Finance Committee on Oct. 10th, 2023

[Bobby Morrissey, Liberal, Egmont, PE]

Thank you. I'd ask you to submit to the committee the estimated cost to the federal treasury of implementing this demonstration project with the Government of P.E.I.

[Trish Altass]

Absolutely, yes.

I just want to note, though, if I could very quickly, that was really a starting point for a more complete costing of basic income. Of course, as a provincial standing committee, our capacity to fully cost out every detail of what a basic income would entail was quite limited, but we worked with economists. We worked with a fantastic economist, Harvey Stevens, who has done a lot of work on basic income, as well as others such as Evelyn Forget, who, it was mentioned, contributed to this work.

That information is there to start. It's a starting point. It's a fraction, though, of the federal budget. It's tiny small.

[The Chair, Liberal, Peter Fonseca]

Thank you. If you could also provide that information to the committee, that would be great.

Thank you, MP Morrissey.

We'll go to MP Ste-Marie, please.

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

Thank you, Mr. Chair.

Mr. Roy, in your presentation, you said that you had appealed to three Canadian Heritage ministers and a very large number of elected officials, several dozen of whom support your requests, but that you're now at the point of appealing to the Minister of Finance. Have you had any response from her?

[Martin Roy]

We have not heard back from the minister.

The last budget included the extension, until 2026, of one of the two programs I was talking about, the Building Communities through Arts and Heritage Program. However, there was a deafening silence, not a word in the budget, about the other program, the Canada Arts Presentation Fund. That's what worries us.

We don't need to convince the Minister of Canadian Heritage of the importance of these programs, and his officials are well aware of it too. We've therefore reached the point of calling on the Minister of Finance, because we feel that this is really where the stumbling block lies.

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

Thank you, Mr. Roy.

Ms. Griffin, during your remarks, you alluded to the Canadian Emergency Business Account, CEBA, which allowed businesses to obtain loans of $60,000, of which $20,000 could be forgiven. From what reporters said, we thought the government had given an extra year to repay these loans, but that's not the case: it's just a few more days.

In greater Charlottetown, for your members, the SMEs, what are the consequences of the current repayment deadline? What is the situation? What's the reality? Can we expect an increase in the number of bankruptcies? What is your message for the government on that?

[Kim Griffin]

Thank you.

We had our advocacy committee take a look at this with our members specifically. Because we had a small portion of our membership confirm when we were trying to prepare for this committee presentation, I would like to add that answer as a follow-up to this committee with information directly from our membership, in a timely manner, to confirm for you that impact, as well as those numbers.

What our members are telling us specifically is that they have been very appreciative of the support post-COVID and through COVID. However, I think particularly now, with many other costs on the rise—particularly in the shortage in the labour force—there's still a great need, and they want to continue to do business. If you're agreeable, I would offer that information in a follow-up.

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

Thank you very much.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Ste‑Marie.

We'll go to MP Blaikie now for two and a half minutes, please.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Thank you very much.

Mr. Sanderson, I'm a construction worker by trade and very interested in the issue of workforce development for the trades. I wanted to ask you how important it is to have reliable, predictable infrastructure funding in order for contractors to be able to develop their workforce.

Just as an example, I don't think the rental construction financing initiative under the national housing strategy has approved a project in a year and a half. All of the money in the co-investment fund is already committed or out the door. I think it is more committed than it is out the door, but there's no planned intake for those programs.

I'm just wondering: If you're in the business of building things, but these funding envelopes are sporadic and unpredictable, how does that impact your ability to develop a workforce?

[Sam Sanderson]

That's a great question.

First off, I have to ask: Are you looking for work? I've got a job for you.

[Voices]

Oh, oh!

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Not until the next election, at least.

[Voices]

Oh, oh!

[Sam Sanderson]

It's tremendously important. We've been saying for years as an industry that sitting at the table and talking about what's going to be rolled out in the future is more important now than ever before. Not only are we looking at federal programs and provincial programs; we also have the private sector programs. They're all in that same loop. Again, knowing what each buyer of the construction is doing has a huge impact on preparing the workforce.

Right now we have to do anything and everything we can to acquire, train and educate our workforce, existing and new, from many different platforms. We have to pull, push and tug from every angle we possibly can to get people into the trades. Again, it's more important now than ever before to know what's coming down the pipeline. For a project now, from the time it's thought of and then engineered, that time frame is certainly extended substantially. Then you go through the tendering process. We're seeing projects now, over the last little bit, with very few bidders if any bidders, because the industry is just so busy. Not knowing what's coming down pipeline doesn't help either.

This industry here is a little different from many other sectors, because it's based on the procurement process. To go back to one of our asks as an industry, for the procurement process it's about sitting at the table so that we know what's coming down the pipeline. If there are 10 jobs listed federally in P.E.I. all of a sudden, or if there are five federal, four provincial and two private jobs, or whatever it may be, in the same time frame, it limits the ability of industry to bid those jobs. All of a sudden this contractor, who has the financial and manpower capacity, may not be able to bid those jobs coming down the road. Six months from now they may be able to.

Again, there's a really big impact from having information and sitting at the table.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Thank you very much.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Blaikie. There's a lot of construction work out there.

Now it's MP Duncan for five minutes, please.

[Eric Duncan, Conservative, Stormont—Dundas—South Glengarry, ON]

Thank you, Mr. Chair.

Ms. Griffin, in your role as president of the chamber, you mentioned in your opening comments that a fund was announced a year ago, I believe, in the fall statement of 2022 for financial relief from hurricane Fiona. You mentioned that there was no further word besides the announcement of how those funds were to be distributed.

Can you confirm whether, for the area you represent, there's been an application? Are there funds? What's the status? My point is that, again, we're talking about reliable infrastructure announcements and actual support. Can you elaborate on that a little bit more?

[Kim Griffin]

I would like to comment on behalf of our members that, yes, $1 billion has been set aside for requests related to hurricane Fiona. What our members are telling us specifically is that they're not sure how that's going to translate into specifics for the needs of business, whether that be in Atlantic Canada or particularly on Prince Edward Island, with all due respect.

Many of our members are looking at this new season, if you will.... You're here in high season, when there are lots of tourists, but it's also become a new hurricane season for us with climate change. Many of our members are talking to us: How do we ready our business? What does that look like? We've lost business, and Fiona is behind us, but what about the future?

As to the prescription specifically of how that money is going to be allocated, we're not aware of it, based on the feedback we've received from our membership in the last month.

[Eric Duncan, Conservative, Stormont—Dundas—South Glengarry, ON]

I think the argument is that it's one thing to announce the fund a year ago, but a year later you haven't even gotten the details of how it may be distributed. Again, if somebody has had costs out of pocket to fix the business, and then again to do mitigation measures going forward, my point is about the time frames and the costs and further impacts on businesses. The cost of business is going up, and here we are a year after an announcement with no further detail.

The deliverability of these things, I think, adds a further cost of business in that they're out of pocket for a year either on repair costs or having to do mitigation measures or wanting to do those. I would say there's a difference between that and how it happens.

[Kim Griffin]

Respectfully, $1 billion is a lot of money. I would never try to say how they're spending that money specifically. Our members are asking if there's an opportunity to assist these businesses. Insurance adjusters by the hundreds who were sent to P.E.I. have assisted many of our members post-Fiona, but some of our businesses have still not fully recovered. For us, we would just like to understand a little bit more specifically how that's helping our businesses.

[Eric Duncan, Conservative, Stormont—Dundas—South Glengarry, ON]

If I go back the other way, I agree that $1 billion is a lot of money, undoubtedly. However, I think the issue is that, when it's taking a year to even get some details on how to distribute that, it becomes an operational aspect.

Mr. Sanderson, if I can go back to the construction side again, I want to build on that and the 30% in building costs and so forth, with labour obviously being a major challenge there as well. What have the residential rates been here in terms of building? Are you up or down from previous years? The reason I'm going to that is that we have the CMHC, the federal agency, saying that Canada needs to build millions of new homes by 2030 to meet demands, and we're actually seeing a decrease.

Is that same thing happening in P.E.I. right now—that there's been a decrease—or is it not meeting that threshold of what's needed to meet up with demand?

[Sam Sanderson]

There's been a decrease for sure.

I think the latest CMHC report speculated that, as an industry, we need to build 3.5 million more homes than what the industry has the capacity to build. Again, going back to the capacity of the industry, we don't have the people to build it—end of story.

The cost of building has gone up. Will the cost of construction ever come down? It probably won't because it would mean going back to our employees in every sector and asking if they could take a dollar per hour decrease in pay or a two dollar per hour decrease, whatever the case may be. We know that's not going to happen. Is the cost of lumber going to go down? Well, it will fluctuate a little bit. Commodities fluctuate on a daily basis.

Going back to supply and demand and looking at interest rates and stuff, we see that the cost of borrowing money and doing business is greater every day, and it has that increase. We've seen a reduction in permits here because the industry is tapped out. Industry has gone above and beyond and worked at 120% or 130% all through Fiona and COVID. Like I said, we kept building and stuff, and the industry is tired.

[Eric Duncan, Conservative, Stormont—Dundas—South Glengarry, ON]

I understand.

Let's go back to the CMHC numbers. At a time when I think we need to triple the current pace of new housing starts, we're actually seeing a decrease, which to me is scary. That situation is getting worse now as opposed to getting better.

With my remaining time, I have a quick question, Mr. MacPherson, regarding the input costs for the carbon tax. I want to ask you specifically whether you've done any estimations, from an industry perspective, of the added costs to the industry of the input costs for transportation to different markets around the world.

[Ian MacPherson]

We haven't directly. One tiny aspect that we've been advocating for is to have bridge fees dropped for anything related to seafood that comes to or from the island, because that puts us at a competitive disadvantage in many cases. That's just a small example.

Obviously, we don't consume 40 million pounds of lobster on P.E.I. It goes around the world.