Evidence of meeting #90 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was industry.

A video is available from Parliament.

On the agenda

MPs speaking

Also speaking

Luke Harford  President, Beer Canada
Murray Souter  Board Member, Canadian Vintners Association
Carl Sparkes  President and Chief Executive Officer, Devonian Coast Wineries
Joyce Reynolds  Executive Vice-President, Government Affairs, Restaurants Canada
Jan Westcott  President and Chief Executive Officer, Spirits Canada
Frank Rider  Chairman of the Board, Canadian Association of Mutual Insurance Companies
Normand Lafrenière  President, Canadian Association of Mutual Insurance Companies
Nicholas Rivers  Associate Professor, University of Ottawa, As an Individual
Marc André Way  President, Canadian Taxi Association
François Pepin  President of the Council, Transport 2000 Québec
Maëlle Plouganou  Secretary of the Board, Transport 2000 Québec
Louis Marcotte  Director General, International Business Development, Investment and Innovation, Department of Foreign Affairs, Trade and Development
Roger Ermuth  Assistant Comptroller General, Financial Management Sector, Office of the Comptroller General, Treasury Board Secretariat

6:10 p.m.

Conservative

Ron Liepert Conservative Calgary Signal Hill, AB

Then I think we're in good shape.

6:10 p.m.

Liberal

The Chair Liberal Wayne Easter

If each of the parties could look at the bill and give us an indication of the areas they expect will require more discussion and debate, and if I know which those are, we can go through them and make sure they are done and then come back to the others.

6:10 p.m.

Conservative

Ron Liepert Conservative Calgary Signal Hill, AB

I have one more question. Is there any kind of minority report on this?

6:10 p.m.

Liberal

The Chair Liberal Wayne Easter

No.

6:10 p.m.

Conservative

Ron Liepert Conservative Calgary Signal Hill, AB

No. Okay.

6:10 p.m.

Liberal

The Chair Liberal Wayne Easter

Not on the budget implementation act.

Is there anything further?

Mr. Dusseault.

6:10 p.m.

NDP

Pierre-Luc Dusseault NDP Sherbrooke, QC

Why don't we deal with amendments because we have to submit amendments before a certain date? We can deal with all the amendments, and then we can deal with the clauses where no amendments were proposed. At least we can do the scrutiny of each and every one of them, but maybe we can start with the proposed amendments.

6:10 p.m.

Liberal

The Chair Liberal Wayne Easter

I think that's normal procedure. We would deal with the clauses where amendments were proposed. We can have a discussion on the other clauses that people deemed necessary to debate, and then the rest of the bill.

I would ask Global Affairs Canada to come forward on part 4 of division 20, the Investment Canada Act. We have Mr. Marcotte, Mr. LeBlanc, and Ms. Pellerin.

Mr. Marcotte, I believe you have some opening remarks.

6:15 p.m.

Louis Marcotte Director General, International Business Development, Investment and Innovation, Department of Foreign Affairs, Trade and Development

Thank you, Mr. Chair.

The Budget Implementation Act, 2017, No. 1 introduces the enabling legislation of the Invest in Canada Hub announced in the 2016 Fall Economic Statement.

This new federal body is to work globally, in partnership with federal departments, as well as with provincial and municipal investment attraction offices, to ensure that Canada makes the most of every opportunity to attract global investment.

Foreign direct investment makes a significant contribution to the Canadian economy—creating jobs, spurring innovation and driving trade. Foreign-controlled enterprises in Canada employed 1.9 million Canadians in 2015, representing 12% of Canadian jobs and 30% of manufacturing jobs. They are responsible for 49% of all of our merchandise exports and 37% of all business expenditures in research and development.

The Advisory Council on Economic Growth noted in its October 2016 report that Canada stands to gain enormously by attracting more foreign direct investment.

The enabling legislation that you're reviewing determines, first, the nature of the entity as a departmental corporation.

Second, its mandates and functions are to create the partnerships required to leverage all of what Canada has to offer; brand Canada as a premier investment location; and to provide a one-stop service to assist investors in navigating the investment landscape; and to actively pursue anchor investment projects and deliver world class after-care services.

Third, the act also determines the governance of the entity where the minister provides directions, the board of directors manages the organization, and the CEO operates it on a day-to-day basis.

Fourth, the act determines the general powers, and its specific authority of the entity over administrative policies.

Fifth, it determines its human resources regime.

Overall, the enabling legislation allows for the creation of an organization able to interact effectively with business while being subject to the necessary oversight and accountability measures.

6:15 p.m.

Liberal

The Chair Liberal Wayne Easter

Thank you very much. I'm trying to see how long the bells will be.

Turning to questions, Mr. Dusseault.

6:15 p.m.

NDP

Pierre-Luc Dusseault NDP Sherbrooke, QC

Thank you, Mr. Chair.

Mr. Marcotte, thank you for being here.

I would like to know how the work done by such an entity would be very different from what is already being done to attract foreign investors. I assume that a lot of work is already being done on this by our network of embassies abroad. This entity would allow things to be centralized, but would it do better work?

6:15 p.m.

Director General, International Business Development, Investment and Innovation, Department of Foreign Affairs, Trade and Development

Louis Marcotte

In fact, you are correct. Attracting investments is certainly a part of the duties of the trade delegates in our embassies and consulates abroad. When you compare Canada to other countries, you can see that the number of agencies working to promote investment has increased by 50% over the past 10 years.

I think that at this time, Canada is disadvantaged as compared to other countries. Investment promotion agencies abroad often have more resources. They also provide a single wicket that allows them to serve investors on site.

If foreign investors want to know more about the Canadian business climate and about certain programs, the agency that will be created could act as a single wicket. It could provide access to those services and promote Canada abroad in a more persuasive way.

6:15 p.m.

NDP

Pierre-Luc Dusseault NDP Sherbrooke, QC

Fine.

Will this body work mostly in Canada or abroad?

6:15 p.m.

Director General, International Business Development, Investment and Innovation, Department of Foreign Affairs, Trade and Development

Louis Marcotte

It will be established exclusively in Canada, and will work in close co-operation with our trade delegates who are abroad. They will establish contacts with the foreign businesses, but they will be here in Canada. The purpose is to offer better service to those people here in Canada and encourage them to invest here.

6:20 p.m.

NDP

Pierre-Luc Dusseault NDP Sherbrooke, QC

Has the city where the head office will be located been selected?

6:20 p.m.

Director General, International Business Development, Investment and Innovation, Department of Foreign Affairs, Trade and Development

6:20 p.m.

NDP

Pierre-Luc Dusseault NDP Sherbrooke, QC

However, the Infrastructure Bank's location was determined even before the bill was adopted.

6:20 p.m.

Director General, International Business Development, Investment and Innovation, Department of Foreign Affairs, Trade and Development

Louis Marcotte

No, the location has not yet been determined.

6:20 p.m.

NDP

Pierre-Luc Dusseault NDP Sherbrooke, QC

Thank you.

6:20 p.m.

Liberal

The Chair Liberal Wayne Easter

Thank you.

Is there any other discussion?

I would say this, and you can tell this to the powers that be, Mr. Marcotte. In saying this, I think I would be speaking for all of us here on some of this, that in my view this is a good news story, but it should be a separate piece of legislation and not in a budget bill.

I think we're seeing too much of this. Legislation that could be handled separately is a good news story to profile, but if it's in the budget bill, it's not going to get enough debate. I personally support it, but in any event, it's a problem when we see these areas in a budget bill. Having said that, I know that's not your fault, not your responsibility, but I couldn't sit here and not say it.

With that, thank you very much for your presentation. I didn't introduce you fully. Mr. Marcotte is the director general, investment and innovation, with Global Affairs Canada. André LeBlanc is the executive adviser to the transition team, also with Global Affairs Canada; and Ms. Pellerin is counsel with legal services.

Thank you for your efforts, and thank you for your appearance.

6:20 p.m.

Director General, International Business Development, Investment and Innovation, Department of Foreign Affairs, Trade and Development

Louis Marcotte

Thank you.

6:20 p.m.

Liberal

The Chair Liberal Wayne Easter

Could we call up division 21, because we only have a few minutes? From the Treasury Board Secretariat, we have Mr. Ermuth and Ms. Meilleur.

The floor is yours on modernization of service fees. I know you've been here about four times before and didn't get the chance. We have a very short period of time.

Mr. Ermuth.

6:20 p.m.

Roger Ermuth Assistant Comptroller General, Financial Management Sector, Office of the Comptroller General, Treasury Board Secretariat

Thank you very much.

Like most other governments, the federal government charges fees for services that provide recipients with benefits beyond those received by the general public. Some examples of these fees include fees for services, such as icebreaking; inspection of cattle for export; fees for products such as marine navigation charts; fees for the use of a facility, for example, a wind tunnel; and fees for rights or privileges, for example, the right to use a publicly owned or managed property.

It should also be noted that the service fees act will not apply to bridge tolls, as the federal organizations responsible for administering these federal bridges do not fall under the scope of the legislation. For all fees that are subject to the act, the amount charged is normally intended to recover all or part of the product or service that's being provided. In setting the fees, the government must consider the private versus public benefit of the associated fees, in other words, the extent to which a product or service provides a benefit to all Canadians, such as food safety, versus the profits that specific businesses derive from the sale of safe foods.

Under the current legislative framework governing fee setting, many organizations have not changed their fees for years, if not decades. As a result, taxpayers currently subsidize relatively high percentages of products and services, many of which primarily benefit users of specialized government services. A modern legislative framework will support a more cost-efficient delivery of its services. It will also help improve transparency and oversight, and ensure that those who set fees are accountable to Canadians.

Key changes under the service fees act include the fact that all fees will be subject to the legislative framework, improving the accountability regime that would ensure fee payers are reimbursed when performance standards are not met, a streamlined approach for setting fees and speeding up the process, the introduction of an automatic escalator clause to ensure that the fees maintain pace with actual costs, and increased transparency to provide Canadians and parliamentarians with annual information on fees. This includes both mandatory departmental reports that would be tabled annually in Parliament, and the requirement by the president of the Treasury Board to make a consolidated report available.

It should also be noted that introducing new legislation will not increase fees beyond the proposed inflationary escalator. Fees are set under ministerial authority after consultation with interested stakeholders. The modernization of the legislative framework opens the door for departments and agencies to look at rebalancing the burden of costs between general taxpayers and those benefiting from those specialized services.

At this point I'd be happy to take any questions.

6:25 p.m.

Liberal

The Chair Liberal Wayne Easter

Okay, do we have any questions?

Mr. Dusseault.

6:25 p.m.

NDP

Pierre-Luc Dusseault NDP Sherbrooke, QC

We are told that fees will increase progressively, in keeping with the inflation rate, but does that apply to all of the fees covered by the User Fees Act? According to my understanding, there are fees that are not imposed under that act, but that are imposed pursuant to other taxation authorities. Nevertheless, all of the fees provided for in that act will be subject to the same increases, according to the inflation rate, no matter what product or service is involved.

Is that correct?