Finance Committee on May 24th, 2022

[The Chair, Liberal, Peter Fonseca]

I call this meeting to order. Welcome to meeting 50 of the House of Commons Standing Committee on Finance.

Pursuant to the order of reference of May 10, 2022, the committee is meeting on Bill C-19, An Act to implement certain provisions of the budget tabled in Parliament on April 7, 2022 and other measures.

Today's meeting is taking place in a hybrid format pursuant to the House order of November 25, 2021. Members are attending in person in the room and remotely using the Zoom application. As per the directive of the Board of Internal Economy on March 10, 2022, all those attending the meeting in person must wear a mask, except for members who are at their place during proceedings.

I would 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 mike, and please mute yourself when you are not speaking. For interpretation for those on Zoom, you have the choice at the bottom of your screen of the floor, English or French. For those in the room, you can use the earpiece and select the desired channel.

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 and the clerk and I will manage the speaking order as best we can. We appreciate your patience and understanding in this regard. I request that members and witnesses treat each other with mutual respect and decorum.

Now I'd like to welcome today' s witnesses.

For our first panel from 10 to 11:30, we have the Centrale des syndicats démocratiques, and Maxime Gilbert, who is a lawyer in the social law department.

From the Co-operative Housing Federation of Canada, we have Tim Ross, executive director.

From Diabetes Canada, we have Andrew Jones with us in the room, the executive director, government affairs, policy and advocacy.

From the Green Budget Coalition we have David Browne, director of conservation, Canadian Wildlife Federation; Tom L. Green, senior climate policy adviser, David Suzuki Foundation; and Andrew Van Iterson, manager.

We'll now begin with Mr. Gilbert from the Centrale des syndicats démocratiques for up to five minutes, please.

Monsieur Gilbert, you have five minutes for your opening remarks. Thank you.

[Maxime Gilbert, Lawyer, Social Law Department, Centrale des syndicats démocratiques]

Thank you, Mr. Chair.

I hope the sound is good. I unfortunately didn't receive the headset on time.

I want to thank you for this invitation on behalf of the Centrale des syndicats démocratiques, or CSD, which I represent this morning.

My name is Maxime Gilbert. As mentioned, I am a lawyer with the CSD's social law department.

First, I want to thank you for postponing our appearance. It was supposed to take place last Thursday, but unfortunately, that wasn't possible. We're pleased to take this opportunity today to present our remarks on the budget implementation bill.

Our comments essentially focus on division 32 of part 5 of Bill C‑19. It's not that the rest of the bill isn't worth a few comments, but CSD wants to review Parliament's response to a demand frequently repeated by many labour organizations. Consequently, I'll be discussing division 32 of part 5, which is entitled Employment Insurance Board of Appeal.

In CSD's view, the fact that the government is finally proposing to reform the employment insurance appeal process is clearly excellent news, particularly since it announced that reform nearly three years ago. Of course, a pandemic occurred in the intervening time, but we are nevertheless pleased to see that action is being taken. However, this division of Bill C‑19 should be amended to ensure that the reform is conducted in accordance with the parameters outlined three years ago and based on the lessons learned from the failures of the Social Security Tribunal of Canada, the SST.

We feel that division 32 of part 5 should contain provisions stating that the new Employment Insurance Board of Appeal will report to the tripartite structure of the Employment Insurance Commission, not solely to its chairperson. In our view, the employment insurance appeal process shouldn't return to a tripartite approach solely when an insured is heard. This tripartite approach, which embraces all employment insurance stakeholders, must be part of the entire appeal structure. That would also be consistent with the discussions the government had in the fall of 2018 at the initiative of Mr. Duclos, who was the minister at that time, and with the announcement that Employment and Social Development Canada made in a press release in August 2019, and I quote:

The Canada Employment Insurance Commission will become responsible for first-level EI appeals through the creation of a new tripartite decision-making tribunal called the Employment Insurance Boards of Appeal. As a tripartite organization, the new Boards of Appeal will represent the interests of government, workers and employers, helping put first-level EI appeal decisions back into the hands of those who pay into the EI system, i.e. workers and employers.

Once again, in our view, there must be a direct line of accountability to the Employment Insurance Commission in monitoring the way that union and employer representatives are recruited, appointed and trained and the way they carry out their mandates on the boards of appeal. There must be no repeat of the error made with the SST, which is virtually unaccountable to the Employment Insurance Commission. For the record, when the SST was at its most dysfunctional, the commission was effectively powerless to elicit adjustments from the tribunal or to hold it accountable.

Provisions should also be added to division 32 of part 5 entitling employment insurance claimants to regional representation and to the strong likelihood, if not guarantee, of an in‑person hearing. At the SST, the default hearing, as it were, is by telephone. That trend must be reversed so the default hearing is the one conducted in person. Genuine access to an in‑person hearing has been recognized as an essential aspect of any reform of the employment insurance appeal system.

In addition, we want hearings to be held, where possible, in the region of the insured so that they are conducted by members who are familiar with the regional labour market rather than by members whose conception of that market is too general and thus detached from reality.

To cite only one example that I consider obvious, the actual situation in the regions is quite different from that in the major centres. As far as possible, decisions must take that fact into account and reflect it.

Furthermore, division 32 of part 5 should provide that all members of the board of appeal shall be appointed on a part-time basis. In its current form, the bill provides for some members of the board to be appointed part time and others on a full-time basis. As a result, part-time and full-time members may exhibit different levels of engagement and effectiveness. That imbalance, which seems apparent from a reading of the bill—

[The Chair, Liberal, Peter Fonseca]

Monsieur Gilbert, could you start to conclude, please?

[Maxime Gilbert]

All right.

We therefore fear that the difference in status and compensation among members of the board of appeal may result in inequality and unfairness.

As I said earlier, the new appeal process must be set forth in provisions stating that the Employment Insurance Commission of Canada shall direct the process of selecting members, workers, employers and the board of appeal and that the board shall be tripartite in nature only if the social partners are directly involved in selecting and appointing worker and employer members.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Gilbert.

[Maxime Gilbert]

Thank you.

[The Chair, Liberal, Peter Fonseca]

There will be an opportunity during question time to further your comments.

Thank you.

[Maxime Gilbert]

All right.

[The Chair, Liberal, Peter Fonseca]

We're moving now to the Co-operative Housing Federation of Canada and Tim Ross, executive director.

You have five minutes, please.

[Timothy Ross, Executive Director, Co-operative Housing Federation of Canada]

Good morning and thank you very much.

It's a pleasure to be here with you today. Thank you for the invitation, on behalf of Canada's housing co-operatives and related organizations that are members of the Co-operative Housing Federation of Canada.

I'd like to acknowledge that I'm grateful to be speaking with you today from the traditional and unceded territory of the Algonquin Anishinabe nation, which has lived here since time immemorial.

Today, I would like to share with you some perspectives on the housing crisis and what the 2022 federal budget can do to help address this acute crisis.

First, I'll start by providing a brief picture of co-op housing in Canada. There are more than 2,200 housing co-operatives, located in every province and territory in Canada. Housing co-ops are home to a quarter of a million Canadians. The vast majority of these housing co-operatives were developed in the 1970s and 1980s, supported by a robust and dedicated federal investment program and, in some jurisdictions, provincial investments as well. Federal investment in new co-op and non-profit housing ended in 1993, and then resumed at a much more modest scale in the early 2000s, but without a dedicated federal co-op housing program. Since 1993, we have really only seen a modest amount of new co-op homes developed, primarily sourced with some provincial funding.

Why does co-op housing matter? Most would agree that we need much more housing supply to address the housing crisis that we're in. We're no doubt in a very serious housing crisis in Canada, so we need more supply.

However, not all supply is created equal. In past decades, market rental housing became less expensive over time, becoming a relatively affordable option for many households. This is no longer the case, because of a process of financialization whereby housing is increasingly treated as an investment. In fact, we're losing more affordable housing in Canada due to financialization today than we're building. These effects are not shared equally, and they adversely affect indigenous peoples and members of racialized communities even more.

The supply response must intentionally build and acquire more housing that is safe from the forces of financialization, which means more co-op and non-profit housing in order to create a housing supply that is truly affordable, secure and inclusive. To be clear, co-op housing is more affordable than market rental housing, because the vast majority of housing co-ops operate on a not-for-profit basis, and their permanently affordable rents become more affordable over time.

Co-op housing also offers security of ownership. There's no outside landlord who might sell property or renovict tenants. Co-ops are inclusive by design, because almost all operate on a mixed-income model. Finally, co-ops are stronger communities. During the pandemic, we've witnessed countless stories of neighbours helping neighbours. The value of this in a world increasingly characterized by division cannot be overstated.

We're very excited to see in the federal budget an announcement of a co-op housing development program funded at $1.5 billion over five years, along with a commitment that the co-op housing sector will co-design the program with CMHC. The program is anticipated to commit funding for 6,000 co-op homes over the next five years. We need a lot more than 6,000 new co-op homes across the country. Most markets alone could absorb that and benefit from at least that many, but this is an incredibly important start.

We've been reflecting on what did and didn't work so well with previous federal co-op housing programs and how today's housing markets differ. With that in mind, we look forward to a co-op housing development program that focuses on scale, supports acquisition alongside development and enables the co-op housing sector to lead the way by directly delivering the program.

Our sector's excitement to start building more co-op housing is tempered by the fact that we know more is needed to solve the housing crisis. In particular, we know the crisis is hitting indigenous people in urban, rural and northern communities particularly hard. The budget committed 300 million for the development of an urban, rural and northern indigenous housing strategy, which is a start, but it is broadly agreed that this funding level is inadequate. Alongside other advocates, Canada's housing co-ops have been calling for a robustly funded urban, rural and northern indigenous housing strategy developed for and by the indigenous housing sector for years, and we'll continue to do so.

I'll close with appreciation and a sight line on what we can accomplish by building new co-op housing. I equally encourage all the committee members to do what they can to realize a meaningful investment in an urban, rural and northern indigenous housing strategy going forward.

Thank you again for your time and for the invitation to appear here today. I look forward to your questions.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Ross.

Now we'll hear from Diabetes Canada and Andrew Jones, the executive director of government affairs policy and advocacy.

Mr. Jones.

[Andrew Jones, Executive Director, Government Affairs, Policy and Advocacy, Diabetes Canada]

Thank you, Mr. Chair.

I'm Andrew Jones, executive director of government affairs, policy and advocacy at Diabetes Canada. It's a pleasure to be here this morning to assist in your study of Bill C-19. I'm looking forward to discussing an important issue for people affected by diabetes that aligns with your current study, which is the disability tax credit.

Before I dive into the details surrounding the disability tax credit, let me tell you a little about the burden of diabetes and a number of federal government initiatives from 2021 that are intended to address this burden.

Many of you will know that Canada gave the world the gift of insulin more than 100 years ago. It's a discovery that ranks among the leading achievements of medical research. Because of insulin, millions of people around the world with diabetes live long lives. However, insulin is not a cure and we are not at the finish line. Recently, Diabetes Canada released new diabetes figures that show a steady, continued increase in diabetes in our country, with 11.7 million people in Canada living with diabetes or prediabetes. Just a decade ago, that number was 9.2 million. That's a shocking 27% increase.

Diabetes continues to affect more Canadians than ever before, despite concerted effort and numerous diabetes-related accomplishments in Canada and throughout the world. There is no denying that diabetes is an epidemic.

The good news is that in 2021, in honour of the 100th anniversary of the discovery of insulin in Canada and in recognition of the huge and growing burden of diabetes on Canadians, the federal government and all parliamentarians made significant and laudable commitments to improve prevention, management and research in diabetes. Canada proudly co-hosted a World Health Organization symposium on diabetes in April 2021, and jointly with them, launched the global diabetes compact.

The 2021 federal budget contained important commitments to funding research and developing a national diabetes framework. On June 29, 2021, royal assent was received for Bill C-237, An Act to establish a national framework for diabetes, which was unanimously supported by all parliamentarians. These commitments laid a critical foundation that we can build upon to meaningfully reduce the burden of diabetes in Canada by implementing the recommendations of Diabetes Canada's diabetes 360° nationwide strategy.

Diabetes Canada is eager to continue to collaborate with the federal government on this important and urgent work. Diabetes Canada continues to recommend that the federal government dedicate the necessary financial and human resources required to realize the 2021 budget and Bill C-237 commitments to implement a national diabetes framework, based on the diabetes 360° framework, as quickly and comprehensively as possible. Previous stakeholder consultations suggest an investment of $150 million in funding over seven years.

I'd like to also take a moment to discuss with you our concerns surrounding the disability tax credit.

I know our friends in the diabetes community, JDRF, appeared before you last week. You may be comforted to know that our position regarding the disability tax credit is well aligned with what you heard last week from JDRF.

We at Diabetes Canada ask that the federal government consider granting eligibility for the disability tax credit to all Canadians with diabetes who are on insulin therapy. We maintain that the current eligibility criteria that requires a life-sustaining therapy for an average of at least 14 hours per week is antiquated and unfair.

Furthermore, we support recommendation 14 of the Canada Revenue Agency's disability advisory committee. They recommend replacing the current eligibility requirements, including the 14-hour rule, with the following: “Individuals who require life-sustaining therapies...are eligible for the [disability tax credit] because of the time required to administer these therapies.... Without them, the individual could not survive or would face serious life-threatening challenges.”

Insulin therapy is on the recommended list of therapies. We believe that anyone who is on insulin therapy, regardless of whether they are living with type 1 or type 2 diabetes, would qualify for the disability tax credit following the advisory committee's recommendation because unfortunately without insulin, they would not survive or they would face serious, life-threatening challenges.

Everyone with type 1 diabetes and some people with type 2 need to use insulin as a treatment. To determine a dose of insulin multiple times a day, people with diabetes must problem solve, make numerous decisions and undertake many activities. These include consulting regularly with their diabetes specialist, checking blood sugar six or more times a day and maintaining a record of the blood sugar levels. With that, they must identify trends requiring alterations to treatment, make complex calculations accounting for such things as the time of day, the amount or type of food they are eating, the activity or exercise they plan to do in the coming hours, how much stress they are under and whether they are fighting a cold or flu.

All of these factors can affect blood sugar levels. Many of these activities are not easily quantified and/or permitted to be counted towards the antiquated 14 hours a week disability tax credit eligibility criteria.

The disability tax credit helps offset costs and enables eligible Canadians with diabetes to manage their condition. We trust that you will amend Bill C-19 to make it easier and fairer for people living with diabetes and relying on life-sustaining therapy to qualify for the credit.

Thank you for your attention. I look forward to answering any questions you might have.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Jones.

Now we'll go to the Green Budget Coalition. For opening remarks, we have Andrew Van Iterson, who is in the room with us.

[Andrew Van Iterson, Manager, Green Budget Coalition]

Mr. Chairman and honourable committee members, thank you for inviting the Green Budget Coalition to speak to you today.

The Green Budget Coalition, active since 1999, is unique in bringing together the expertise of 21 of Canada's leading environmental organizations, collectively with over one million members, supporters and volunteers. The Green Budget Coalition's mission is to present an analysis of the most pressing issues regarding environmental sustainability in Canada and to make a consolidated annual set of recommendations to the federal government regarding strategic fiscal and budgetary opportunities. We appreciated the opportunity to meet with the Deputy Prime Minister in February.

As the clerk mentioned, I'm pleased to be joined today by two of my expert colleagues to help answer your questions: one of the coalition's co-chairs, David Browne, with the Canadian Wildlife Federation, plus the coalition's lead on climate, Tom Green, with the David Suzuki Foundation.

The Green Budget Coalition made five feature recommendations for budget 2022 addressing three feature objectives of net-zero emissions by 2050, full nature recovery by 2050 and environmental justice. Specifically regarding the renovation wave, they address fossil fuel subsidies and public finance, freshwater management, protected areas and a new office of environmental justice and equity.

The Green Budget Coalition much appreciated the major federal funding announcements advancing climate and nature progress in the April 7 federal budget and the preceding emissions reduction plan. We particularly appreciated the funding for building retrofits for fresh water and for incentives in infrastructure for electric vehicles, including medium- and heavy-duty vehicles. We also appreciated funding for clean electricity, nature-based climate solutions, oceans protection, improving the environmental impacts of agriculture and expanding tax credits to apply to more clean technologies.

At the same time, we were disappointed by the gap on fresh water between the amount announced and the funding necessary, as outlined in our recommendations and committed in the Liberal platform. We were also disappointed by the lack of progress on phasing out fossil fuel subsidies, on permanent funding for protected areas and on the office of environmental justice and equity. Green Budget Coalition members expressed particular concern about the new tax credit for carbon capture, utilization and storage, which is estimated to cost $2.6 billion over the next five years.

Given that I have a couple of minutes left, I would like to turn to Tom Green with the David Suzuki Foundation to add an extra comment or two on climate change in the budget.

[Tom L. Green, Senior Climate Policy Adviser, David Suzuki Foundation, Green Budget Coalition]

I'm very pleased to be here today. Thank you, committee members, for the invitation.

As you know, the climate crisis is accelerating, and I understand many of you in Ottawa are on Zoom today because it was impossible to travel around, as electricity is still out in many parts of town. I think the urgency with which we must act is clearly evident, yet as my colleague mentioned, we are continuing to double down on fossil fuel production through the CCUS tax credit, which is very substantial and will rise to $1.5 billion a year by 2026-27.

We know that we should be putting our money into, for instance, generating more electricity with renewable electricity. Actually, we have a study coming out tomorrow that will show how much can be done with that. Really, we need to rebalance our investments, take away the subsidies and invest where the opportunities are and the real emissions reductions are.

I'd be happy to talk more about that during questions and answers. Thank you.

[The Chair, Liberal, Peter Fonseca]

Is that it, Mr. Van Iterson and Mr. Green?

[Andrew Van Iterson]

Yes. Thank you again.

[The Chair, Liberal, Peter Fonseca]

Thank you very much.

Now we are moving to the rounds of questions by members. In our first round, for witnesses to know, each party will have up to six minutes to ask questions. We're beginning with the Conservatives.

I have MP Stewart up, for six minutes, please.

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

Thank you, Mr. Chair.

I want to thank all of the witnesses for being here today. I want you to bear with me as I have some raging allergies today, so my nostrils are kind of out of commission.

Anyway, first up, my questions are for Diabetes Canada. Both kids and adults who have type 1 diabetes require life-sustaining therapy for the rest of their lives. Most have insulin pumps that give insulin 24 hours a day. Can you confirm that the inequality of access to the disability tax credit is really about patients and doctors trying to navigate arbitrary and inconsistent rules by the Department of Finance and Revenue Canada?

[Andrew Jones]

Thanks very much for the question.

Unfortunately, I think you've hit the nail on the head with respect to the disability tax credit. We find that the process for eligibility is full of administrative burdens. Patients are required to fill out lengthy, lengthy forms and communicate with their health care professional. Our major concern is around the threshold of 14 hours per week. What counts towards this 14-hour threshold is arbitrary. As I said in my opening statement, we maintain that individuals who are on insulin therapy—life-saving insulin therapy—ought to just simply qualify for the disability tax credit.

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

I appreciate your answer to the question.

Honestly, I share your opinion and that of JDRF, as does my party.

Would you say that it defies common sense that Canadians requiring insulin multiple times a day for the rest of their lives don't automatically qualify as requiring life-sustaining therapy for at least 14 hours per week? I mean, the government doesn't ask somebody who is blind if they cannot see at least 14 hours per week. It just seems like a very outdated rule that people with type 1 diabetes are faced with every day.

I've had a number of friends with type 1 diabetes, and good friends of mine have children with type 1 diabetes, so I don't have direct experience, but I've seen first-hand the struggles that people have had.

How do you feel about that comment?

[Andrew Jones]

You know, it sounds to me as though we're well aligned on this issue. We certainly thank you for all your hard work on the issue.

The bottom line is that we're asking the federal government to just simply consider granting eligibility for the disability tax credit to all Canadians with diabetes who are on insulin therapy.

Furthermore, as I mentioned, Revenue Canada has a disability advisory committee, and they've also gone down this road and have recommended great improvements to the eligibility system. We think the government ought to put those recommendations in place, and that will eliminate this 14-hour burden and make it much simpler for those who have type 1 diabetes and who are on insulin therapy to qualify for the disability tax credit.

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

Thank you, Mr. Jones.

You're directly speaking the language, and I'm aligned with you. I think it's long overdue and I think the beauty of this committee is that as parliamentarians we can actually make these changes in committee. We actually have the power to do that if all parties can work together and find common ground.

One of my concerns with the disability tax credit is that there's been some talk in the past by other parties about going from 14 hours to seven, which would help, no question about it. However, I think we're at the point where there are 300,000 Canadians living with type 1 diabetes, or at least having problems with the program, so would you say the gold standard really is making it so that everybody automatically qualifies over and above just going to seven?

[Andrew Jones]

Yes. The short answer there, of course, is yes.

We believe that seven would be an improvement over 14, but seven still requires administrative burdens and still requires back and forth with health care professionals. There is confusion around what qualifies for the seven hours, when as you said so eloquently, individuals who have type 1 diabetes and who are on insulin therapy require insulin therapy to maintain their life, as harsh as that is.

We believe it's time to get rid of the antiquated and outdated 14-hour rule and just open up that eligibility for individuals who are on insulin therapy.

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

Thank you.

I have one last comment. We appreciate your being here today

When people think of type 1 diabetes, we often think of children, but I think government and parliamentarians alike can forget that with type 1 diabetes, whether you get it when you're a child or when you're older, you have it for the rest of your life. It never goes away. You're always going to have type 1 diabetes.

As parliamentarians, moving that so that everyone can automatically qualify is the right thing to do. As revenue critic, I support it, and I have the support of my party.

I'll have some more questions for you in a little while. I'm not sure how much time I have, Mr. Chair—