Finance Committee on June 4th, 2020

[Kevin Lee]

There's no question that it would have a negative impact on the recovery. Certainly our recommendations are quite different from that. Changing rules like total debt service ratio, gross debt service ratio, is the equivalent of adding on top of the stress test, which would serve to make it still more difficult for Canadians to qualify for mortgages to buy homes.

I think it's really important to remember that there are a lot of Canadians who are in very unfortunate circumstances right now, but there are also a lot of Canadians who still have well-paying jobs and should be in a position to buy a first home and move forward.

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

It strikes me, though, that CMHC should really be a partner with your industry in working together to make sure that the construction industry is healthy on a go-forward basis. Has your association had any discussions with CMHC about a go-forward plan? Has anyone reached out to you, or have you reached out to them?

[Kevin Lee]

Well, certainly the way things have gone with CMHC in recent times, there's been a very different tack taken by CMHC with respect to home ownership and moving forward on a great many things with respect to that, so there hasn't been a lot of dialogue. We've relied much more heavily on working with parliamentarians in recent times to try to get things moving forward, like the changes that came through on the stress test that were supposed to come in April.

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

I'm sorry to hear that.

I'll just turn to another subject. We've been hearing reports that industries have been having some trouble hiring back people who are on the CERB. Have you been hearing reports of that in your industry?

[Kevin Lee]

Well, certainly there have been a variety of challenges with getting employees back once they've been disconnected, hence our real recommendation to fix that wage subsidy. One challenge, too, is that people might not be coming back for health reasons, health concerns. They might be on the CERB and finding that to be adequate at this time if they have other concerns.

The other challenge that I think we all need to be very cognizant of is the underground economy—cash jobs and all those kinds of things—hence our recommendations around renovation tax credits.

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

I wanted to turn to that before; it's just that I had limited time. You discussed a couple of stimulatory measures in addition to having CMHC on side, which hopefully will happen. You talked about a reduction of the GST, maybe the elimination of the GST for a short period of time, and the home renovation tax credit.

From my perspective, these measures are fundamental to getting the housing market back up and running as quickly as possible. Have you had any discussions with government, other than with this panel, on the possibility of implementing these types of measures?

[Kevin Lee]

Those are the types of recommendations we have been making. We have submissions on those. Obviously, times are tricky as we also try to figure out the current crisis and work to fix and deal with the current programs that are in place. As the government turns its mind to how we deal with the recovery, we're very anxious to have further discussions on these opportunities.

[The Chair, Liberal, Wayne Easter]

Okay. We will have to end it there, Marty. You are a little over.

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

Thank you very much.

[The Chair, Liberal, Wayne Easter]

Mr. Lee, you mentioned the challenge of the wage subsidy. You talked about trying to use, as the criteria, the fair value of the contract signed. I don't have time to go into it, but can you send us a little note on that, just basically what you propose as the solution? Just send it to the clerk. We'll get it, and we'll go from there.

We're turning, then, to Ms. Dzerowicz, who will be followed by one question from Mr. Brunelle-Duceppe and one from Mr. Julian.

Julie.

[Julie Dzerowicz, Liberal, Davenport, ON]

Great. Thank you so much, Mr. Chair.

I want to thank everyone for their excellent and very diverse presentations.

My first question is for Mr. Kiendl from the Canadian Art Museum Directors Organization. I'm very blessed in my riding of Davenport to have a lot of artists and creators, and to have a number of museums, both small and medium-sized museums. One of them is the Museum of Contemporary Art Toronto.

I worry about medium-sized museums across this country, not only in my riding, because I feel that they have limited places to actually go to get some additional support.

There's one thing that I'd love for you to comment on. We know that phase one of the $500-million emergency support for arts and culture has been announced. Phase two is yet to come. One program we're looking at is the museums assistance program. Many museums aren't able to actually apply to it. I'm not sure, with the current criteria right now, whether MOCA Toronto would be able to. Is there some way that we could maybe adjust that program that might actually make more museums eligible for it? Could you address that, please?

[Anthony Kiendl]

Yes, absolutely. The program is due for an overhaul. Traditionally, there's been division in funding between the museums assistance program and Canadian Heritage more broadly, and the Canada Council for the Arts. It is often the case that you're eligible for funding from one and not the other.

The reality is that most of our museums and galleries actually serve multiple roles. They should be eligible for both the museums assistance program and Canada Council funding. I know our sector is really interested in having that conversation. I feel like we could provide a lot of really productive ideas around how to broaden the accessibility.

[Julie Dzerowicz, Liberal, Davenport, ON]

Just because we don't have a lot of time and I have one small question before I have to move to someone else, if you could maybe write some recommendations to this committee, I'd be very grateful. I think it would be very helpful to us.

My second question has to do with one of your recommendations around a match from the government in terms of, I'm assuming, private donations. Are you talking about a one-to-one donation? I just want to be clear on your recommendation.

[Anthony Kiendl]

Yes. It could be up to one-to-one. There is an existing matching endowment incentive program with the federal government; however, art galleries and museums are excluded from that program, and the rationale for this is not that clear. It's—

[Julie Dzerowicz, Liberal, Davenport, ON]

Sorry, which program is that?

[Anthony Kiendl]

I believe it's called the Canadian Heritage matching endowment incentive program, or something like that. About 75% of art galleries have endowments and over 90% of our members would support opening up that program to art galleries and museums. I believe we have the support of our peers in the performing arts sectors to allow that to happen.

Really, what it does is—

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you. Sorry about that, but I have to move on because I have limited time. I do appreciate your point, though. We have heard it loud and clear.

My other question is for Ms. Amyot.

One of the interesting things we're hearing is that a lot of people have lost jobs and a lot of industries desperately need jobs filled. If you go to www.jobbank.gc.ca, there are a number of industries, such as health care, manufacturing and agriculture, that need jobs filled. There are people who have completely lost their jobs in this pandemic, because a restaurant has closed down or some manufacturing facility has closed down forever, and they need to pivot to something else.

Do you see a role in helping to train people, moving them along from colleges and institutes? If you see a role, what is it?

[The Chair, Liberal, Wayne Easter]

Sorry, Denise, but you will have to do it in 30 seconds.

[Denise Amyot]

I absolutely do: upskilling, re-skilling and applying research to help the industry retool.

My colleague Peter Devlin could give you a specific example from Fanshawe and the community where they are.

[The Chair, Liberal, Wayne Easter]

We will get Peter's response to that in a moment.

We'll now turn to three or four single questions.

I'm not sure who is up, but go ahead, Mr. Brunelle-Duceppe or Mr. Ste-Marie, whoever wants to take it.

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

That'll be me, Mr. Chair.

[The Chair, Liberal, Wayne Easter]

You have one question.

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

Mr. Semple, could you tell the committee what you think the shortfall is? What is it about the rules that excludes you from the wage subsidy?

[Gavin Semple]

As I explained, we meet all the qualifications for the program except for the fact that we expanded through an asset purchase of another company. That precludes us from qualifying. As I mentioned earlier, it is maybe an unintended consequence, but it should make no difference, when you are acquiring another company, whether you buy shares or you buy all or substantially all of the assets and ownership of that company. That is what we're asking them to correct.

The problem we have is that we've been trying to get this resolved for two months and we are now out of time. I have been resisting laying off additional employees, but we will have no choice but to mitigate our risks and reduce our expenses if we can't get an answer to this very important question.

We qualify in all other respects for the program.

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

Thank you, Mr. Semple.