Finance Committee on June 11th, 2020

[The Chair, Liberal, Wayne Easter]

Thank you very much, Minister, and thank you for the work you and your team do. We know you must be tired. There have been long days and short nights for you folks, I expect, so thank you for your efforts.

The minister has to stop at 7:15 or 6:15, your time.

[Bill Morneau, Liberal, Toronto Centre, ON]

You almost got me there.

[The Chair, Liberal, Wayne Easter]

We'll make a hard stop at 6:15, your time.

We'll go to five-minute rounds. We'll start with Mr. Cumming, then Mr. McLeod, Mr. Ste-Marie, Mr. Julian, Mr. Cooper and Ms. Dzerowicz, and that will end it.

Mr. Cumming, the floor is yours.

[James Cumming, Conservative, Edmonton Centre, AB]

Thank you, Mr. Chair.

Thank you, Mr. Minister, for appearing again in front of us today.

In my 30-some years in the private sector dealing with uncertain times, and there were many of them, I was always able to produce some kind of a budget or a forecast. In fact, I just found out that Parliament has always received a budget or a forecast in the last 100 years.

Can you tell us today when we can expect an economic forecast or budget?

[Bill Morneau, Liberal, Toronto Centre, ON]

I completely appreciate and understand the importance of continuing to provide information to Parliament and to Canadians.

The biweekly report that you received in contemplation of this meeting, of course, details all of the measures that we've put forward. We are working to make sure that we keep updating that so that people have a very good understanding of the measures that we've put forward. Of course, we do intend to give a better understanding of our economic base. That will be able to be done as the economy gets more stable and as we get into a better position to make those understandings well known to Canadians.

[James Cumming, Conservative, Edmonton Centre, AB]

We're asking businesses to forecast their revenues to be able to apply for programs. We're asking them to deal with their spending and be able to understand how their businesses are operating. You have a very talented crew here who are on this call with you today.

When can that team put together a full forecast or full budget so that people can see exactly where we're going and get some certainty about what's going to happen in the future?

[Bill Morneau, Liberal, Toronto Centre, ON]

I think the challenge that we're all facing is that we are looking for certainty at a time where it's very difficult to deliver certainty. You will have seen this week that the OECD put out a forecast, but in fact, what it said is that it couldn't give us a forecast so it gave out two separate scenarios.

We're going to continue to deliver for you and for Canadians an understanding of the investments. As the situation is stable enough to provide better and more comprehensive information, we will be coming forward with that information.

[James Cumming, Conservative, Edmonton Centre, AB]

You said that you're still looking at changes to the wage subsidy to better serve the businesses that are out there. I spoke to a company today, Canadian Benefit Providers. They have a flow-through on the insurance costs, but they really get paid through administration fees. Their top-end revenue has stayed quite high, but of course, their administration fees have gone way down. Overall, their revenues have not gone down enough to apply for the CEWS. It strikes me. They have a massive payroll, and they're a great company, but they are falling through the cracks.

Is that something your department will look at trying to revise?

[Bill Morneau, Liberal, Toronto Centre, ON]

First of all, I appreciate your providing that input from that company. We've been trying to get insights from businesses and participants in the economy from across the country. We have had, among the many recommendations or ideas, a suggestion that, for some businesses, the revenue cut-off at 30% puts them at one side or the other of that line. That's something that we've heard. It's something that we are certainly considering as we think about next steps in the wage subsidy. I'm hopeful that we'll have more information on that in the near future.

[James Cumming, Conservative, Edmonton Centre, AB]

The oil and gas sector continues to wait. I see on the BDC site that the details for that program have yet to be announced. It was suppose to be days. Then it became weeks. Now it comes into months. I know that you're fully aware of the struggles in that sector.

When can it expect the details to be announced?

[Bill Morneau, Liberal, Toronto Centre, ON]

Well, thank you for that. We've been trying to support the energy sector—in fact, all sectors—with access to financing across the country. Obviously, the emergency business account has gone out across the country to small businesses. That's been very successful. With regard to the BCAP that was specifically designed for the energy sector, the final terms and conditions, I understand, are almost ready. We wanted to make sure and they wanted to make sure that the reserve-based lending approach that's so important for that sector was appropriately tailored.

I'm encouraged to hear that is imminent. Of course, the large employer emergency financing facility is open. We are seeing firms come forward to that as well.

I'm pleased that we're moving forward on all these fronts.

[The Chair, Liberal, Wayne Easter]

Ask your last question, James.

[James Cumming, Conservative, Edmonton Centre, AB]

Minister, with regard to the CEBA program, there were changes that were announced several weeks ago. They still haven't been executed. Specifically, those with regard to personal chequing accounts still haven't been executed.

When can we announce to small businesses that these changes will be in place so that they can access those funds that they desperately need?

[Bill Morneau, Liberal, Toronto Centre, ON]

First of all, I think we have to acknowledge how successful this program has been in getting support out to small businesses with more than 650,000 loans. That's very important.

Of course, EDC has said that there will be an ability to enlarge the companies that are eligible. I think that will be out in the coming days. Then there will be additional facilities through the regional development agencies.

We are expanding the range of businesses, as we've said. It is imminent. We're very pleased to see that the support has gone to such a broad range of businesses across the country.

[The Chair, Liberal, Wayne Easter]

Thank you, both.

James, I have the same concern on the personal banking account, but I have sent people to the regional development agencies, and it has gone through on the personal banking account there. That's just a point of information for you.

Mr. McLeod.

[Michael McLeod, Liberal, Northwest Territories, NT]

Thank you, Mr. Chair.

Thank you to the minister for appearing in front of us once again. I also want to say thank you to the minister and his cabinet colleagues for providing very good communication with the Government of the Northwest Territories and other northern governments.

I'm also very happy to report that we've had no cases of COVID-19 for over a month now, and our territories are beginning to safely reopen. However, the economic picture is not as positive; there's a lot of uncertainty about jobs. I've joined my three northern colleagues in the Senate, as well as many municipal, territorial and business leaders in supporting greater flexibility for programs like the wage subsidy to reflect the unique nature of our region.

Is the government prepared to make much-needed improvements to ensure that northern businesses are able to access these emergency programs?

[Bill Morneau, Liberal, Toronto Centre, ON]

Thank you. I think it's an important question.

We are not looking at making changes to the wage subsidy that are specific to any one sector or any one region, necessarily. We're trying as best we can to consider the issues around the program that have come to us through these consultations. They include a number of areas, and we're trying to reflect those areas to make sure the support for employment and for businesses to get through this time is appropriate. I suspect the kinds of issues you're hearing have been reflected in our consultations, and I'm certainly very hopeful that businesses in northern Canada and across the country will see that our continuing support for businesses and for their employees will be a positive way for us to get through this crisis.

[Michael McLeod, Liberal, Northwest Territories, NT]

In the north I think we have a number of challenges that the rest of the country doesn't face. I'm hoping that as the government rolls out its recovery supports, like the $14 billion announced last week to help reopen the provincial and territorial economies safely and carefully, the government and you would consider delivering these funds on a base-plus per capita allocation, which is a lot better for us. We have small populations; we have a significantly higher cost of living and doing business than the rest of Canada. Would you look at that? It's been done historically with other programs.

[Bill Morneau, Liberal, Toronto Centre, ON]

I know that, and I think that has been one way that programs have been delivered. We're trying to come up with an approach that recognizes the challenges the provinces and territories are going to face in the restart. By definition, those challenges are going to have some element of base costs, as you would probably identify, so we're thinking about things like testing and tracing, which will require some sort of human resource capability in case there's a second wave. We are thinking about ensuring we have the capacity in our health care system in case there's a second wave. Elements of that will be different in different parts of the country, and I think that's appropriate.

We're expecting to work together with the provinces and territories to get to what we hope will be an outcome that allows us to be an important partner in getting the restart done safely. That includes in the north, where the challenges are different, as you say. The distance to provide health care is obviously challenging in the north, the infrastructure that might be used for testing is going to be more challenging in some cases; we recognize that. There are going to be different issues in different parts of the country, and as a result, those discussions will have to be somewhat tailored to each situation.

[Michael McLeod, Liberal, Northwest Territories, NT]

A lot of what happens in the area of job creation is going to be what we announce in the next while. We've made significant announcements in the north; a lot of these projects have not hit the ground yet. We've also announced budgets that we have not seen moved forward, for example, the northern trade corridors. The money's been announced for the north, there has been no call; we don't have a call; we don't have projects identified. Because of our seasonal construction season and winter roads and all these things that impact the ability to do construction, we need the calls to come out early. We still haven't seen anything on the northern trade corridors. Could we see that move forward fairly quickly?

[Bill Morneau, Liberal, Toronto Centre, ON]

I think I will have to defer that question. I'd be happy to have my colleague, Minister McKenna, get back on the specific nature of the funding for infrastructure.

Obviously there have been some things that, by necessity, have been delayed during the course of the crisis. We want to see funding move forward, because that's why we've put it there. We want to see funding move forward that will enable important infrastructure to get done. That's an objective of our government that continues.

Especially in the north, I think the economy has opened up enough so that the construction can go on, from what I hear from the finance minister in your jurisdiction, so I would think that would be an objective that we would certainly share, but I don't have any specific insights for you on whether things that haven't gotten done before are not happening for a particular reason. I would be happy to have Catherine McKenna get back to you.

[Michael McLeod, Liberal, Northwest Territories, NT]

Thank you.

[The Chair, Liberal, Wayne Easter]

Thank you. If we could do that, that would be great.

Mr. Ste-Marie is next, followed by Mr. Julian.

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

Thank you, Mr. Chair.

Thank you, Minister, and thank you for being here.

I would also like to greet all the teams from the different departments who are with us at the end of this afternoon.

Minister, this morning, I met with some representatives of the creative sector such as stage workers, musicians and technicians. This sector has ceased its activities and it will be a very long time before it starts up again. Almost all of these workers are self-employed workers who are not eligible for the Canada emergency wage subsidy.

They are asking you to do three things: first, to recognize the importance of the creative sector; second, to extend the Canada emergency response benefit, at least for sectors like theirs, because those who are living this reality have nothing else; and third, to insert a mechanism to allow them to qualify for the Canada emergency response benefit so that they don't lose everything if their income exceeds $1,000 a month.

What would you have to say to them?

[Bill Morneau, Liberal, Toronto Centre, ON]

I know that the creative sector is very important. I also know that a large majority of these people are self-employed. For that reason, I know that the Canada emergency benefit is very important to them. We want people to know that we are working on an approach to protect them and ensure they have enough money during the COVID-19 pandemic.

I understand that some people are eager to take advantage of the Canada emergency benefit. We are now looking at how the programs can best protect people and businesses. The Canada emergency benefit, wage subsidies and our employment insurance system must work together to ensure our near future. At the moment, I am very concerned about this issue, and we will have more information about it soon.