Evidence of meeting #45 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was federal.
10 a.m.
Liberal
The Chair Liberal Wayne Easter
I need more than programming when it comes to computers sometimes.
Go ahead, Mr. Sorbara.
10 a.m.
Liberal
Francesco Sorbara Liberal Vaughan—Woodbridge, ON
Thank you, Mr. Chair, and good morning, everyone.
There are lots of good ideas here. That's the way I like to start.
I'll start with a theme that we have heard for three days in a row. I completely agree with you on the principles of rent or leases for airports. In the area I'm from, the GTA, the Greater Toronto Airports Authority, or GTAA, pays approximately $150 million in ground lease rent. I just want to confirm that this fee is a full pass-through, in that whatever the airport is charged gets charged to consumers using the airport.
10 a.m.
Executive Director, Atlantic Canada Airports Association
Yes, airports are closed-loop systems. They're charged rent by the federal government, which was $323 million in 2015, and as the airport continues to grow, we're anticipating that will move to $400 million by 2020. We think that now is the time to change that, to cap rent for at least our larger airports but also to eliminate rent for airports of fewer than three million passengers. These airports need that investment to be put back into their infrastructure and to support growing our economy and shipping our seafood and all the things we are doing in our region. We would like to see rent eliminated for our smaller airports.
10:05 a.m.
Liberal
Francesco Sorbara Liberal Vaughan—Woodbridge, ON
When people speak about innovation and productivity and these cliché words, what it comes down to is that airports are economic generators for tourism, for shipping lobsters or other things, and also for bringing in talent.
People wanting to move to a certain area will want to know there is great access to an airport to travel and so forth, so that's imperative. There's also the issue of leakage, because millions of Canadians cross the border every day—especially the ones lucky enough to live close to the border—to use a U.S. airport because it's much cheaper.
I'm moving on to coding. Is there a numerical ask?
10:05 a.m.
Chief Executive Officer, Ladies Learning Code
Yes. We wanted to expand our programming at Ladies. We've asked for $3 million.
10:05 a.m.
Liberal
Francesco Sorbara Liberal Vaughan—Woodbridge, ON
It's $3 million.
I have two young daughters at home. I hope they're afforded every opportunity, as any other Canadian would be. Are these programs strictly offered to young girls, or to young girls and youth? How does that work?
10:05 a.m.
Chief Executive Officer, Ladies Learning Code
As an organization, we run a lot of different programming, and it's for anything from young girls to kids to educators to adult women. We specifically want to grow programming for our adult women and young girls, and we're focusing on expanding that, which is the most under-represented group within our offering of programs.
10:05 a.m.
Liberal
Francesco Sorbara Liberal Vaughan—Woodbridge, ON
Okay. Thank you. I think it's a great program. It's a great pilot. I'm glad to see you're doing that. It's one step above literacy. We had one presenter yesterday who talked about just having people becoming literate. This is obviously people taking it to the next level.
Mr. Poschmann, I would love to hear your view on the housing market and maybe some of the measures that we've enacted. If you could just answer for 30 seconds, that would be great, because I would like to ask another person a question.
10:05 a.m.
President and Chief Executive Officer, Atlantic Provinces Economic Council
Thank you, Mr. Chairman. Thank you for the question.
Yes, over the past several years, collectively we've made important changes to the mortgage insurance system, which I think in general have been quite good, as well as important structural changes in the way we will deliver and fund mortgage insurance.
The current government has since made a couple of changes to the rules regarding qualifications for down payments and maximum limits on loans. These took place after a one-year or two-year pause in changes to regulations. I think that it was good that we waited that long before the further tightening that the government has put on the table.
I do worry that the current measures will make life a little more difficult than it has to be for first-time buyers. Time will tell. At this point, I would strongly recommend that the finance department in the government take no further action on the housing market front until the market has digested the changes that are currently under way.
10:05 a.m.
Liberal
Francesco Sorbara Liberal Vaughan—Woodbridge, ON
You spoke of a patent box or an innovation box, and you mentioned that two provinces have already enacted that measure. I'm quite interested because I think you are correct in that. The material I've read as an economist said that we do favour providing tax credits for labour on R and D spending versus the capital input side. With that, the output from the capital that's been invested, we're not rewarding....
With the two provinces you mentioned, how is it working out for them? Is there any data to coming out from those measures that were enacted?
10:05 a.m.
President and Chief Executive Officer, Atlantic Provinces Economic Council
Thank you again.
There is no data, and there won't be any for quite some time. In Quebec, the measure was introduced in the last budget, along with the ways and means. In Saskatchewan, the proposal for an innovation box was presented in the budget as a proposal, with the details to be worked out later. The government undertook an internal task force, which will be reporting on the details any time around now in Saskatchewan.
I would anticipate very modest results, because it is relevant only to provincial income taxes, which is a small portion of the overall tax bill that a corporation faces. Larger corporations and multi-jurisdictional or multi-national corporations tend not to pay much provincial income tax. Small businesses within a province tend to pay none at all. It would only be a small subset of businesses that would be able to avail themselves of the benefits of a provincial innovation box. In conjunction with a federal program designed similarly, the impact could be quite different.
10:10 a.m.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
Thank you, Mr. Chair, and thank you to all of our witnesses today.
I'm going to start with Ladies Learning Code. After people take the course with you, do they stick with coding?
10:10 a.m.
Chief Executive Officer, Ladies Learning Code
That's a good question.
We have a wide range of experiences. On the adult side, our largest group, the vast majority of women are looking to upgrade their skills. They are taking on additional opportunities at work and taking on more responsibilities. We do have another group, about 20%, that go on and pursue computer science, or take a boot camp—if you've heard of coding boot camps—and then they become developers.
Mainly our adult women are interested in being able to take on additional work, improve their skills, get professional development, get the raise they're looking for, and do that kind of thing.
10:10 a.m.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
If you were to receive the financial support, how quickly could you scale up and show that you would have quantifiable outcomes?
10:10 a.m.
Chief Executive Officer, Ladies Learning Code
We could do that next year, 2017. We've done a lot of evaluation, and there are a lot of metrics. There is an annual report I can also give you. We've built this mechanism, we've scaled up really scrappily over the last few years, and we have private-sector support as well as partners, so I feel really confident that we can start scaling up and reach 50,000 learners next year alone, which is what we've reached cumulatively to date.
10:10 a.m.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
A number of groups have been before this committee, and all of them sound like very worthy causes, needy areas that we could look to invest in. Why your organization versus all the others?
10:10 a.m.
Chief Executive Officer, Ladies Learning Code
You mean other coding organizations or in general?
10:10 a.m.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
I meant generally, because everyone is looking for the same dollar.
10:10 a.m.
Chief Executive Officer, Ladies Learning Code
I think the idea is that we don't know what the jobs of the future are yet, but digital skills and technology are pervasive. We know that 42% of the Canadian workforce is up for replacement through automation, so technical skills are the next frontier. It's a language, and it takes time to get good at a language. If we don't invest now in our youth and in our women, when we need it in five years or 10 years, we won't be there. The timing is really now.
10:10 a.m.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
Okay. Thank you.
Mr. Poschmann, you mentioned capital versus labour on the R and D front, saying that there are far more generous labour credits than there are capital investments. Did I paraphrase you roughly?
10:10 a.m.
President and Chief Executive Officer, Atlantic Provinces Economic Council
I was speaking with respect to scientific research, as in SR and ED.
10:10 a.m.
Conservative
10:10 a.m.
President and Chief Executive Officer, Atlantic Provinces Economic Council
These are changes that were implemented a couple of years ago at the federal level, and SR and ED generally provides a credit for a broad range of expenditures that businesses do on R and D.
There have been a number of criticisms of the program over the years, including its size. Some of the previous changes rebalanced the design of the program so that it was more generous for small businesses than for large ones. Refundability was introduced for small businesses, and eligibility for capital expenditures was sharply trimmed, leaving labour as the primary expenditure.
If what you're interested in doing is promoting employment in basic research within firms, that could have some positive benefit. If your goal is to generate the fruits of research, however, then it's less clear that it is the course we would have followed.
10:10 a.m.
Conservative
Dan Albas Conservative Central Okanagan—Similkameen—Nicola, BC
I appreciate that.
Mr. Sullivan mentioned the lack of certainty for business right now, with all the new things that are coming up. Mr. Navarro-Genie, you also mentioned that Energy East is a viable project that would bring a lot of prosperity right across the country. Obviously, certainty to business is important. In British Columbia we've seen the Trans Mountain project, and there have been additional delays by additional processes put on top of that.
What things should the government consider or not consider in regard to Energy East or other energy processes coming down the pipe?