Finance Committee on Oct. 5th, 2016

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

I'd like to ask one very brief question, Mr. Chair.

Do you have any comment or position on the Agrium-PotashCorp merger?

[Pamela Schwann]

I think that's the reality of how companies have to react to the pressures they're under. For these companies to remain viable, they have to look to strengthen themselves. Agrium is not a big potash mining company. They have one potash mine, but they have a lot of value-added down the supply chain, so it will strengthen the companies.

When we're looking at places like Russia that don't have the environmental standards and the associated costs, we need to make sure that our companies in Canada remain competitive. I think this is really a response to that pressure.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you, Ron and Pamela.

Could I ask a question?

Three or four times it has been mentioned what Russia does in terms of...I guess what little they do. Is there anywhere that information is accessible, so we can get a good comparison?

[Pamela Schwann]

I can forward that information. The most recent article is from Bloomberg on two new potash mines a Russian company is going to put into production at significantly reduced operating costs.

[The Chair, Liberal, Wayne Easter]

If you could send that to the clerk, Pamela, it would be useful information for the committee to have. Then we'd have a direct comparison.

Ms. O'Connell.

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

Thank you very much, Mr. Chair.

Thank you all for coming. I want to follow up on what my colleague, Mr. Grewal, talked about with regard to our government's plan to tax carbon pollution. As you mentioned, it is cost neutral in the sense that the provinces would keep all the revenues and be able to use them as we move toward this low-carbon economy.

Mr. Hall, you mentioned your priorities for funding. With this revenue that the provinces would receive from this program, what would be your priority in how they can flow that back and create infrastructure? You talked about pricing margins in the agricultural area. What should be the priority use of this tax revenue from the carbon pollution? What would be your priority for the use of those funds?

[Norm Hall]

Now you've got me.

I guess there are a number of areas that can be looked at. As I mentioned earlier in my presentation, there are ecological goods and services that can be used in the grasslands area, in planting trees, in storage of water. That's simply off the top of my head. We haven't gone further on this. As I said, this announcement was made on Monday and with the huge dollars we're talking about on an annual basis, there would be a number of places it could be spent.

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

Fair enough. I know I put you on the spot there.

I would only say that in thinking about this in your sector, in particular—and I would recommend that all provinces think about this—you talked about those tight margins. However, the right kind of investment, moving toward a low-carbon economy, using these funds on the right kind of investment could increase your margins. You could invest in other things, like infrastructure, that would ultimately help those costs, so I would start thinking about those priorities to move in this direction.

I have a question for Mr. Moran with regard to housing. I'm from Ontario, so I'm not sure if our situation is different from that facing your corporation, but an interesting proposal that was brought to my attention in my region was about the ability to use one's capital assets. If you've owned some of these assets—in my region there are corporations that have owned housing assets for a long time and the mortgages are essentially paid off—and if they could access some of them, 20% let's say, they could use those funds to reinvest in retrofits, or potentially for new programs or expansion. Is that something that would be of interest to you? Would that not work for your corporation?

I'm simply trying to get a little bit of feedback.

[Doug Moran]

Simply put, we do that right now. We can only borrow about 60% of our total asset base to do anything, but it is something we're looking at right now, how we could utilize the money we already have to do other things, like purchase other apartment buildings or get involved with the private sector. If we can convince somebody to build a 12-unit apartment building, we certainly could utilize some of that money.

We do have options, but we need additional help as well.

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

Great. Thank you.

I have one last question for Mr. Potter or Mr. Hudson. I was having a conversation with my colleague at breakfast the other day about tracking in this country, and I would assume in rural communities that it's even worse. We don't really have a way to track how many people get sick or who is getting these diseases, because doctors don't have a universal coding system. Although I would never advocate for the U.S. model, when every doctor has to submit every claim to insurance, they have a universal coding system, so, at the very least, that information can be used in national standards to know how many people had the flu this year or something like that.

How do you get this information? Do you feel that your numbers are under-representing some diseases in certain areas? How do we really know what's out there when we don't really have a universal system to track?

[Andrew Potter]

You raise a very good point. We don't have a good system in this country. We have a lot of very good provincial systems that don't talk to each other, which doesn't do us a whole heck of a lot of good as a country.

If you look at something like influenza, nobody knows how big a problem it is in this country. We all tend to say, “It's just the flu." It's not just the flu; it's the number one killer among infectious diseases in developed countries, and we simply don't have the information.

There was a central study done by a very good scientist in this country, Mohamed Karmali, that suggests that the rate of most diseases is about 25 times higher than reported. That study was done in the Hamilton area, and there's no reason that it would be any different anywhere else. You raise a great point, and I would argue that when you try to tie that to immunization records and that type of thing, you confound the problem.

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

I'll just squeeze in a follow-up there. Would a recommendation be, for example, when we're looking at our health care system, some national leadership on standardizing of reporting and things like that? I know, again, that each province is really doing something different, but at least we might recommend having some guidelines. I would assume that would help your work in your research as well.

[Andrew Potter]

There's no question about that. Anybody involved in disease surveillance and that type of thing relies on this type of information. I do believe there is a void waiting to be filled there at the federal level. I don't think you'll find anyone in the infectious disease field who would disagree.

[The Chair, Liberal, Wayne Easter]

Thank you both.

We will take a couple of more questions, a quick one from each party, if you want.

Mr. Moran, you have eight really good recommendations in here that really relate to aboriginal communities and housing. It seems to me some of these should be funded out of Indigenous Affairs. Do you have any discussions with Indigenous and Northern Affairs Canada on these kind of points?

[Doug Moran]

Not at all.

[The Chair, Liberal, Wayne Easter]

Okay. One of our members on the committee, Robert-Falcon Ouellette, would be questioning you intensely about these recommendations if he were here. We will give him a copy as soon as we get back to Ottawa, and he can look into that as well. Thank you for that.

I have one other question, Ms. Schwann. Your recommendation five is to facilitate the transition to a low-carbon economy by promoting and investing in the use of nuclear power and carbon capture and sequestration technology. How do you suggest we do that in budget 2017-18?

[Pamela Schwann]

On the CCS front, Boundary Dam was the model in response to the federal legislation that was passed, which basically said that thermal coal power stations of a certain age had to be shut down unless they went to CCS.

Possibly supporting funding for additional CCS power stations to leverage the existing technology would be one area that could then be.... And assistance in exporting the existing technology, quite frankly, would also maybe tie into the trade missions.

On the nuclear front, we provide 22% of the world's uranium. Supporting the advancement of nuclear power throughout Canada, and also the world via the trade missions, would be helpful.

Also useful would be moving towards really looking at small modular reactors that could be used in remote areas throughout Canada, and even at mine sites, to help achieve reductions in diesel energy and things like that. They have started to look at doing this in Japan now, and in the United States. We know that regulatory approval for that would probably take seven years, but it's a new and emerging technology that would definitely address greenhouse gases.

I think there has to be a lot of thought about what's going to happen to northern Canada with climate change. There are not a lot of options out there. You can't just run natural gas to the north, so what is the power infrastructure going to be like when you have eight months of winter and no solar and no reliable wind? What are the options going to be?

I think that maybe some thought could happen around those two fronts.

[The Chair, Liberal, Wayne Easter]

We'll take one question from Mr. Aboultaif, and one from Mr. Weir.

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

I have a question for Robert and Holly from SSM.

You mentioned the benefit of expanded CPP, GIS, and all that. The tone sounds like you are probably looking to an immediate, positive impact on seniors, while the expansion of CPP is going to be years down the road.

We see the expansion of CPP as a tax levy, and that it's going to quite a negative impact on businesses.

How do you see that happening? Are you looking for an immediate solution to pensions? And on the pension or GIS side, it seems that you are in support of the CPP expansion.

[Holly Schick]

Not yet, certainly. I think it's both immediate and long term. There is a combination of those that we'd like to see.

In the long term, yes, increasing people's CPP contributions in small ways will help.

In the more immediate term, though, we have people who are living just on pension incomes that put them below the poverty level. We'd like to see things that happen immediately to help increase CPP and OAS for the people who are currently receiving those pensions.

We get comments lots of times from folks who talk about their pension going up by one dollar a month, or something of that sort, and that it's really not helping them keep pace with the cost of living. We often also hear stories of people who are making decisions between whether they can afford their medication or to put their money toward buying food or paying the rent.

If we have people who don't have the adequate, basic living income that we need as Canadians, we need to to address that, be they older adults on pensions or other people as well, and certainly low-income folks of any sort.

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

Just to clarify, the current CPP expansion, as it's being presented, is more or less a tax levy on the businesses and will not provide an immediate solution to pensioners and seniors right now. That's just to clarify that point.

Am I good?

[The Chair, Liberal, Wayne Easter]

Yes, you're good, but that's your point of view.

Mr. Weir.

[Erin Weir, NDP, Regina—Lewvan, SK]

Ms. Schwann, you spoke about the number of people employed in mining across the province. Of course, that workforce would include people who live here in Regina but work at mines in other locations.

The federal government extended employment insurance benefits for certain regions in response to the drop in commodity prices, but left out Regina. So of the eight EI regions across Alberta and Saskatchewan, seven currently have extended EI benefits; Regina is the only one that doesn't.

I wonder if you could speak from the perspective of your members and their employees about the importance of including our city in the extended EI benefits.

[Pamela Schwann]

I think the short answer is that we've been fortunate that in our sector in the Regina region, we haven't seen the degree of layoffs that perhaps the oil and gas sector has seen. I think Estevan was the leading place in Canada for expansion and they rapidly lost a lot of employment. I think it was very important that those changes were made to include the Estevan area, and certainly if Regina has the same employment statistics, and I'm not sure they do, it would be important that this benefit also be extended.