Finance Committee on May 27th, 2021

[Trevor McGowan]

Thank you. I would be happy to do so.

There are provisions in the bill that would allow for the extension of the wage and rent subsidies up until the end of November. There are currently two additional qualifying periods at the end of the subsidies. One runs from September 26 to October 23; that's the twenty-first period. The second is from October 24 to November 20, the twenty-second period. For both of those periods, you'll see that the base percentage that provides the subsidy rate for the wage subsidy, and then the rent subsidy percentage, which provides the rent subsidy rate, are set at 0.0%, with the ability to change those subsidy rates by regulation. Those are the specific mechanisms that would allow for the extension of the wage subsidy.

The periods are already in place, and then if the intention is to extend the programs, the subsidy rates could be increased from nil to whatever is appropriate.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

Okay. Understood. Thank you.

[The Chair, Liberal, Wayne Easter]

Go ahead, Mr. Julian.

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

Thanks very much, Mr. Chair.

Thanks, Mr. McGowan, for the explanation. Basically, it contradicts Madam Dzerowicz's....

The reality is at this point there is no provision that allows for an extension of the wage subsidy as we know it or the rent subsidy as we know it. As you point out, it is zero-rated, which means at this point that we would basically be saying to the Liberals that we hope you do something. That's why the amendments and the Liberal government actually accepting the royal recommendation and basically saying, yes, we will endorse these amendments would have made a real difference in people's lives.

We've heard very compelling testimony from so many Canadian organizations—small businesses, the tourism sector—that this is fundamentally important. It is zero-rated, so it is not correct to say that the wage subsidy and the rent subsidy are somehow going to be renewed for a certain period. It is only an option. That is why it would have been important for the government to accept these amendments that would actually make the extension a reality.

[The Chair, Liberal, Wayne Easter]

Okay.

For those who aren't sure, this relates to pages 31 to 33 of the bill. I finally found a bill with the numbers and the pages rather than the scroll.

NDP-4 I have ruled out of order.

Before we go to the next NDP one, we'll go to Mr. Ste-Marie with BQ-1.

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

Thank you, Mr. Chair.

The first amendment I am proposing specifies that political parties are not eligible entities for the purposes of the recovery wage subsidy. We know that, in the act implementing the wage benefits, eligible entities are indicated and political parties are not included. When I have finished my explanation, I would like to ask the senior officials for confirmation on the matter.

In our view, the eligibility criteria for the emergency wage subsidy seem to have been quite broadly interpreted by the Canada Revenue Agency. Some political parties made use of it, diverting the funds intended for companies and not-for-profit organizations.

My amendment specifies that political parties are not eligible entities for the purposes of the recovery wage subsidy.

[The Chair, Liberal, Wayne Easter]

Okay.

Did you want an answer from officials on that, Gabriel?

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

Yes, I would like the senior officials to confirm that political parties were not identified as eligible entities in the act implementing the recovery wage subsidy.

[The Chair, Liberal, Wayne Easter]

Go ahead, Mr. McGowan.

[Trevor McGowan]

Thank you for the question.

Currently, the classes of eligible entities provide the basic level of eligibility for both the wage subsidy and the rent subsidy in the new hiring program.

When those were introduced, there were certain classes of entities that were eligible. Broadly speaking, one of them is not-for-profit organizations. My understanding is that political parties tend to be organized as not-for-profit organizations, and as such, they would be qualifying under that heading. There are no specific rules that currently would prevent political parties from applying for the wage subsidy.

[The Chair, Liberal, Wayne Easter]

Okay.

Is there any further discussion on BQ-1? I'm not seeing any.

It is admissible.

Does BQ-1 carry?

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

On division.

[Sean Fraser, Liberal, Central Nova, NS]

Put it to a vote, Mr. Chair.

[The Chair, Liberal, Wayne Easter]

Okay. A vote has been called for.

Mr. Clerk, can you poll the members?

[The Clerk of the Committee, Mr. Alexandre Roger]

Yes.

(Amendment negatived: nays 10; yeas 1 [See Minutes of Proceedings])

[The Chair, Liberal, Wayne Easter]

We're on NDP-5. I believe you explained the first seven NDP amendments, right, Peter? The NDP-5 amendment extends the existing admissibility period referred to in the bill, which will result in more money coming out of the treasury. Therefore, the amendment is inadmissible because it requires a royal recommendation. There are no challenges on that.

For NDP-6, we have basically the same reason. It requires money to come out of the treasury and therefore requires a royal recommendation, so it is inadmissible.

For NDP-7—I think you explained them that far—we have basically the same reason. It requires money from the treasury and therefore requires a royal recommendation, so I declare it inadmissible.

We're on BQ-2, with Gabriel Ste-Marie. I'll let you explain it first and then I'll make a comment.

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

Thank you, Mr. Chair.

In the budget, the Minister announced that, to continue to receive the wage subsidy, company executives must no longer pay themselves bonuses. But that measure would only come into effect as of the 17th eligibility period, in June.

So amendment BQ‑2 specifies, instead of giving companies an incentive to provide bonuses to their executives between April 19, the date the budget was brought down, and June, that the measure be retroactive to April 19. That needs to be done so that companies do not have an incentive to pay themselves bonuses right now.

[The Chair, Liberal, Wayne Easter]

Thank you.

I note for the committee's interest that if BQ-2 is adopted, NDP-8 cannot be moved because of a line conflict.

Is there any further discussion on BQ-2?

I see Gabriel first, and then Peter.

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

I will let Mr. Fragiskatos have the floor because his hand was up first.

[The Chair, Liberal, Wayne Easter]

Go ahead, Mr. Fragiskatos.

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

Mr. Chair, I'd like a vote, please.

[The Chair, Liberal, Wayne Easter]

Before I go to a vote, I see Mr. Ste-Marie's hand and Mr. Falk's. Go ahead, Mr. Ste-Marie.

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

I would have liked to hear Mr. Julian's comments on the difference between the motions.

[The Chair, Liberal, Wayne Easter]

Okay—

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

The amendment I am proposing makes the measure retroactive to the date on which the budget was brought down, that is, the date on which the measure was announced. If I understood correctly, my colleague's amendment makes the measure retroactive to a time before that date.

The reason we chose the budget date as the date for this to go into effect, is to clearly mark the point at which the measure was announced, so that there could be no retroactivity before the date of the announcement. Clearly, I much prefer my motion.