Finance Committee on May 26th, 2020

[Ron Lemaire]

I will reply in English for the committee.

In terms of the limit we're looking at, in an ideal world an exemption would be ideal. Because of the diversity of our entire supply chain and within our agri-food sector, and the regionality of how many of our producers, our wholesalers and our repackers operate, setting a specific limit would be difficult. In an ideal world, there would be an exemption for our essential service so that they could target and apply the appropriate wage necessary for their operation.

That would be in an ideal world. Focusing on a common approach on a national level, with even an additional thousand dollars on top of that to allow for a $4,000-a-month value, would work.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Okay.

You talked about tax credits for what has to be spent on sanitary equipment. Mr. Gervais talked about the $20 million it has already cost the co-operative for their needs. Would you like to see that put in as soon as possible?

[Ron Lemaire]

As soon as possible; the tax credits will be key, especially right now with the diversity between small and medium- to large-sized companies that are implementing the use of new tools and products. They would never have had that burden of cost in the past.

In this case, they may not qualify for the $77 million in benefits that have been put in place. Tax credits would at least provide an additional incentive to ensure that the employees are safe. They're doing it now, but it would enable a business continuity plan.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Gervais, what do you think?

[Ghislain Gervais]

I am sorry, I did not understand the question.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Earlier, you spoke of the costs associated with health measures that could be as high as $20 million. Is that correct?

[Ghislain Gervais]

These are the costs of implementing all social distancing measures, purchasing plexiglass and buying visors and masks. They do not include costs related to the loss of productivity due to the slowdown of the chains. These are only the implementation costs.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

All right.

[Ghislain Gervais]

In Olymel's case, the costs amount to $20 million. For Exceldor, which you probably know, the costs are about $15 million, and for Agropur, they are between $15 million and $20 million. The impact on processors of implementing these measures is enormous.

It is ironic, because we are currently looking for employees, but we cannot train them because we are unable to maintain the social distance of two metres.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Gervais, what do you think of Mr. Lemaire's idea for a tax credit that would help cooperatives or businesses put those things in place? I have talked to a lot of small businesses that are incurring significant costs to comply with these measures.

[Ghislain Gervais]

It is one potential solution to be considered. As I said earlier, the first measures announced are a step in the right direction, but the needs are much greater than that. The Canadian Federation of Agriculture recently conducted a survey, which showed that $2.6 billion was needed to help the agricultural and processing sectors deal with the impact of COVID-19 across Canada. I feel that is not far off the mark.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Mr. Masterson, what is plastic made of?

[Bob Masterson]

Well, there are many different ways to make plastic. We have a large plastics industry in Canada because we have abundant low-carbon, low-cost natural gas liquids. The products come out when we take natural gas out of the ground, largely in western Canada.

Other nations will make them out of crude oil or out of coal. We make all of our plastics out of natural gas liquids.

[The Chair, Liberal, Wayne Easter]

We will have to end it there.

We'll go to Ms. Dzerowicz, then to a single question from Mr. Ste-Marie, Mr. Julian and Ms. Koutrakis.

Julie.

[Julie Dzerowicz, Liberal, Davenport, ON]

Hi, and thanks for all the amazing presentations. I have three questions for you.

First, Mr. Lemaire, we're talking about self-sufficiency, moving forward. I want to talk to you about labour. In the produce sector, there's traditionally been an issue around labour. Before COVID-19, in a typical year, what would be a ballpark number for the percentage of labour filled by migrants? In a typical year, even with migrants filling your labour, did you still have labour shortages?

[Ron Lemaire]

It's a great question. To give you an idea, I will tell you that out of all the temporary foreign workers coming to Canada, in horticulture they represent about 72% of all that labour force. That's very significant. You're looking at over 32,000 to 33,000 workers. That is below the requirements the industry needs at the farm level and through some of the supply chain.

It's been a big challenge. It was especially so at the beginning, with the disruption to access because of travel restrictions. It's recovered, but there's still a gap.

[Julie Dzerowicz, Liberal, Davenport, ON]

To what extent do you actually think any type of encouragement or pushing students, or even adults, to work in these industries, when they weren't filling these positions in the past, is going to be helpful?

[Ron Lemaire]

That's one portion of the supply chain, on the farm, and it's a hard sell. It really is. It's manual, physical labour that we are having a hard time convincing Canadians to do. But there are other parts. There are repackers. There's wholesale. There are other components within the logistics section of our operations that can leverage Canadians to get them involved. Those are the guys who are finding gaps and finding challenges because of the workforce absenteeism. If you have a suspected case of COVID, 30% of the workforce doesn't show up to a greenhouse repacking facility in B.C. the following day. How do they fill that? How do they continue to support business continuity?

[Julie Dzerowicz, Liberal, Davenport, ON]

I have one more question for you.

One idea that I think is being tossed around, or at least I heard this publicly today, is potentially looking at non-status asylum seekers who are here in Canada or non-status workers who maybe had a permit before but it ran out. If we were looking at the non-status workers we have here, would you be open to finding a legitimate way to maybe get them a work permit, if they would be willing to fill positions we desperately need them to fill? Is that an idea you think your sector might be willing to look at?

[Ron Lemaire]

I think that would be something we could consider. We'd have to go through the logistics of how that would work, but it's definitely something we can look at.

[Julie Dzerowicz, Liberal, Davenport, ON]

Okay, that sounds great.

Ms. Greenwood, I was interested in your common cross-border manufacturing proposal. I just want to quickly ask you two questions. One, how is the border working right now? Two, are there any improvements you think we need to be making now, or ongoing improvement that you think we need to be thinking about?

[Maryscott Greenwood]

The border was closed to non-essential commerce but remained open to essential commerce. It works extremely well if you're in a tractor-trailer or a train car. Critical supplies are going back and forth, and I think both governments have done a very good job on that. There have been some other instances, though, where it wasn't clear. Border agents have a lot of discretion to determine what is essential commerce and what isn't. There have been some instances where someone was turned away, but actually they should have been allowed to go forward.

Our idea for that is an “essential commerce” designation. We actually have a pilot project idea for this. Just like you have a “trusted traveller” designation, you could have an “essential commerce” designation. It could also be used for resumption of commerce after this, when you would add a health element to the screening.

The border is going pretty well, but it's not perfect and we think we have a solution to propose.

[Julie Dzerowicz, Liberal, Davenport, ON]

Great.

Ms. Gray, I'll ask you one quick question, if I could. You were saying that one of the solutions moving forward in terms of self-sufficiency is capital funding for innovation. Since time immemorial, in our country we have tried to be even more innovative. Every single time, every government tries successively. What is the one thing you think we could do differently this time that just might get us to be an extraordinarily innovative and productive country?

[Diane Gray]

We do have some great innovation in our country, for sure. Lots of studies have been done by very smart people looking at how we can become a more innovative economy, so I'm not going to speak to that specifically. But I do chair the board of Mitacs, so I'll throw that out there, which is, obviously, a great relationship between governments, business and the university and academic sector for funding research internships. Much of that work does eventually become commercialized on some small scale.

However, the issue I was speaking about today was actually something much more basic than that. When we have the technology in Canada, why are we not actually adopting and using that technology, as opposed to forcing our Canadian innovators to try to find Asian markets or investors for their products and technologies? I threw out a few examples. It could be something as simple as why there are no electric buses on the streets of Winnipeg, but there are in California. Those buses are made here in Manitoba. Why are we not adopting something as simple as nurses having wristwatches that can automatically tell the temperature of patients? They're $150 and manufactured here in Manitoba. These are just a few ideas. In some cases, governments have to lead the way, because a lot of the innovation is in health care and related sectors.

[The Chair, Liberal, Wayne Easter]

Okay. Thank you.

We'll go to one question from Mr. Ste-Marie, one from Mr. Julian and one from Ms. Koutrakis.

Gabriel.