Finance Committee on May 15th, 2019

[Dale Marshall]

Please let me finish. This is a very important question.

[The Chair, Liberal, Wayne Easter]

Go ahead.

[Dale Marshall]

We think that we need to curtail more production. It's big enough. It needs to be phased out and the science is clear on this. The Intergovernmental Panel on Climate Change says we need to be phasing out oil by mid-century.

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

We need to—

[Dale Marshall]

It's not tomorrow. It's 30 years of a phase-out.

[The Chair, Liberal, Wayne Easter]

Okay. You've completed your answer, Mr. Marshall.

Mr. Poilievre.

[Pierre Poilievre, Conservative, Carleton, ON]

My questions relate to the budget's measures on journalism. The government claims that it can protect independent media by making media dependent with a half-a-billion dollar package.

Mr. Furey, you mentioned the existence of this so-called independent panel that will determine the criteria of eligibility for the various measures in the budget. There are actually two bodies that are going to decide who gets what. There is this “independent” panel, selected by the government, but then there's also a body—the term “body” is used in the legislation—that will not decide the criteria, but actually pick the individual news agencies that qualify under the criteria.

No officials were able to tell us who will be part of this body, whether it's an existing agency of the Government of Canada or whether it's a new one, whether it will be public servants or Governor in Council appointments. We have no idea who this body is, even though the tax credit and the tax benefits that it will dole out are already in effect as of the beginning of this year. Does it worry you at all as an independent journalist that a so-called body within the government will decide which news outlets qualify for taxpayer funds?

[Anthony Furey]

Certainly it worries me and I have no more insight into exactly how this will unfold and the details of it than anyone else, particularly obviously those officials who you referenced. I think a lot of people in the media industry would like to know the details of how this is going to unfold and would probably prefer to be consulted in advance of all this being devised.

As I said in my opening statement, if this is simply a tax credit to be administered, which I believe is typically how anybody, any sort of tax attorney, any sort of accountant would think of a tax credit then fine, but this seems to be a different sort of animal, a sort of quasi-granting operation, as opposed to strictly just a tax credit. Hence my recommendation that we need to do everything we can to turn it more towards administering this as sort of a basic set criteria, either you fulfill it or you do not and leave it at that. Whoever is sort of employed are simply the individuals in government administering that program, as opposed to being some sort of board or panel, etc.

[Pierre Poilievre, Conservative, Carleton, ON]

Thank you.

The blacklocks.ca, which does a lot of access to information requests, reported this today:

Federal agencies will publish an A-list of newspapers and websites deemed reliable under a multi-million dollar subsidy program, the Department of Finance yesterday told the Senate national finance committee. Subsidies to federally-approved news media invite government meddling in a free press, cautioned one senator.

Reading that, I feel like I have just cracked open a dusty old copy of 1984.

Federal agencies will publish an A-list of newspapers and websites deemed reliable under a multi-million dollar subsidy program.... Subsidies to federally-approved news media....

“Federally approved news media”, the adjectives that load the noun should send shivers down all of our spines. Do you expect you'll be on this A-list?

[Anthony Furey]

I don't know if individuals would be on it, and I can't speak for my organization, but I think a lot of people don't like the idea that there's a list, as I referenced. The “qualified Canadian journalism organization” or....I'm not sure specifically which list that story's referring to, but for those who get the not-for-profit status and the status where they will get a tax charitable status, there will be some sort of list that says which are approved to receive that charitable status. If you're talking about listing registered charities, okay, that's already a thing that's done online, and if it's somehow compatible with that, then fine; but any sort of separate list that is on a government website saying these are the qualified Canadian journalism organizations—that's a problem.

As I said in my remarks, to get any tax credit that's out there for your family, for your business and so forth, you don't go onto a government list. You or your accountant just files for it, and you either qualify or you do not. I think the idea of abolishing any sort of public list is the right direction to head. Year over year for the recipients of these tax credits, like any other tax credit that exists, or at least the bulk of them, that is what happens.

[The Chair, Liberal, Wayne Easter]

Mr. Dusseault.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Thank you, Mr. Chair.

Thank you to all the witnesses who came to see us today to give their opinions.

I will not have time, of course, to put questions to everyone, but I have taken good note of the recommendations. The amendments proposed to improve the bill are of particular interest to the committee.

Ms. St-Onge and Mr. Tremblay, my colleague just mentioned the fact that witnesses from the department unfortunately did not have many answers to give us as to what to do next.

Earlier, I was wondering about the advisability of giving the government a blank cheque. Essentially, the government would be given full latitude to determine what happens next; that leeway would be given to the independent committee, the entity, to use the term used in the bill. It would be up to that entity to make the ultimate decision. Of course, we are faced with a dilemma, which has been explained by Mr. Furey: ultimately, someone has to make a decision.

In the case of tax credits, among other things, it is generally the Minister of National Revenue who ultimately assumes responsibility for them. For this reason, we decided to opt for some kind of entity; we would transfer this responsibility to someone else who would be, supposedly, independent.

Do you think there should be not only a certain transparency, but also an appeal mechanism, the possibility of recourse in the event of a refusal by the government, with regard to the decision made about the eligibility of a journalistic organization?

[Pascale St-Onge]

From the outset, I would like to point out that the federation has never suggested that an independent entity, such as an independent committee, be used. From the beginning, we have said that the most important thing is to save the media first. It is good to criticize them, to determine if they are independent and to have a whole social debate around this issue. It is important, and even healthy, to do so, but if we no longer have media to debate, it is a problem.

Furthermore, I rather agree that we need a list of objective criteria. A basis for criteria has already been introduced in the law. For example, 75% Canadian ownership, and a certain number of journalists must be employed by the company. Objective criteria are therefore already provided for in the law. I can understand the government's intention to stay as far away as possible from these tax credits and the administration of the program in order to preserve the appearance of independence. The government therefore chose the path of an independent committee. What is important, in my opinion, is what will result from this committee.

In fact, it will be necessary to see if the criteria are objective, as if they had been directly formulated by the Canada Revenue Agency, for example. Mr. Furey mentioned this with respect to film. Before judging the work, it will be important to see what has resulted from this. For our part, we have never favoured this approach. We would have been quite comfortable with the idea of the Canada Revenue Agency listing the criteria itself, as long as they were objective and remained an administrative measure. In our opinion, this is the best way to protect the media from subjective government influence.

With regard to the independence of newspapers and journalists, however, I must express some reservations. The media is always somewhat dependent, whether it is on advertisers or the government. The media need money to be able to do their job, and that money comes from somewhere. We have discussed this many times with our members, and we have fought for years for codes of ethics. In Quebec, there are three that apply in almost all companies: that of the Conseil de presse du Québec, of the Fédération professionnelle des journalistes du Québec, or FPJQ, and the one contained in collective agreements concerning professional clauses. Journalistic work and what protects independence may be misunderstood, but this program will not cause journalists to lose their independence of mind in their work.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Your calculations clearly come in below those of the government. There is a fairly significant discrepancy in the figures, and that tends to justify the fact that you are asking for an increase in the allowable salary limit for tax credits. Do you think more media will decide to become non-profit organizations? This transformation was expected to take place, but how do you expect it to change the landscape of this industry?

I'm also going to ask you my second question, since my time is limited and this will probably be my last opportunity to ask it.

What is your view on the issue of written content for radio and television broadcasters, who produce a lot of it on their websites? I am talking about digital written content and not what is published on good old paper, for example in newspapers. Do you have an opinion on the eligibility for these credits? The bill does not provide that radio and television broadcasters will be able to access these credits. Yet they produce a lot of written content. I would like to know your opinion on these two topics.

[Pascale St-Onge]

In terms of transforming businesses into non-profit organizations, I would first say that philanthropy has its limits. A number of donors focus, most of the time, on the health, education and other sectors. Donations to the culture sector make up only a marginal portion, especially in regional and local markets. I don't think companies are going to rush into a business model like that one. Some major markets may be able to secure a share of donations for philanthropic causes. This is the bet that La Presse and Le Devoir have made from the beginning. As for the Quotidien, in Chicoutimi, or l'Acadie nouvelle, in New Brunswick, they occupy markets that probably have fewer major donors. That is not what will allow the business model to survive, in my opinion. Therefore, I would be surprised if there were a major transformation within the five-year period provided for in the program.

As far as the second subject is concerned, the aim is to help the media that are currently in danger. This is mainly the written press. There are problems with television and radio, but they will have to be addressed in a different way. Television already benefits from the Canada Media Fund for television production. The written press does not benefit from it. We support the program as currently proposed.

[The Chair, Liberal, Wayne Easter]

Thank you, all.

We're substantially over time.

Mr. Sorbara.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Thank you, Chair.

Thank you to everyone who's presented today.

I'd like to start off with the NTCCC and then the CCA.

We need to applaud that endeavour to bring prompt payment legislation into the BIA and get it to where we are now. I can still remember having a conversation with the Honourable Judy Sgro and the Honourable Judy Foote, who is no longer with us here in Ottawa but in Newfoundland, and explaining why it's so important that we ensure that some contractors receive timely payment for their services. It's great to see it in the legislation and I applaud all those involved and I thank you for allowing me the chance to participate in a number of meetings over the last three years with the NTCCC and the CCA and the CISC as well, the Steel Institute folks.

You folks have pointed out some things that could potentially be improved in the bill. Don't restate the whole brief, but I wonder if you could quickly review what we could do to strengthen the bill and get it to where the Ontario prompt payment legislation is, which was brought in by the Wynne government, and which should be applauded.

[Sandra Skivsky]

I'm going to let Geza respond to that. We did have conversations about this.

[Geza Banfai, Legal Counsel, National Trade Contractors Coalition of Canada]

Ms. Van Buren has identified three areas that could stand improvement, and we accept all of those. We've identified those as well. I have three more.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Be quick, in 30 seconds.

[Geza Banfai]

I have 18 more, but let's limit it to three. They're in no particular order, but one of them is more significant than the others.

First, as currently drafted, the legislation, in a situation where there is a partial payment—in other words, a notice of dispute is given only for part of an invoice—does not positively prescribe a mandatory obligation to pay the undisputed portion. It's implied, but it's subject to interpretation, and we would suggest that this positive obligation to pay the undisputed portion should be a no-brainer.

Second, there's no obligation for a payer who has not received money from upstream—such as a general contractor or a major trade contractor—to go to adjudication of that payment issue to maintain the pay when paid protection is sitting in the act. To put that in English, if a general contractor, for example, doesn't receive money from upstream for some reason, all the general contractor needs to do downstream is deliver a notice of non-payment to his subcontractor.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

So, in the case of a bankruptcy—

[Geza Banfai]

Bankruptcy's a different situation. We can talk about that too. But I'm talking about.... We need that.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

I have one more question to ask, so I want you to finish up really quickly.

[Geza Banfai]

Third—and this, I think, is a pure oversight—there's no right for Her Majesty herself or a service provider to commence an adjudication. It's only a right afforded to a contractor.