Finance Committee on Oct. 3rd, 2016

[Dan Albas, Conservative, Central Okanagan—Similkameen—Nicola, BC]

You know these businesses best. I appreciate that.

I'm going to say quickly to the First Nations Finance Authority, thank you for raising the example of the Penticton Indian Band that used to be in my previous riding. That is one of the best cases I think of leadership and consensus-building within a band. I appreciate the work that you're doing to make sure that other bands raise not only the economic end, but also the fiscal side. Being able to join in as members I think is important, but most important is that infrastructure. When I met with band members, the biggest thing they would say is that they were more concerned about a health centre or having the roads done. Any capacity-building that the federal government can do to help you, I would be happy to see.

[The Chair, Liberal, Wayne Easter]

Mr. MacKinnon, and then Mr. Cannings.

[Steven MacKinnon, Liberal, Gatineau, QC]

We spent a great deal of time with the regional development agencies prior to undertaking these consultations. They went through in every region of the country with their growth prospects and areas of focus.

With respect to wine, and perhaps with respect to first nations financing, have you engaged with Western Diversification on these proposals that you've come with today? Are those discussions productive? Could there be better engagement with Western Diversification?

[Miles Prodan]

I'll quickly talk about the wine industry.

Yes, we have. To date we have an initiative with the UBC campus here in the Okanagan, and as well KEDGE University out of Bordeaux specializing in wine management, to take a look at some of these issues. That was a WD funded project also. What it was looking at was how to best position B.C. in the export market. That's an ongoing process.

[Steven MacKinnon, Liberal, Gatineau, QC]

Mr. Albas used the example of the family getting into sparkling wine. Are they eligible, or could they be eligible for—

[Miles Prodan]

No. My understanding is that it's for export initiatives. That's what to date the WD—

[Steven MacKinnon, Liberal, Gatineau, QC]

This wouldn't be an export possibility?

[Miles Prodan]

Not necessarily.

What we're asking for is capacity-building within.... There would be an export component of it, but our institute has accessed money. I don't know that individual wineries have done that.

A case could be made that for increased capacity, there is the ability to export. What we want to do is take care of our internal market share. That's where the low-hanging fruit part, and pun, is.

[Steven MacKinnon, Liberal, Gatineau, QC]

That's what I'll remember about your presentation today, Mr. Prodan.

[The Chair, Liberal, Wayne Easter]

One quick question.

[Steven MacKinnon, Liberal, Gatineau, QC]

The development agencies continually told us that first nations and first nations economic development are areas of focus for them. Have you had interactions with WD, or any other across the country?

[Ernie Daniels]

No, we haven't talked to anybody who is working in those areas. Usually it's because they don't know we exist. As we get more known, we're sure this is going to happen. We're talking with a lot of different governments across the country and looking at other things. We're looking at monetizing capital dollars and those types of things for health centres and other things.

[The Chair, Liberal, Wayne Easter]

Thank you, both.

Mr. Cannings.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Dan touched on excise tax with regard to small wineries that use Canadian grapes, craft breweries, and the impact that has had on the industry. This might involve some speculation, because it's outside your industry, but we had a private member's bill recently in the House that was asking to reduce the excise tax on craft distilleries by cutting it in half to give the same boost. I argued in the House to eliminate it for small craft distilleries that were using Canadian products to make their alcohol and make their sprits. Unfortunately, the government side of the House voted it down for mysterious reasons. I wondered if you could speculate, based on the wine industry's history, what the impact on the craft distillery industry might be if we had an initiative like that to eliminate the excise tax on small craft distilleries.

[Miles Prodan]

Sir, I can't speak to that.

I speak on behalf of B.C. VQA wine. That is wine that is guaranteed and audited to be of 100% B.C. input. The excise exemption identified that so that it excluded it, as Dan alluded to and you as well. The brewery industry and the distilled spirits industry, they're local. For us in the wine industry, as long as it's 100% B.C. or local product, I don't see an issue with that at all. I can tell you—and Dan can concur—the reduction in that was instrumental. That's just more money that goes back to the operation, the enterprise, to invest in the business.

[The Chair, Liberal, Wayne Easter]

Is that it?

With that, I'll thank everyone for their presentations, their briefs. We also have your briefs online that came in by August 5, which I believe the deadline was.

Thank you for your responses to questions.

We'll suspend for about 15 minutes and bring the next groups forward.

[The Chair, Liberal, Wayne Easter]

We'll come to order.

For the record, we are, under Standing Order 83.1, doing pre-budget consultations in advance of the 2017 budget.

We have, I believe, seven witnesses this session. Welcome, everyone, and thank you for coming.

Thank you for the briefs that you sent earlier in the year. We appreciate that. We haven't gotten through them all yet, but we will be going through them all.

We'll begin with the Canada Green Building Council.

Mr. Mueller, the floor is yours.

[Thomas Mueller, President and Chief Executive Officer, Canada Green Building Council]

Thank you, Mr. Chair.

The Green Building Council represents the building sector in Canada on sustainability issues. We think that there's a significant opportunity, one of the biggest opportunities, to reduce carbon emissions to meet Canada's target of a 30% reduction by 2030. In fact, the recommendations we're bringing forward today were modelled on the premise of how to get to a 30% reduction in carbon emissions from the building sector by 2030.

The existing building sector is the biggest opportunity to achieve reduction by 2030. If our recommendations were accepted, we could, by 2030, eliminate 17.6 million tonnes of carbon from the existing building sector, save $6.2 billion in energy costs, and have a GDP impact of $261 billion.

The advantage the building sector has over other strategies is that it's been recognized over the years both by the UN and the International Energy Agency, and in many other reports, as the most cost-effective opportunity to reduce energy use in carbon for the simple reason that these investments have clear paybacks over time for the building owners who either live or work in those buildings. What's important, though, is the rigorous and advanced standards to get there.

In terms of the overview of our recommendations, we're recommending four things. These are on page 2. One, meeting Canada's climate change targets by focusing on the existing building sector; two, that the government—the federal government is one of the largest building owners in Canada—reduce its GHG emissions from its own building stock; three, strengthen building performance through energy benchmarking reporting and disclosure; and four, invest in net zero carbon buildings as an innovation strategy, and as a future-proofing strategy, to get to very low or zero carbon buildings. There's a little bit more detail on page 3 with recommendation A.

The existing building sector is critical in achieving GHG reductions from the building sector. This is particularly due to the fact that Canada's building sector, overall, is relatively inefficient. Many gains can be made with good paybacks of about three to seven years.

We're recommending four strategies that have been modelled for us. We modelled with a very recognized engineering firm in Canada, WSP, along with another very well-known economic consultant to deliver economic outcomes.

We're recommending four initiatives, two of which are recommissioning buildings, which is already an accepted practice in the industry; and undertaking deep retrofits for 60% of buildings over 25,000 square feet, so not the very small ones. These two strategies alone would take us to a 30% reduction in carbon emissions by 2030.

If we add solar or other renewable onsite energy to 40% of the buildings over 25,000 square feet, and do some fuel switching, switching from fossil fuel to a low or zero fossil fuel, we would actually get over 40% in carbon emission, and save 17.6 million tonnes in emissions from those buildings. That would clearly surpass Canada's 30% target that's been set nationally.

On the following page, page 4, these recommendations are summarized in a table. I want to draw your attention to the bottom line, which is the overview of environmental and economic impacts. In terms of taxes, $5.2 billion in taxes by 2030 would go to the provinces and the federal government. Regarding employment, retrofit generates employment, and it also generates the application of technology, know-how, and services in the Canadian economy.

Moving on to the next page, number 5, recommendation B, we see the federal government as a large building owner. There is an opportunity here to be a global leader in showing the industry where buildings could be. It's really a recommendation to invest in government-owned buildings. The government already has a LEED Gold policy, since 2005, for new buildings. This has been applied quite successfully within real property. We're recommending that this policy be expanded to include LEED platinum for new buildings and/or net zero targets for new building construction.

That would be in line with where the private sector is currently moving and with the buildings that have been constructed by the private sector.

It's equally important that the government also invest in existing buildings and establish a high standard for building retrofits, particularly large government-owned buildings. It would also be LEED Platinum for existing buildings.

For the remainder of the building stock, in terms of meeting these standards, we're looking not just at real property but across government departments. That would include DND and, obviously, real property, but also buildings that are owned by Natural Resources Canada and other departments.

Finally, the government also has an excellent role to play in strengthening procurement policies to green the supply chain, and that would include leased properties for office purposes and other purposes. They could also meet high standards like LEED Platinum or net-zero carbon targets.

Going on to our recommendation C, strengthening building performance, energy benchmarking, and reporting disclosures are fundamental strategies. It's important to engage owners, to raise industry awareness, to set goals, and to measure performance and progress towards those goals. This also sets the stage for strategic investment and improvements.

When we talk about how to engage existing buildings, I think the first step would be energy benchmarking and reporting. We recommend that the federal government collaborate with the provinces and the territories to draft the framework for a stock energy benchmarking, reporting, and disclosure program, similar to what the Province of Ontario is currently doing. I think it would be a very important step forward. The jurisdictions could also adopt policies to require buildings over 25,000 square feet to benchmark their energy use and carbon footprint.

Finally, we also recommend that the government invest in the energy star portfolio manager program. This is a very good program that's currently operated by Natural Resources Canada. Further investment would really support the industry in moving in that direction.

Finally, the last recommendation is to invest in net-zero buildings. As I've said, this is really an innovation strategy for the government, and it would future-proof the carbon performance of the building stock.

In terms of initiatives like that, if the government were to support a national net-zero carbon initiative and work with organizations like the CaGBC to ramp it up over time, apply it to its own buildings, and work with the provinces and the cities that are applying these standards and practices to their own buildings, Canada could really become a global leader and position itself as a global leader in sustainable construction and design.

I would like to finish off with the last page, page 8, and say that we see the building sector as a really important opportunity not just to reduce carbon, but also to stimulate the economy. We can build up Canadian expertise and technology. We can grow Canadian small and medium-sized enterprises. We can create export opportunities for Canadian technology and expertise, and we can move Canada to the front of the international pack in leading in green building. This is a global and growing industry that looks for innovation like this. I think Canada could be very well positioned for pursuing these opportunities.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Mueller.

We'll turn to the Pacific Salmon Federation.

Go ahead, Mr. Meneer.

[Michael Meneer, Vice President, Pacific Salmon Foundation]

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

Good morning. I'm Mike Meneer, vice-president of the Pacific Salmon Foundation. We are a federally registered non-profit committed to the sustainability of wild Pacific salmon and their ecosystems.

Our 30-year history is intrinsically linked to the federal government as we have a long-standing contribution agreement with Fisheries and Oceans Canada to manage funds from the salmon conservation stamp. For those of you who have fished in our salt water, this is the stamp that you need to keep the fish that you catch. We've also recently worked in a collaborative way with DFO on salmon science and research to better understand what's limiting the returns of our wild Pacific salmon here in British Columbia.

Our community salmon program is funded by the salmon conservation stamp and provides grants to support salmon steward volunteers through 345 community organizations. Since our founding, 35,000 volunteers across British Columbia have engaged and participated in conservation, habitat restoration, and education related to wild Pacific salmon. Volunteers take every $1 that comes to us through the stamp and turn it into $6 or $7 more through their hard work and fundraising at a local level.

Pacific salmon are a vital part of the socioeconomic well-being of western Canada, and they are integrally linked to the natural ecosystems of British Columbia and the Yukon. New federal investments in Pacific salmon have the potential to contribute significantly to future economic growth in British Columbia and the Yukon, particularly for coastal communities and first nations peoples.

For some context, it is estimated—actually not estimated but based on economic facts—that more than $2 billion a year in economic activity derives from fisheries and aquaculture in British Columbia, and a little over half of that comes from salmon-related activities in British Columbia. So this is very much still a very significant part of our economy.

Given our limited time for testimony, I will cut to the chase here on our two budget proposals. First, we are calling for the federal government to adjust the price of the federal salmon conservation stamp to $10 from $6, which will help us meet the growing demand from grassroots organizations that I referenced earlier for salmon stewardship activities.

We base this request on several factors. One, it has no direct cost to the federal budget because it's a user fee. Second, the $4 adjustment accounts for inflation because the stamp hasn't been increased in value since 1996, as well as a response for needed complexity and larger projects that the grassroots organizations are bringing to us. The adjustment would generate roughly $1 million each year in new activity, and add to that the roughly $6 million that local communities would raise as a result of those stamps that we invest.

Our second proposal is to encourage the federal government to invest $30 million in the Pacific salmon endowment fund. This is an independent society that provides key operational and strategic funding to the Pacific Salmon Foundation. The endowment was established in 2001 with a $30-million contribution from the federal government, and it's become a source of stable support for our foundation in terms of operating ongoing salmon conservation.

I coordinate fundraising for the foundation, and what it allows us to do is to tell donors that 90-plus cents of every dollar they donate goes to projects because, with the endowment, we are able to keep our lights on and operate our foundation. That is what gives us that $6-$7 of leverage that we get with the federal funds that come through the salmon stamp.

We see lots of opportunities to partner with the federal government: salmon science to help us understand how we can have more of our salmon survive and return each year, adaptation to climate change, sustainably advancing natural resources and the jobs that come with natural resource projects, first nations engagement, sustainable aquaculture, and really many of the priorities that were outlined in the Cohen commission report several years ago.

In the interest of time, let me just give you one example of what we think we can do with this $30 million in our endowment. Since its inception in 2006, the Pacific Salmon Foundation's Skeena salmon program has become a trusted and independent facilitator of people and processes. Among the results of our efforts is the Pacific Salmon Explorer. This is a new online visualization data platform that provides a much deeper understanding of the 55 unique local salmon populations in the Skeena River and all the factors that are affecting them and their conservation.

We believe there's a valuable role for the Pacific Salmon Foundation in providing independent environmental perspective on major resource development projects, like the Pacific NorthWest LNG project that was announced last week in the Skeena watershed. Whether it's coming up with good science-based decisions for planning projects, monitoring, or mitigation, all of these things need independent science and independent validation for the public to trust that they are in the best interests of Canada.

The facilitation of collaborative and independent science, monitoring, and mitigation represents the type of opportunity for federal investments in budget 2017 that we at the Pacific Salmon Foundation envision, investments that will support major economic development and jobs, while ensuring that Pacific salmon, wild salmon, are sustained for generations to come.

We've engaged with the ministers and our government caucus and other MPs who were Ottawa last week. Both of these proposals have been received favourably, and we look forward to questions from this committee and further opportunities to talk about what we and our volunteers do in British Columbia.

With that, I thank you, Mr. Chairman.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Meneer.

Before I go to Mr. Hughes, most of the committees that are travelling on the road now, are doing what we call open-mike sessions. We'd like people to register and then we'll give them a few minutes at an open mike after this session at 12:30.

Turning to the Unifor Local 2182, Mr. Hughes, president. The floor is yours.

[Allan Hughes, President, Unifor Local 2182]

Good morning, Mr. Chairperson and committee members.

My name is Allan Hughes. I am the president of Unifor Local 2182. I represent marine communications and traffic services officers across Canada. Our officers are responsible for detecting marine distress calls and regulating shipping movements in the Canadian waters. That's the Arctic, Pacific, Atlantic, St. Lawrence Seaway, and the Great Lakes.

Without our presence and our professionalism, there would be significantly more marine pollution due to shipping accidents, and obviously the safety of life at sea would be in jeopardy. Our officers can really be considered the 911 operators of the ocean, and the air traffic controllers of the marine waterway.

In the 1990s, the union representing radio operators at the Coast Guard radio stations approached the government to propose consolidation and mergers with the Coast Guard vessel traffic regulators across Canada. The union initiative, carried out through the 1990s, saw 44 centres condensed into 22. That saved approximately $15.7 million a year, and that was in 1990 dollars.

In 2012, the deficit reduction action plan was announced, and Coast Guard was moved to consolidate 22 remaining centres into 12. This saw 10 additional closures across Canada, in Inuvik, Rivière-au-Renard, St. John, St. Anthony, St. John's, Montreal, Thunder Bay, Ucluelet, Comox, and Vancouver. This consolidation was completed on May 10 of this year and was proposed to save approximately $5.7 million a year.

In 2012, we had 350 officers at 22 centres across Canada, and the Coast Guard's goal was to reduce approximately 60 officers and supervisors. The net result is 100 officers left, leaving a shortage of approximately 40 officers across Canada.

It takes a newly hired officer, what we refer to as an ab initio, six months training at the Canadian Coast Guard College in Sydney, Nova Scotia, and then a further six to 18 months to certify with an on-job instructor, so that they can work on their own. In some centres, that certification may involve training in as many as seven sectors or operating positions. It costs approximately $100,000 to train each of those recruits.

Currently, the Coast Guard College in Sydney is limited in its ability to train enough officers to replace those who have departed, and like the rest of the public service, there's a huge retirement bulge coming in the next five years. We anticipate a great number of departures.

Adding to the challenges due to the short-staffing situation across Canada in our centres and regions, the regions are reluctant to release experienced officers to teach at the college, which is further complicating the ability for the college to train more officers. Without significant investment in recruiting new officers and strategies to retain the existing officers, the MCTS program may be forced to decrease levels of service, leaving our coasts at risk.

With the shortage of officers, centres are combining operational positions and increasing the areas that our officers are required to monitor: shipping, and listening for distress calls. This is an area where there are tankers, deep sea traffic, container ship concentrations, fishing vessel activity, and pleasure craft activity, some of that year-round.

In addition to the human resources challenges, technology impedes the delivery of services by our officers. The technology that has been introduced in the last number of years hasn't increased the efficiency or effectiveness of the service, or the delivery to our users in the marine community. For example, look no further than the current implementation of the Phoenix pay system to know that project management and technology need to be well tested before being implemented.

To protect all three coasts, three oceans, Great Lakes, the government must commit to predictable, stable, and long-term funding for the Coast Guard. This commitment means increased capacity at the Coast Guard College for more instructors. It means hiring more officers to get ahead of the predicted departure over the next five years, and increasing the staffing factor that accurately reflects 24/7 operations. The Coast Guard requires adequate experienced staff to properly study, develop, and test technology to meet the current and future operational requirements of the MCTS service and the domain awareness of security to many agencies, such as DND, RCMP, and Transport Canada.

The bottom line is that the Coast Guard is more than ships. MCTS is the first line of defence to prevent marine casualties and respond to accidents that happen. It requires long-term, stable funding.

Thank you for the opportunity to present our concerns.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Hughes.

Mr. Friesen, from the Canadian Immigrant Settlement Sector Alliance.

[Chris Friesen, Chair, Canadian Immigrant Settlement Sector Alliance (CISSA)]

Thank you and good morning, Chair, and members of the committee.

The Canadian Immigrant Settlement Sector is a pan-Canadian association, which represents the immigrant settlement sector in Canada, so my remarks today come from colleagues across the country.

The immigration and settlement program has a direct impact on the well-being of the Canadian economy. As we know, Canada is facing a significant labour market shortage, an aging population, and declining birth rate. There is also a critical need to attract and retain immigrants to smaller centres across Canada. In some parts of the country, such as in Atlantic Canada, some provinces have instituted population growth strategies largely based on higher immigration levels.

The national settlement budget allocation directly relates to our ability as a country to successfully integrate newcomers on both an economic and social basis. The Government of Canada recently indicated a desire to introduce multi-year immigration plans with higher immigration levels of economic, family, and humanitarian classes. With the likelihood of higher immigration levels over the next few years, we're concerned that the current national settlement budget does not even meet present needs. While our membership supports the recent Syrian refugee resettlement initiative, it has brought to the forefront several settlement-related program challenges across the country.

First, the ability to effectively speak one of Canada's official languages is key to social cohesion and integration, including labour market attachment. The federally funded language program has wait-lists across the country. The province of British Columbia, as an example, has a current wait-list of over 5,000 permanent residents; Alberta, a list of 4,400. These wait-lists do not take into consideration child-care spaces. Child care makes it possible for immigrant and refugee women to attend language classes. Having newly arrived immigrants and refugees waiting for months, sometimes over a year, for language classes is unacceptable. It's a waste of human capital and causes unnecessary delays in their integration process.

Second, one of the immediate desires that most newly arrived immigrants and refugees have is their interest in working and contributing to Canada. While the lack of adequate language programs hinders their ability to attach to the labour market or reach their full capacity, there is also a greater need for specifically designed training and employment programs for both high- and low-skilled newcomers. Previous models such as project-based training—which offered specific occupational language support, skills training, paid work experience, placements, and wage subsidies—would have contributed more to the economic integration of newcomers than many of the existing approaches under the Canadian job strategy.

Lastly, since the significant overhaul of Canada's immigration act in June 2002, the Immigration and Refugee Protection Act, Canada has selected government-assisted refugees through the use of vulnerability criteria, including the urgent need for protection. We support the selection processes of past and current governments. However, we have an obligation to adequately support resettled refugees under humanitarian immigration objectives. Since 2002 the characteristics of government-assisted refugees have changed significantly. We're now seeing refugees who have spent sometimes decades in protracted refugee situations: low literacy, large-size families, survivors of torture, and various other special-needs cases.

There are a few areas I'd like to draw your attention to for additional budget considerations. First, there is the transportation loan program. Canada remains the only country in the world that provides an interest-bearing loan to refugees. We combine their overseas medical examination and their one-way ticket from wherever they're coming from to Canada, and we bundle that into an interest-bearing loan. We should get rid of it.

We also need funding for a national program of settlement-informed refugee trauma support. Due to significant trauma, and pre-existing mental health conditions associated with migration, we urgently need funding for short-term, time-limited, first-language clinical counselling programs as part of the current budget for the national resettlement assistance program.

We looked at successful models, such as in Australia, that have been funded for years by the federal government as an integral part of immigrant settlement, not under the provincial health jurisdiction.

If we cannot adequately support the mental health of refugees, these issues will continue to impact their ability to learn one of Canada's official languages, as well as integrate into the labour market.

Overseas, pre-departure orientation programs for resettled refugees, specifically for youth.... The unique migration experience faced by young people is distinct from that of their parents and guardians. We need to ensure that all resettled refugees are provided with some targeted, specialized pre-departure orientation before coming to Canada.

Our members' direct work with immigrants and refugees constitutes nation building. Our ability as a country to successfully integrate newcomers, both economically and socially, is directly related, in part, to ensuring that newcomers have the programs, services, and supports they need in place to actively participate in and contribute to Canadian society.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Friesen.

Next is Ms. Conway, from the Interior Savings Credit Union, the second credit union today. We'll be borrowing money big time.