Finance Committee on Nov. 20th, 2023

[The Chair, Liberal, Peter Fonseca]

We are resuming meeting number 121 of the House of Commons Standing Committee on Finance.

Pursuant to the order of reference of Thursday, November 23, 2023, the committee is resuming its study of Bill C-56, an act to amend the Excise Tax Act and the Competition Act.

I'd like to provide members of the committee with a few comments on how the committee will proceed with the clause-by-clause consideration of Bill C-56.

As the name indicates, this is an examination of all the clauses in the order in which they appear in the bill. I will call each clause successively, and each clause is subject to debate and a vote.

If there is an amendment to the clause in question, I will recognize the member proposing it, who may explain it.

I'd like to remind committee members that pursuant to the order adopted by the House on Thursday, November 23, all amendments had to be submitted to the clerk of the committee by noon yesterday.

As a result, the chair will allow only amendments submitted before that deadline to be moved and debated. In other words, only amendments contained in the distribution package of amendments will be considered.

When no further members wish to intervene, the amendment will be voted on. Amendments will be considered in the order in which they appear in the package each member received from the clerk.

In addition to having to be properly drafted in a legal sense, amendments must also be procedurally admissible. The chair may be called upon to rule amendments inadmissible if they go against the principle of the bill or beyond the scope of the bill—both of which were adopted by the House when it agreed to government business motion 30 and the bill at second reading—or if they offend the financial prerogative of the Crown.

Amendments have been given a number in brackets in the top right corner to indicate which party submitted them. There is no need for a seconder to move an amendment. Once it has been moved, you will need unanimous consent to withdraw it.

During debate on an amendment, members are permitted to move subamendments. Subamendments must be provided in writing. Those subamendments do not require the approval of the mover of the amendment. Only one subamendment may be considered at a time, and that subamendment cannot be amended.

When a subamendment is moved to an amendment, it is voted on first. Then, another subamendment may be moved, or the committee may consider the main amendment and vote on it.

Finally, pursuant to the order adopted by the House, if the committee has not completed the clause-by-clause consideration of the bill by 11:59 p.m., all remaining amendments submitted to the committee shall be deemed moved, the chair shall put the question forthwith and successively without further debate on all remaining clauses and amendments submitted to the committee, as well as each and every question necessary to dispose of the clause-by-clause consideration of the bill, and the committee shall not adjourn the meeting until it has disposed of the bill.

I thank members for their attention and wish everyone a productive clause-by-clause consideration of Bill C-56.

Today's meeting is taking place in a hybrid format pursuant to Standing Order 15.1. Members are attending in person in the room and remotely using the Zoom application.

I'd like to make a few comments for the benefit of the witnesses and members.

Please wait until I recognize you by name before speaking. For those participating by video conference, click on the microphone icon to activate your microphone, and please mute yourself when you are not speaking.

Regarding interpretation for those on Zoom, you have the choice at the bottom of your screen of floor, English or French audio.

For those in the room, you can use the earpiece and select the desired channel.

Although this room is equipped with a powerful audio system, feedback events can occur. These can be extremely harmful to interpreters and cause serious injuries. The most common cause of sound feedback is an earpiece worn too close to the microphone. We therefore ask all participants to exercise a high degree of caution when handling the earpieces, especially when your microphone or your neighbour's microphone is turned on. In order to prevent incidents and safeguard the hearing health of the interpreters, I invite participants to ensure that they speak into the microphone into which their headset is plugged and avoid manipulating the earbuds by placing them on the table away from the microphone when they are not in use.

I will remind you that all comments should be addressed through the chair.

For members in the room, if you wish to speak, please raise your hand. For members on Zoom, please use the “raise hand” function. The clerk and I will manage the speaking order as best we can, and we appreciate your patience and understanding in this regard.

In accordance with the committee's routine motion concerning connection tests for witnesses, I've been informed that all witnesses have completed the required connection tests in advance of the meeting.

Members, just before we welcome our witnesses, you should have received the budgets that we need approved. Could I just get a thumbs-up?

(Motion agreed to)

That's great. Those are approved.

Thanks to you and to the clerk.

Today, we are studying Bill C-56, an act to amend the Excise Tax Act and the Competition Act.

With us today are our witnesses. From the Department of Finance, we have Robert Ives, who is an expert adviser on real property and financial institutions. From the Department of Industry, Mark Schaan is with us. He is the senior assistant deputy minister of the strategy and innovation policy sector. Also from the Department of Industry, we have Samir Chhabra, who has joined us. He is the director general of the marketplace framework policy branch. Finally, we have Martin Simard, who is the senior director in the strategy and innovation policy sector.

Those are all of the officials who are with us today.

I saw MP Ste-Marie.

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

Thank you, Mr. Chair.

I have a few comments to make concerning the conduct of the study we are doing of Bill C-56. I don't know whether this is the right time to talk about it. If not, I will do it when I speak to the first amendment I am going to suggest.

I want to let you know that I will shortly be withdrawing two of the amendments that I submitted. I am not happy about withdrawing them, because they reflect needs that have been expressed by groups of experts in the field who are directly affected by Bill C‑56. However, as they stand, those amendments would have adverse effects that might outweigh the benefits they were supposed to provide.

I am talking about this because we have a serious problem. We had to submit our amendments at the same time as we were listening to the witnesses in committee. Why? Because, as a result of the super gag order, we did not have enough time to do our work properly in committee. This is very serious. The fact that the government has an agreement and everything will be passed does not mean that we should bypass the work that members do in committee. This kind of contempt for parliamentarians is rarely seen. We cannot do our work properly.

I will give you an example. On day 1, at the briefing on Bill C‑56, we asked the finance department officials to send us the projections they had concerning the GST rebate. What effects were expected? How many more buildings and units would be built? How many fewer condos would be built? What figures is the bill based on? The day before yesterday, I again asked the Minister for these figures, and she said yes and they would be sent to us.

Now we are shortly going to be starting the clause by clause study of the bill, but we are going to be voting blindly, in a fog, because we still do not have those figures. The Minister named an academic who she said had done a study that the officials seemed not even to have read. That is not a serious way of doing things; it is not disciplined. We are still waiting. Ordinarily, I would not be prepared to vote, because I have not received the finance department's answer, even though the Minister of Finance undertook to send us the information.

On this point, I want to reiterate that the finance department seems to regard members of Parliament with contempt. For the last two years, when in camera studies of the budget or the economic statement took place, there were no officials on site to answer our questions, despite our repeated requests. Journalists, however, get in‑person access to the officials. We are given only hard copy documents, while journalists have access to the same documents on USB keys. It is as if the media were more trustworthy than members of Parliament, the people's elected representatives. It reflects the finance department's perception of the House of Commons and its members. It is unacceptable.

This week, in addition, we received a notice of ways and means motion five minutes before the briefing started. I would reiterate that there was no summary. There was nothing. We received 529 pages of incomprehensible legislative and tax gibberish and we had only five minutes to read the whole thing before asking the officials our questions. That shows the contempt that the department has for Parliament. I have an assistant who does research and has worked in the party for 25 years, and he says he has never seen things done this way in 25 years. As well, during the presentation, the sound quality of the official's remarks was so bad that we did not understand half of what he said. I was the only member who asked questions. I asked two questions. The answers were clear, but we did not have the means to prepare.

Then they will be coming to us with Bill C‑60, the follow‑up legislation, and I warn you. There are two weeks and a bit left before the work of the House is adjourned for the winter break. Does the government seriously want to get through the entire process to enact this mammoth bill and still think we are going to be able to do our job well? Does it not care at all about our work? This is not acceptable.

Some of the amendments I will shortly be proposing and I will not be withdrawing may create inconsistencies in the act. They were drafted with the help of the Office of the Law Clerk, but it was done quickly. The message I am sending to the government is "tough": if my amendments are adopted and create inconsistencies, it will be up to you to introduce other legislation to solve the problems, because you do not respect the work we do here, and that is unacceptable.

I hope that for the next budget implementation bill acceptable time is allowed so we are able to do our work properly.

In Bill C-60, for example, there should be the follow‑up to the reform of the Competition Act. This is the first time in 37 years that there has been such a reform. However, if we want it to be enacted by Christmas, we can expect that we will not even have time to study it. Ultimately, there will be a reform of the Competition Act, when there has not been one for 37 years and there have been 20 years of calls for reform, but we will not even be able to do our work on it properly. This is not a serious way of doing things and it is undisciplined.

I oppose gag orders. Obviously, my party will always be in opposition here. I do not like it when Parliament is gagged. The government, which is in charge of how the work is done, could at least allow enough time for us to be able to hear witnesses and experts in committee, to talk to officials, and be able to delve a little more deeply into things and do our work properly.

That has not been possible with Bill C‑56. That is why I am shortly going to withdraw two of my amendments and why some of my other amendments might create problems in the overall structure of the bill. However, we have no choice, because of the super gag order that limited us to a single day of study before going to the vote. That is unacceptable.

During the pandemic, it might have been excusable; that was a special situation. Now, however, we have had two years of the finance department not respecting members of Parliament by preventing us from doing our work properly, both in camera and in committee and the House. This has to change, please.

Thank you, Mr. Chair.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Ste-Marie.

On MP Ste-Marie's point of order, go ahead.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

In brief, I think that was extremely well said—eloquent, I might say as well. I realize that we are where we are with respect to Bill C-56, but Conservatives would agree almost entirely with your comments, Mr. Ste-Marie.

As we go forward into the fall economic statement, I know Mr. Blaikie particularly to be an advocate for good process. I'm hoping he will use his voice and his power to make sure that we have a good process with respect to the fall economic statement.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Lawrence.

I have PS Bendayan.

[Rachel Bendayan, Liberal, Outremont, QC]

Thank you, Mr. Chair.

I would like to thank Mr. Ste-Marie for his introductory comments.

I would just like to point out that we had over 20 hours of debate on Bill C-56 in the House, in addition to six hours of debate on motion number 30. We debated this bill at great length in the House. I understand that it was a bit tight this week, but we are 10 days from the end of the parliamentary session. As well, I think that everyone around the table agrees that this is a bill that should be passed before the holidays.

[The Chair, Liberal, Peter Fonseca]

Thank you, PS Bendayan.

Now members, as per the annotated agenda pursuant to Standing Order 75(1), consideration of clause 1, the short title, is postponed. The chair calls clause 2.

(On clause 2)

On clause 2 we have Bloc-1.

MP Ste-Marie.

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

Thank you.

As was said at the meeting on Monday, we have been contacted by many entrepreneurs to tell us that in their opinion, there are vague points in the bill when it comes to the GST credit that will be applied to projects. This is an example that comes up often: a project has been started, but the ground floor, which will house commercial premises, has not yet been begun. They want to build rental housing above. These entrepreneurs want to know what point marks the start of the project, so they know what it consists of.

If the first shovel of earth has been turned, we can assume that it is for the commercial part. They are in the process of deciding how many storeys they want to build and wondering what to do with the rest of the project. Whether they will have access to credit will change their financing arrangement and what will be built. They have to know this information in order to determine whether they will construct a five-storey building or an eight-storey building, for example. That is what we are being told.

We have therefore requested clarification. Because we have not received any clarification from the Minister, or at least this is my understanding of what has been said, this is what we are proposing here: for a project that has been started but for which the housing component did not start before September 14, 2023, we suggest that the project be considered to be eligible, in order to provide more stimulus for building housing.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Ste-Marie.

I have PS Bendayan who would like to speak to this.

[Rachel Bendayan, Liberal, Outremont, QC]

Thank you, Mr. Chair.

I have had the opportunity to speak with my colleague. I have a lot of respect for amendment BQ‑1, but there are a few points I would like to clarify.

The intent of the bill, and in particular the measures to encourage housing construction, is really to provide an incentive for new supply, not to reward existing supply.

In addition, we understand that the change proposed in amendment BQ‑1 would actually involve new spending. On the government side, we would like to spend on building more housing, not rewarding the existing supply, as I said.

For those two reasons, I will not be able to vote for the Bloc Québécois amendment.

[The Chair, Liberal, Peter Fonseca]

Thank you, PS Bendayan.

Is there anyone else to speak?

Shall amendment BQ-1 carry?

[Rachel Bendayan, Liberal, Outremont, QC]

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

(Amendment negatived: nays 6; yeas 5 [See Minutes of Proceedings])

(Clause 2 agreed to)

(On clause 3)

[The Chair, Liberal, Peter Fonseca]

Clause 3 has amendment BQ-2.

No, it's withdrawn. We are now at amendment NDP-1.

Mr. Blaikie, go ahead.

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

Thank you, Mr. Chair.

This amendment essentially is to allow the commissioner to conduct—

[The Chair, Liberal, Peter Fonseca]

Mr. Blaikie, you are moving this.

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

I am.

[The Chair, Liberal, Peter Fonseca]

Okay, just let me read something into the record here.

If amendment NDP-1 is adopted, members, amendment CPC-1 cannot be moved because of a line conflict. The House of Commons Procedure and Practice, third edition, states on page 769:

Amendments must be proposed following the order of the text to be amended. Once a line of a clause has been amended by the committee, it cannot be further amended by a subsequent amendment as a given line may be amended only once.

That's just so members are aware of that.

MP Blaikie, go ahead.

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

Thank you very much, Mr. Chair.

The purpose of this amendment is to allow the commissioner to initiate, on their own authority, a market or industry inquiry. There's some allowance for consultation with the minister, but it does not allow the minister to prevent the commissioner from moving ahead.

That is the essence of the amendment, Mr. Chair.

[The Chair, Liberal, Peter Fonseca]

Okay.

MP Lawrence, go ahead, please.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Thank you very much, Mr. Chair.

We'll make a decision as to whether we want to go forward with the CPC one or the NDP one, so I will, at this point, make an argument for why I believe it should be the CPC one.

The CPC one would give solely the commissioner the ability to make a decision about an investigation, thus taking it out of the political realm. This is what the commissioner asked for fairly clearly with respect to the testimony. Conservatives fear that if investigations are allowed to be directed by a minister, they could be politicized and used as a weapon to attack companies that are unfavourable to the government.

Not to be antagonistic, but we certainly have seen, in the past, governments that have utilized their powers to promote one company over another. Therefore, Conservatives are in favour of a completely and 100% depoliticized situation in which it is a non-partisan, independent commissioner who decides who will be investigated.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Lawrence.

We are on amendment NPD-1.

Is there anybody else to speak to NDP-1?

(Amendment agreed to [See Minutes of Proceedings])

We are onto amendment BQ-3.

MP Ste-Marie, go ahead, please.

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

This amendment is in the same vein, and, according to the legislative clerk, it may also be adopted, and be added to the others. Its purpose is to give the Competition Bureau the power to initiate its own inquiries without needing to consult the minister. The commissioner would also have the power to extend an inquiry if they considered it necessary. The commissioner would therefore have more independence.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Ste-Marie.

Is there anybody to speak to this?

Go ahead, MP Blaikie.

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

My impression is that NDP-1 provided sufficient authority for the commissioner to be able to initiate his own studies. I appreciate there are some differences, but my plan is to vote against.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Blaikie.

Is there anyone else?

We will have a recorded vote.

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

(Clause 3 as amended agreed to on division)