Evidence of meeting #3 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was infrastructure.
A video is available from Parliament.
4:20 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
The representation I was listening to was not very clear on that point, and I wanted to be sure I understood.
4:20 p.m.
Chapter President, Ottawa Chapter, Canadian Association of Retired Persons
I'm sorry.
4:20 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
I also want to clarify your organization's position regarding tax-free savings accounts. The current government came in and reduced it from what we had moved it to, which was $10,000.
What is CARP's position on that?
4:20 p.m.
Chapter President, Ottawa Chapter, Canadian Association of Retired Persons
We preferred the higher amount, quite frankly. Any amount in a tax-free savings account is a good idea. We would like to see it higher, as it was.
4:20 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
Have you any idea of how many seniors took advantage of saving that way?
4:20 p.m.
Chapter President, Ottawa Chapter, Canadian Association of Retired Persons
I don't have that answer right now, sorry.
4:20 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
I just thought you might have that number.
Now I'll move over to Mr. Kelly.
Mr. Kelly, small business, as we all know, generates the bulk of employment. This past week, I was in my community at a Polish delicatessen. The owner of the business came out from behind; I hadn't met him before. I was doing some shopping. He pulled me aside and said to me that he has four jobs available, basically making sausage in the back of the facility. He had a Polish butcher who had to go back because his work visa was done. He has since had five individuals, youth. He mentioned they were generally in their early twenties. Of those five, none of them lasted more than two days on the job. This is not a made-up story. This is the story he told me, and he wanted me, as his MP, to come to Ottawa and advocate in the largest way possible to get that Polish butcher back into Canada to work in the back shop.
There is some disconnect here, as I've mentioned. In small business, which is my background, the kind of popularized thinking is that you're making all kinds of money, that you're a rich guy and you can afford to pay more taxes and more indirect taxes, but I think your members would agree that the margins are often so small between staying in business and going out of business that one small addition can make the difference. Am I correct in saying that?
4:20 p.m.
President and Chief Executive Officer, Canadian Federation of Independent Business
You are. I have to tell you that I'm really worried about what I'm seeing right now and the economic signs that we're looking at. I know that you, as parliamentarians across all parties, are as well.
I am quite concerned. Even small actions with good intentions could be that straw that breaks the camel's back. Right now I have a bunch of members in Ontario who are apoplectic about the ORPP, the Ontario retirement pension plan. It is good news that it's delayed, but CPP expansion could be just as bad. I really do worry.
This is a different environment than the one we were in when CPP enhancement happened the last time. When Paul Martin fixed the Canada pension plan, CFIB members supported a small, gradual increase in CPP contributions in order to save the CPP. It is a myth that we are always opposed to any new form of taxation.
This is different now. The signs that the economy is showing us right now suggest this is not the time to increase the largest payroll tax in the country. At the very least, even if there's sympathy toward doing it, I would suggest that you shouldn't.
On this specific—
4:25 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
Can I just stop you there? I'm sorry, I only have a few minutes and I want to get to Mr. Lee for one quick question.
Mr. Lee, you know that I know the home building industry intimately. On a new door, from the time you take the raw piece of land to the time you hand the keys over to the new homeowner, how much of the cost of that home is taxation, on average?
4:25 p.m.
Chief Executive Officer, Canadian Home Builders' Association
It varies from municipality to municipality. We're seeing numbers from 20% to 25% of government imposed taxes from all three levels.
4:25 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
I have one last point. I met with a builder during the holidays. I meet with builders all over the place. I met with one last week, and he said that the price of lumber has come down on a house this year to the lowest it's been in 20 years. It's because of the price of commodities and where they've gone.
I asked him how much of the price of the house is the lumber, the materials to build the house? He said less than 10%. Will it be reflected in the final price of the house? Not likely, because every jurisdiction in this country, mainly municipalities, is taking up that space with development charges that in my community exceed $25,000 a door on any new dwelling. That's for apartments, condominiums, and single-family houses.
Is that what your members are experiencing?
4:25 p.m.
Chief Executive Officer, Canadian Home Builders' Association
Yes. We're seeing that similar kind of decline where the construction costs are becoming a fraction. One example we've seen is, in the GTA, the same house built a decade ago versus today. It used to be that the construction cost of the house was 40%, and then you had land, taxes, and everything else on top of it. For that same house today, the construction cost is down to 20%, so it reflects your numbers of half—
4:25 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
I might make the last point if you'll allow me, Mr. Chair.
Affordability in many cases, as we've watched trend lines over the last 20 years, has to do with making sure we hold the line on taxation for new home buyers.
4:25 p.m.
Chief Executive Officer, Canadian Home Builders' Association
That's a huge part of it.
February 16th, 2016 / 4:25 p.m.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
Thank you very much.
Mr. Marotte, I would like to begin with you. You referred to your report. Could you table it officially with the committee?
4:25 p.m.
Lawyer, Mouvement Action-Chômage de Montréal
In fact, it was the Employment Insurance Monitoring and Assessment Report. I have some excerpts.
4:25 p.m.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
Could you table them officially so that the committee may consult them?
4:25 p.m.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
I appreciate that very much.
You spoke of the Social Security Tribunal of Canada. I hear a lot about eligibility issues. It generally takes 28 days to respond to an employment insurance claim, but these days, people sometimes have to wait three to four months before they even receive a decision about their eligibility.
Is this something that is going on today? If so, how can we solve this problem?
4:25 p.m.
Lawyer, Mouvement Action-Chômage de Montréal
In fact, we see this more and more.
I have been with the Mouvement action-chômage de Montréal since 1994. The objective to reply within 28 days has always existed. So the administrative machine feels it is reasonable to provide a reply within four weeks, apparently. However, for some years now, these reports have stated that the objective is not being reached, and that the time it takes to reply is getting longer every year.
The explanation is simple. There have been many cuts to the public service in the employment insurance sector. Public servants tell us that the resources are just not there anymore.
There is also a new way of doing things. I am not an expert on processes, but I can say that in the past, when someone applied for benefits, an agent received the application and dealt with it to the end. He knew the file, he knew the employer, he could process the application quickly. Now, the application is received and processed in cyberspace, according to what public servants tell us. When you apply for benefits, your application goes into the Web. After that, an officer in Rimouski begins to process it. He must go through two or three steps...
4:25 p.m.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
Not anymore, since the Rimouski centre was closed.
4:25 p.m.
Lawyer, Mouvement Action-Chômage de Montréal
Yes, that is correct. I spoke of Rimouski, but let's say it is processed elsewhere.
At a certain point, this agent will work on another file, and someone in Shawinigan will take over. However, when the citizen would like an answer, there is no one to contact. He cannot speak to Ms. Thibodeau, who is aware of what is happening with his file. It is a dog's breakfast.
It is indeed quite complex. Resources have to be allocated and claims have to be processed quickly. They used to be before. I have been in contact with public servants for a very long time. The system worked and was efficient, because it was important and it was treated as a priority.
Public servants now tell us that they are no longer certain that paying benefits is a priority.
4:30 p.m.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
In the past, employment insurance claims were processed in 6 main centres and 23 secondary sectors in Quebec. Now the 23 secondary centres have been eliminated and only the 6 main centres remain. So, all of the claims are processed in these 6 centres. Claims sent in by people in Rimouski or Gaspé may be processed in Gatineau or Shawinigan, as you said.
I thank you for having provided these details.
This morning I spoke about employment insurance as an economic stabilization factor, particularly in regions undergoing economic difficulties. The example you gave illustrated that situation well. Thank you.
Mr. Kelly, I would like to talk about credit card transaction fees. I often hear small business owners, in my riding or elsewhere, say that this is a major problem for them. You did not include this point in your priorities.
The fees for basic cards are generally 1.5% to 2%, but this can reach 3.5%, if not almost 4%, for prestige cards. For many of these people, this is really a priority. If their profit margin is 5% or 6%, they can kiss their profits goodbye, as well as the possibility of reinvesting or hiring anyone.
I know that there is a voluntary code and that the issuing companies have voluntarily reduced the basic rate they charge businesses, but this remains a problem.
In your opinion, is this one of the priorities the government should tackle?
4:30 p.m.
President and Chief Executive Officer, Canadian Federation of Independent Business
I do. You're quite right. Credit card processing fees have come down for the first time ever. They did drop. We were pleased to see that. Actions were taken by the previous government to help make that happen.
Has it gone far enough? No, absolutely not. The code of conduct is working. It put some new ground rules in place, so we're very pleased with the code and how it's being enforced. That seems to be very good.
What seems to be missing, though, is that additional downward pressure on rates. With credit card processing fees, again, it's been about a 10 basis-point reduction, a 10% reduction at most, but we had seen a 40% increase in credit card processing fees in the previous several years.
We would encourage the new federal government to give this file another look. I wouldn't say, right now, that it's the most burning issue among our members, but it is an important one and it does erode the amount that the business can hang onto to pay their staff, pay their bills, and grow their businesses. It remains an important issue.
