Finance Committee on Oct. 13th, 2023

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

If I may, in my remaining time.... You mentioned, which is appreciated, the impact on your employees who are asking for payment advances to get enough money to fill their gas tanks to get to work. Can you talk about the struggles of your employees? They are making $23 an hour—again, as you said, not the minimum wage. Are there examples or stories and that type of thing of just how bad it's gotten and how much worse it would get if the carbon tax increases?

[Barry Warren]

Well, I think all of us around the table.... We have a health and benefits packages. We're being told that more people are reaching out for help for maternity leave, for stress, for whatever. Last year, $48,000 was the amount of money that our company advanced to our employees to help out with various things. My accountant said, “Barry, you can't do that. You can't continue to do that.” I said, “Well, they're good workers, and that's what good employers do: They help their people.”

What frightens me—and I don't want to be political here—is that your own budget officer said that in 2030-31 the cost to Newfoundlanders' median income is going to be an extra $4,872 a year. That's what I'm told. That's what I read. I'm quoting him. To me, that stress is not going to lessen. I'm not an economics professor, but I do know this: If I spend a dollar and I generate only 90¢ in revenue, I have a problem somewhere down the road coming real fast.

[The Chair, Liberal, Peter Fonseca]

Thank you.

Thank you, MP Duncan.

Now we have MP Rogers for five minutes.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Thank you, Mr. Chair.

To you and all your colleagues, and to the people visiting today, welcome to our beautiful province of Newfoundland and Labrador.

I have a couple of questions. First of all, I'll start with Barry. I sit on the transport committee in Ottawa, and we talk about supply chain issues. Many of the things you've identified, of course, are things that are brought to our attention by witnesses who come regularly to our transport committee.

Carbon pricing is obviously a contentious issue, but prior to the implementation of carbon pricing on July 1 in Newfoundland and Labrador, we saw periods of extreme prices for gas. What's the most you've ever paid for fuel per litre prior to the carbon tax?

[Barry Warren]

I can't give you an exact figure, but I'm going to say $2.01.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

What are you paying today?

[Barry Warren]

It's $2.01, but you have to realize the fluctuation in the price of gas and diesel. I'm burning two fuels there. As that price goes up and down, we get a chart every week that justifies where we need to be with our pricing model and fuel surtax.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

I'm just trying to make a point. The carbon price is an issue, yes, but the fluctuation in the world market on fossil fuels at any time is driven by a lot of factors.

We have a carbon rebate program for individuals. Carbon pricing rebates for families of four go up to $360 per quarter. I understand your challenge as a business person, though, and it's well noted. We've certainly been passing on that message as well in Ottawa.

From your perspective, Barry—I know you've identified a number of challenges—what do you think is your biggest challenge going forward?

[Barry Warren]

The biggest challenge for me right now, because I see the direct effect, has been the effect of the carbon tax. The bigger challenge for me is the fact that I see people who are not listening to what the industry is saying about the cause and effects of all this.

Like I said, I'm not an economics professor, but I do know the reality. I look at what I do. I look at the people I do work for, and they dictate to me what my price will be, what I can charge, and what they're going to pay me. I have a choice to say no or to take that work, but as an individual and as a group of great employees who work very hard.... The middle class is disappearing in going the direction we're going in. That's what's more frightening than anything, because all the other things.... On the cost of parts, a turbo at one time was $1,800, two years ago, and now it's $6,800. Those in the trucking industry would understand how important a turbo is to a truck.

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

Yes. I just wanted to make the point about the fluctuation in the fuels. I understand the concern around carbon pricing, but the reality is that there was an 11¢-a-litre carbon price in place by the province prior to July 1. You were paying that as well, of course, and now we've added 3¢, to 14¢. We're now rebating that money back to individuals, but that's not happening in your situation.

[Barry Warren]

But, Churence, what I want you to understand is this. I understand the provincial; yes, they lifted it and so on, dictated by the federal government. I paid $16,302 in September alone that I didn't budget for. That number is going to go up. When I'm meeting with my people.... What do we have to do to survive this? Do we start laying people off or what do we do?

[Churence Rogers, Liberal, Bonavista—Burin—Trinity, NL]

I have time for one more question.

Courtney, on the EI issue, I've acknowledged that it's a problem. We're working on it. All I can say is that I can't give you any information today, particularly, but I think we're moving forward. We'll hopefully be able to announce some kind of support soon.

This year has been an extremely difficult year, a lot of it brought on by the delayed fishery and the seven weeks we lost, which led to many problems in the production facilities. In my riding, I have lots of fisheries, from Bonavista to New-Wes-Valley to the St. Lawrence to the Grand Banks and so on. This has been a difficult year.

On top of that, the EI regulation changed because we had good news: The unemployment rate dropped. You'd think we'd be happy about that, but unfortunately that doesn't work in a seasonal industry. That's our problem. I agree with you that we need to bring about some reform that says there are exemptions for seasonal industries of some kind. Our seasonal fishing industry is defined by DFO in a lot of ways. They open the fishery in April and they shut it down at a certain time.

Now, I can't go into a lot of the other issues you raised, because I don't have the time. That's just my comment in terms of your commentary.

Thank you.

[Courtney Glode]

Thank you. We look forward to an announcement soon.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Rogers.

Now we will go to MP Ste-Marie, please.

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

Thank you, Mr. Chair.

Mr. Rogers, I'm glad to find out that good news is on the way soon when it comes to EI. I, personally, was worried. That wasn't the impression the minister gave the Standing Committee on Finance. I'm very glad to hear that things are moving forward. I'm eager to see the measures.

Ms. Whitaker, I'm not sure I understood an issue you raised at the end of your presentation, so I'd like you to explain. You are calling on the government to exclude institutions like universities from the Bankruptcy and Insolvency Act. Currently, universities can declare bankruptcy. I had no idea.

Please explain the problem to us, if you wouldn't mind.

[Dr. Robin Whitaker]

Thank you very much.

For the sake of clarity, I'm going to answer in English

You probably remember that Laurentian was brought under the CCAA legislation. There was a report or a research study done on that situation after the fact by the Auditor General of Ontario. Her conclusion was that the legislation is inappropriate for public post-secondary education institutions, that it was unnecessary and that other alternatives that would have led to a much more favourable outcome for the institution, students, faculty, other employees and the community would have been possible.

It's not the right legislation for dealing with financial challenges that post-secondary institutions face. It doesn't serve their public mission. It was designed for a different situation in the private sector. So we think this is important, particularly given the significant public investments that still go into public post-secondary institutions, although they've declined, unfortunately.

In the case of Laurentian, the effect was obviously also on northern, indigenous, and francophone communities, which were very affected. The public mission of the university was damaged by the imposition of inappropriate legislation.

I hope that answers your question.

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

Thank you.

That brings me to a follow-up question.

We know the unfortunate situation that befell Laurentian University, in Ontario. Is there a real risk to post-secondary institutions in Newfoundland and Labrador right now? Do you think what happened in Ontario led people to sound the alarm, so there isn't a risk to institutions in this province in the short or medium term?

[Dr. Robin Whitaker]

I hope there are no issues here in the short or long term.

We want to ensure that it's not possible for this kind of damaging process to happen again. As I said, the public mission of public post-secondary education is vital to all of us and it's vital to our collective future as a country. This is simply not the right framework for dealing with financial challenges, and I think that was made very clear in Bonnie Lysyk's report on Laurentian. I highly recommend reading it, as it is really instructive.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Ste-Marie.

MP Cannings, go ahead, please.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you.

I'm going to turn to Ms. Walsh.

One of the roles I have is to be the NDP critic for emergency preparedness and climate resilience. You touched on that in your presentation, and we all know that the cost of climate change is great right now and it's going to be increasing, with a lot of those costs falling on municipalities and individuals. We know, a year after Fiona, that people in Port aux Basques have nothing because they didn't get anything from insurance.

The question is how municipalities are going to prepare for the future and not just react to these emergencies and catastrophes across the country. You mentioned Harbour Main and what it faces. I have communities in my riding that are facing costs, after fires and floods, that are double or triple their annual budgets. We have to fix that whole funding formula, which asks too much of them in many cases.

Could you spend some time talking about that?

[Dr. Deatra Walsh]

Sure. Thank you very much.

Indeed, at the municipal level, all these crises intersect, which is part of the complexity; it's troublesome, and unexpectedly so, sometimes.

Here in Newfoundland and Labrador, we are really behind in terms of managing and preparing for climate change. It is about capacity, in many ways, for small communities. If my colleague Dr. Parewick were here with me now, she would talk a lot about asset management. Asset management is critical to any of these response issues, especially as it relates to climate change. I know the national adaptation strategy talks about that as well. I think 60% of our members here in Newfoundland and Labrador do not have an asset management plan. This was part of the Canada community-building fund, formerly the gas tax, that was needed to do that. We have a lot of catching up to do to get to a state of readiness on climate change.

I have to tip my hat to the people in our communities, the municipal counsellors, and the staff who are faced with these challenges and these crises. They are doing a tremendous job. There are first responders with very little in terms of resources. I would like to point out that most of the fire departments that are the first responders to these issues here in Newfoundland and Labrador are made up of volunteers. They're not getting paid extra for these things. The volunteer fire department, which comes under the municipality, is not getting paid extra for all of these elements.

We have to fix the system. We have to meet communities where they are and we have to get working together. I know these sound like lofty goals, but we need regional approaches. Yes, MP Rogers, we need the regional government or at least some form of regional approach or collaboration. We have to get rid of this competitiveness on this. We don't have time to lose or waste. People's lives are at stake here.

I don't have an easy solution. Municipalities in Newfoundland and Labrador are doing tremendous work with fabulous partners in this province, and we are trying our best to get further along. Whatever comes out through new federal funding programs as it relates to the NAS, and as it relates to housing, please keep in mind that we are not where everybody else is. If you want us to access this funding, you need to meet us where we are and get some capacity going here. It's so critical, but we can do it.

Smaller municipalities, perhaps in your riding, can do it, but we have to meet them where they are. We have to get that local capacity going, work together and do the best we can under what I consider to be impossible circumstances.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Cannings.

Now we're going to go to MP Duncan for five minutes, please.

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

Thanks, Mr. Chair.

Mr. Warren, I want to build on Mr. Rogers' comments here. The frustrating point is.... We talk about the fluctuations. There's no fluctuation with the carbon tax. It is imposed now at 14¢ per litre. The other thing to remember here in the province, as well, is the 17¢-per-litre increase on homeowners who heat their homes with oil, and it's going up.

I just want to get one quick clarification before I go to Ms. Callahan.

When you talk about the fuel surcharge, if that carbon tax was scrapped and taken off the price of fuel, the fuel surcharge amount that you charge would decrease, and that would lower the cost of getting goods and food here to the province. Is that correct?

[Barry Warren]

Speaking for my company, I would say yes. Speaking for the industry as a whole, I would say that, yes, it would. However, keep in mind that it's these ongoing.... I won't call them surprises, but what you're reacting to. We talk about CERB; we talk about the mandated sick days and all these things. You're dealing with that, but then, all of sudden.... So the industry is not being heard.

When the trucking association says that the carbon tax is going to cost $3.2 billion per year.... It's coming to the coffers, so, I mean, it's great for the federal government, but who's paying for that? All of us are taxpayers; we're paying for that. This issue is the biggest challenge for me and, I know, for others in our industry in Newfoundland. It's hitting me directly on the bottom line.

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

I appreciate that.

Ms. Callahan, in the transition to that, we talk about food prices. The cost of the carbon tax adds to the trucking bill, adds to the grocery bill. When you check out at the grocery store, it has your tax lines on it. It doesn't have a carbon tax line. That is baked into the price of food inflation, which you alluded to among housing and other things.

I would say that we want to try to humanize, as well, particularly with regard to seniors, the impacts that inflated food costs are having. You said in your opening comments that seniors are having to cut back. We heard in Fredericton about seniors cutting their medications in half and stretching them out as an example of how bad it's gotten.

Can you talk a little bit about the carbon tax impact, whenever we have food inflation, and what exactly seniors are having to do to make ends meet?