Finance Committee on Nov. 7th, 2024

[The Chair, Liberal, Peter Fonseca]

I call this meeting to order.

Welcome to meeting number 164 of the Standing Committee on Finance. Today's meeting is taking place in a hybrid format. All witnesses have completed the required connection tests in advance of the meeting.

I'd like now to remind participants of the following points: Please wait until I recognize you by name before speaking, and all comments should be addressed through the chair.

Members, please raise your hand if you wish to speak, whether participating in person or via Zoom. The clerk and I will manage the speaking order as best we can.

Pursuant to Standing Order 83.1 and the motion adopted by the committee on Thursday, September 26, 2024, the committee is resuming its study on the pre-budget consultations in advance of the 2025 budget.

Before we get to our witnesses today, I'd like to thank all the witnesses who have taken part in our PBC meetings this year, because this will be our final meeting with witnesses.

We've had an amazing job done by our clerk, the analysts, the entire team and the interpreters. Everybody tried to accommodate all of our witnesses as well as possible.

We have a limited number of meetings. While many of you have received last-minute invitations, you all still do your best to provide excellent testimony to us here at our committee. We're thankful for that, and it's much appreciated, so thank you.

Now we will go to our witnesses who are with us here today.

From the Affiliation of Multicultural Societies and Service Agencies of BC, we have its chief executive officer, Katie Crocker, via video conference.

From the Canadian Live Music Association, president and CEO Erin Benjamin is here in person.

From HEC Montréal, we have Professor Pierre-Olivier Pineau, also via video conference.

From Platform Calgary, we have Terry Rock, president and CEO.

From the TMX Group Limited, we have with us the head of government affairs, Mr. David Clarke.

From the Union des producteurs agricoles, we have its general manager, Charles-Félix Ross, and Marc St-Roch, coordinator of accounting and taxation department there.

We're going to start with opening remarks. You'll have up to five minutes.

We'll start with Katie Crocker, please, for the first five minutes.

[Katie Crocker, Chief Executive Officer, Affiliation of Multicultural Societies and Service Agencies of BC]

Thank you very much.

Hello, members of Parliament. Thank you for inviting me to speak briefly to recommendations for the 2025 federal budget.

My name is Katie Crocker. I'm the chief executive officer of AMSSA, the Affiliation of Multicultural Societies and Service Agencies of British Columbia. We are the provincial umbrella association for 94 organizations serving newcomers in British Columbia.

Today I'll be sharing three key recommendations with you that we strongly believe will support both the overall impact of Canada's non-profit sector and newcomers' ability to meaningfully engage with and contribute to the social fabric of our nation.

Our first recommendation is to develop an all-of-ministry approach to immigration that pulls support and funding from different federal ministries in addition to Immigration, Refugees and Citizenship Canada.

As the ministry responsible for supporting the settlement of newcomers to Canada, IRCC has developed strong relationships with the settlement sector and the non-profit sector. However, while the sector has certainly benefited from IRCC's specialized support over time, it has become clear that the full array of supports required for newcomers to be fully settled falls beyond the purview of what IRCC can offer on its own.

For example, securing safe, adequate and affordable housing continues to be a barrier for newcomers settling in Canada. Collaboration with Housing, Infrastructure and Communities Canada could benefit both newcomers and Canadians, as having newcomers fill construction job shortages can increase both housing affordability for newcomers and domestic housing supply.

Immigration plays a significant role in Canada's overall economic growth, with most immigrants arriving in Canada through the economic pathway. As immigration provides positive impacts to the country, proactive and meaningful collaboration between federal ministries benefits the whole country.

Our second recommendation is to have multiple funding sources for immigration through the all-of-ministry approach, which must be coupled with implementing a holistic, fluid and more flexible funding model for the settlement and integration sector.

The funding model needs to be fluid and flexible enough to allow organizations to change program delivery to respond to evolving unique client needs amid global events and Canada's social and economic changes. The current funding model does not allow organizations to adjust programming according to emerging short- and long-term needs without the additional administrative burdens of contract amendments. Certain types of support, such as housing supports, are not even part of the equation or of the eligible support types.

Additionally, the strict eligibility criteria for who can access IRCC-funded services impacts organizations' ability to serve the most vulnerable groups, such as asylum seekers, refugee claimants and others with precarious immigration statuses. A less restrictive model would allow for more robust compensation, attract and retain staff and help organizations better address emerging needs for their most vulnerable clients in alignment with IRCC's core principles to deliver the right service to the right client at the right time.

This model will also have an impact on collaboration and community engagement with indigenous communities. A large part of working with indigenous communities involves working and thinking creatively, relationally and reciprocally, which is not possible within a funding model that is fundamentally based on colonial practices and restrictive structures and time frames. A flexible model will allow for meaningful relationships to be built, based on reciprocity and co-creation from inception.

A more fluid funding model is also connected to calls from the non-profit sector more broadly to change Treasury Board funding structures to better account for the needs of non-profits.

This leads to recommendation number three, which is the implementation of a non-profit unit in federal government.

The non-profit sector is currently dealing with skyrocketing demands and rising costs amid stagnant funding and capacity issues that could be addressed through the establishment of a dedicated unit to provide long-term planning and champion the perspectives of non-profits within the federal Government of Canada.

In Canada, the charitable and non-profit sector contributes 8.3% to the GDP and provides 2.8 million jobs, which is greater than the GDP contribution and job creation of the fisheries and agriculture sectors, yet, unlike those sectors, non-profits do not currently have a place in government.

Building a dedicated non-profit unit in government would address current gaps in which the needs of the non-profit sector in policy, legislation and data collection can be overlooked. There is a long and well-researched history that backs this suggestion, which was recommended by the Special Senate Committee on the Charitable Sector and the advisory committee on the charitable sector in 2019 and 2021 respectively, after widespread sector consultation.

In March 2021, the Government of Canada supported the creation of a single window into government for the charitable sector, yet a dedicated unit has not emerged. A unit in the federal government could follow many other examples and models, including British Columbia's recent creation of a parliamentary secretary for community development and non-profits.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, Ms. Crocker.

Now we'll hear from Ms. Benjamin.

[Erin Benjamin, President and Chief Executive Officer, Canadian Live Music Association]

Mr. Chair, vice-chairs and members of the committee, thank you so much for inviting me to speak with you today.

I would like to acknowledge Alexandre. Thank you as well.

The short notice to appear provided me with a challenge I was happy to accept, because I am always proud to talk about the remarkable impact that our members have on Canadians, on the Canadian economy, on Canadian businesses and on Canadian artists. I'm really grateful to have this opportunity to be before all of you today.

My name is Erin Benjamin. I am the president and CEO of the Canadian Live Music Association, and I have the great privilege of representing Canada's live music industry. While we don't represent artists directly, we do represent the venues, clubs, concert halls, stadiums, festivals, concert promoters, talent agents and the vast supply chain that facilitates live music, in all its shapes and sizes, for artists and their fans from across the country and around the world.

We are the touring infrastructure, indoors and out. You know us as your favourite local festival or maybe as the punk rock club where you used to mosh as a teenager, and you certainly know us as the industry that brings Taylor Swift to town.

Our budget submission contains three very important and specific recommendations, but rather than walk through the submission, which you've seen, I would instead like to share some additional information for your consideration as you think about how to situate the power of live music into the next federal budget and beyond.

In our brief, particularly in the second recommendation—although it does relate directly to all three—we talk about the potential and the opportunity music tourism is representing here in Canada and globally, and about how it's growing.

Music tourism is basically when you visit somewhere you don't live, no matter how far away, to see a show, and it's about the money you spend along the way. That is music tourism. In fact, in a few short weeks, the Canadian Live Music Association will release the first-ever economic impact study of Canada's live music sector. It will say that in 2023, visitor spending associated with live music tourism reached an estimated $9.9 billion, which in turn contributed $8.9 billion to GDP. That is in addition to the direct $2 billion in GDP from the live music industry itself, without the tourism piece, all while creating nearly 80,000 jobs combined.

This means not only that live music is about connecting artists and fans, but also that live music means tourism, and these numbers are basically without trying. Barely any policy or investment strategies that could wrap themselves around our industry exist, but they should and they could. We have comprehensive programs for the creation of content, but we have very few that focus on the infrastructure required to showcase that content.

The Canadian Live Music Association has a road map to level up Canada's live music activity and to compete with the international music tourism marketplace, which is growing by 10% per year because our industry is like no other. When our concert halls are full, our neighbourhood restaurants are full. When our festivals are sold out, our hotels are full. Our margins are very slim. We take on the risk, and everyone benefits. Just ask the city of Toronto next week.

Here's the thing; this is across our ecosystem. The Taylor Swift effect is scalable, whether it's a mid-sized performing arts centre in Calgary, a concert series in Prince George or the Festival d'été on the beautiful Plains of Abraham in Quebec City.

I want to reinforce, too, that the music itself matters. The artists are why we do this in the first place. Without them, none of this happens. Sometimes when we talk about the economics of this business, the fear is that this will get lost. The truth is that the more live music activity there is, the more opportunities there are for artists and their fans to create and share lifelong memories together. We bring them together.

I want to thank the committee for your time and for allowing me to amplify our recommendations by focusing on the solution we represent for Canadians, for the Canadian economy and for Canadian artists.

I look forward to future questions. Thank you so much.

[The Chair, Liberal, Peter Fonseca]

Thank you, Ms. Benjamin. You delivered those opening remarks in short order. It was excellent.

Now we're going to move to the HEC Montréal and Professor Pineau, please.

[Pierre-Olivier Pineau, Professor, HEC Montréal]

Thank you, Mr. Chair.

I would like to thank the committee for the invitation.

I'm a professor at HEC Montréal. My focus is energy and climate issues. Since I work in a management school, I obviously look at these aspects through an economic lens.

As I'm speaking, I can hear the interpreter in my ears. I'll try to ignore it, but it's hard.

For 30 years now—

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

I have a point of order, Mr. Chair.

[The Chair, Liberal, Peter Fonseca]

We will suspend for a second to make sure that we can fix these technical challenges.

Professor Pineau, we are going to move you in the order for opening remarks. We're going to try to get these technical challenges fixed, and then we'll bring you back.

Now we're going to move to Platform Calgary and Terry Rock, please.

[Dr. Terry Rock, President and Chief Executive Officer, Platform Calgary]

Thank you, Mr. Chairman and members of the committee, for having me.

I'm Terry Rock, CEO of Platform Calgary here at the relatively new Platform Innovation Centre in Calgary's East Village.

Platform Calgary is part of Canada's Tech Network, CTN, which represents 27 technology hubs across the country. We made a submission to this committee through CTN, but I'm here representing Platform Calgary.

Platform Calgary is a member-driven organization representing more than 600 tech companies in Calgary. Together with a network of more than 150 partners, we're committed to making Calgary the best place for anyone to start and grow a tech company.

Tech firms and the entrepreneurial people who start them are vital contributors to the growth of our economy. This work is urgent as Canada looks to reverse declining productivity and to future-proof important industries like manufacturing, transportation, health care and agriculture.

To succeed, our entrepreneurs and innovators need conditions that promote growth, which we break down into three simple necessities: access to talented and ambitious team members, patient and smart investment capital and customers who are themselves pushing to be on the cutting edge. In my simple way of looking at the world, the work of government is mostly about getting out of the way of our innovators; it's about removing friction and incenting smart risk-taking.

We have a mantra at Platform Calgary: founders first, entrepreneurs first, innovators first. These people are the ones building our economy, not us. We're here for them.

As it relates to the work of this committee, much of the conversation in our community has been about the changes to the capital gains tax, and rightly so. These changes have had wide impact on entrepreneurs, on their employees and on angel investors whom we need to back early-stage companies.

I would encourage the committee members to put themselves in the shoes of a start-up founder. During your journey, you might dilute your ownership stake in the company to onboard the investors and employees you require to take your business to the next level. The prosperity generated by your start-up is spread across a variety of different interests. That's what makes these changes so difficult. These changes put a cap on the incentive to grow these companies beyond the prescribed limits that are in place. We're pushing entrepreneurs to think big, and we're punishing them for doing that. That will not improve our productivity.

Now put yourselves in the shoes of a venture investor. You're being asked to risk your money on a team or technology that is often unproven, with no hope of return for at least a decade, often two decades. This is high-risk and sometimes high-reward work. It requires savvy, patience and a return on investment. Without a strong angel and venture investment ecosystem, our economy will simply not have the power of a dynamic start-up ecosystem, a proven driver of shared prosperity.

It gets worse. Canadian founders are already finding investment, and often a new home, south of the border. A recent survey by the Council of Canadian Innovators showed that over 84% of Canadian tech leaders view the U.S. as the best place to grow their businesses. The last thing we need right now is more barriers put in front of our local investors and innovators.

This is a global market. We must be globally competitive. We must be.

I'd like to take a moment to thank the government for its careful consideration of the Canadian entrepreneurs' incentive, the CEI. Changes announced earlier have made the CEI more competitive, but there remain important gaps. Employees are still not being considered appropriately, as 98% of employees in tech companies will not meet the threshold of 5% ownership in a company. This is a disincentive. Ninety-eight per cent of angel and early investors will not own 5% or more of a company and are also excluded. This will decrease early-stage Canadian investment and increase U.S. ownership in Canadian companies. The U.S. already owns the majority of total Canadian equity. This is a disincentive.

To fix this, CTN continues to recommend full harmonization with the qualified small business stock measures in the U.S., including increasing the lifetime capital gains exemption to $13.5 million and including employees and angel investors in eligibility.

Canada has an important opportunity here. A growth-minded capital gains policy could be a catalyst for the Canadian innovation economy, for the investment climate and for our bold and ambitious founders. Research from the U.S. shows that every 5% decrease in capital gains means that 15% more start-ups are created. We should want this.

In the absence of leadership across the country, provinces are pursuing boutique tax incentives for tech investment. We need less fragmentary regional approaches. Instead, we need to get on the same page to address our productivity challenges and innovation opportunities and to position Canada as a leader.

In closing, we are seeing amazing momentum in tech and innovation in Canada. Let's not hit the brakes. Let's back our innovators. We encourage the Government of Canada to work constructively with Canada's Tech Network and with individual hubs like Platform Calgary to harness this amazing potential and to secure Canada's place as a global hub for innovation.

Thank you.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Rock.

Now we'll go to TMX Group Limited and Mr. David Clarke.

[David Clarke, Head, Government Affairs, TMX Group Limited]

Thanks, Mr. Chair.

It's great to be following my friend from Platform Calgary. I will start by saying that I echo everything he has to say about the changes to capital gains.

In terms of my own remarks, I want to say thank you, Mr. Chair and members of the committee, for inviting me here to speak today. It's a pleasure to address you on behalf of TMX Group and the more than 3,000 listed issuers we represent. The vast majority are scale-up companies, like the friend from Platform Calgary I was just talking about. An underappreciated fact about our capital market is that it's a small and mid-capital market. Most of the public companies in Canada are actually SMEs.

For those who may not know, TMX Group is a leading Canadian financial market infrastructure provider. We operate diverse businesses, spanning information technology, equity, fixed income, derivatives and energy markets.

At the centre of everything we do is our commitment to make markets better and empower bold ideas. This guides our advocacy efforts as we strive to contribute to a thriving and resilient Canadian economy.

As operators of critical market infrastructure, including the Toronto Stock Exchange and the TSX Venture Exchange, we facilitate the flow of capital that fuels innovation, job creation and economic growth across the country. Recognizing the important role government policy plays in shaping the investment landscape, we are actively engaged with policy-makers to promote measures that support the long-term success of Canadian businesses, investors and workers.

My submission today reflects this commitment. I'm pleased to provide these remarks and answer any questions you may have.

Our pre-budget submission—which I hope most of you have had a chance to read—enumerated a whole suite of measures and recommendations. Today I'm going to focus on three of them. Really, you can think of this thematically as one ask or one proposal: Create tax policy that incentivizes investment in Canadian companies. Specifically, I'm going to talk about our flagship R and D program.

The scientific research and experimental development program allows access to the most generous part of that credit for Canadian public companies. I'll echo a bit of what my friend had to say about the changes to the Canadian capital gains inclusion rate, specifically for Canadian companies. If I have time, I'll talk a little about the mineral exploration tax credit that supports our junior mining ecosystem.

In terms of the R and D program—the SR and ED program, as it's commonly known—we've been a vocal advocate of this for years. We're hoping to get reform for this program. I want to commend the government for the very meaningful engagement process we've been involved in over the last number of years.

There have been two formal consultations. Who knows if we'll see something soon? However, I know it's something the government takes seriously, and so do we. The basic idea here is that the most generous part of this tax credit is not available to small Canadian public companies—the kinds of scale-up innovators my friend was just talking about in the previous submission. Our ask here is simple: All Canadian companies doing R and D in Canada should have equal access to SR and ED.

The second recommendation I'll talk about today has to do with the increase to the capital gains tax. What I would say here is that not all capital gains are created equal. If we are looking at measures that will drive investment and growth in companies, it's important to note that companies that need capital to innovate, grow and employ people are facing a very difficult capital-raising environment right now. This tax increase is another point of friction. We recommend repealing the increase to the capital gains inclusion rate on Canadian-based investments and Canadian companies that drive growth and productivity in our economy.

Do I still have time?

[The Chair, Liberal, Peter Fonseca]

You still have time.

[David Clarke]

The final piece is around what's known as the mineral exploration tax credit, or METC.

This is a policy that's been around for decades. It's designed to support junior mining companies. We talk a lot about the clean energy transition and the need to find, access, mine, refine and produce the minerals that are going to lead to our clean energy transition. This credit plays a critical role in that. The issue we have is that every year, it gets renewed for only one year. When you're talking about investors and creating certainty, this annual cycle of having to ask for the program to be renewed decreases that certainty. We suggest making the credit permanent or extending it for perhaps five years. That would increase certainty and make those investment decisions easier.

I'll wrap up by saying that these recommendations, as I mentioned, are aimed at fostering a more competitive, innovative and growth-friendly Canadian economy.

We urge policy-makers in the committee to give all Canadian companies conducting R and D in Canada equal access to the SR and ED program, including small public companies; to abandon the increase to the capital gains inclusion rate on Canadian investments; and to make the mineral exploration tax credit permanent.

Thanks for inviting me here today. I look forward to your questions.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Clarke—

[Rachel Bendayan, Liberal, Outremont, QC]

I have a point of order, Mr. Chair.

[The Chair, Liberal, Peter Fonseca]

We have a point of order.

[Rachel Bendayan, Liberal, Outremont, QC]

I'm sorry to interrupt the meeting, but I believe the technical team is trying to get in touch with Professor Pineau from HEC Montréal.

Professor Pineau, I would ask you to answer the phone. The parliamentary technical team is trying to reach you to fix the problem.

[The Chair, Liberal, Peter Fonseca]

Mr. Pineau, is your phone working?

[Pierre-Olivier Pineau]

No. For some reason, it's not working. It's on my computer and it's not working. I'll just log out and try to come back again. I think that might help.

[The Chair, Liberal, Peter Fonseca]

I don't know if his phone is through his computer. Anyway, we'll keep trying.

We are now going to hear from the Union des producteurs agricoles. I believe Monsieur Ross will be speaking.

[Charles-Félix Ross, General Manager, Union des producteurs agricoles]

Good afternoon, everyone.

On behalf of Quebec's agricultural producers, we thank the members of the Standing Committee on Finance for their invitation. It's very much appreciated.

Allow me to introduce myself. My name is Charles‑Félix Ross, and I am an agronomist and the general manager of the Union des producteurs agricoles, or UPA. I am accompanied by Marc St‑Roch, coordinator of the UPA's accounting and taxation department. Our organization represents 42,000 agricultural producers in Quebec, who operate or work on 29,000 farms across Quebec.

Agriculture is a key sector of the Canadian economy. It is a strategic sector for wealth and job creation in all regions of Canada. I'll give you some numbers. Canada exports nearly $100 billion in food and agri-food products annually. That's almost 13% of our total goods exported, which is huge. Canada's 200,000 or so farms generate nearly $100 billion in farm gate revenue as well. Out of the more than 200 countries in the world, Canada is the eighth-largest exporter of agriculture and agri-food products. It's a really important sector for Canada's economy, and it's a sector that also ensures food security for Canadians for their three squares a day, or 21 meals a week.

A strategic economic sector is one that is essential to good public finances and balanced budgets. In a budget, you try to control and manage expenses, but there's also the revenue column. The agriculture and agri-food sector's role in the Canadian economy contributes significantly every year to the soundness of Canada's public finances. Our agriculture sector performs well in terms of competitiveness and productivity. The figures show that, but we have major challenges to meet in the coming years as an economic sector. In this context, we still need support and investment from the Canadian government and a partnership to support our industry.

The first major challenge facing our sector is the environment and adapting to climate change. Canada wants to be a leader in reducing the impact of its economy on the climate. There are also challenges in terms of the environmental impact on waterways and air, and Canada's agriculture sector and agricultural businesses are being asked to make an enormous amount of on‑farm investment to meet international commitments. This is a challenge for our businesses because, while these expenses often result in benefits for the public and the environment, they generate little revenue for businesses. We are being asked to make major investments that will give us few returns. If Canada wants its agriculture sector to get up to speed on beneficial agricultural practices, we need to think about programs that will support businesses. In fact, that is our main request here at the pre-budget consultations.

Our requests may seem outsized and ambitious, but when you compare Canada with its main competitor on international markets, i.e., the United States, you see that the United States invest heavily to support their businesses in terms of adapting to climate change and protecting the environment. If Canada wants to offer support similar to that of its main competitor, it will have to invest $2 billion a year for five years in a strategy to support sustainable agriculture or better environmental practices.

Businesses in Canada also have challenges when it comes to risk management. It could be climate risk, it could be policy risk, it could be market risk. In 2023, Quebec experienced climate disasters in the form of heavy rainfall and drought. We have made relief claims through federal programs, but the response has been very slow. Even if events happened in 2023, relief funds won't start to flow until 2025.

We are therefore asking that significant adjustments be made to the AgriStability program. This is the first safety net—

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Ross.

There will be a lot of time during members' questions to expand on your comments.

Right now, we are going to try Professor Pineau one more time. Hopefully it works. Sometimes we have technical challenges and we don't know where they come from, but we'll try. Let's hope it works this time.

[Pierre-Olivier Pineau]

Okay. Thank you very much. Let me know if there's a problem.

I'd like to thank the committee again for the invitation. I really appreciate it.

In my research, I look at Canada's energy future from both an environmental and a Canadian economic perspective.

I have noticed over the last 30 years or so that Canadians are getting richer all the time in terms of gross domestic product or average household income. As Canadians, we've been continuously getting richer and richer. Obviously, this wealth is not evenly distributed, but we are seeing growing wealth across all segments of society. Unfortunately, at the same time, we have a climate crisis that is creating climate challenges, an increase in greenhouse gas emissions and a national debt that has been growing steadily since 1990. This debt has nearly tripled as Canada's population has grown from 27 million in 1990 to 40 million in 2023. Our debt is growing at a much faster rate than the population.

In addition, despite the fact that we are richer, we are taking on more debt and polluting more. This is something that is very difficult to understand because, normally, by being richer, we should be able to take better care of the environment and not get into debt. I say that because we are taking on debt as a society at an unprecedented rate.

I think the federal government's budget could be an extremely useful tool for reversing these trends. Although I do want Canadian society to continue to get richer, we want to avoid getting into debt and polluting.

When you look at Canadian households, you can see that they have been getting richer and richer over the last 30 years, and I've included some numbers in my brief that clearly show that this applies to all categories. Those households have three major expenditure items: housing, which represents about 30% of expenditures; transportation, which represents 15% or $10,000; and food, which also represents 15% or $10,000 on average. There are problems in all three sectors.

Let's start with the housing sector. Again, we are seeing worrying trends that are leading us to a housing crisis as well as an energy crisis. We have to heat our buildings, which is costing Canadian households a lot of money. Householders often complain, despite their increased wealth, that money is tight.

However, if we look at the statistics for the past 20 years, we see that the size of Canadians' homes continues to increase. I would even say that we've been seeing this trend for 30 years. In 2000, the average home in Canada was 48 square metres. In 2021, it's almost 59 square metres. That's per Canadian. This means that in 21 years, every Canadian's home, on average, has gained an additional 10 square metres of space.

According to a ranking by the Organisation for Economic Co‑operation and Development, Canada has the most rooms per person. There are 2.6 rooms per person in Canada, whereas in the United States, there are 2.4 rooms per person. That means we have more and more empty spaces, which are expensive to heat, build and cool. In addition, these spaces are expensive to equip for goods and services, because we want to have televisions and other equipment in these rooms.

All that to say that when we are facing a housing crisis and the size of our homes is increasing, and when we are facing a climate crisis and we should be using less energy, building more housing and more large homes is not sustainable.

We must use the budget to reverse this trend of homes continuously getting bigger. My proposal would be to consider including a tax in the budget that would penalize those who have large homes.

Let's move on to food, the second item. Food weighs heavily on household budgets. In addition, we also see obesity problems in Canada. Statistics are constantly showing that people are overweight, which is obviously the result of an imbalance between the calories consumed and the physical effort made. It costs society a lot of money, because being overweight and obese leads to health problems. It costs households a lot of money, because they have to buy expensive food.

We also see a pollution problem related to agriculture, which is responsible for 10% of greenhouse gases in Canada. This sector is producing more and more greenhouse gases. However, as you know, Canada's goal is to achieve net zero by 2050. So we have to reduce greenhouse gas emissions.

It is inconceivable that we are spending money today to create pollution and contribute to obesity, which in turn stresses the health care system. This means we have to find ways through taxation to ensure that Canadians eat better and reduce their fat, sugar and salt intake to improve their health. I therefore invite the committee to look at making changes to the taxation system based on that.

Finally, we are noticing concerning trends in transportation. Canada has an ever‑increasing number of vehicles per 1,000 inhabitants. We went from 495 vehicles per 1,000 people in 2000 to almost 600 in 2021. As a result, there are more and more vehicles per person and those vehicles are getting bigger and bigger. In 2000, sport utility vehicles accounted for 30% of all vehicles; in 2021, that percentage rose to nearly 50%. Not only do these vehicles cost more and weigh heavily on household budgets, but what impact are they having?

[The Chair, Liberal, Peter Fonseca]

Professor Pineau, you have to wrap up. We're way over time. We will have a lot of time during members' questions, but you have to wrap up.

[Pierre-Olivier Pineau]

I will conclude by simply saying that in the transportation sector, we also need to discourage people from choosing to use more cars that cost us a lot of money, and instead push people towards modes of transportation that are much better for our health, the environment and the economy, because public transit and active transportation cost less.

Thank you, and I look forward to any questions.