on behalf of 130,000 realtors who live and work in every community across Canada.

I would like to start by recognizing the government for acknowledging the social and economic importance of home in budget 2019. At the Canadian Real Estate Association, our role is to advocate on behalf of homeowners, homebuyers and home sellers. We support policy efforts to secure the entire housing spectrum, from emergency shelters to rental housing to ownership. All Canadians deserve safe and secure shelter.

Two years ago, the government launched the first-ever national housing strategy to help give Canadians a place to call home, and we strongly support the budget 2019 efforts to make this a permanent and ongoing effort. Long-term investments, such as the rental construction financing initiative, will help move people along the housing spectrum from social housing to rental apartments and into their own home.

Turning to ownership, it is clear that it has become more difficult for first-time homebuyers to accumulate enough capital for a down payment, as incomes have not kept pace with housing prices. Last fall, realtors met with many of you to highlight the concerns of millennials anxious to buy homes, but this anxiety applies to many first-time homebuyers, including millennials, small business people and new Canadians, so helping Canadians with a down payment through the first-time homebuyer incentive is positive.

The initial $1.25 billion in grants could, according to our estimates, help some 100,000 Canadians. The plan will encourage new home construction, which we consider critical given housing supply issues in many parts of the country. We look forward to getting more details about this shared equity program. Realtors are anxious to know more so they can encourage their clients to make use of the program to fulfill their home ownership dreams.

Another key program is the the homebuyers' plan, which allows a first-time homebuyer to access their RRSP for a down payment on their home. It has helped over 2.9 million Canadians purchase their first home. The homebuyers' plan is a program born of realtors' advocacy efforts in the 1990s, so we were pleased that budget 2019 included an adjustment to the plan by raising withdrawal limits to $35,000. One-quarter of all withdrawals were maxed out at the previous limit of $25,000. A higher limit will help people achieve home ownership with less debt.

We know that Canadians work hard to get into their first home, but significant life changes can compromise their ability to maintain the family home. The extension of the program to Canadians who experience a marital breakdown, allowing them to use their RRSPs to maintain home ownership, is great news. This compassionate measure has the potential of helping 25,000 Canadians every year during a difficult period in their lives.

Other initiatives in the budget that we consider promising include the housing supply challenge and the review of housing supply and affordability in British Columbia.

Finally, we are encouraged by a line from the budget document that reads, “The Government continues to closely monitor the effects of its mortgage finance policies—including the stress test for insured mortgages—and would adjust them if economic conditions warrant, to support access to housing while safeguarding financial stability.”

This vigilance is critical, as we know that the impact of the stress test, especially on housing markets that were already in balance or in distress, has been significant. B-20 rules have sidelined many potential homeowners. For example, a buyer in Moncton needs to save about $28,000 more for a down payment on a single family home after the implementation of the stress test. ln Edmonton, with a benchmark price of $380,000 for a single family home, a first-time buyer would need to save an additional $60,000 toward their down payment.

We understand Canadian regulators are laser-focused on measures to lower household debt and limit the risks to our financial system. At the same time, we believe and support financially responsible home ownership. We don't think those two goals are incompatible.

No single measure will address housing affordability. While budget 2019 has many positive initiatives, we will continue to advocate for additional policy innovation that is coordinated across all levels of government and executed in partnership with stakeholders in the housing sector.

As you return to your ridings in a few weeks, I think you will find your constituents expect nothing less from us all.

Thank you for your time. I'd be happy to answer questions.

[The Chair, Liberal, Wayne Easter]

Thanks very much, Michael.

Turning now to Macdonald-Laurier Institute, we have Mr. Cross, who has been here quite a few times.

Welcome again, Mr. Cross.

[Philip Cross, Senior Fellow, Macdonald-Laurier Institute]

Thanks for having me back.

I promise I'll limit my reference to data to the first two paragraphs, so don't be scared that I'm going to drone on with data from my StatsCan days forever.

Canada's real GDP fell by 0.1% in February, continuing a weak trend of only 0.1% growth over the last six months. Mediocre growth of less than 2% has persisted from 2015 to 2019, with the exception of a 3% gain in 2017.

Canada's slow economic growth is all the more striking in view of accelerating growth in the U.S., our main trading partner. Over the past four quarters, real GDP in the U.S. has risen by 3.3%, building on gains of 2.9% in 2018, 2.2% in 2017 and 1.6% in 2016.

The United States is the only G7 economy that has strengthened consistently over the last four years. What explains the unique buoyancy of the U.S. economy? One variable stands out as different in the U.S.: the steady acceleration of business investment. As documented in the Bank of Canada's recent monetary policy report, business investment growth in the U.S. has strengthened steadily from essentially nothing at the end of the Obama administration to nearly 7% over the past year.

Why is business investment robust solely in the U.S.? The upturn reflects the raft of pro-business initiatives from the administration, including historic cuts to corporate income taxes, accelerated writeoffs of capital spending, massive deregulation, and the most pro-business rhetoric seen from any administration in recent memory.

By contrast, business investment in Canada today is 13% below its peak in 2014, and the Bank of Canada anticipates another small decline in 2019. Of course, some of the weakness in business investment reflects the 2015 downturn in oil prices. However, investment since then has declined in a majority of industries despite the absence of a recession. As such, much of the retreat is due to factors within Canada's control. For example, pipeline firms want to invest more, but have been continually thwarted by government opposition and regulatory blockades. This fosters the growing impression in the global business community that Canada is not serious about committing to economic growth, focusing instead on the distribution and not the creation of income.

Some may claim that sustained employment growth reflects a buoyant economy. The regional breakdown of jobs growth suggests that new provincial government policies and attitudes to business have sparked these gains more than the macroeconomy. The upturn of employment, even as GDP has sagged, has been concentrated in Ontario and Quebec. As detailed in a recent commentary I wrote for MLI, firms in Ontario delayed hiring in the first half of 2018 until they were certain that the Wynne government would not be re-elected. That government had adopted several policies that made labour more expensive for firms. However, once a new government was elected in June, firms became more confident that their labour costs would not be subject to further unexpected increases and they resumed hiring. Hiring the former head of the Ontario Chamber of Commerce as chief of staff for the Treasury Board minister sends a resounding message to the business community.

A similar pattern played out in Quebec around the election of the CAQ government under François Legault. In the year before its election, jobs in Quebec fell outright by 0.6%. However, the election of the CAQ with a platform of tax cuts, no referendum on sovereignty and a firmly pro-business cabinet was followed by a surge in jobs, despite widespread reports in Quebec of labour shortages.

With employment surpassing output growth at the turn of the year, the effect is a further dampening of labour productivity. Stagnant labour productivity has become chronic in Canada with no net change since the oil price crash late in 2014. Lagging productivity is symptomatic of our declining competitiveness regularly cited by Canada's business leaders. Weak productivity reflects the failure over the last two years to engineer a transition to growth driven by business investment and exports.

In a little-noted speech in February, Bank of Canada Governor Stephen Poloz addressed the power and limitations of policy. He acknowledged the risks of maintaining low interest rates far longer than ever envisioned in 2008, including the stress for retirees who rely on interest income and the risk of rising household debt levels. Most importantly, Poloz acknowledged that economists do not have a complete understanding of how the economy works and how it will react in the future to policies adopted in today's uncertain global environment. It is time for more federal leaders to similarly recognize the limits of the government's ability to manipulate outcomes in our economy. Fostering a better environment where businesses can invest and grow may be one of the best initiatives it can make.

The trend of jobs in Ontario and Quebec underscores the importance already demonstrated in the U.S. of adopting pro-business policies and attitudes. Seeing new governments in Ontario and Alberta competing for the mantle of “open for business” shows that Canada is beginning to understand the necessity of responding to the pro-business administration in Washington. Former President Obama said, “The world needs more Canada.” If he'd understood Canada more, he would have added, “Canada needs more business.”

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you, Philip.

I'll turn now to Mr. Milligan, a Professor of Economics at the University of British Columbia, speaking as an individual. Then we'll come back to Ms. Therrien.

[Prof. Kevin Milligan]

Are we good to go?

[The Chair, Liberal, Wayne Easter]

We're good to go.

[Prof. Kevin Milligan]

Great.

Thank you for your invitation.

My name is Kevin Milligan, and I am a Professor of Economics at the University of British Columbia, here in Vancouver.

I will direct my remarks to the changes to the guaranteed income supplement that are proposed in Bill C-97.

The GIS was introduced in 1967, and has grown into a vital part of Canada's retirement income security system for seniors. The GIS is focused on low-income seniors, with over two million seniors now receiving the benefit. That's about one third of all seniors in Canada. The GIS is vital to poverty alleviation among seniors. Some people arrive at retirement with too little income. Maybe they had unemployment or a health problem that made it difficult to save when they were younger. Others start retirement on a firm footing but end up outliving their savings and risk falling into poverty at older ages. In both these cases, the GIS tops up the income of these low-income seniors and allows them to have a dignified retirement.

A challenge with the GIS arises from how it is phased out with income. As someone earns more income, the GIS is reduced at rates of 50¢ to 75¢ on the dollar. If you earn one more dollar, you lose 50¢ or 75¢ off your GIS. For low-income seniors who want to work past age 65, these phase-out rates impose a very high effective tax rate on earned income.

Now, many seniors are actually pretty happy to retire from the workplace. They just put their feet up and enjoy their family. Others are unable to work because of health or family needs. For those Canadians, the GIS is there for them to top up their incomes. However, there are some older Canadians who want to continue working. Perhaps they're a new Canadian who arrived in Canada midway through their life and they need to fortify their retirement savings in order to build a nest egg. Perhaps they're someone who wants to continue to ply a trade part time into their retirement years. For those Canadians who want to work, the phase-out rates in the existing GIS can present a barrier to work.

In budget 2008, finance minister Jim Flaherty established an exemption of $3,500 for earned income in the GIS. For the first $3,500 you earned, you didn't lose anything off your GIS cheque. This exemption currently allows seniors to earn up to $3,500 a year without losing their GIS.

In budget 2019 and here in Bill C-97, Minister of Finance Bill Morneau has proposed to extend and enhance this GIS exemption in three important ways. The basic exemption is proposed to be extended up to $5,000. There will then be a partial exemption on the next $10,000 of earnings. As well, self-employment will now qualify for the exemption. Combined, this means that a senior who might be working at a part-time job or another kind of job and earning, say, $20,000 a year will now be further ahead by almost $3,000 per year.

In my assessment, this measure is well designed and should be supported for two main reasons. First, the GIS is left in place for those who need it most, that is, seniors at highest risk for poverty, and this proposal leaves in place every dollar now going to needy seniors. Second, for those able to work, this measure allows them to keep more of their earnings and build a more secure income base for their own future retirement.

Thank you for this opportunity to testify. I look forward to your questions.

[The Chair, Liberal, Wayne Easter]

Thank you, Kevin.

Turning to Universities Canada, we have Ms. Therrien.

[Wendy Therrien, Director, External Relations and Research, Universities Canada]

Thank you very much, Mr. Chair.

Thank you for the opportunity to speak to you today on behalf of Canada's 96 universities about the implementation of budget 2019.

Our president, Paul Davidson, last appeared before this committee in September to talk about our pre-budget submission. He spoke about how, in a world of disruption and constant change, our most valuable resource is our people, and equipping them with the skills and talents they need to make Canada a prosperous country is one of our most important priorities.

Canadian universities are very pleased with the set of measures contained in Budget 2019 to prepare Canadians for the jobs of the future, as well as the recognition of the central role universities play in training Canadians and stimulating the economy.

Canadian universities will continue to benefit from previous investments in research and learning infrastructure, as well as from measures to support collaboration between universities and business so as to stimulate innovation and economic growth. These measures also support science and university research.

In this context, the emphasis placed in this year's budget on skills and talent will help Canadians to remain productive and adapt to our era, which is marked by profound technological, economic and social changes.

Budget 2019's investments look to leverage the strengths of all players, including post-secondary institutions, governments, business and civil society to ensure that all Canadians get the skills and experiences they need to start their careers, to advance them and to transform them at any point.

Universities Canada started more than a year ago to push for all students, every student, independent of area of study to have access to a work-integrated learning experience during their post-secondary education experience. This ask was endorsed by the business and higher education round table as well as multiple stakeholders. We were very pleased to see budget 2019 commit to 84,000 new work-integrated learning placements and to pick up that call for those placements to be accessible for all students across areas of studies with a particular emphasis on making sure access is there for people from diverse backgrounds. Work-integrated learning is essential to make sure that not only students have those work connections but the skills they will need to seek employment post-graduation.

We were also pleased to see the new Canada training benefit, which will allow Canadians to plan for the training they will need as their careers progress.

We also saw the investments made in the international education strategy, which are critically important. Canada receives international students from a wide variety of countries, and those students contribute no less than $20 billion to Canada's economy.

In addition to that, there were investments in an outbound student mobility pilot program. In an age of globalization, the value of international study and work opportunities cannot be understated, particularly for students from under-represented groups. Students who have studied abroad learn more. They are more resilient in a global economy and have the skills and connections that employers are looking for.

Let me give you one example. Recently, Power Corporation of Canada gave $1.5 million to the University of Ottawa to fund co-op and research opportunities abroad. That's just one example.

Budget 2019 also responded to the fundamental science review's call for better support for the next generation of researchers and innovators by creating additional scholarships for master's and doctoral students through the Canada graduate scholarships program. In a knowledge-based economy that is facing digital disruption and strong international competition, increasing the number of highly skilled, talented Canadians will be key to Canada's economic success.

We were also pleased to see the supports for indigenous learners, including funding for the post-secondary student support program.

We welcome the funding to expand post-secondary options in the Arctic and in northern Canada.

Finally, changes to student financial aid, including extension of the interest-free grace period, lower interest rates for the Canada student loans program and improved supports for students with disabilities, were also measures that were well received by our sector. A tool box of measures that supports student access, particularly targeted at those most in need, is helpful in ensuring an accessible, affordable system of higher education that meets the demands of an increasingly complex economic environment.

In conclusion, budget 2019 provides meaningful measures to support universities, businesses and governments to collaborate concretely to prepare Canadians for success in changing times. It will expand collective efforts, such as those by Ontario Tech, Trent University, the Oshawa Chamber of Commerce and Durham College, to retrain and upskill workers displaced by the GM plant closure.

Universities Canada looks forward to the implementation of budget 2019, and continuing to work with the federal government and all of our partners to prepare Canadians and Canada for the future.

Thank you very much.

I look forward to your questions.

[The Chair, Liberal, Wayne Easter]

Thank you, Wendy.

Rounding out our panel is Mr. Mohammed.

Welcome. The floor is yours.

[Seidu Mohammed, Refugee Claimant, As an Individual]

Thank you.

Good morning, everyone. My name is Seidu Mohammed and I have come here from Winnipeg, Manitoba, to speak to you today.

I would like to acknowledge that the land on which we are gathered here today in Ottawa is the traditional unceded territory of the Algonquin Anishinaabe people.

I know that as a newcomer to Canada, what I am about to say today may not make everyone on this committee happy, but I feel that the heavy burden on my soul will be lifted a little if I could respectfully share my views before this honourable committee.

I would like to begin by quoting the words of a great Canadian, His Excellency the Right Honourable Vincent Massey. He spoke these words at the Canadian citizenship ceremony that was held in Winnipeg on May 20, 1955. At that time he was the first Canadian-born Governor General of Canada.

In his address to the new Canadians, His Excellency said:

What are we doing with the spirit of debate and free speech? May I tell you of an incident that happened not long ago in a Canadian city? A new-comer to this country, an educated man, who had learned the value of freedom the hard way, came here to find it. He complained, not bitterly, but sadly, that when he ventured to speak critically of any institution or practice in Canada that he could not approve, he was rebuked; “You don't need to criticize,” he was told, “you are lucky to be here at all!”

This cannot really be our view of honest criticism. We offer new-comers something more than a refuge. When we welcome new citizens, we are accepting free men and women and we invite, and urge, them to join us in using the privileges and responsibilities of free speech.

Members of the committee, and ladies and gentlemen, before coming here today I had a meeting with Mr. Bashir Khan, a well-known Winnipeg immigration and refugee lawyer. I asked him to explain to me what Bill C-97 would mean for a refugee claimant. I was shocked, saddened and very much disturbed at what he told me. I was so outraged that I could not sleep that whole night.

There are unjust laws as there are unjust men. What Bill C-97 proposes today is unjust. It is trying to amend the current Immigration and Refugee Protection Act.

The change that really bothers me is that, if this bill becomes law, if I had to come to Canada, it makes a person like me ineligible to make a refugee claim. This would have prevented me from having my claim heard by an independent decision-maker at a hearing before the Immigration and Refugee Board of Canada.

This proposed law means that many refugee claimants like I once was, who may need Canada's protection because they face persecution or a risk of torture or death in their countries of citizenship, will be denied access to Canada's refugee determination system.

However, under the new proposed law, a person like me would have access to only a pre-removal risk assessment application, which is a process that provides much less fairness than a hearing at the Immigration and Refugee Board of Canada.

Mr. Khan also told me that Legal Aid Manitoba would pay only a maximum of $530 for a pre-removal risk assessment application to a lawyer, which takes between 10 and 15 hours to complete properly. This would create a serious funding problem as it would reduce the number of lawyers who would be willing and available to take on pre-removal risk assessment applications. This would end up hurting those who are most vulnerable and in need of Canada's protection.

What I would like you to please remember about me long after I have gone back home to Winnipeg is that the people of Canada saved my life from death by lynching by homophobic mobs in Ghana, and protected me from imprisonment by the Ghanaian police because of my sexual orientation. The Canadian people did this by giving me the right and privilege to have my refugee claim heard by the independent and impartial Immigration and Refugee Board of Canada.

Before coming to Canada I went to the United States, thinking it was a country that protected and kept refugees safe. I was wrong. I was jailed in detention for nine months, with murderers, drug dealers and people who committed felonies. In detention, I was not provided a lawyer for my bond hearing, nor for my asylum hearing at the United States immigration court.

After I was released from detention, I was required to report every two weeks to an immigration and customs enforcement officer, who harassed me for documents and constantly threatened me with deportation. I felt very afraid because at that time the U.S. was deporting people.

Like many other refugees, I fled from the U.S., where I was not safe, to Canada where I would be safe. On December 24, 2016 I walked for 10 hours in the cold, across the border near Emerson, Manitoba. On that fateful night I suffered severe frostbite, which resulted in losing all of my fingers.

In closing, I ask you this question for self-reflection: Would the Canadian Parliament really want to pass a law that would deny me access to the Canadian justice system, and certainly others like me who are coming to Canada for protection? Would you want to see me deported back to Ghana?

Thank you for giving me this opportunity to speak.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Mohammed.

We have ample time today, so we'll go with seven-minute rounds first and then shift to five.

Ms. Rudd.

[Kim Rudd, Liberal, Northumberland—Peterborough South, ON]

Thank you.

Thank you, Mr. Mohammed, for your testimony. It is very moving and very relevant, and I appreciate the fact that you've come from Manitoba to speak to us personally, so thank you very much.

I do have a number of questions, and seven minutes are a lot better than four yesterday.

I think I would like to start with work-integrated learning, because both Wendy and Adam talked about it and its importance. I was part of the committee that went on the western tour of pre-budget consultations, and we heard it from a wide variety of groups, from businesses, from educators and from indigenous peoples and organizations who were looking to find creative solutions, if you will, to the challenges. When you mentioned the Arctic and other places—and I know my colleague Mr. McLeod will want to talk about this as well—the portability, the fact that it's paid, became very important. As a small business owner my whole life bringing students in, paid interns, I think it's a learning experience for both the business as well as for the student. We certainly have unique perspectives we bring each other.

I want to talk about the 84,000 spaces that will be created. Maybe I'll ask two questions, and then maybe you can both respond to them. That might be a bit more efficient. I know you talked about those opportunities being across the spectrum of disciplines. Where do you see there has been a lack of availability for students in certain areas, and what will this mean to them?

The second thing—and I think it was you, Adam, who talked about it the most—is around the interest-free six months, the reduction of interest, and what difference that will make. I'm from the province of Ontario, and I see one step forward and a couple of steps back by the province, and we're very concerned. I have people coming in talking to me all the time about what it's going to mean in Ontario particularly, and I don't know about other provinces. You may be able to speak to that. It's about how that is going to impact students and make it more difficult for them to start their work life after they've completed university.

I'll leave those two questions to whoever wants to start.

[The Chair, Liberal, Wayne Easter]

Anybody who wants to come in at any time, including you, Mr. Milligan, just raise your hand, and we'll catch you.

Ms. Therrien.

[Wendy Therrien]

Indeed, there had been a lot of emphasis previously on the importance of work-integrated learning, but it was targeted mostly at STEM disciplines: science, technology, engineering and mathematics. That is very, very important, because we had a lack of Canadians who were going into those disciplines.

What we see, and you see it in the recent RBC report, is the importance of students having both the arts skills and the science skills. Both of those skill sets are complementary to one another, and they're needed in businesses across the spectrum, whether it's banking or marketing or whether it's in engineering. It's understanding the importance of students from all disciplines not being siloed, such as arts students going to work in a museum some day. No, they might not. They'll probably go and work in a business, and that business needs that arts student, and that art student needs that experience working in that business, understanding that interdisciplinarity is key to solving some of these complex problems that we're facing today, like climate change and others.

I'd be happy to share with you the RBC report. It really shines a light on why that's so important to businesses today.

Why don't I let you answer first the question around the benefit of the six-month delay?

[Adam Brown]

Absolutely. CASA has been advocating for this for quite a while now. A number of other provinces have this measure with provincial loans, but creating that six-month interest-free grace period really does allow students to transition into the workforce. It often takes an average of four to six months, I believe, to find stable employment after graduation.

This does allow students to transition into that workforce while not having to worry about the interest on their loans beginning to accumulate. That's a fantastic measure, as is the decrease in interest. You mentioned that Ontario is experiencing a number of changes in its loan program, and I know that other provinces as well may not have the best loan program. I'm from Alberta and we understand that, but it's important that the interest on those loans does decrease. It will help students as they transition into the workforce as well.

That said, when we talk about loans, we shouldn't discount the impact of grants as well and what they can provide, especially for low- and middle-income students, in terms of that upfront funding for them to access a post-secondary institution as well.

[Kim Rudd, Liberal, Northumberland—Peterborough South, ON]

Thank you very much.

I have a question for you, Mr. Milligan, on your comments around the guaranteed income supplement.

Again, we heard loud and clear that it's something that is so important, particularly the increase in the guaranteed income supplement for single seniors. I live in a rural riding, and I was explaining to a panel yesterday that often these seniors are women and often they've worked in the home. Their asset is their farmhouse or the home they're living in. That difference of almost $1,000 a year is significant.

The second part, as you mentioned, is with regard to the increase in threshold exemption for GIS. I was interested, because I think one of the things we heard loud and clear is that people may leave a job in retirement and then realize that retirement isn't exactly what they thought it was going to be. They want to work, but where is their incentive to do it and what will that mean to their family income? On the self-employment piece, I wonder if you could talk a bit about that, because a number of the folks who I know who have done that have gone into fields that they weren't employed in before. They're in part-time jobs, often those kinds of—I hate to use the expression—casual jobs that people need help with. Someone who comes and fixes things for you is an example.

Can you talk about the importance of the self-employment piece being added?

[Prof. Kevin Milligan]

Yes. I think the self-employment piece is very important. I agree with the member on that.

As she mentioned, a lot of people, when they hit retirement, do so in a way that is different from a traditional path where you have a work life and then a clean break and retirement. People have found new ways to do this. It might be a different career. It might be a part-time engagement of some kind.

Work is one way for people to remain engaged with their communities. It gives a bit more focus to your day. Also, when it's paid employment, whether it's self-employment or regular employment, it's a way to buttress and fortify your retirement nest egg at the same time as being engaged with your community and having some focus in your day. That's something that is helpful not just for that one person's retirement security, but also for the public finances in general, because the more that people can save on their own, the less in the future they will end up relying on the public finances.