Finance Committee on Oct. 18th, 2016

[The Chair, Liberal, Wayne Easter]

Thank you.

Mr. Dusseault, the floor is yours.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Thank you, Mr. Chair. I will speak a little English this morning. I feel comfortable.

First, I would like to thank the two PEIFA organizations who talked about the problem with business transfer within a family. I hear that it's a concern here too. I'm happy to say that one of my NDP colleagues has a private member's bill that will be up for debate quite soon, and I think the Federation of Agriculture, and probably the fishermen too, have shown their support for that bill. I hear that it's an issue for you, and we are hoping to get it resolved.

My first question will be for the chamber of commerce.

Madam Walsh McGuire, you alluded to the problem of access to capital in saying that there was a gap in access to capital, maybe more so for a young entrepreneur. Can you elaborate on what the federal government could do to help get capital for people who need it to start their business?

[Penny Walsh McGuire]

To reiterate, on the point of taxation waivers for new entrepreneurs, we have submitted some points around that in our written proposal from August.

I might ask my colleague Ron to speak to the access to capital. He's been leading a pretty important initiative through Island Advance around venture capital programs. I might get him to speak on that, please.

[Ron Keefe]

Thank you.

Access to capital is a very challenging problem in terms of small business, and we have been searching for innovative ways to attract capital. Our venture capital infrastructure in Canada is not as robust as we would like. We do believe that in Canada and the world it's very liquid; there is a lot of cash available. It's just very difficult to put structures and systems in place to access that capital, so we have looked to ways, and one way that we are trying in the province here is the creation of a fund for small businesses that will have some government involvement, but mainly private sector participation.

We have looked at taxation aspects of this. Flow-through shares have been a concept that we have pushed to several successive federal governments, in terms of trying to ensure that investment losses actually flow back through to individual investors when initial investments in companies are going to lose money until they get to a stage where they are viable, as they have in the mining sector and others.

BioAlliance and BIOTECanada certainly have been pushing that aspect, and we think that's a good way to do it. There are all kinds of things.... I know we don't have much time, and I'm aware of that, but there are all kinds of things that we have some good ideas about, and we would be more than pleased to share those ideas with you when there's more time.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

Thank you.

I will stay with you, Mr. Keefe. You talked about incubators and accelerators, and I'm very pleased to hear that it's working quite well here in P.E.I. I also have in my riding an incubator and accelerator, in a partnership at the University of Sherbrooke. I wonder what you would propose the federal government do to make sure it's still going well. You talked about infrastructure. Is the main proposal you have for the federal government to invest in infrastructure so those incubators and accelerators can continue to grow?

[Ron Keefe]

It is. Today, we are asking for an incubator or an accelerator that would allow us to move along the continuum. We have a very strong research network. A lot of federal dollars and a lot of provincial dollars have gone into that.

One of the many hats I wear is that I am the chairman of the tech transfer company at the University of Prince Edward Island. What we're trying to do is commercialize some of the great ideas that these innovators have.

The problem we face is that we are now at a stage where we don't have the physical infrastructure to allow start-up companies to expand, nor do we have the services that are required. That's what we need at this juncture in our development here in the province and, I'm going to say, certainly in the Atlantic region and I think throughout Canada. I think that strategic investment in infrastructure for economic development is important.

[The Chair, Liberal, Wayne Easter]

Just on the flow-through shares, Ron, is the proposal for flow-through shares in the main submission?

[Ron Keefe]

No, it is not.

[The Chair, Liberal, Wayne Easter]

Can you send the clerk a note on flow-through shares and what you're asking for there?

[Ron Keefe]

I might actually turn to Oliver, who is with BIOTECanada. Oliver is a director of BIOTECanada, and they had and continue to have a very strong position on this.

We'll do something on this.

[The Chair, Liberal, Wayne Easter]

Yes, between you and Oliver, if you can get a note to the clerk on flow-through shares and how they work, it will go to all the committee members and we can have a look at it.

[Ron Keefe]

I should say that the chamber of commerce also passed a resolution to the same effect.

[The Chair, Liberal, Wayne Easter]

Mr. Sobara, you have five minutes.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Five minutes? I think it was at six. A minute has disappeared.

Thank you, Mr. Chair.

Good morning, everyone. It's lovely to be here. It's my first time ever in Prince Edward Island. It's wonderful.

I can almost echo what Steven had to say on some of themes we've heard about in the last two days: human capital, skills related to immigration but also demographics, and taxation. I wasn't aware of the issues dealing with the transfer of farms within families. I grew up in northern British Columbia on the coast, so I'm well aware of the fisheries. In my area, it was salmon and halibut—groundfish—that were the big industries up in Prince Rupert. I've seen the contraction, so I understand what's going on here. Then there seem to be some comments on access to capital and some issues there.

To start off with my first theme, on literacy, Amanda, I believe your request is for $600,000 on an annual basis for the next three or four years. Is that correct?

[Amanda Beazley]

It's for four years.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Okay. I take it that the payback on it would be quite substantial.

[Amanda Beazley]

Yes, that's our hope with it too.

We are a not-for-profit. We do have a history of being effective and efficient with the use of funding, by necessity.

As Steven mentioned earlier on community literacy initiatives, as coalitions our hope with this funding is to form better, stronger partnerships with all community literacy organizations in our region as well and to work together to strengthen that so we can identify where the needs and gaps are in services.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

As an economist by training, I'll say that human capital is so important to increase economic growth. Those small investments are not glamour-type investments, but small investments in human capital and skills training are so important. I fully support your view on that.

On the labour side and the request for 2,000 plus immigrants—I believe done through your pilot project—my one question remains. Growing up in a small town, I've seen this when people immigrate to an area of the country that may be not as urban or as urbanized as a larger area, be that Toronto, Hamilton, Montreal, Vancouver, or wherever. On retaining those people once they do come, I would love to hear some feedback. Could you please keep it to 20 seconds on what the experience has been on retaining individuals who do immigrate to P.E.I. or Atlantic Canada and not having them leave for another part of the country?

[The Chair, Liberal, Wayne Easter]

Who wants to get that? Penny?

[Penny Walsh McGuire]

Yes. [Technical difficulty—Editor] related to the PEI Connectors program, it's specifically targeting an audience that is looking to become an entrepreneur here in Prince Edward Island, to create jobs and to create prosperity, but with that entrepreneurial newcomer comes a family, and maybe a partner or a spouse who is also looking for employment.

One initiative we've been working on with the PEI Association for Newcomers, as well as the provincial Office of Immigration, is trying to create connections not just with the entrepreneurs, existing businesses, and business people, but also with the employers, who are in fact our 1,000 members. There's that component. There's the integration from a cultural perspective. There is the idea of coming from a place with a very large populace to a place with a very small populace. All of these items are on the table for the chamber's activity around immigration, retention, and recruitment.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Does anybody else wish to comment before I go to my next question?

[Mary Robinson]

Our federation has done an outreach program not only with our grade schools but also with immigrants in offering a PD day on the farm. We're taking them out and giving them a glimpse into what opportunities exist for employment within agriculture. We took a busload of immigrants on a tour of a few farms and were impressed that there were connections made with a few of those people. They became employed on some of those farms that they were there to tour just for information purposes.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Thank you.

On the issue of the taxation and the capital gains exemption—Pierre-Luc, I think you said that one of your colleagues may be addressing this in a private member's bill—I would like to learn more about, Mr. Godfrey. I will follow up with you. You can comment on it, but I do wish to investigate with someone who sat on the CICA board for accounting standards. It never crossed our laps, but it's something that I think....

But I do want to talk about one thing that our committee heard last year, and we've heard loud and clear this year, and that is with regard to the airport here, the Charlottetown Airport, being one of those six airports. What would be the benefit of the system changing and allowing the airport to receive funds? I'll throw that out there.

[Penny Walsh McGuire]

If I recall, there are I think six airports that were on the Canadian Chamber of Commerce resolution and that of course don't have access to the ACAP funding because they're on federal land.

My colleagues at the airport have identified that infrastructure or that access to capital as important to both the security and the safety of the airport structure, as well as for upgrades for expanding the capacity of the runways, etc.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

If I could add one comment, I think the airport issue is actually tied to an immigration issue. When you have people who move to a certain part of the country, if they see that there is access to come and go on a freer basis, or an easier basis, then they're apt to stay, whether that's having an airport in Kelowna where you can catch a flight from Toronto to Kelowna on a daily basis, or having an airport here in Charlottetown where you can easily access the larger markets. If you want to go away for the weekend or travel or or something like that, then you have that access. I think it's important that we focus on that.