Finance Committee on Oct. 6th, 2016

[Chuck Davidson]

Thank you very much, Ms. Ashton.

This is a file that's obviously very near and dear to the chamber's heart. It's an issue that we've been dealing with. I've been up there on numerous occasions.

I appreciate your initial comment about the need for a long-term solution. I think there has been so much uncertainty in northern Manitoba in terms of the potential but also some of the challenges that the communities are dealing with. When I go to visit communities in northern Manitoba, there is, for those of you who may not be aware, an uncertainty in every single community in northern Manitoba.

In your home community of Thompson, there's a lot of uncertainty going on there in terms of what the long-term solutions will be. It's the same in Flin Flon, The Pas, and Churchill.

That's part of the rationale for our organization calling for a long-term economic development strategy. We need to determine what is in the best interests of northern Manitoba—with individuals from northern Manitoba. They need to be part of that solution, as do the indigenous community and the community as a whole in terms of looking at the long-term solution.

We're very aware of Mr. Spence's comments in terms of a solution for the Port of Churchill. Our organization hasn't taken a hard and fast position on exactly the nationalization. We look at the opportunities in the far north in terms of Churchill being a resupply port to the far north, in terms of the strategic asset we have. We think it would be significantly impacted if it were to be lost. We think it needs to be a key priority for the federal government as well as for the provincial government.

We understand that there are no quick solutions to this, but I think the fact that we're continuing to make this a top priority for our organization and continuing to push with both the provincial and federal governments is key. Working with stakeholders, making sure that individuals in the north are part of the solution, and making it a long-term solution, not one that will be there just for short-term gains, are what we would obviously be in favour of.

[Niki Ashton, NDP, Churchill—Keewatinook Aski, MB]

Thank you.

[The Chair, Liberal, Wayne Easter]

I won't take time away from you, Niki, but I have a question for the benefit of the committee.

Can somebody explain the cause-and-effect situation in Churchill with the rail line and the port? Can somebody, for the benefit of the committee, explain exactly what's going on? I think everybody's operating under the assumption that we all know. We may not all know.

Who wants to explain it?

[Niki Ashton, NDP, Churchill—Keewatinook Aski, MB]

I appreciate that, Wayne, and I know that with your background in agriculture you know the domino effect on the agricultural sector.

That is all to say that at the end of July, the American company that owns the port and the rail line basically said that they were shutting things down for the season with respect to the port in particular. This meant that about 70 people didn't have a job in a community of 800 people, so you can imagine that's devastating in and of itself. The various other spinoffs are the number of farmers who were expecting to ship their grain through Churchill and all of a sudden had no other option.

Obviously this has put the entire community's local business in a tailspin and it reverberates throughout the Hudson Bay line, and I appreciate the reference to the Bay line as well. Basically it's a major source of insecurity but also pessimism because people are wondering how to move forward from this.

What I will add finally is that many people have said, and I think we've heard it here as well, that there is a very significant role for the federal government to play. This used to be owned by the federal government. The for-profit model for a port like Churchill has not worked. In fact, it's been an epic failure.

Last week Minister Bains made an announcement in the short term but as has been indicated, much more is needed in the long term. This is the only deep-water Arctic seaport we have in our country. It's integral to the diversification of the Manitoban economy and particularly to the development in the far north as well.

I appreciate that reference from you, Mr. Davidson.

All signs point to the need for the federal government to be at the table to find a long-term solution for Churchill and also for Canada.

[The Chair, Liberal, Wayne Easter]

Okay, I think that spells it out.

Ms. O'Connell, you have the five-minute round.

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

Thank you very much, Mr. Chair.

Mr. Hicks, I'm really glad you're here and I'm really glad you presented. This issue is very near and dear to my heart.

My colleagues know, but you may not, that I spent 10 years in municipal government prior to running federally. One of the things I focused on most was persons with disabilities and how to make a change there, both in my public life as well as my private life. I was on some boards dealing with that, so this issue is important, and I thank you for being here.

I want to start off by saying that one of the things we were able to do in my municipality was hire some people with cognitive disabilities and put a training program in place. We worked with an organization that provided the “outside the job“ skills that were needed. For example, they learned how to take the bus to work every day and created that routine of who to go to.

We also knew with this partner organization the business case. To Mr. Liepert's point, the business case for hiring a person with a disability is actually there. They tend to be more loyal. There are some upfront costs, maybe in terms of accommodation, but they tend to not have to rehire someone, especially in the service industry.

That being said, I want to expand on your recommendation in terms of changing some of the tax systems. In my experience, those with disabilities tend to never find paid employment—it's usually only volunteer—to build up their résumés. Nobody ever hires them for paid employment, and sometimes it's a disadvantage to be paid because then they will lose their disability credit, or they will lose because of that income gap where you get benefits and then you lose them if you supplement them with anything else. This impacts someone's ability to be in the meaningful labour market.

Can you speak about what that means and the disadvantage of finding paid employment in terms of those other tax benefits or disability tax credits?

[James Hicks]

First off, I tried to stick primarily to federal issues, because this is a federal government. Typically, the provincial government is responsible for any disability pension that people get.

Money is provided by the federal government. Obviously there would need to be an agreement between the two governments so that they're not going to start clawing that back. There's no use in the federal government paying something out to try to bring somebody's level of poverty down, and then somebody else taking it back because it goes against their policies.

There needs to be a really good federal-provincial combination there, where they're actually talking to each other, and the municipalities. The FCM needs to be involved in identifying what impact it's going to have on the municipalities themselves, because the municipalities also get involved in a lot of those sorts of supports.

If the supports are done properly, it doesn't necessarily have to impact what's going on. If people are paid for what work they're doing, if they're doing a good job and they're paid, then you shouldn't have to lose benefits. That's where some of the refundable disability tax credit comes in. If it's refundable, even if you're in a lower paying job, you still get that money back.

Primarily the folks who are benefiting from the disability tax credit are those who are at a high income level. They're well-employed and they're in a higher tax bracket. The fact that they're paying more taxes means they get that full credit. The folks who aren't paying a lot of taxes don't get that credit. That's the rationale behind it.

I just go back to the whole idea that it needs to be a joint effort between all levels of government. Although I'm really happy that Minister Qualtrough is looking at a Canadians with disabilities act, the fact that there was a choice made for it to be only federal means they're not going to get at a lot of the issues that happen between governments in trying to support this population.

[The Chair, Liberal, Wayne Easter]

Mr. Groening wants in.

[Ralph Groening]

Thank you for the opportunity.

Accessibility for Manitobans and the national or federal role is very relevant to us at this moment. We've been involved as an organization with the provincial government in establishing and creating The Accessibility for Manitobans Act of 2013. It's a good act. The standards are in the process of being developed. I had a good conversation with Mr. Hicks this morning. I certainly am hopeful and I appreciate some of his comments that are supportive of how we're trying to move ahead as a provincial organization with the support of the province.

We also have been looking to some degree at the Ontario model, but we need leadership from the federal government. That has been part of our discussion with our accessibility for Manitobans advisory council. We have directly referenced and would ask that you provide some of that detail to would allow us to play a role in having a better standard for Canadians with disabilities, not only Manitobans or Ontarians.

Thank you for the opportunity. I think it's very important that you move ahead with that.

[The Chair, Liberal, Wayne Easter]

Mr. Aboultaif.

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

Thank you all for good presentations.

I would like to focus my question on productivity. I heard from Ms. Lane and Mr. Davidson a little bit on the internal trade barriers and the labour mobility between provinces, as well as strategic trade, safer workplaces, and human capital policies.

One thing I believe we do suffer from is in terms of productivity. That means competitiveness. That means a better place in the world market, especially if we can encourage—and we do encourage—trade agreements, free trade agreements with the rest of the world. It would be nice to sign free trade agreements, but if you're not in a competitive position, you'll be losing more than you will be gaining.

My question is to Mr. Davidson, Mr. Hicks, Ms. Lane, and whoever else wants to participate. How do we improve productivity among our industries, specifically in Manitoba since we're here; and why do we always ask the federal government to interfere when I do believe the private sector is the main factor in working on that because they will be front stage to do so?

[The Chair, Liberal, Wayne Easter]

Go ahead, Mr. Davidson.

[Chuck Davidson]

That's a great question. In regard to productivity, this is not a “government fix everything for business” solution in my mind. The business has a role to play. I think the bigger issue is what we are doing in Canada and in the provincial government about what the regulations are, what the challenges are, and what the red tape is that is before businesses right now. That's always been the biggest challenge. I met with a business last week in Brandon that was dealing with a workplace health and safety issue. They're dealing with a piece of machinery. They had an inspector come in and say that this piece of machinery needed to have a guard on it. This piece of machinery they've had in place for 35 years, and its never had a guard. Someone came in and has basically shut down this organization for the past 10 days until they can put a guard in place for a piece of machinery that's never had one.

Things like that are some of the challenges that corporations and businesses are dealing with. We need to make sure that we have a good relationship between business and government in what some of those challenges are that businesses are dealing with and how they can respond to them. Whether it's red tape, regulations, or paperwork that needs to continually be done, what are we doing for these businesses and are we listening to what's holding them back? I think that's creating that better relationship. That's going to be a key to increasing productivity in Canada.

[Ziad Aboultaif, Conservative, Edmonton Manning, AB]

Ms. Lane.

[Janet Lane]

There are so many answers to this question, but from my perspective it is about skills and competencies. We could go right back to our literacy levels, which are in decline in this country. The federal government does have a role to play in supporting the development of literacy skills. I know that everybody thinks that's education, but when it comes to workplace training, we have aboriginal people, immigrants, and people with disabilities. Especially for people with disabilities, we don't think about that, but it's harder for them if they've had this disability from birth, and it's harder for them to gain those cognitive skills that they need in the first place. We could be supporting their training in adulthood a bit longer.

For the cognitive skills that are needed, we are in decline and we need more of them. We have no level one jobs left on a five-point scale for literacy and cognitive skills in this country, but we still have 40% of our workforce at levels one and two. We could increase our productivity by increasing the cognitive, literacy, and math skills of our workforce, and then demanding that we use them. If we want to be more productive in this country, we're going to have to raise the level of demand for skills, as well as our level of supply.

For some of the jobs, and for want of a better word, we've dumbed down those jobs over the last little while. We need people to be using all the skills they have, and I think that the federal government has a role to play in increasing the demand for literacy skills for our employers to help them add more value. Let's take McDonald's. Everybody thinks McDonald's is a low-skilled workforce, but it's getting to be a higher-skilled workforce. When they put in those new machines, they had to increase the number of people to make the hamburgers because a customized hamburger is more difficult to make, and it takes more cognitive skill than what you did with a Big Mac. Even McDonald's has increased the demand for cognitive skills in their employees, and their sales are going up and their profits are going up because of it. That's the kind of thing I'm talking about.

[The Chair, Liberal, Wayne Easter]

Ms. Rosales.

[Carinna Rosales]

I'd just like to add that some policies create additional barriers that reduce productivity. When we're looking at our skilled immigrants, for example, the policies established by the regulatory bodies and trade associations mean that in some instances folks have to go back right to the high school level when the different kinds of assessments that should be done aren't being done, and it can take someone four years to requalify through the process.

Another challenge the federal government could play a role in is working with local governments. Here in Manitoba we have shortages in the health care field of nurses and doctors. We have a provincial government that's closing bridging programs. I have now a wait list of internationally trained nurses who were actively recruited here to work in this field, and now they can't even access the education they require to do so.

I would encourage the government to look to work collaboratively with provinces and regulatory bodies around the policies that are creating barriers.

[The Chair, Liberal, Wayne Easter]

Thank you.

Mr. Grewal.

[Raj Grewal, Liberal, Brampton East, ON]

Thank you, Mr. Chair, and thank you to all of our witnesses for coming today.

I'm just looking at the Conference Board of Canada's website, and Manitoba is one of the provinces that is supposed to have greater than 2% GDP growth this year. It is a light in the country, especially given the grim outlook not only for Canada's economy but for the world economy. For that, I congratulate you all.

My first question is to the Association of Manitoba Municipalities. You spoke about infrastructure funding, and Manitoba has received $82 million in public transit infrastructure funding and $95 million in clean water in the first round. I totally recognize the fact that small cities weren't included in the phase one infrastructure funding. In phase two, the minister made a point of saying that the funding would be more permanent and more flexible to ensure a bottom-up approach because we recognize that municipalities have the talent and the knowledge to invest the money correctly. What is your organization doing? What are municipalities doing here to ensure that the money is spent correctly?

[Ralph Groening]

I think I started my comments by offering that we are the third level of government, and sometimes the least appreciated. As an organization representing the municipalities, we are on the ground. We're grassroots. We are directly on site and are able to identify the projects. That's why we appreciate having been able to play a role with the federal government in identifying projects. We are there and we have the ability. We understand the need for the projects.

[Raj Grewal, Liberal, Brampton East, ON]

How much is the infrastructure shortfall amongst your municipal partners?

[Ralph Groening]

We have identified $11 billion. It's growing rapidly because we do have growth in our province. That, of course, places additional stress on our infrastructure.

[Raj Grewal, Liberal, Brampton East, ON]

You mentioned that there's a shortfall in the cost of policing. Is this with the RCMP or the local...? You have two local police services here, the Winnipeg Police Service and another one. Is the shortfall with the RCMP?

[Ralph Groening]

The shortfall is more with the cities of Winnipeg and Brandon. The larger police forces in particular are struggling to maintain the level of service that's expected by their communities. Because of the ability of the RCMP to unionize, we have already identified that as an additional cause for concern and very likely a potential additional cost. It is with the larger cities, the cost of policing, and the potential increased RCMP costs.

[Raj Grewal, Liberal, Brampton East, ON]

Is there a number of officers that you could quantify?