Finance Committee on Feb. 17th, 2016

[Alex Ferguson]

I'm just closing right now.

I will finish by saying that we certainly support investment in cleaner technology, and our sector has many examples of opportunities for developing cleaner technologies for our sector and others. We look forward to the opportunity to continue to engage with governments, indigenous peoples, communities, and other sectors, to ensure Canada is prepared for a future that is a lot different from today.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much.

Turning to Dr. Forbes, the president of the Canadian Medical Association, the floor is yours.

[Dr. Cindy Forbes, President, Canadian Medical Association]

Thank you, Mr. Chair.

On behalf of the Canadian Medical Association, I appreciate the opportunity to appear before the committee as part of its pre-budget consultations. As the national organization representing Canada's doctors, let me commence by highlighting the CMA's strong support for the federal government's commitments to health and health care. The CMA's recommendations for the federal budget are based on tangible and meaningful actions that support the advancement of the government's commitments.

I'll briefly outline our core recommendations. Taken together, these measures will go a long way to addressing the major challenges facing Canadians as well as the provinces and territories in meeting the needs of our aging population.

As our first area of focus, the CMA recommends new funding to the provinces and territories to support seniors care by means of a demographic-based top-up to the Canada health transfer. This needs-based funding would be delivered in addition to the CHT, which currently leaves provinces with older populations at a disadvantage. Rather than opening up the funding formula, the federal government can deliver this much needed funding immediately.

Our second area of focus is on expanding the availability of home care and long-term care. The CMA recommends that the government establish a new targeted home care innovation fund. In addition to incenting innovations, this fund would support scaling up best practices.

To support access to long-term care, where wait times range up to hundreds of days across Canada, the CMA recommends including capital investment in the continuing care sector as part of the commitment to social infrastructure.

Our third area of focus is on delivering support to Canada's informal caregivers. There are 8.1 million Canadians currently giving informal care to family and loved ones, and only a fraction are receiving any assistance. As an initial step to expanding support to caregivers, the CMA recommends that the federal government amend the caregiver and family caregiver tax credits to make them refundable.

Our fourth area of focus is on improving access to prescription medicine. The CMA was pleased to hear last month that Ottawa will be joining the pan-Canadian pharmaceutical alliance in negotiating savings for all publicly funded drug plans. In addition to this important step, the federal government can reduce costs further by establishing a new funding program for catastrophic coverage of prescription medication. As we know, far too many Canadians simply cannot afford to buy their prescription medications, and this is unacceptable. We must and can do better.

A final matter I'd like to raise as part of the pre-budget consultations is that while the CMA strongly supports the federal government's commitment to reducing the small business tax rate, we have been concerned by statements regarding Canadian-controlled private corporations. This may be unknown to some, given our public system, but the majority of Canada's doctors are self-employed small business owners.

Physicians are highly skilled contributors to the knowledge economy. They invest in our communities, and provide hundreds of thousands of jobs. For a significant portion of physicians, incorporation is a key component of the practice model. Changes to this framework could introduce unintended consequences for the health sector. In light of the critical role of this framework, the CMA is calling on the federal government to affirm its commitment to the existing framework governing Canadian-controlled private corporations. I would be pleased to provide more information on this issue.

In summary, the CMA's pre-budget recommendations offer tangible and practical means of implementing many of the federal government's health sector commitments. Each of these recommendations has been designed to deliver an immediate impact in areas where Canadians are struggling the most.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Dr. Forbes.

With the Canadian Nurses Association, we have Ms. Sutherland Boal.

[Anne Sutherland Boal, Chief Executive Officer, Canadian Nurses Association]

Good afternoon. I'd like to thank the House of Commons Standing Committee on Finance for this opportunity to bring to you recommendations from the Canadian Nurses Association, the national professional association for nurses and nurse practitioners, representing 139,000 individuals across the country.

As nurses, we see first hand how Canadians can be better supported by more accessible, community-based care approaches and a shift from current policies and funding models that drive acute, episodic, and hospital-based care. New models for more integrated community-based care would emphasize health promotion, chronic-disease prevention and management, client-centred accessible care, and the use of a range of technologies.

Our official submission to the 2016 federal budget highlights three recommendations for your consideration.

First, deliver federal health dollars through a needs-based top-up in addition to the CHT to each province and territory based on demographics and population health priorities. This new formula would take into account the concerns that several provinces and territories have raised about the demographic differences and unique requirements of their respective populations, especially those living in rural and remote areas.

Furthermore, to increase transparency for taxpayer dollars, we recommend that every bilateral agreement must include a robust accountability framework. Such a framework would take into consideration the relationship between federal funding and the measurable outcomes that need to be achieved for the benefit of Canadians, include reporting on a comprehensive set of indicators and outcome measures derived from existing national data sources, and provide outcome measures calculated using publicly accessible data to report on federal heath funding and the associated measurable health and social outcomes that we seek to achieve for all Canadians.

Our second recommendation is to improve access to equitable, national, publicly funded home and community-based care that includes telehealth, mental health, and palliative care. We applaud the federal government's commitment of $3 billion over four years for home care. This funding will encourage a shift toward client-centred, cost-effective care that supports patients and caregivers and promotes the health and well-being of Canadians. CNA will work with the federal government and stakeholders to support policy development, implementation, and scaling up of existing and new and promising models for community-based care.

Our final recommendation is to invest in early, secondary, and post-secondary education for indigenous students and in professional development for health care providers who serve Canada's rural and remote communities. We are ready to work with the federal government in acting to implement recommendations of the Truth and Reconciliation Commission and strongly support the government's commitment to make significant new investments in indigenous education, improve essential physical infrastructure for indigenous communities, and create jobs for indigenous peoples.

This can be achieved by providing a four-year annual investment of $100 million to improve infrastructure in rural and remote communities, specifically in the form of construction of educational facilities and satellite learning centres and expanded broadband to promote distance education.

We also encourage a four-year annual investment of $25 million for initiatives to create more locally accessible infrastructure and learning opportunities for students enrolled in health care training programs and health care professionals already serving in rural and remote communities. Access to high-quality post-secondary health care education and professional development programs for health providers has been shown to lead to a more stable and skilled health care workforce to serve rural and remote communities.

Thank you very much for your attention.

[The Chair, Liberal, Wayne Easter]

Thank you very much.

We'll now turn to Mr. Sanger of the Canadian Union of Public Employees.

[Toby Sanger, Senior Economist, Canadian Union of Public Employees]

Thank you very much. I'm the economist for the Canadian Union of Public Employees. Our new national president, Mark Hancock, is out of town and sends his regrets.

CUPE is Canada's largest union, with 635,000 members. We deliver front-line services for municipalities, health care, social services, education, and many other sectors in communities across Canada. Our members take pride in delivering quality public services, and with incomes close to the Canadian average of $40,000 to $50,000 a year, they depend crucially on quality public services to maintain their standard of living, as do all Canadians.

As we all know, Ottawa experienced a record snowfall yesterday. I and many others spent hours shovelling snow for neighbours and pushing cars stuck on the road. I was happy to help, but I was also happy to see the snowplows arrive, operated by CUPE members. That's what we Canadians do. We shovel snow, but we also help each other. We help each other in our communities and as a country. We help each other out because it's in our nature, and if there's a car stuck on the road, or someone in poverty, in sickness, or without decent education, it holds us all back as a nation.

As a nation, our progress has been held back by inequality and an increasingly unbalanced economy. We need increased stimulus and infrastructure investment, but we also need more fundamental changes. We won't achieve sustained economic growth unless we work together to diversify and grow our economy, improve public services, generate good quality jobs, reduce inequality, and make the transition to a more sustainable economy.

To these ends, our recommendations for this budget are that the federal government increase infrastructure spending, particularly in public transit, green and social infrastructure, and particularly for those most in need, including through affordable housing, transition homes, child care centres, seniors facilities, and community and cultural facilities.

Federal infrastructure funding should support a long-term plan to reduce our emissions and generate good quality jobs. The federal government and other levels of government should demonstrate leadership by ensuring that all public buildings and facilities are constructed or retrofitted to high environmental standards.

All federal infrastructure funding should be tied to environmental, climate change, and social requirements. In the short term, we support the government providing more than a third share of the funding for these investments, tied to achieving environmental and broader social objectives, including decent wages, labour rights, pay equity, and opportunities for apprentices and equity-seeking groups.

The federal government should establish a dedicated fund to support public waste-water infrastructure investments required to meet the new national waste-water regulations. It should also increase funding for first nations water and waste water.

We commend the government for removing requirements that recipients of federal funding use or consider P3s, but urge it to go further and eliminate PPP Canada, and redirect the P3 fund to public infrastructure projects. It should also introduce comprehensive P3 accountability and transparency legislation.

The Canada infrastructure bank shouldn't be another vehicle to subsidize high cost private finance.

With unemployment rising rapidly, we urge the government to accelerate planned changes to EI in this budget.

In training and labour force development, funding should be restored with an emphasis put on literacy and essential skills development. As a priority, we agree that the federal government should work with the provinces and territories to establish and fund a national, affordable, and public non-profit early childhood care and education system with a distinct system for indigenous communities. We also support reducing and ultimately eliminating undergraduate university and college tuition fees.

We welcome the commitment to enhance the Canada pension plan, and urge the federal government to demonstrate leadership in achieving a universal expansion of the CPP, instead of deferring to piecemeal and provincial measures.

A new health accord should provide significant annual funding increases strictly tied to enforcement of the Canada Health Act, as well as improvements and expansion of the public health care system, including a national pharmacare plan.

We urge the federal government to commit to a 10-year timetable to increase our international development assistance budget and to dedicate at least half to the least developed countries. We're opposed to the ratification of the Trans-Pacific Partnership, CETA, and other deals that expand corporate power at the expense of jobs, wages, the environment, and our democratic sovereignty.

Finally, we need increased tax fairness. Priorities in this budget should be to broaden the base by eliminating regressive tax loopholes, such as the stock option deduction, to tackle tax evasion, and to move toward higher taxation of both corporate and capital income. After many lost years, we look forward to working with the new government and parliamentarians to rebuild a more prosperous, diversified, equitable, and sustainable Canada.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Sanger.

We've heard a lot about yesterday's snow in Ottawa. Those of us from Atlantic Canada think it was just a little flurry.

[Voices]

Oh, oh!

[The Chair, Liberal, Wayne Easter]

It wasn't very much of a storm.

We'll now turn to Ms. Decter from YWCA Canada.

[Ann Decter, Director, Advocacy and Public Policy, YWCA Canada]

Good afternoon. Thank you for the invitation to appear today on behalf of YWCA Canada.

For almost 150 years, YWCA Canada has worked to improve the lives of the tens of thousands of women and girls who use our services annually. My remarks today respond directly to their life experiences.

YWCA Canada and our 32 member associations across the country in nine provinces and two territories are committed to building a country that works for all women and girls. That includes first nation, Métis, and Inuit women, young women, and newcomer, refugee, and immigrant women. We welcome the quick initiation of the development of a national inquiry into missing and murdered indigenous women, and look forward to the government honouring its funding commitment to this in federal budgets 2016 and 2017.

Gender-based analysis is essential across government departments and should already be incorporated in the development of this federal budget. It is particularly important for allocation of infrastructure funds to affordable housing and early learning and child care to ensure that this spending responds equitably to the needs of women and girls. The Auditor General reported that in the 20 years since the government committed to applying gender-based analysis, it has been implemented in only some departments and agencies. Correcting this will require ensuring that Status of Women Canada has sufficient staff capacity.

YWCA Canada welcomes the government's support of the motion on pay equity earlier this month. Women working full-time year-round earn 20% less than men in comparable work, feeding poverty and inequality. We look forward to funding in federal budget 2016 to support recognition of pay equity as a right, implementation of the 2004 pay equity task force report, and restoration of the right to pay equity in the public service.

The new Canada child benefit, or CCB, is a potential life-changer for single mothers and all families living in poverty if the federal government can ensure that provincial and territorial governments refrain from deducting it from social assistance payments, or counting the CCB as income for access to means-tested benefits. If it is to lift 300,000 children out of poverty, women and children living on social assistance must retain the entire benefit.

The Minister of Status of Women is responsible for ensuring that no one fleeing domestic violence is left without a place to turn. Often violence survivors are unable to leave women's shelters because they can't afford housing. This leaves shelters full to capacity and turning away women in need. The CCB would provide a single mother with one child under six with $580 a month. With two children under six, she'd receive $1,160 a month. These payments could be enough for women to secure housing in the community and reduce the system bottleneck if they remain fully in women's hands.

As Canada's largest single provider of shelter for women and children fleeing violence, we work to end the interconnected issues of violence against women and women's homelessness. Federal budget 2016 needs to provide a minimum of $5 million to Status of Women Canada to support participation of the violence against women sector in the development of a national action plan on violence against women. Federal budget 2016 should restore the shelter enhancement program at $10 million per year to achieve the promise of no one turned away.

The promised national housing strategy requires a gender lens and gender-based analysis. Male bias pervades perceptions of who is homeless, despite women and girls comprising almost half of the estimated 235,000 homeless people in Canada. Homelessness is gender differentiated. Violence and poverty are the major drivers for women. Forty per cent of women leaving shelters don't know where they will live. Women and girls hide their homelessness because the streets aren't safe.

For women, housing first is not a panacea. The shift of funding from the homelessness partnering secretariat to the housing first model was not accompanied by gender-based analysis. This is absolutely critical before expansion. Transitional housing is an essential service for survivors of violence. It doesn't fit the federal government's current housing first model. Actual housing first for women and children living with violence would leave them in the home, remove the perpetrator, and secure their safety.

The national housing strategy must address housing for women and families in the northern territories. Women with children trying to escape violence are profoundly impacted by the northern housing crisis and seriously disadvantaged by the lack of federal social housing funding that has continued for years.

YWCA Canada welcomes Minister Duclos' statements indicating quick progress by federal, provincial, and territorial governments under a framework for a national early learning and child care program. Federal budget 2016 should dedicate social infrastructure funds to a short-term emergency-style fund for transfer payments to provinces, territories, and indigenous communities for early learning and child care during funding negotiations.

[The Chair, Liberal, Wayne Easter]

Could you sum up fairly quickly?

[Ann Decter]

Yes.

Federal budget 2016 should close the discriminatory funding gap for first nations child and family services determined in the January 26, 2016 ruling of the Canadian Human Rights Tribunal.

We would also suggest that the development of a poverty reduction strategy needs a gender lens, a gender-based analysis, and grounding in the realities of women's poverty. Women account for 70% of part-time employees and two-thirds of Canadians working for minimum wage. The median income of single-mother-led families is one-third lower than that of father-led single parent families. The strategy needs to include all women living in poverty. Some of the most vulnerable of women are homeless young women escaping sexual abuse and abused adult women coping with trauma, mental health issues, and addictions who have lost their children to the depths of the child welfare system.

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much.

We will turn by video conference to Calgary and to Mr. Bloomer, who is with the Canadian Energy Pipeline Association.

Welcome, Mr. Bloomer. The floor is yours.

[Chris Bloomer, President and Chief Executive Officer, Canadian Energy Pipeline Association]

Thank you very much, Mr. Chairman.

I want to thank the standing committee for the opportunity to speak on behalf of the Canadian Energy Pipeline Association and to provide the submission and speak today with respect to the upcoming budget.

I will summarize our submission comments with respect to Canada's investment climate for major pipeline development, the NEB processes, and NEB modernization.

CEPA represents Canada's 12 major mainline transmission pipeline companies, which operate approximately 117,000 kilometres of pipeline in Canada, moving annually approximately 1.2 billion barrels of oil and almost three trillion cubic feet of gas.

For more than 60 years, our pipelines have operated across the country, delivering energy safely, reliably, and efficiently. Over the past decade, CEPA members have had a 99.999%—almost 100%—safe delivery record. In 2015 there was a 100% safety record, with zero incidents along the mainline transmission system.

Our industry is undoubtedly a pillar of the Canadian economy, but recently we have seen difficult challenges. The collapse in the price of oil has resulted in delayed or cancelled energy projects and enormous job losses. In 2015 alone, over 100,000 direct and indirect jobs have been lost, and more are expected.

The situation is made much worse by our dependence on the United States as our only major customer from an exporting perspective. This forces us to sell our oil at a severely discounted price because of the lack of pipeline infrastructure to access global markets, and this results in billions of dollars of lost revenue for Canada.

CEPA members have over $68 billion of proposed investments in pipeline projects forecast over the next five years, projects that will open new markets and provide greater access to existing markets. All of these projects will be built with private capital. To build these important projects, we need to have a competitive investment climate. Companies will choose to invest their capital in other jurisdictions if they see the Canadian regulatory and fiscal system imposing process uncertainty, additional risks, costs, and delays that are not inherent to more competitive jurisdictions.

We recognize that the responsibility to create investment confidence comes hand in hand with building public confidence. To build public trust and confidence, we believe that decisions on whether new pipelines will be built must be placed and based on predictable and rigorous quasi-judicial processes based on evidence, science and fact, and appropriate consultation.

Unfortunately, the recent government announcements that extended the review of two proposed pipeline projects, together with the requirement of additional reports and processes at the back end of an extensive NEB process, are leading to increased ambiguity, delays, duplication of work, and growing potential politicization. Building public confidence requires industry, regulators, and governments to work together.

To that end, CEPA recommends the following:

We need to avoid politicizing the NEB. We are concerned with the potential politicization of the review process and believe that an evidence-based process serves better than a cabinet decision for Canada, which may be based on politics.

The National Energy Board was established in 1959 to depoliticize energy infrastructure decisions. More recently, we find ourselves in a similar situation. The legislative changes brought about by Bill C-38 in 2012 changed the role of the NEB from making a decision to making a recommendation to cabinet, leaving cabinet with the final decision. The change has now led to politicization of the decision-making process.

CEPA recommends that this 2012 amendment be reversed, restoring balance and decision-making towards the NEB, a quasi-judicial regulator whose decisions are based on science, fact, and evidence, rather than with cabinet.

On modernizing the NEB, the government has also committed to moving forward with that; however, we need to recognize that not everything is broken. Ensuring the board composition reflects regional views and has sufficient expertise is a good step, particularly greater indigenous representation. Taking a look at governance and the practices and overhauling the information management systems should be part of modernization.

The NEB's role in regulating existing operations spans the life cycle of a pipeline from design approval to construction, operation, and ultimately abandonment. It has done this for 60 years, mostly quietly.

Continuous improvement is always welcome, but we do this at the same time as recognizing that the NEB is recognized globally as a leader in life-cycle pipeline regulation.

As we modernize the NEB, we believe that public confidence can be improved by getting the right balance, building on what works well, improving what doesn't, and providing the regulator with the tools and resources for oversight through the entire life cycle of pipelines.

CEPA believes that a strong, credible regulator needs to be well resourced to provide the tools it needs to fulfill its mandate. This was recently confirmed by the Commissioner of the Environment and Sustainable Development's report. To better address these issues, CEPA recommends that the Treasury Board grant the NEB greater flexibility with the cost recovery model, allowing the NEB to better attract and retain highly skilled employees and to continue to fulfill its strategic priorities.

In summary, by improving public confidence and trust we're better able to make progress on necessary pipeline approvals and infrastructure development.

Thank you for the opportunity.

[The Chair, Liberal, Wayne Easter]

Thank you very much, Mr. Bloomer.

We'll now go to round one of questioning, and I'm going to take a minute off each person in order to get everybody in.

Mr. Ouellette, go ahead.

[Robert-Falcon Ouellette, Liberal, Winnipeg Centre, MB]

Thank you very much, Chair. I really appreciate the opportunity.

My question is for Mr. Ferguson of the Canadian Association of Petroleum Producers.

Why should liquefied natural gas companies get capital cost depreciation tax benefits and be classified as manufacturing companies?

Most businesses get 8%, but on February 9, 2015, in the last federal budget, you got a tax break amounting to billions of dollars. It's 30% now. Professor Kin Lo at the UBC's Sauder School of Business predicts it could mean a tax break of $1.5 billion to $2 billion over seven years for only around 800 permanent jobs. Is that fair?

[Alex Ferguson]

Well, first I'd like to comment that our association represents the upstream, and the LNG industry is the downstream part of the sector, so it's not really—

[Robert-Falcon Ouellette, Liberal, Winnipeg Centre, MB]

Oh, I'm sorry to point that out. But actually it's in your annual report here—

[Alex Ferguson]

Yes. We have supported that, as we've supported all market access opportunities for our products. The request for the capital cost allowance was to bring it into some measure of parity with the rest of the manufacturing sector in Canada. Our perspective, when we looked at it and did some analysis of our own, was that we could support that given that it does add value to British Columbia, adds value to our resources, and diversifies our market.

[Robert-Falcon Ouellette, Liberal, Winnipeg Centre, MB]

Okay.

How many indigenous people work as engineers within the oil and gas industry?

[Alex Ferguson]

I don't have the number offhand, and—

[Robert-Falcon Ouellette, Liberal, Winnipeg Centre, MB]

Sorry, because I think it's probably almost none.

[Alex Ferguson]

It probably is.

[Robert-Falcon Ouellette, Liberal, Winnipeg Centre, MB]

I know a lot of indigenous people who work as cleaners, and they do a lot of food services.

But I think a lot of the decisions are made at higher levels, and I think the industry needs to spend more time getting different types of people into this industry and making sure more different types of Canadians can benefit and have the same level of opportunity.

I have a quick question. Ten years from now, how many jobs will be created in Alberta, Saskatchewan, Manitoba, or B.C. for the refinement of bitumen oil?