Evidence of meeting #4 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.
7:30 p.m.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
Can you say with certainty that, without your involvement, without the communities building the towers themselves, those areas would not have cellular or high-speed Internet services?
7:30 p.m.
Coordinator, Agence interrégionale de développement des technologies de l'information et des communications
That's true, except, perhaps, in one or two municipalities, where efforts were in the works. All the other municipalities, however, are quite tiny. The AIDE-TIC model does not necessarily satisfy everyone's expectations. Nevertheless, we are able to facilitate construction and, above all, reduce construction time frames. We help communities succeed in situations where the critical mass isn't normally strong enough for self-funded projects.
7:30 p.m.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
I'd like to point out that, according to your building Canada fund recommendation, there is currently a way for municipalities and regions to obtain federal funding for high-speed Internet, which, very often transforms into satellite reception because it's just about the only way to get funding. That's not the case for cellular towers.
Is that correct?
7:30 p.m.
Coordinator, Agence interrégionale de développement des technologies de l'information et des communications
The problem lies in the mismatch between supply and demand. More and more, the demand is for mobile Internet services, whereas infrastructure programs are intended more for fixed Internet services. The desperate need that elected representatives often draw attention to concerns cellular service primarily. As soon as a community wants to set up cellular infrastructure, the realization sets in that a lack of Internet capacity or service exists while satellite reception is available. If I give communities a choice between satellite technology and cellular infrastructure, where Internet and voice services are provided as collateral, the answer is clear: the local priority is always the sustainable technology.
7:30 p.m.
Liberal
7:30 p.m.
Liberal
Jennifer O'Connell Liberal Pickering—Uxbridge, ON
Mr. Chair, I feel so bad for the parliamentary secretary, I'm actually going to give my time to him, if he'd like.
7:30 p.m.
Liberal
7:30 p.m.
Liberal
François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC
Thank you. I appreciate that.
It's difficult to do justice to all your submissions. Obviously, as we went from, I would say in my case, Moncton to Yellowknife, a lot of the issues you brought to the table we've heard.
I'd like to pick up on the issue you brought up, Mr. Nepton, and that is connectivity.
What I called digital infrastructure is an issue we've heard about in every region of the country. I can assure you that, together with our partners and various colleagues, we are looking into the matter.
When we talk about infrastructure programs in an urban area, we are referring to bridges and roads. In a rural area, however, we are referring to digital infrastructure. You will definitely find people on our end who are very aware of that. As Mr. Caron said, a number of our fellow members are from the regions.
I can tell you that high-speed Internet and cellular phone service provide people with opportunities to participate in today's economy. What is often proposed revolves around investing in productivity, innovation and exports. But, in order to do that, most of the regions need to have access to cell phone or Internet service.
My question is for Mr. Scholten, specifically.
We've heard from credit card companies and a number of banks, and I'm very curious to know, where is the 1.5% going? I've heard different things from different industries on exactly who's charging the 1.5% and where it is going. Could you shed some light for the members of the committee on where the 1.5% is going?
7:30 p.m.
President, Canadian Convenience Stores Association
Sure. The 1.5% goes to the credit card network or credit card system, so the credit card providers, the banks, and the intermediary parties that provide the POS equipment, point of sale equipment. Among all of them, that 1.5% is divided up in accordance with their agreements.
7:30 p.m.
Liberal
François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC
So, what would be our best strategy, if you were in our shoes, to address that particular issue that you mentioned? We've heard it in a number of submissions. But clearly, as I understood, and you just confirmed, the 1.5% is split among different, I would say, partners in the industry. How would you tackle that issue in a very proactive way?
7:35 p.m.
President, Canadian Convenience Stores Association
In a proactive way, what we've been promoting for some time is the approach that the Australian government took to determine a reasonable rate.
We understand as merchants the importance of having a vibrant credit card system and we want to make sure that's ensured. The Australian government, when they looked at this as well, studied the issue, studied how much the costs were for all of those components of the credit card system to understand what was necessary and what was too much in terms of costs.
The recommendation that we would make is that a very fulsome study be conducted on all aspects of the credit card network system to understand where there is overcharging being done and where there's a situation where reductions should be passed along to merchants. With that in mind, the Australian government came back and initially created a rate of 0.55%. What we're talking about in Canada right now is 1.5%. They've since reduced that to 0.5%. From what I understand, they're looking at reducing that further to 0.3%.
In their review of the system in Australia, they have found that 0.5%, or an even lower rate, is sufficient to ensure that members of the credit card industry are making enough money, and compare that to 1.5% in Canada. We don't have a different system; it's exactly the same. What we're saying is it's too much. Studying that first, understanding and making sure that it's a reasonable rate is what we would suggest.
The other point that we've made, which we've seen in the United States, for example, is that some states in the U.S. have looked at the possibility of actually not charging credit card fees on the tax portion of purchases made. In our industry, for example, as I mentioned earlier, we collect $18-billion worth of taxes for federal-provincial governments. The thanks we get for that is when those purchases are made by credit cards, it costs us 1.5% to 4.5%.
What we suggest is if finance is looking at this, if this is something that you want to study, I would suggest that this would be a very good avenue to look at as well.
7:35 p.m.
Liberal
François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC
Does that apply as well to debit cards or is this just a credit card issue?
7:35 p.m.
President, Canadian Convenience Stores Association
It's just a credit card issue.
In the code of conduct that's under the FinPay committee, debit cards have been capped at a certain rate now. Merchants in Canada are quite happy with that rate.
7:35 p.m.
Liberal
7:35 p.m.
President, Canadian Convenience Stores Association
Between 5¢ and 10¢ a transaction.
7:35 p.m.
Liberal
François-Philippe Champagne Liberal Saint-Maurice—Champlain, QC
It's not percentages. It's a fixed amount?
7:35 p.m.
President, Canadian Convenience Stores Association
It's based on a fixed amount.
7:35 p.m.
Liberal
7:35 p.m.
Liberal
7:35 p.m.
Conservative
Phil McColeman Conservative Brantford—Brant, ON
Thank you, Chair.
Mr. Scholten, I go back with you to my early days as a member of Parliament.
I'd like to discuss this quickly. I represent an area that is the largest first nation in Canada, the Six Nations of the Grand River, and they have the largest cigarette manufacturer in Canada on Six Nations ground. It's called Grand River Enterprises, or GRE. I'm sure you're familiar with them.
Are you the organization that did the butt count on school grounds and street corners and things to find out how large the usage of contraband cigarettes is?
7:35 p.m.
Conservative
7:35 p.m.
President, Canadian Convenience Stores Association
I do. Which province would you like?
