Finance Committee on Oct. 24th, 2022

[Sophie Chatel, Liberal, Pontiac, QC]

Thank you very much.

I have a question for Équiterre.

I bought myself an electric bike to get to work, which is to say to Parliament. It is true that it works very well, but it is expensive. I have to admit that it's not affordable for all families.

Can you elaborate on your recommendation regarding assistance for the purchase of electric bikes?

[Marc-André Viau]

Power-assisted bikes do cost more than regular bikes. However, as I mentioned in my presentation, they cost less than a car, for example, and they enable their owners to make similar trips.

What we are increasingly seeing is that power-assisted bike trips are not only adding to automobile trips, but also replacing them, as these bikes allow for longer distances compared to regular bikes.

Similar programs are in place in a number of places. Nova Scotia, for example, has a credit program for the purchase of a power-assisted bicycle.

As for details on how the program will be adjusted, we will leave it to the Department of Finance to define the percentage of credit or the amount to be given for the purchase of a power-assisted bike. However, we can easily imagine a credit of $500 to $1,000 to help people who want to purchase a power-assisted bike or a cargo bike. We can also think of cargo bikes for transporting goods.

So there is a whole range of possibilities, and we see no reason why assistance for electric vehicle purchases should be limited to automobiles and active transportation should be neglected.

[Sophie Chatel, Liberal, Pontiac, QC]

Thank you very much.

[The Chair, Liberal, Peter Fonseca]

Thank you, Mrs. Chatel.

I look forward to seeing you on an electric bike.

We're now going to hear from the Bloc, with Monsieur Ste-Marie.

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

Thank you, Mr. Chair.

Greetings to all the witnesses. I thank them for their attendance and their presentations.

Mr. Chair, we could do our pre-budget consultation tour across Canada on an electric bicycle. That could be an interesting experiment.

Jokes aside, my questions will be for Mr. Viau.

In your presentation, you said there were other items on your list of recommendations, so I would like to hear from you about those. If not, I invite you to comment on what you have heard so far in the exchanges.

[Marc-André Viau]

First, I would focus on the recommendation in our report that proposes the creation of an appliance repair fund. We are talking about this because last week we revealed the results of a study we had launched to try to determine what was holding back repair of electronics and appliances. Repair does fit into that logic I was talking about, which is to reduce the cost of living for families across the country.

In fact, repair could reduce the costs to families, who must replace their electronics and appliances with increasing frequency. It is becoming less easy to repair these devices as they increasingly rely on technologies that make repair complex and expensive. Too often we hear that it costs more to repair devices than to replace them.

However, we believe that the life cycle of these devices can be extended. The government could intervene through regulations and taxation to help consumers keep their appliances longer and thus reduce their bills. In addition, extending the life cycle of appliances is good for the environment.

This is one of the things I wanted to bring to your attention.

Another thing to mention is fossil fuel subsidies. As we indicated in our brief, these expire in 2023. We expect the upcoming budget to mention the dissolving of fossil fuel subsidies that have been deemed ineffective and to lay out the roadmap to get there.

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

Thank you very much. That's very interesting.

I would like to come back to the circular economy. It's a topic that transcends rich economies, if I can put it that way. I think other countries have started to set up a fund for repair. It could be a payment of $25 to $100 to a citizen who invites a repair person to come and take care of an appliance, for example. Having an appliance repaired would then become more economical than throwing it away and buying a new one.

To your knowledge, are the regulations and laws we have in Canada sufficient to counter the interest of Canadian industries in planned obsolescence?

[Marc-André Viau]

No. We see that there are not enough regulatory tools right now. Existing laws and regulations must be addressed to make sure that we have a framework in place to move in that direction.

What we are suggesting and recommending, based on examples seen in other countries, particularly in France, is to get something passed that can cover up to about 30% of the repair cost. If you do a quick rule of three and compare that to what's being announced in France, that's about $115 million for the Canadian economy.

So the whole regulatory aspect is something to look at. Also, that's not up to only the federal government, but also Canadian provinces and territories.

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

Okay, thank you.

My understanding is that electric school buses are not currently included in the subsidies. But as you said, including them as an eligible vehicle would go a long way to reducing emissions and improving air quality for students.

[Marc-André Viau]

That's right. We are not sure why subsidies are not available right now for these buses. As with the purchase of any other electric vehicle, the purchase of electric buses is an additional expense for school bus companies.

What we want to do is obviously level the playing field, including for school bus companies, and allow them to make the best choice possible. So we want to ensure that they have access to electric buses, and we think that subsidizing the purchase of electric school buses would help do that.

We also want there to be organizational capacity building. In fact, a decision can't be made overnight to do this. School bus companies also need to be supported through the transition. So investments also must be made to build capacity in these companies, so that they can acquire new fleets of electric buses.

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

I would also like to ask you about the funding of public transit companies, but since my time is up, I'll come back to that later.

Thank you.

[The Chair, Liberal, Peter Fonseca]

We still have much more time for that. Thank you, MP Ste-Marie.

For the end of this round, we will now hear from the NDP. We have MP Gazan with us.

Welcome, MP Gazan.

[Leah Gazan, NDP, Winnipeg Centre, MB]

Thank you. It's nice to be here in committee with everybody today.

It's nice to see you again, Mr. Macdonald. My first question will be for you.

As we know, an issue the federal government has consistently failed on is addressing the crisis of violence against women and girls in this country, including indigenous women and girls. In your alternative budget, on page 60, the CCPA is recommending a “comprehensive 10-year National Action Plan to prevent and combat all forms of violence against women”. It's critical, because we know that since the pandemic, rates of violence have increased 400 times in some areas, with inadequate response from this government. We also know that the movement on addressing the ongoing genocide against indigenous women and girls continues to be a crisis in the country. In fact, the Liberal government has spent only $12.6 million of the amount allotted in 2020 to address the crisis of murdered and missing indigenous women and girls.

In budget 2021, $539.3 million was allocated over five years, even though we know this is a crisis, and budget 2022 was shamefully silent. This is absolutely unacceptable. We know that without money invested, led by women's organizations and organizations of gender-diverse people, we're not going anywhere.

I'm wondering if you could outline and clarify for the committee what a budget would look like if it actually addressed the issue of violence against women and girls, including indigenous women and girls. What would recommendations for funding look like?

[David Macdonald]

Sure thing. Thank you very much for the question.

We do have two detailed chapters on these questions. There's a gender equality chapter and a first nations chapter in our alternative budget. Some of the first nations chapter deals with some gender issues, but much of it is in the gender equality chapter.

When it comes to the gender equality chapter, part of it is certainly about adequate support of women and gender equity organizations. We're advocating for $100 million a year, or $300 million over three years. To that end, we need to continue to improve and extend funding for the 2SLGBTQ+ capacity-building fund. It's an existing fund, but we need to continue to support that.

When it comes to more support for first nations generally, this will certainly help women and help first nations communities in general. The dramatic underfunding of communities, from basic infrastructure to education, has just been terrible and requires redress. In terms of what's needed there, we are advocating in the AFB, or alternative budget, for about $5 billion a year on the infrastructure front alone. These are substantial new investments—for first nations communities as well—to help everyone in the community, including women and children.

[Leah Gazan, NDP, Winnipeg Centre, MB]

Thank you. Certainly your recommendations are much different from what we see committed for addressing this crisis.

My next question for you is regarding child care, which we know is a pillar of the Canadian economy.

We often hear that the pandemic primarily affected women. Many people call it the “she-covery“ plan. The pandemic highlighted this so thoroughly that the introduction of an early learning and child care act was supposed to be put in place by 2020. We know this is a core piece of the confidence and supply agreement that was put forward, but we also know that the issue surrounding providing a robust early childhood education is complex. We need funding, we need spaces and we need training. With regard to the training piece and ensuring that there are enough early childhood educators trained, that's certainly being put forward by experts in the field.

I'm hoping you can walk the committee through how the CCPA envisions a progressive budget addressing policy change as necessary for a successful program, and how the funding would accompany these changes.

[David Macdonald]

One of the major initiatives of the federal government at present is this substantial reduction in child care fees that most Canadians with young children will have already seen and will continue to see over the course of 2023, with the provinces fully implementing their version of these plans by the end of this year. This is the first step, and most Canadians in most cities should see a roughly 50% reduction in fees in most cases. It's not universal, but it will be close. This is step one of the longer-term plan of $10 a day, which is still a couple of years off. That being said, that will be the most obvious implementation of this plan.

What will become clearer in 2023 is that we need a lot more spaces to fulfill this increased demand, and the funding for those spaces is not entirely in place at present. The big issue is not so much capital, which is to say the physical space, but, as you alluded to, the staff—the ability to retain trained staff and train new staff—so we can actually staff these spaces. This was a big issue during the pandemic as staff left the profession, just as we're seeing in other professions, so we advocate in the alternative budget for substantial additional investments on the infrastructure front. This isn't on the fee front. This is building more spaces, and primarily around the training with $2 billion—

[Leah Gazan, NDP, Winnipeg Centre, MB]

Can I—

[The Chair, Liberal, Peter Fonseca]

Thank you, Mr. Macdonald and MP Gazan. That's the time. There will be an opportunity in the second and third rounds.

We are going to the second round and we're starting with the Conservatives. We have MP Lawrence for five minutes.

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

Thank you, Mr. Chair, and thank you to our witnesses for being here.

I'm going to focus my questions—and try to go as quickly as I can—on the Chamber of Commerce, the Canadian Federation of Agriculture and the CFIB.

We are experiencing a cost of living crisis in this country that we haven't seen for decades. Inflation is at record highs. We have inflation at 11.4% on food. This is causing extreme pain for Canadians across the country.

In this very committee, I had the opportunity to ask Tiff Macklem, the Governor of the Bank of Canada, about his thoughts on the carbon tax and inflation, and he wrote to this committee and said that unequivocally it is a driver of inflation.

I want to get some anecdotal evidence from you as well. I'll just go to the Federation of Agriculture, the Chamber of Commerce and the CFIB. Could I hear quickly from each of you as to whether the amount that your members are paying is balanced off by the rebate? Do you believe that your members are actually paying more in carbon tax than they're getting in rebate, in contrast to what the government has said?

I'll start with you, Mr. Kelly, and the CFIB.

[Daniel Kelly]

As I said before, there is virtually no money going back to small businesses from the carbon tax. They are just net payers of the tax. Of course, they are not just paying it on a small footprint, but paying it on all of the many ways that small firms might use carbon. None of the money, essentially, is going back to small and medium-sized firms right now .

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

Thank you, Mr. Kelly.

I'll ask the same question of the Canadian Chamber of Commerce.

[Alex Gray]

It's a little more difficult for us to answer given that we have about 200,000 businesses. It would be hard to provide a general answer to that question.

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

Mr. Currie or Mr. Ross, go ahead.

[Scott Ross]

On that front, we have a very diverse membership of roughly 200,000 businesses as well, but what I will say is the parliamentary budget office itself identified that carbon pricing impacts in agriculture are very variable across operations. What we are seeing is that the largest, most efficient operations tend to have dramatically higher carbon pricing impacts and, at the same time, are not seeing that returned through the rebate. It's not a one-size-fits-all answer by any means, but we do see a significant disconnect between what many farms are paying and what they're receiving back in the rebate.

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

Thank you.

I'll go back to you, Mr. Kelly, just to make this clear. I know your written submission is fantastic; this is just for the viewers here. Is the carbon tax adding to costs and making life more difficult for your members?