Finance Committee on May 17th, 2017

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

Thank you, Mr. Chair.

Thank you all for being here.

I'll be brief, and I'll try to ask everyone a question.

Mr. Cunningham, I'll start with you. How much money does the federal government spend on preventing tobacco consumption? Should we do more and use tobacco taxes for prevention activities? How does it work in the provinces?

[Rob Cunningham]

The federal government collects $3.25 billion in tobacco taxes and spends $38 million on prevention. In the past, it was higher. We're talking about $72 million. Today, it's only $1.04 per person in Canada. However, in the United States, it's $3.60 per person in Canadian dollars.

Minister Philpott is studying these issues and is responsible for looking at possibilities. We're supporting Minister Philpott's efforts, and we'll have a new federal strategy. I'm very optimistic.

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

Certainly, spending close to $3,5 billion on prevention and advertising campaigns would be a major way to reduce consumption.

Ms. Ballantyne, let's discuss early childhood. There's talk about extending parental benefits from 12 to 18 months, but dropping the rate from 55% to 33% of the salary. Is that a positive development? Or, is it a pointless exchange, as I said on other occasions? It amounts to the same, and ultimately, the system isn't really improved.

[Morna Ballantyne]

We actually consider these changes to be negative, because they will create a situation in which some parents have access to longer leave, and most will not. We cannot see how a reduction in the benefit level under EI could be a positive development.

We also think that although the government seems to know what the problem is—lack of affordable child care for children under the age of 18 months—it has come up with the wrong solution. The solution is not to have parents on leave for the 18 months at lower pay; the solution is to actually create affordable child care for all, and not just for lower- and modest-income families but for families of all income levels. We know from the evidence that that's actually a better way to create choice for everybody, and it's actually a better way to create opportunities for lower- and modest-income households. We have a saying that if you have a child care program that is for the poor, it will make for a poor program. What we want is a universal child care program, because it will actually benefit everybody.

We think that in terms of EI changes, the priority of the government should be to make access easier. Right now, 40% of parents are excluded from the employment insurance maternity and parental special leave program. That is compared to the situation in Quebec, which has a much better program, and only 11% of parents are excluded. In Quebec, the benefit level is at 70% of replacement income. There is also a flexibility in Quebec, but the flexibility is actually to take less for longer, at 75% replacement income. That's a much better option.

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

Exactly. I think this also sheds light on one of the issues raised. A public servant had no choice but to recognize that one of issues is only four out of ten employees can access the employment insurance program. The public servant confirmed that, to access the parental insurance program, workers must be eligible for employment insurance. Obviously, workers have a problem.

We're currently studying Bill C-44. Do you think the removal of this aspect and the increase in payments, with a percentage higher than 55%, would be a solution? Is 55% of the salary enough?

[Morna Ballantyne]

Our position—and it's set out in the brief—is that the changes that should be made are to bring the employment insurance program in line with the one in Quebec. It makes no sense that citizens and workers in one province would have superior benefits to those in the rest of the country. That is our position. We propose that your committee should recommend that in studying Bill C-44, because that is not, in fact, what is being advanced in Bill C-44.

[The Chair, Liberal, Wayne Easter]

We'll have to cut it there. We will have time for two more questioners at about four minutes each.

I understand that Mr. Ellis is here from the veterans committee.

If you want to explain what happened there, come to the table in a minute.

We'll go to Mr. Fergus.

Please hold it to three or four minutes.

[Greg Fergus, Liberal, Hull—Aylmer, QC]

First, I want to thank the witnesses for being here.

I'm a member from Quebec, but I see that nobody, aside from Mr. Cunningham, speaks French. Therefore, I'll ask my questions mainly in English.

Ms. Ballantyne, very quickly, the universal child care program is near and dear to my heart, since I was a stay-at-home dad with my kids. My wife and I job-shared when we had our children. I was a stay-at-home dad as long as possible, and I always used to complain about the lack of parental benefits that I was able to take.

With regard to the universal child care program, with your experience, you know that Quebec had started along that line, to have a very generous universal child care program, which was very popular. Over time, due to fiscal constraints, it had to make some very difficult choices. As a result, it moved to a system in which if you made more, you paid more and if you made less, you paid less. It seems that the federal government is approaching this from a different perspective but with largely the same results.

Do you have any comments on that?

[Morna Ballantyne]

First, on your comment about being a stay-at-home father, one of the big advantages of the Quebec employment insurance program is that it actually gives paid leave, under the EI program, exclusively for fathers. That's another improvement that we would want to see in the EI program.

[Greg Fergus, Liberal, Hull—Aylmer, QC]

I was a stay-at-home dad 20 years ago, before the programs came in. I wasn't able to take advantage.

[Morna Ballantyne]

On the question about Quebec's child care program, I would suggest that the changes made to that program were not as much a result of fiscal constraints as opposed to fiscal choices. The Quebec government chose to reduce the amount of public funding for the universal child care centres—les centres de la petite enfance—and family, home-based child care and, instead, put more public money toward providing tax credits for families who access the for-profit private sector.

A lot of money is still being paid out, but it's not going toward boosting universal access; it's going toward supporting the for-profit child care industry. That was the mistake, in our opinion. But for those families who are fortunate to be able to access child care under les centres de la petite enfance, it is still much more affordable in Quebec than in the rest of Canada.

We're looking for an affordable child care program. We're not saying it should be free, necessarily, but that it should be affordable. We think the best way to finance a system is to provide direct public funding to the providers of the child care services, as Quebec has done in the case of les centres de la petite enfance. Then, whatever fees would be collected from parents would go to the government to help subsidize the cost, as opposed to the other way round—of giving money in the form of subsidy to parents. The latter doesn't create child care spaces, but gives parents the money to go into the child care market to try to purchase services. Those services, unfortunately, are not as high quality because they're not directly funded through public funds.

[The Chair, Liberal, Wayne Easter]

Okay, we'll cut it there.

Mr. Deltell, you have about three minutes, and then Mr. Ellis you have one.

[Gérard Deltell, Conservative, Louis-Saint-Laurent, QC]

Thank you so much, Chair.

Mr. Cunningham, I would like to address what you said a few minutes ago. It was very interesting, by the way, and I appreciate your testimony.

When you talk about Quebec and Ontario, where there are the most illegal situations, maybe it's because those provinces have the most people, and also where the illegal manufacturers are. Maybe it can explain that more than the taxation.

Speaking of taxation, you could say too much taxation kills taxation. If you tax too much, people will find other ways, which are illegal. Where do you find the breaking point of too much taxation?

[Rob Cunningham]

I don't think we're anywhere close to it, but I think you're right about the location of the illegal factories close to major urban centres in Ontario and Quebec. I think those have to be targeted. B.C., the western provinces, are able to sustain far higher tobacco taxes without the level of contraband seen in Ontario and Quebec. In Australia, they're far higher yet. I think we have to fight contraband, but lots more potential remains to do that

[The Chair, Liberal, Wayne Easter]

Thank you.

Mr. Ellis, I understand you're just getting back from D.C. I hope you found some sense down there.

The floor is yours.

[Neil Ellis, Liberal, Bay of Quinte, ON]

Thank you, and I appreciate just a minute of your time here today.

I appreciate your sending your motion to ask us to study that. We wish we could do it. If the deadline were extended, we could do so under the circumstances today. I was with Mr. Kitchen, the vice-chair of the committee, last night at six o'clock in Washington. We sat with the clerk and looked at the situation; we tried to see if we could get a room in Parliament today. Unfortunately, the room that we wanted is booked; we're in it now. We agreed to do it maybe tonight at 7:30 after votes; unfortunately, with the witnesses from New Brunswick there's a little time difference, so we decided on 9:30 tomorrow morning. That was agreeable. After Mr. Kitchen talked to his counterparts, he decided we could get through this without having the meeting. We agreed as a team not to go forward with this and offer the committee, if they could extend the deadline, we could look at it.

[The Chair, Liberal, Wayne Easter]

Okay, we'll leave it at that. We are fairly used to extremely tight deadlines, and I think there's a message from that to the system. We need to find ways of giving all committees more time, including our own. We've heard from 50 to 55 witnesses this week and part of last week, and we honestly don't have enough time to adequately question the four witnesses who have taken their time to be here.

With that, we are two minutes away from voting. I want to thank every one of you. Your presentations are valuable to us and your testimony will be looked at. With that, I appreciate your coming.

Members, tomorrow we are in the Wellington Building from 11 to 1 and here from 3:30 to 6:30.

The meeting is adjourned.