Finance Committee on Feb. 3rd, 2022

[Jeremy Kronick]

The C.D. Howe Institute paper was published by an individual. Neither Mark nor I wrote that paper. However, the fiscal accountability papers in general are based on a series of measures, a variety of measures: transparency, how close you stick to what you say you're going to do, and things of that nature. Based on that series of rankings, that's how the authors of those papers do that for the federal government and for the provinces, and they do it for the municipalities as well.

Again, neither of us wrote that paper.

[Jake Stewart, Conservative, Miramichi—Grand Lake, NB]

I respect that.

Is there anything in that report that you found particularly alarming?

[Jeremy Kronick]

I think you always find it alarming when anyone is ranked at the bottom when some of the issues concern transparency.

[Jake Stewart, Conservative, Miramichi—Grand Lake, NB]

Mr. Zelmer, the provinces tabled a report and the federal government didn't, which lacks accountability.

Would you say that holding public officials accountable for their spending, taxing and borrowing is fundamental in our roles as parliamentarians?

[Mark Zelmer]

I certainly would. In general, given the amount of money that we, the population, entrust to our elected officials at whatever level of government, we are entitled to have an accounting of how it's being spent and an understanding of the reasons they made the choices that they did.

We expect that increasingly of the private sector, and the public sector should lead the way.

[Jake Stewart, Conservative, Miramichi—Grand Lake, NB]

How do you feel the current government is doing with respect to its spending and the accountability that the public has in that spending?

[Mark Zelmer]

I am not an expert in this area, so I don't think I can give you a very well-informed opinion. I'll ask Jeremy if he can, but I certainly cannot.

[Jeremy Kronick]

The focus continues to be on that paper, which neither of us wrote. To answer your question, there was a budget tabled last year. That would have markedly changed the rankings, because not having one certainly affected the ones you're discussing.

You're moving in that direction when you table a budget. That's what we're here to do today, to discuss some of the measures that will make it into this coming budget.

[Jake Stewart, Conservative, Miramichi—Grand Lake, NB]

What advice can you give the committee when it comes to the government being more financially transparent? Do you have any advice for the current government on how they could improve financial transparency?

[Mark Zelmer]

One suggestion I would put on the table is that as much as possible, they should not only be accountable for what's going directly through their budget, but also be willing to explain on a more consolidated basis what's happening with respect to Crown corporations and other vehicles that exist, if you like, outside of the main budget. We have senior public officials who are accountable for those institutions, but talking about how things are happening on a consolidated basis would be important.

Also being accountable for and talking about some of the contingent liabilities that could exist for the government down the road and how they propose to manage the risks around that would be helpful.

[Jeremy Kronick]

Mr. Stewart, I could add one quick point to that, around misses.

If you're missing certain targets you had put in place in the budget, explain why that's happening when you do your updates. COVID threw a lot of the projections, at least of the budget that predated it, off course quite considerably. The key is to communicate with the public about where those misses happened and why.

[The Chair, Liberal, Peter Fonseca]

That's your time, Mr. Stewart. Thank you very much.

We're moving to the Liberals and Ms. Dzerowicz for five minutes.

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you, Mr. Chair.

I want to thank all the witnesses for their excellent testimony today.

I want to thank Mr. Zelmer and Mr. Kronick. Your last two recommendations were excellent. It's on our record and I really appreciate those comments. We could always be more transparent and more accountable, and they were both very helpful.

I have tons of questions and very little time, so let me try to get to them.

I'm going to start with the Council of Canadian Innovators. Ms. O'Born, you indicated that you have some recommendations around immigration and training. Are they in the report you submitted in your brief to the finance committee?

[Dana O'Born]

They are.

[Julie Dzerowicz, Liberal, Davenport, ON]

Okay. I won't have you repeat it, because it's too much to go through.

I also appreciated your recommendations on how to improve SR and ED and the need to ensure that we are developing and protecting IP, as well as making sure that we give money to companies that are not taking our IP out of the country, but that they remain here. I heard that loud and clear. I very much appreciate that. I'm assuming that's also in the report you have submitted to us.

There are many who feel that we do not have a culture of patenting, or IP protection, in this country. You've made some recommendations on SR and ED. Are there any other recommendations you would make on creating that culture of IP generation, retention and education?

[Dana O'Born]

Certainly. A few of those are in our report, so I'm happy to follow up with that as well.

In my deputation, I did make reference to what is called a “patent box”, which is a way of treating patent taxation in Canada. As you can imagine, it's basically putting a little bit of a fence around an idea—that's what a patent does, in its simplest form—and making sure that people don't steal those ideas and generate them for wealth in different parts of the world. So the use of a patent box—for more notes on that, I can certainly follow up with the committee—would be a great tool.

The government has already taken a few steps. The initiation of the Innovation Asset Collective under ISED has been a great step in the right direction, but we also need to think about making use of and protecting some of the new technologies that have come out of the pandemic. I think the government provincially, federally and municipally—I know those are not all your domains—have put a lot of investment into health technology. How do we make sure that this stays in Canada and services Canadians?

When we look at some of the research and development at NRCan, NRC, IRAP and some of the other investments that are being made through the strategic innovation fund, and we put those investments out into the ecosystem to try to generate business and growth, it's also important to keep tabs on how those ideas are being commercialized to make sure they're benefiting Canada.

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you.

I'm going to shift over to you, Mr. Kronick. You gave a number of excellent recommendations. On housing, you mentioned that there are some limited tools at the national level. Then you went on to say that there are some things we can do, such as incentivize as we're giving dollars around housing; incentivize the lower levels of government to actually reduce development fees. I forget what else you said.

Could you repeat those? When I heard them, I thought, oh, these are excellent, and I'd like to record them.

[Jeremy Kronick]

Yes. What I said was that the federal government can prod lower levels of government in areas of the approval process, such as the rules around density and the way they charge development fees. I can expand on those, if you'd like.

[Julie Dzerowicz, Liberal, Davenport, ON]

I'd appreciate it if you could send us an email on that, because then we could incorporate it as part of our recommendations.

The other thing I wouldn't mind your talking about for the last bit of time I have is open banking. You indicated that it's a zero-cost way for us to improve productivity. Would you mind elaborating on that further, please?

[Jeremy Kronick]

I probably should have been more careful with my wording around “zero-cost”. It's productivity-enhancing at minimal cost, at least, in the sense that you are letting the private sector do the work. You have all these fintechs that would benefit immensely from access to the data that they would get through our putting open banking into play. I mean, some of this stuff is already happening, but the advisory committee gave some recommendations, quite specific recommendations, on what's needed to get open banking off the ground, and there hasn't been much movement on that. To the extent that there would be, the idea is that those fintech players would be able to provide at a lower cost to consumers some of the banking services and investment services, etc., that they're getting for much higher costs with the incumbents.

So it's not zero-cost, but certainly it's not the kind of thing where the government has to run the program and therefore spend billions and billions of dollars to do it.

[Julie Dzerowicz, Liberal, Davenport, ON]

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, Ms. Dzerowicz.

Now we'll move to the Bloc.

Monsieur Ste-Marie, you have two and a half minutes.

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

Thank you.

Mr. Viau, regarding agriculture, you spoke of soil health and climate risk management.

In two and a half minutes, could you elaborate on your requests?

[Marc-André Viau]

Of course.

[Terry Beech, Liberal, Burnaby North—Seymour, BC]

I have a point of order, Mr. Chair.