Finance Committee on Oct. 4th, 2016

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

Thank you.

Finally, again, in one of the municipalities that I represent, council just approved a one-dig policy, which means any time a road is dug up by the municipality, it'll put in the tubes and the piping for future broadband. They're saying that they will come to the table, and it will have a minimum impact on that construction project, but that they are then ready, once the service provider or the federal government or whomever comes to the table with the rest of the infrastructure.

Is this something your members are discussing in terms of being, essentially, shovel-ready for this type of broadband?

[Sue Bohaichuk]

In most of our rural areas, the physical space is not too much of a challenge. That's probably more of an issue in our Edmontons and Calgarys where rights-of-way are in busy high traffic density areas. We tend to use the template that the Federation of Canadian Municipalities put out fairly recently. It really helps to resolve disputes between municipalities and service providers. But like you said, in the good old wide country areas, right of way doesn't tend to be a biggie.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

Great. Thank you very much.

My question is for the National Cattle Feeders' Association. You spoke about the infrastructure and the current government plan and it sounded like you suggested that rural infrastructure is really not being addressed. You mentioned that the pillars of the current plan are things that don't take into account the rural infrastructure need. However, in your brief, you actually specifically point out things like telecommunications as well as social infrastructure like child care, heath care, social services, recreation. Did I misunderstand what you were saying versus what's in your brief? Based on your brief, it talks about some of the pillars that would be included in, for example, the current government's phase two infrastructure plan.

[Casey Vander Ploeg]

Thanks for the question, Ms. O'Connell.

In our brief, we point out a number of areas of rural infrastructure that we should be looking at, not just roads and bridges but things like rail infrastructure. For our sector, border infrastructure is a big one. Live cattle move back and forth across the Canada-U.S. border. Last year, over a million head went back and forth over that border. Inspection facilities at those border crossings are deteriorating, so looking at investments there would be helpful as well. There's also telecommunications and things like community infrastructure for these small rural communities that need to attract a workforce, and sometimes the communities don't have those amenities that people are looking for. When we're talking infrastructure, we are talking about a wide range of possible investment.

That said, in our discussions with our members what emerged from what cattle feeders are telling us is that, as important as all of those are, investments there won't mean a lot ultimately if we don't have the road and bridge infrastructure to maximize agriculture's contribution. That is of primary importance. I didn't have enough time in the presentation to talk about those other investments, so I wanted to basically focus on what we would consider to be the urgent need, which is roads and bridges.

I'll make just one final point. With respect to counties like Lethbridge, this county has a very small property tax base. There are very few residents, very few homes. There's very little linear tax in the form of utility corridors, oil and gas, but what they do have is a lot of farmland, and farmland is typically taxed differently from other classes of property.

On the flip side of the low tax base, what you have are huge infrastructure needs, a lot of that driven by irrigation. There are miles and miles of irrigation canals in that county and they need bridges over those canals to move that product. We're looking in that particular case at a county with a poor tax base and with a very high expenditure obligation in the context of a provincially, regionally, and nationally important agricultural zone.

I apologize if there was any confusion. I just wanted to really strike to the important heart of the matter on this one.

[The Chair, Liberal, Wayne Easter]

Thank you both. Thank you, Jen.

Mr. Aboultaif.

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

Good morning, gentlemen. Thank you very much for all your presentations. I'm going to focus right now on agriculture and my questions are for Mr. Friesen and Mr. Vander Ploeg. I always believed that one of the largest elements of support in our economy in Canada, and specifically in western Canada, is agriculture. I'd like to see that industry advancing further on all levels, first of all, to increase the level of contribution in what we produce, in other words, to advance our economy further and to have job creation, especially in the rural areas, where we do suffer from a young labour force and people leaving to the urban centres.

Mr. Friesen, you did not ask the government for any money, which is unusual. We haven't heard that throughout our consultations. How can we use any fund, any government participation, in advancing our agriculture industry, and where is the potential in terms of dollars and in terms of man-hours within the spectrum of what we do in the next few years?

As I said earlier, next to oil in Alberta, I see agriculture as the filler for the gaps that we have right now that are being created by the volatile oil markets.

[Bob Friesen]

I'm not sure if I understood the question completely.

Are you asking what we need from government over the next few years?

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

Yes.

[Bob Friesen]

One of the things I know that general farm organizations are working on is how to create better business risk management programs to make sure that they cover severe downturns in farm income, but it's not something that Farmers of North America is involved in. We typically stick to regulatory and/or policy changes that impact directly on farm profitability. Business management programs typically are just band-aids to help farmers survive very critical low-income periods.

But what our proposal...and I'm sorry, I do have a brief and the clerk has the brief. It's being translated. My invitation was on short notice so I submitted it on Friday. Please avail yourselves of that information, because it's very clear what we're asking for and it's not a very long document at all.

What we are simply doing.... Farmers really, especially young farmers, have a lot of confidence in the industry. Typically older farmers—and our average age of farmers is quite high—are already winding down towards retirement. The rule change that we're asking for really is more for young farmers who still look at farming as something that they want to do for the next 25 or 30 years. A lot of these farmers are also quite willing to invest in the industry. That's why we're suggesting to at least remove the disincentive that farmers currently have to use the $900 million that they're sitting on to perhaps invest.

One of the things that Farmers of North America is doing is that we're looking for different opportunities where farmers can own more of the value chain. To that end, we've started a fertilizer manufacturing project. We've had farmers invest about $10 million in that. Just recently we are now also ready to close and put shovel in the ground on the first fertilizer super-centre for a farmer-owned fertilizer distribution company. We're also creating opportunities for farmers to own more of the value chain, because it's only when there's ownership in the value chain that they can really accrue the benefit from value-added.

We believe that the environment is right to create more and more incentives for farmers to invest back into the industry, especially with the multiplier factor that we have in the industry, which ranges anywhere between four and seven as a multiplier factor of money invested in agriculture. That's what we're looking towards, more private sector solutions to some of the challenges that we've had in agriculture.

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

Mr. Vander Ploeg, would you like to elaborate on that too, please?

[Casey Vander Ploeg]

Sure.

Very briefly, I think I understand your question. It's essentially getting to an understanding of the potential of agriculture in Canada, and I think that potential is tremendous.

Half of what we produce in this country, we export. Canada is one of only five major net exporters of agriculture and agri-food products in the world. Increasingly, going forward, the world is going to rely on Canada for its food supply. We're well positioned, I think, to serve that role.

Over the last 10 years, our food exports have grown by almost 80%, from $31 billion to over $56 billion, and that has boosted farm cash receipts by almost 50% over the same period. Agriculture is the third-largest single contributor to our GDP, 8% of the total GDP employment, one out of every eight jobs. Agriculture, out of all the industries, has a tremendous track record on efficiency and productivity gains. It's a very dynamic, innovative industry. We don't tend to think of it that way, but it is. We need government policy to line up with that potential, and I would suggest three ways.

First, agriculture and agri-food has a huge labour shortage. It's severe and it's chronic, both on farm and off farm. When we look at beef, all you need to do is take a look at beef processing facilities, whether in Brooks, High River, or Guelph. There are literally hundreds of work stations on the line that are vacant. We cannot find the workers for those beef plants, so labour is a challenge. Industry is coming around that. Over 80 agriculture association groups have come together under the Canadian Agricultural Human Resource Council to develop the labour task force action plan. We've made recommendations to the federal government on our labour needs.

Second is trade. We have a new trade deal with Europe. We have the pending Trans-Pacific Partnership. We also have a lot of interest and growing interest from China on Canadian agricultural products. Trade-related issues, freer trade, fairer trade, and more robust trade is definitely needed for the agriculture sector.

The third—we've done a lot of talking about it—is infrastructure to support that agriculture investment. If we can get our head around those three things, it puts agriculture well positioned to be a significant economic generator in the future. People need to eat and we can feed them.

[The Chair, Liberal, Wayne Easter]

Thank you, Casey. We're well over time on that round.

Mr. Grewal.

[Raj Grewal, Liberal, Brampton East, ON]

Thank you, Mr. Chair.

Thank you to our witnesses for coming today. We really appreciate it.

Ms. Augustin, I agree with all of your three recommendations. You'll be happy to know that members on the government side have also started youth councils in their own ridings to specifically support youth entrepreneurship and to encourage young Canadians to participate in the democratic process.

You don't have a cost on your recommendations. Do you have an amount that you would ask for?

[Agnes Augustin]

We do.

[Raj Grewal, Liberal, Brampton East, ON]

What would the number be?

[Agnes Augustin]

In our brief we asked for $10 million over five years, $2 million per year, of which we allocate a certain portion to discoverability because we believe that it's imperative that anything that's done online has to be sound and monetized. The other portion is for research.

[Raj Grewal, Liberal, Brampton East, ON]

Thank you very much.

Mayor Holmes, everybody's picking on you, but we really understand the importance of local decision-making. One of the frustrations I have in my city, in Brampton—it's one of the fastest-growing cities in the province of Ontario—is that our council is very dysfunctional. We can't get infrastructure money to the City of Brampton because the City of Brampton cannot get projects approved at the council level. It goes both ways when we say that, yes, we want to encourage local decision-making, but if, like in my example, the local government doesn't have its act together, the citizens of that city suffer.

I couldn't agree with you more that the funding allocation form should be more relaxed, and Minister Sohi has a great job of that. He held a town hall in our city just a few weeks ago, and he really focused on the fact that we're here to work and partner with cities.

What are you guys doing in Alberta to make sure your cities are taking advantage of the infrastructure funding?

In prior years, as well, the City of Brampton never applied, and then they complained.

[Lisa Holmes]

Well, actually, the changes to the Alberta Municipal Government Act are going to help that, for sure.

Obviously, it does depend on local councils. I think what's happening with yours is the exception, not the rule. One thing we're seeing is a lot more focus on intra-municipal collaborative planning. We will be required in Alberta to have intra-municipal collaborative framework agreements with our regional partners.

We're seeing the success coming out of the Edmonton region and the Capital Region Board, and it's the same in the Calgary region as well. One item that they've put forward is infrastructure prioritization for the entire region. If we see coordination at the regional level, and it's a regional priority and determined that way, then I think there may be more comfort in the money going towards the local governments.

As an aside, we're also putting some more standards in our code of conduct and things like that as well. I do think it's important that we're not penalized for some of the unfortunate situations out there.

We are seeing that the five-year capital plans are going to be great tools moving forward, making people more accountable. It's such a need. I think that with the pressure from the public when things happen, especially in regard to health and safety of water, and waste-water projects, there is not going to be an issue about the money being spent in the right way.

[Raj Grewal, Liberal, Brampton East, ON]

Thank you.

You spoke about crime rates, which is actually news to me. I didn't know it was that high in this region. It's very surprising.

You asked for additional RCMP support. What's the total budget ask for that?

[Sue Bohaichuk]

We've never been able to get a clear answer from Public Safety Canada or the RCMP, but we do know that in Alberta we are currently short somewhere in the neighbourhood of about 30 to 40 officers.

That doesn't sound like a lot, but a lot of those are located in what we'll call rural detachments, where there's a really high rate of burnout and overtime, and things like that.

[Raj Grewal, Liberal, Brampton East, ON]

Thank you for your answers.

Mr. Wicklum, that's a great initiative, a great idea.

I echo my colleague's sentiments on being more public with the good things and great things you do. You mentioned partnering for a supercluster in Minister Bains's innovation agenda. Innovation is essential to our government's economic growth strategy.

What do you anticipate the financial ask will be from your organization?

[Dan Wicklum]

The way we're looking at it is this. What messages have the government given in terms of what the opportunity space is? In the last budget, your government messaged that there would be about $800 million, profiled over several years, for somewhere between three and five superclusters.

I'll answer the question this way. We could very responsibly invest $800 million of that money, but we understand that this is a national program, coast to coast, and not just about the oil and gas sector. We very much fall into the notion of form follows function. Again, starting last night, we had our senior leaders together and we're figuring out, being extremely crisp, what this cluster could actually deliver for Canada in terms of innovation, and then we'll develop the mechanics and the ask after the fact.

[Raj Grewal, Liberal, Brampton East, ON]

Have you met with anybody from the ministry?

[The Chair, Liberal, Wayne Easter]

I'm sorry, you'll have to leave your next question to the next....

Okay. Go ahead, but keep it tight.

[Raj Grewal, Liberal, Brampton East, ON]

I appreciate that from my wonderful colleague across the way.

Have you met with anybody from the ministry?