Finance Committee on May 7th, 2020

[Michelle Baldwin]

Sure. What I would concur with is that there are other measures and policies that we could be looking at. The reason for the $6-billion ask is the urgency and also the efficiency that comes from being able to share that out.

I would agree that business is stepping up in incredible ways. In our community, our local credit union, Libro Credit Union, partnered with our regional innovation centre, and we're doing a design challenge to find products, services and solutions. I think it really is the three pillars coming together to support this.

The tax credit would be welcome. The $6-billion number is the number that is needed in order to really hold and lift up this sector, so if that is a piece of the way you're doing it.... But we need to know that something is happening, because we've been waiting, and right now we're having to make tough decisions during this time.

The other piece I would add is that social finance is another piece that you're looking at. There are loans that are available. In our own community, we have Verge Capital, so some of the money that has been delegated towards that to get that moving quickly could be another solution, but I go back to the urgency and the reason for the sector resilience grant program.

Thank you.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Thank you.

Mr. Simon, you haven't been asked any questions. I don't want to leave you out. I have the same question for you. What do you think about policy options outside of direct subsidies? I know you've said that your members have stepped up big time, and I think that's a lesson that all of the panellists could take from today, but what do you think of these policy options of tax credits, private shares and foundations?

[Peter Simon]

Without commenting on something that obviously has different political perspectives, I would say that anything the government could consider that would stimulate donations from individuals would be a big plus for not-for-profit organizations.

I certainly know about Don Johnson's suggestion, as he's been quite active on all of these fronts, but I think the government has a range of options on this. I would just encourage you to explore all of those, because it really does stimulate donations, and we are 25% donation-dependent.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Yes. That's why I'm asking. I've seen how the charitable sector.... Ms. Baldwin talked about the partnership with the private sector as well, and I really appreciate that. This is a way to partner with the private sector in a major way that could help charitable organizations without a direct government subsidy, or as big a one, because I think we recognize that it's necessary across a wide variety of sectors.

While I have you on the line, Mr. Keast, I'll ask you the same question. What do you think about the three policy options I outlined?

[Brad Keast]

To Mr. Simon's point, definitely, I think anything we could do to encourage more giving would be incredible. As per some of the previous comments, there have been people stepping up, and individuals and foundations have been honouring their gifts. I will note, though, that right now a lot of donations are either tied to programming or are coming from sources, be it foundations or individuals, that rely on the markets. As we know, the financial markets right now are not the most predictable, so I think that is a challenge.

From a foundation's point of view, for the preservation of capital.... I know that to mandate a higher amount would obviously help us as a sector. I just want to make sure we're also balancing the preservation of the capital there for the foundations, especially vis-à-vis the drop in interest rates. So you have a spread there, which is something we need to consider—

[The Chair, Liberal, Wayne Easter]

Sorry, Marty, but we're a little bit over—quite a little bit.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Thank you, Mr. Chair.

[The Chair, Liberal, Wayne Easter]

We'll go to Ms. Koutrakis. Then we'll go to a series of single questions from Mr. Ste-Marie, Mr. Julian, and Mr. Manly, I expect.

Ms. Koutrakis.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you, Mr. Chair.

This is a great conversation this afternoon, and I'm happy to be part of it. I'd like to thank all the witnesses.

First, Mr. Ambrosie, in addition to the financial support you have requested from the federal government, has there been any discussion with the provinces? Is there any role that the provinces can play during the COVID-19 pandemic? Are there any discussions on that front?

[Randy Ambrosie]

Yes, we've started an outreach to the provinces to talk to them about our situation. Much like today, we're saying to the provinces, as we've said to your colleagues in the federal government, that we are looking to be creative. We are willing to be creative to find solutions. Obviously, we want to protect jobs, which is a priority for us. We want to help our players. We want to look after the future of our game.

So the answer is, yes, we've started those conversations with the provincial governments as well.

[Annie Koutrakis, Liberal, Vimy, QC]

Your initial request for funding is $30 million right now. I know you said that no decision has been made as to how it will be paid out, but do you have an idea of where that funding will go? Has it targeted any group?

[Randy Ambrosie]

The first big category is to keep as many people employed as we possibly can. Of course, we don't know whether the wage subsidy program will be extended beyond the June 6 expiry date. That's a question that is overhanging all of us. The big category is that we'd like to keep as many people employed as we can. We want to talk to the players about how we work with them and find a way to get them funding.

Of course, the other thing is that we take in ticket revenue from our fans, who in this case are essentially serving as creditors. We expect that we will have to pay back some of those fans, Canadians with real financial needs.

Really, our big bucket is to keep as many people employed as we can, as we see whether or not we can actually get a football season in during 2020.

[Annie Koutrakis, Liberal, Vimy, QC]

I also have a question for Mr. Keast.

Mr. Keast, your organization sent a letter, dated April 14, to the Prime Minister and to a number of ministers, recommending alternative deployment of infrastructure funding in support of the arts and culture industry.

Can you offer examples of the projects that this funding should be targeted toward?

[Brad Keast]

I'd be happy to.

Often infrastructure funding will go to the buildings themselves. Of course, it is very important to have a home for the arts and culture, but we see arts and culture more broadly, as infrastructure to fuel beyond the sector. Often what happens is that an organization will receive money, and they have the building. That's the upfront capital, but there are ongoing operational costs with a lot of these that are very tough to deal with.

Is there a way for some organizations that are paying rent, for instance, to prepay a long rent so that the organization has secured the space for a long term and doesn't have to worry about those ongoing operational costs? That money can then go into programming, which is, of course, the entire reason we exist. It's not just to pay rent.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you, Mr. Chair.

[The Chair, Liberal, Wayne Easter]

I'll steal a little of the minute that you have left, Annie.

Ms. Edwards and Mr. Dalgleish, does either of you have anything you want to add to the discussion we've had so far? If you want to make a couple of points, go ahead. There have been no questions sent your way.

Ms. Edwards.

[Kate Edwards]

Thank you, Mr. Chair.

I think that with a lot of the themes that have come up through the questions—there were all different sectors—the challenges are shared. With regard to the discussion around policy change versus funding support, for our industry, we really need both. We need funding to maintain capacity to ensure that the industry survives to continue to do the work it does so well when we're past this crisis, but also to ensure that the market can continue to function. For us, a big part of that is a functioning Copyright Act.

I would reinforce that policy and direct support will be needed as we move towards recovery from the immediate crisis.

[The Chair, Liberal, Wayne Easter]

Mr. Dalgleish, do you want to add anything?

[Darren Dalgleish]

Sure, I'd be happy to. Thank you, Mr. Chair.

I share much of the same perspective as my colleagues testifying today.

My perspective on cultural tourism and industry, where there is social value being provided to a community, is that the sustainability of an organization to continue to provide that service or their typical function is really a function of tomorrow, not today. When I think about the programs that exist—and the government has been bold in assigning a great deal of taxpayers' money to the response to COVID-19—I think about what's next. Although we'll get past this pandemic, I really believe that the consumer patterns and behaviours are going to struggle for many, many more years.

I'd like to see some kind of incentive that puts the burden on us as organizations to provide products, initiatives, whatever, where we can provide new explanations for our industries in the future, things that will be generally tied to new markets, maybe evolving markets, ones that require less volume. Maybe organizations across the country are seeing it a little differently, but I believe that when you constrain an organization, you create an incredible amount of innovation.

When we fund things like wage subsidies and the student relief program, these are typically variable costs for organizations in cultural tourism. I'm very thankful for these relief opportunities, and we take full advantage of them, but I don't think we want to remove all of the constraints. I think we need to burden the organizations, such as the ones on this panel, to find new and innovative ways, and incent that through an ROI program, loans or whatever from the government. Allow us to create something new and different. It's not about our industry; it's about the consumer and what the consumer wants to buy.

I would leave the committee with one thought: We're going to look a heck of a lot different a couple of years from now. I don't think we want to struggle and fight to stay the same. That's my only concern, and that's what I'll leave you with.

[The Chair, Liberal, Wayne Easter]

Thank you.

Now we'll go to a series of single questions. We'll have Mr. Brunelle-Duceppe, then Mr. Julian, Mr. Cumming and Mr. McLeod.

Go ahead, Alexis.

[Alexis Brunelle-Duceppe, Bloc, Lac-Saint-Jean, QC]

Good day.

My question is again addressed to Mr. Roy.

Mr. Roy, I would like to hear your opinion on a measure I'm going to suggest to you that could help both major events like the Quebec Summer Festival and smaller events like the Festival de la Gourgane d'Albanel.

I was talking to some people from Festivalma recently. Bryan Adams was due to perform there and the organizers had paid a deposit on his fee. However, the ticket service they're dealing with won't give the money back until the show has taken place. This is a problem, because the show has been postponed to next year.

Do you think it would be a good idea for the government to offer an interest-free guaranteed loan to support this burden up to the amount of the total deposit, until the show takes place? Once the show has taken place, the government will be able to get its money back fairly quickly since the box office will pay out the proceeds from tickets already sold. At the end of the day, it will not have cost anyone anything, because the financial burden will have been borne by the government.

[Martin Roy]

Thank you for your question.

I think that interest-free loans will certainly be useful, whether they come from Quebec, the other provinces or Ottawa. I know that in Quebec, the Société de développement des entreprises culturelles, or SODEC, offers a number of loans. If we could indeed have access to interest-free loans from the Canadian government, I think that would be a fairly appropriate solution.

[Alexis Brunelle-Duceppe, Bloc, Lac-Saint-Jean, QC]

Thank you, Mr. Roy.

[The Chair, Liberal, Wayne Easter]

Mr. Julian.

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

Thank you, Mr. Chair.

You all represent important organizations, so I'd love to ask each one of you questions, but I'll go to Ms. Edwards for Canadian publishing. It is so vitally important for Canadians to tell stories to each other about ourselves.

Ms. Edwards, what is your fear if the supports that you've requested today are not provided? What would that mean for Canadian publishing in the medium term and the long term?