Finance Committee on May 18th, 2017

[David Shepheard]

That would be more of a question for some of my colleagues who work on some of the other areas, for instance, around green technology and on some of those really exciting elements that are coming through.

Vancouver has some distinct qualities in various sectors that we would want to see share the limelight on some of those innovation hubs and share an appropriate recognition of the talent and the cluster of those companies that we have in the province. It's being able to make sure those companies, that cluster of different industries, are well recognized within whatever the plans would be for those innovation hubs, and making sure that we can put the best case forward to have an appropriate level of investment and attention come to Vancouver and B.C.

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

Ms. Arte, thank you very much for your presentation. I certainly understand and appreciate the support for some of the moves we've made in regard to aboriginal education, the Canada student grants, and work-integrated learning and co-operatives.

I hear your point very clearly that perhaps the emphasis is too much on STEM as opposed to STEAM, adding arts into that. I would like to give you an opportunity to continue your thoughts on that.

[Bilan Arte]

Thank you for that question.

From our perspective it's incredibly important that we have a system of post-secondary education that is encouraging young people who are interested and passionate about any number of different areas and professions that could be of importance in our society and that they be given equal opportunity to access those.

When we talk about the dangers of particularly focusing on STEM or individual career paths, what we do see are a lot of young people who, even over the past 25 years in my generation, in many ways have been misled into thinking there would be a guaranteed job for them in a particular sector. For example, students were encouraged to go into teaching in Ontario, and then they saw a lack of teaching opportunities after there was a surplus of students who were graduating from the Ontario teachers colleges, or young people decided to focus on developing a career within the resource extraction industry and today aren't finding jobs in those fields.

We believe that the key to actually building a sustainable economic system across our country that actually encourages young people to be trained in a variety of different professions is going to ensure that we have people who are graduating not only in those STEM fields, but people who are also graduating in fields we know we need in our society today but may not necessarily be the ones where all of the public funds for support may be today.

Having the opportunity for anyone to be able to think about expanding their horizons in what they're passionate about will help us ensure that we have young people who are graduating from a variety of sectors and provide us with a diversity that we need in our society. In the same way we need people who are graduating from those STEM fields, we also need people who are graduating in architecture, who are graduating in a number of different fields. I think it's a bit short-sighted to pigeonhole young people and their futures into one particular job sector if those jobs disappear in the next 20 to 25 years.

[The Chair, Liberal, Wayne Easter]

We'll have to cut you there.

Mr. Liepert.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

Elizabeth, thank you for your presentation on behalf of the industry in Alberta, the industry which, quite frankly, has driven this country's economy for the last decade.

I'm glad you mentioned the clarification around the ridiculous assertion of fossil fuel subsidies. I was pleased that the parliamentary secretary and her staff were here to hear that. Maybe they'll take note and change their ridiculous notes that she reads from in question period on a regular basis, because there is a huge difference between incentives and subsidies.

I think what is important here is to point out that this is an industry that drove this economy, that continues to be a major part of this economy where, if we don't get rigs back in the field, if we don't get people back working again, for those 100 people who used to be on planes coming out of Prince Edward Island who aren't coming anymore, those jobs aren't going to be there.

In this budget we now have a recommendation to start to reduce those tax incentives and I think it's important that you outline what, if the government goes ahead with that initiative, it's going to do to the drilling industry in Alberta.

[Elizabeth Aquin]

Yes, thank you for the question.

I think it's hard to predict exactly what the impacts will be. Clearly, commodity prices have an impact. However, I think we are finding that Canada is overall less competitive these days. We have such a number of policies that are impacting our competitiveness and it's not anything taken singularly, but it's the cumulative effect of all of these things. When investors decide where to invest their capital, they do look at all of the aspects, whether it's carbon levies, methane emissions reductions, and now if they are looking at the Canadian exploration expense, it's just one more option that's off the table for them when they're looking where to invest their money.

I think it speaks to Canada not being as open to this industry as other countries are. Certainly as we look to the administration south of the border, they are doing everything they can to welcome and encourage activity down there.

As you have mentioned, the industry has been through devastating times. Tens of thousands of people have lost their jobs, and yes, in Alberta alone in 2014, we had over 100,000 non-resident workers. They have all gone back to their home provinces.

We need to build that investment climate back up again and continue to have a competitive environment to attract that capital, and it's proving difficult.

There is risk involved in exploration, and taking away this incentive that will help them decide to invest that capital is an important aspect of what we can do. As I said, I don't believe it's a subsidy in the normal sense. This isn't affecting the prices that they achieve for their products. It speaks to the risk, and they go on. This will mostly affect the small explorers and producers that these days often are the ones that go out and do exploratory wells which then pass those fields on to larger producers and encourage more development drilling.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

Let's be up front about it: the only benefit is when you actually pay taxes. This is not like Bombardier, where we threw them eight times the money. Fifty million dollars is nice from the federal government for the well cleanup program, but for an industry, it's one-eighth of what we gave to one company in Quebec. That's a subsidy. I'd like you to outline the potential we could have in Alberta not only for job creation but for environmental cleanup, because $50 million and $250 million are nice numbers and will get a lot of people back to work, but they will only make a dent in a situation that needs action.

[The Chair, Liberal, Wayne Easter]

Ms. Aquin, I think the money to Bombardier was a loan, not a subsidy.

[Ron Liepert, Conservative, Calgary Signal Hill, AB]

We'll see if it ever gets paid back, Mr. Chair.

[The Chair, Liberal, Wayne Easter]

Ms. Aquin, go ahead.

[Elizabeth Aquin]

I think that the benefit of having the exploration credit, the CEE and the CDE, is the fact that this goes to an industry. Private companies are spending money in order to claim this, as you say. They are putting people to work and creating economic benefits. Those benefits go far beyond those direct jobs in the companies themselves. When these companies explore for oil and gas that's ultimately developed, they are paying royalties and corporate taxes; people are paying income taxes, and the economic benefits are spread across the province and the country. In terms of all the rural communities where this activity takes place, they're giving business to the coffee shops, the motels, and the car-leasing places.

In fact, we have done studies on the oil and gas services sector, which is above and beyond just the exploration and production companies themselves. Our recent study has shown that in 2013 the oil and gas services sector alone contributed $119 billion to the Canadian GDP. That is beyond just.... That shows the reach and scope of this industry throughout the economy.

When you've seen the downturn over these last years, and maybe you've wondered why it's affected manufacturers in Ontario and Quebec, that's partly because of the energy industry. Many services and industries in this country contribute to the oil and gas industry, even investment banks on Bay Street, for example, and lawyers. It affects everybody, so having these incentives bodes well for all Canadians, really.

[The Chair, Liberal, Wayne Easter]

Thank you both.

Go ahead, Mr. Dusseault.

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

Thank you, Mr. Chair.

Thank you all for being here today.

First, I'd like to get something straight, Ms. Arte. You said that students made $528 million in interest payments to the federal government. Is that correct?

[Bilan Arte]

It was $580 million.

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

Thank you.

That is money students paid into the government's coffers.

[Bilan Arte]

Yes, that's interest that's paid on student loans.

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

Do you think something should be done about that?

It seems to me that the government, or at least the Liberal Party, had pledged to eliminate interest charges on student loans. Do you think that's something Bill C-44 is missing, something we should perhaps address later in our discussions?

[Bilan Arte]

Sure. The work that the federal budget does, we believe, falls short of presenting a bold vision for post-secondary. From the perspective of the Canadian Federation of Students, that will always be the complete elimination of tuition fees and the funding of a totally universal system of post-secondary education.

We do think it is quite disappointing to see that the federal government is profiting over $580 million in interest rates alone off public student debt. I want to remind committee members that the people who are taking on these loans are poorer communities, impoverished communities, vulnerable communities in our society. They are the ones who are relying on the Canada student loans program and its provincial equivalents. The fact that the federal government is making so much money off the backs of poor Canadians and their families is quite disappointing to see.

There are a number of provinces that have completely eliminated interest rates on provincial student loans. Most recently, that happened in my own home province, Manitoba. We've seen this growing in different provinces, for example, Nova Scotia, Newfoundland and Labrador, and a few others.

We definitely believe that we need a bold vision for free education in this country, but at the very least, I think this government can commit to eliminating interest rates on provincial and public student loans.

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

Thank you.

I'd like to get something else straight, this time, with regard to indigenous people and their eligibility for student financial assistance programs.

Have you estimated how many people would be eligible further to these changes? Do you have a number? I'm not sure I heard correctly.

[Bilan Arte]

Yes, we have a number.

It's 4,600 indigenous students, in addition, who will be included. This doesn't fill the backlog that we believe includes over 10,000 indigenous students. This is a figure that has been released by the Assembly of First Nations, which is a group we have worked with. They estimate the backlog to be much higher than that. However, we are excited to see that with that $90-million commitment, at the very least it will change the lives of 4,600 indigenous students in this country, and that is significant.

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

Ms. MacEwen, we heard from a number of people on the issue of parental leave. Do you really see it as progress for a parent to have the option of taking 18 months of leave payable at 33% of their income, as opposed to 12 months payable at 55%?

Can you tell us what you think of the fact that, once a parent chooses an option and receives the first payment, their decision is irreversible? They won't have the ability to change their mind. If they choose the 18-month option, for instance, they are stuck with it.

Do you think that's an element we should address when we do our clause-by-clause study?

[Angella MacEwen]

Sure. When the Government of Canada did consultations around the parental leave changes, there was a wide group, including the CFIB, the Chamber of Commerce, and the health groups, who all told them that this was not a change that would help families or that would make it easier for businesses to have their employees go on leave. We presented other changes that would be better, such as adding specific leave for the father, making EI more accessible, those types of things.

The 55% of your pay is already a barrier for low-income families to take the whole year, so they're not going to have access to the 33%. That's simply not enough to live on if you're a low-income family.

Also, the family low-income supplement has not increased since it was introduced. It's completely phased out at a family income of $25,000 a year. I would recommend you look at the low-income family supplement on EI as well as other options for improving maternity and parental leave, specifically QPIP. If we wanted to make the program more accessible and work better for families, we'd look at what's happening in Quebec.

Child care is a necessary component of that, as well. That's very often what was driving the complaints. Parents would say that they couldn't find child care for one-year-olds, which then would lead us to the case where you can't modify it. If you can find child care at 14 months and your employer can give you leave for 14 months, that doesn't give you the flexibility to be able to go back at 14 months. You have to choose either a year or a year and a half. That doesn't offer a huge amount of flexibility for workers or families. We think this is not a good modification; it just isn't.

[The Chair, Liberal, Wayne Easter]

Thank you, both.

We'll take Ms. O'Connell and Mr. Aboultaif, and that will be it.

Ms. O'Connell.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

Thank you, Mr. Chair.

Thank you, all, for being here. I apologize that we won't have time to ask everybody questions.

I want to start with my question for Mr. Shepheard. In terms of the invest in Canada hub, and then organizations such as yours or what you are part of, when I was in municipal government, even local municipalities wanted to attract that investment. I always found it was very difficult to quantify whether there was a good return on that investment. You might have these trade missions or communications, but it was very hard to determine whether or not any of those leads really translated into anything, especially when clusters were formed not just for one small municipality but, as an example, for where I come from, the greater Toronto area.

How do you translate whether or not it was through that hub or that cluster that business was attracted? I think you pointed out in your testimony some ways that the invest in Canada hub needs to work with these local organizations to ensure that these needs are being met, unless I misunderstood your testimony. Could you maybe comment on how you would like to see this type of hub work with the needs of the local commissions, etc.?

[David Shepheard]

We were trying to put across the fact that the invest in Canada hub is a good thing. It's exactly right. We should be working with the existing economic development agencies and structures already in place. They are trying to do the best they can to build those clusters in the local economies. They are also trying to maximize the talent in those specific areas, whether because of the outputs from educational establishments or because it's a natural hub. For us in Vancouver, it's a massively growing hub for green technology within the wider technology sphere.

The key message was that we are trying to do this work on a daily basis, and we would welcome working with a federal initiative while focusing on how that federal initiative can help us do our jobs better and get more impact from them.