Finance Committee on Feb. 19th, 2016

[Alexandre Laurin]

There are all kinds of possible changes.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you very much.

Mr. Dussault, I only have a minute left to ask you some questions.

We've heard a lot about a possible increase in contributions and benefits to the Canada pension plan and, by extension, the Quebec pension plan. What we're hearing overall is that it will harm small businesses, and business in general. We don't have the means to do this. The matter has been studied thoroughly for some time. The last federal-provincial finance meeting again raised conducting a one-year study before we begin to think about making a decision next year.

What are your comments on this?

[Bernard Dussault]

The fear is justified, but it doesn't really happen that way.

When the Canada and Quebec pension plans were launched in 1966, and when tax rates increased from 3.6% to 9.9% between 1987 and 1989, it was difficult for small businesses, but they were able to absorb these additional costs.

I don't see why a minimal increase like the one anticipated, which would cost 3% or 4% of the salary, so 2% for the employer, could be a major obstacle. The increase could be absorbed by not giving salary increases for three or four years. In fact, ultimately, the employees are the ones who still absorb the costs.

So it's a problem, but I don't see it as a major obstacle.

[The Chair, Liberal, Wayne Easter]

That's it. We'll have to cut it there.

I'll turn to Mr. Sorbara.

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

Thank you for your presentations, everyone.

I could ask a question for everyone, but I'll try to limit myself to three.

This is for Wendy Zatylny.

Having grown up in the town of Prince Rupert, British Columbia, I know how important the ports are and know the port of Prince Rupert and what its growth has done and what it did for that town after the devastation from the pulp mill closures and the downsizing of the fishery.

In terms of the things most important to keep our ports competitive with Long Beach or Newark, New Jersey, what are the top two?

[Wendy Zatylny]

That's almost like being asked which of my children are my favourites.

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

You have to pick sometimes.

[Wendy Zatylny]

Exactly; it's difficult.

I would say it's two-fold. One is ensuring that the port authorities themselves have the financial and regulatory flexibility to respond very quickly within changing market conditions.

You mentioned the competitor ports on the U.S. west coast. Ships travel, and shippers will seek the most effective, fastest, and cheapest route to get cargo to destinations. For the port authorities to be able to respond to this and to ensure that level of competitiveness, the financial flexibility to allow them to purchase land, expand, or change as required is extremely important. A part of this, as we've noted in our submission, is being able to amend their letters patent quickly to manage land transfers and that sort of thing, as well as borrowing limits.

That's the first part of it. The second part of it is being able to have as much access to various levels of funding as possible. I mentioned P6s. It's infrastructure funding. Federal infrastructure support is extremely critical to that.

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

Thank you.

For Ms. Citeau, obviously, Canada's a trading nation. We depend on it and we prosper from it. Is the agrifood sector ready in terms of its labour force?

We've heard all week references to the temporary foreign worker issues, the review that our government is going to undertake because of the changes that were made that seemed to have wrecked the system and impeded what the system was suppose to be.

I've heard this from the Cattlemen's Association, and the beef farmers associations, and my concern is that we may not actually have the labour force in place in the scenario where the TPP is ratified and the European trade agreements are completed. We may not be able to take advantage of the opportunities that present themselves with these trade deals.

Can you talk about the labour aspect, please?

[Claire Citeau]

Whether it is labour or things like infrastructure, to some extent, these can be considered barriers for our sector and their ability to get products to market, for example. This is something that is handled by our members directly. The meat sector in particular is not a CAFTA mandate at this point.

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

For Bernard, your comments on OAS and GIS, we sometimes forget that those are funded from government revenues, where CPP contributions are funded from workers.

GIS and OAS were put in place to help the neediest of the neediest. Where would you see any chance of reform to old age security in terms of, first, having the goal of incentivizing older workers to stay in the labour force and, second, providing more resources for those seniors that need it?

[Bernard Dussault]

As I said in my presentation, I have tabled a brief to that effect. The OAS is paying money on the basis of residence tests rather than need. The goal of OAS and GIS should be mainly to address poverty needs.

Whatever changes we make to those programs, I don't see how they could achieve what you are suggesting, the incentive for people to stay at work. Those incentives come naturally because people are in need and they work longer.

The other factor that is taking more and more room is the fact that people live longer and are in better health. They are induced to work more because some people, a lot of them, enjoy working. They enjoy it and make more money.

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

For Mr. Lehman from Barrie—and I'm just down the street there in Vaughan.

Regarding the gas tax, it is a simple, straightforward mechanism that everyone enjoys. The City of Vaughan receives about $8 million from the gas tax. Are you calling for an expansion of the gas tax in your comments?

[Jeff Lehman]

We believe that the funding allocation within the gas tax.... Are you asking if we think you should raise the gas tax?

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

No, I'm asking about the allocation.

[Jeff Lehman]

You are asking if the allocation to the municipalities should be larger? Yes, that's what we're suggesting.

[The Chair, Liberal, Wayne Easter]

Ms. Raitt.

[Lisa Raitt, Conservative, Milton, ON]

Thank you, Chair.

Could Mr. Laurin and Mr. Dussault give me their points of view, very quickly, about guaranteed annual incomes because there's been a lot of talk in the newspapers these days about looking at that.

Perhaps Mr. Dussault could begin and then I will get Mr. Laurin on the topic.

[Bernard Dussault]

The guaranteed income supplement program is very well designed. Any country would benefit from a program like that to alleviate poverty amongst seniors. The program is doing a very good job, although the level of support might be increased a little bit.

[Lisa Raitt, Conservative, Milton, ON]

Mr. Laurin, you know that I'm talking about the basic income supplement for everybody.

[Alexandre Laurin]

The guaranteed annual income has been studied for many years. The biggest problem is the cost. It's extremely expensive. It's very difficult to implement. We've looked at numbers in the past and it was.... You eliminate everything. You eliminate welfare, you eliminate EI, and any type of income support. Then you only have one payment through the fiscal system, the guaranteed annual income.

It doesn't work. The math never really works because it ends up being more expensive if you want to make a difference. You cannot eliminate poverty. You cannot have a guaranteed annual income that is high enough to bring all these people out of poverty. Then, of course, you have to watch the clawback rates. You don't want a clawback rate that is too steep because then it would have a huge impact on incentives to work.

It's a real puzzle. It's not an easy solution. I haven't seen a credible study yet that would show that it could work here in Canada.

[Lisa Raitt, Conservative, Milton, ON]

Thank you.

Ms. Zatylny, I'm going to ask a port question, of course.

Everybody thinks of the big guys: Vancouver, Montreal, and Halifax. Why don't you tell us a bit about the smaller ports, which are equally important to the fabric of moving goods in our country?

[Wendy Zatylny]

Thanks for the question.

The association breaks down into two major groups, really. The smaller ports, running all the way from Oshawa to Saguenay to Thunder Bay, for example, are as integral to their communities as the large ports are to theirs. In fact, they play a big role in the economic development of their communities, and also in the investment of their communities. Oshawa brings in the road salt, for example. Saguenay is actually receiving cruise passengers during the summertime. It's a huge investment in the communities.

The reality is that they have the same needs for expansion, growth, and investment that the large ports do, and in fact, in some cases, they have a bit of an extra challenge, by virtue of their size, in getting the financing portion to be able to grow.

[Lisa Raitt, Conservative, Milton, ON]

I'm not going to put you on the spot, because you can't be political, but I can be political.

I would say that in my experience, every province in this country, including Alberta and Saskatchewan, understands the importance of having ports, except for one, and that's Ontario. Perhaps the government can hear me when I say that they should be talking to their cousins about issues around ports and the great investments that can happen in Ontario.

I do the politics. You don't have to, but you can follow up with facts and figures on that.

[Voices]

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