Finance Committee on April 8th, 2020

[Cathie Bolstad]

Michael, you make it tough. Nice to hear your voice.

I think the struggle for the north has been that.... You know, it is very receptive of seeing how fast...and how wonderful it is that the federal government has worked together to put out a variety of solutions, but where the struggle has come is in their size and availability and the fit to where they are and where their fit is. They're feeling like they are squeezing a round peg into a square hole.

It's difficult for me. It's one of the things I struggled with, to be frank, last week, after listening to our members for a week. It was really difficult because we're pointing them to programs and they're coming back and saying, “They don't work. They don't fit for us.” You heard from Keith Henry, you heard from Charlotte Bell and you heard from the Hotel Association that liquidity, no matter whether you're small or big, is the immediate issue, and there isn't a program that's helping them with liquidity.

What I'm seeing is that, if we use our hotels as an example, even some of the help available in the Northwest Territories is not for owners unless they live in the Northwest Territories. There are even cracks between how federal and territorial programs are fitting together.

I think that, when Susie talked about some of the criteria and help that is needed, it's looking at where the most people are employed. Those kinds of criteria can help put people to the top of the pile in terms of the industry and where they need it.

As you know, in the Northwest Territories once you get outside of the capital city, most of our tourism operators are indigenous tour operators who are small, so they're really looking for immediate relief in programs that help them pay their bills in the absence of revenue. It's difficult for me to find a positive thing to say, because that doesn't exist for them right now and they're really struggling to survive.

I'm sorry to have to be the bearer of bad news, but that is what we're hearing here in this industry.

[Michael McLeod, Liberal, Northwest Territories, NT]

That's why we're having this discussion, so that we could hear from the industry and hear your recommendations.

Quickly, I also wanted to ask about the types of support that you would need to see from the government to support northern and indigenous tourism to recover once we're all through this pandemic.

[Cathie Bolstad]

I think that CanNor, the Canadian Northern Economic Development Agency, can play an incredible role. It has been a supporter of our organization in the marketing we've done for the Northwest Territories and for small business. I think it needs to create some flexible criteria around the funds that it makes available. It's very difficult for small businesses that don't have the cash flow to put up their percentage of what's needed from that funding criteria. Perhaps it could offer some relief. Perhaps there is a temporary period when CanNor could offer assistance to those small businesses, both to get them through the period now with liquidity and to help them reinvest when they have revenue flowing again. Some flexibility from CanNor in what kinds of programs it can offer could lead it to being the relief agent small businesses need here.

[The Chair, Liberal, Wayne Easter]

Thank you all.

Surprisingly, in all the hearings we've had thus far, we haven't heard much about what the regional development agencies should or could do, CanNor being one.

We will turn to single questions.

Mr. Ste-Marie.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Thank you, Mr. Chair. I agree that this government sector should make a contribution.

My question is for you, Mr. Hamel. As we know, the economic recovery of your industry will take longer. You were talking earlier about the possibility of extending the measures for the tourism industry. Can you address this issue again and elaborate on your proposal?

[Yan Hamel]

Thank you for your question.

All my participating colleagues were very clear about this issue. For our industry, this crisis will have a long-lasting impact. We need two forms of assistance. The first concerns our workforce, which provides the services. The second concerns cash flow. The assistance that we want is very simple, because it already exists. It's the Canada emergency wage subsidy.

As everyone has said, some eligibility criteria must be changed. We completely agree with this. Most importantly, this measure should last at least 12 months for the tourism industry, or until the loss of revenue is less than the 15% that has just been adjusted. This measure is the most important step towards supporting our workforce.

The second measure for the workforce is really the work-sharing program. The program must be better adapted to our tourism situation and must provide more flexibility. As a result, our staff could be more versatile and could perform a variety of tasks in the tourism industry.

I want to address another measure that everyone mentioned and that concerns cash flow. It's extremely important to avoid simply implementing loan, loan guarantee and deferral measures. The industry needs much more than this. The industry needs exemptions. It needs air. We'll need to breathe and we'll need cash flow over the next 12 years. We know that, in Canada, the peak season for tourism businesses is very important. Businesses that are unable to do well and to generate substantial revenue next summer will need exemptions to get through next winter and to create a tourism offering in the future.

These are the most important measures that we need.

[Gabriel Ste-Marie, Bloc, Joliette, QC]

Noted. Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you very much.

Mr. Julian.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

Thank you, Mr. Chair.

My question is also for you, Mr. Hamel. You did indeed say that the tourism industry was the first to enter and will be the last to emerge from the crisis. As you said, conventions and conferences will need more support. Businesses and organizations will also have less money to hold these conventions and conferences.

What would you suggest to ensure that, once the crisis is over, businesses can once again start organizing conventions and conferences, which are essential to the industry?

[Yan Hamel]

To answer your question, from our perspective, the development of the business market, a very lucrative market for Canada, will start with the domestic market. Businesses must be encouraged to use services. I'm thinking of the organization of events, among other things. There used to be a tax credit, and this measure must be implemented again. Businesses must be encouraged to start holding business meetings again and using accommodation services and meeting and dining rooms across Canada. To that end, the use of tourism industry services for business purposes should be made tax free through a tax credit. This will give businesses an incentive to use more services in this sector.

Now, in terms of clients outside Quebec and the very large conventions outside Quebec, as Charlotte Bell said, there must be very strong and consistent efforts when it comes to marketing outside Quebec, whether the clients are leisure travellers, individual travellers or business travellers. We'll need very strong support in this area. About $100 million will be needed to help market Canada abroad for these various types of clients, including business clients.

[The Chair, Liberal, Wayne Easter]

Thank you, all.

Mr. Poilievre and Mr. Fragiskatos, be as quick as you can be, please.

We must have lost Pierre.

Mr. Fragiskatos.

[Peter Fragiskatos, Liberal, London North Centre, ON]

Thank you, Mr. Chair.

Thank you to the witnesses.

Ms. Bell, you mentioned Japan as an example that Canada can perhaps look to and seek to adopt here. I also know that the European Union is very seriously considering allocating very significant amounts of funding toward the advertising fund, which would go toward the tourism sector once we have overcome COVID-19 and the economic rebuilding begins, for lack of a better term.

Is this something that would help the sector? Obviously it would, but how much stock would you place in something like that? As I say, the EU is considering it very seriously and I just wonder if there is merit in Canada looking at it.

[Charlotte Bell]

Absolutely, marketing is going to be key. Because I went a little long in my response, I think I got cut off. In essence, absolutely, marketing is going to be key, and we are going to continue to work with Destination Canada. We haven't talked about it today, but we also still have to make sure that all of our destination marketing organizations are still alive and well and there to help us market all of the amazing communities across the country. They are absolutely key to the continuation and survival of tourism in this country.

Tourism is an ecosystem. We're going to need all of these players and all of the pieces to come together, eventually when we do come out of this, to work together very closely on a robust strategy. We're going to need Destination Canada and a number of players to come together to do that. Advertising and marketing are going to be critical to the recovery efforts. Other countries are already talking about investing quite significantly in those.

[The Chair, Liberal, Wayne Easter]

We'll have to end it there.

I might mention that Destination Canada was invited. They couldn't make it today and they are sending in a submission, so that will be available on the public record at some point, hopefully next week.

With that, I will thank all the witnesses for putting together very detailed information on fairly short notice. Thank you for both your constructive criticism and your advice. We are in times that none of us have ever seen before, and making our way down this path to have a successful economy at the end of the day is extremely important to all of us as we get through this.

I also want to thank the technicians, clerks and analysts who are making this system work under fairly difficult circumstances.

We will meet again tomorrow. Committee members, we will meet at two o'clock on small and medium-sized business, and at four o'clock with the financial institutions.

The meeting is adjourned.