Government Operations Committee on April 21st, 2009

[Alister Smith]

Well, in this case, I think the projects will be considered until May 15, and presumably they will be under way around that time.

But that's just a guess. Infrastructure Canada would be able to clarify that.

[Geoff Regan, Liberal, Halifax West, NS]

Did you say the projects will be considered until May 15?

[Alister Smith]

Yes.

[Geoff Regan, Liberal, Halifax West, NS]

So do you mean that after that date there will be no projects from municipalities considered under the Building Canada Fund?

[Alister Smith]

I don't think so. This is a particular intake of proposals under this framework agreement, and with the funds allocated. Obviously, if you use up all of those funds assigned for that purpose, then you'd have to find some other means of funding them. The department alone probably could tell us if this would indeed take all of the funds.

[Geoff Regan, Liberal, Halifax West, NS]

So it's a current round under the program.

Do you know when the next round closes?

[Alister Smith]

You should really ask them. I'm sorry, I can't really give you a good answer on that.

There are other elements here, which I think begin later under this particular framework agreement, but I would have to look at the framework agreement to know.

[Geoff Regan, Liberal, Halifax West, NS]

Thank you.

[The Chair, Liberal, Derek Lee]

Thank you.

Mr. Calandra, for five minutes.

[Paul Calandra, Conservative, Oak Ridges—Markham, ON]

Thank you, Mr. Chair.

I have just a quick question. The original Building Canada Fund, as passed by Parliament, was a seven-year program. Am I correct on that one?

[Alister Smith]

That's correct.

[Paul Calandra, Conservative, Oak Ridges—Markham, ON]

Thank you very much.

I have a comment. Since we came to office--and this is just to follow up on what my colleague Mr. Anders was talking about--we have invested about $220 billion in tax cuts and reductions for businesses and for families. We've cut the GST from 7% to 5%. I notice that in Britain they're doing the same thing with their VAT as well. And we have been moving aggressively to put more money back into the hands of Canadian families so they can invest in themselves and in their families' futures.

When I was back in the riding, I did what I suspect most members of Parliament did. I visited a lot of local builders and building supply stores, and the reception I got was tremendous. Schell Lumber said that the people they're supplying are so busy because of the home renovation tax credit and that so many jobs are being created by this that the impact it'll have on our small town in Stouffville will be tremendous. We're talking about a small town of 30,000 people.

So I was somewhat disappointed to hear earlier that one of my colleagues opposite doesn't necessarily approve of cutting taxes in that fashion. With all due respect to the chair, let me suggest that the Canadians I talk to and the people in my riding very much support the idea of cutting taxes so they can put more money into their pockets and into their business and so they can invest in their families and their families' futures.

But just as a follow-up, regarding the $222 billion in tax cuts and savings, is it safe to say that when you put $222 billion back into the hands of Canadians, it is a very important stimulus for the economy?

[Paul Rochon]

Yes, I think one could safely conclude that, and I think the permanent nature of the tax cuts that have been put in place, by and large, in Canada is also important in that it allows corporations and households to know they can plan on those tax cuts for the future.

And that's in contrast to the tax reductions that have been proposed in the context of stimulating the economy in both the U.K. and the United States. In one case those tax reductions will last for a year, and in another case they will be provided over two years. So it's not only the fact that Canada is cutting, has reduced, and is continuing to reduce its tax burden, but that it is being done in a way that is sustainable.

[Paul Calandra, Conservative, Oak Ridges—Markham, ON]

I wasn't actually elected when we started to reduce taxes with one of our first budgets, and at the time the Minister of Finance and the Prime Minister had been suggesting, as early as 2007, that the world economy was facing some difficulties. That's why we were starting to put money back into the hands of all Canadians.

I also remember at the time that the government put $37 billion towards repayment of the debt, and I'm not sure if you can comment on whether I'm correct on that amount. Was it about $37 billion?

[Paul Rochon]

Yes, that's correct.

[Paul Calandra, Conservative, Oak Ridges—Markham, ON]

I remember also at the time there was some comment specifically from members opposite that perhaps the government paying down its debt was not the best use of its resources, and that perhaps we should be investing in programs--not in infrastructure--but in different programs and services. I wonder if you would agree that having paid down that $37 billion in advance, foreseeing that there was a world economic crisis pending, has also helped our financial position moving forward, and that forward thinking by the government has helped us prepare for this economic storm right now?

[Paul Rochon]

In general terms, it's quite safe to say that the fiscal strength of the federal government in Canada, as well as that of most other provincial governments, is an outstanding feature of this country. That is important in a whole variety of ways, including keeping interest rates to a minimum, which provides benefits to both households and businesses directly. It also provides the government the flexibility to put in place responses to the current downturn that are viewed as being sustainable and that therefore don't carry with them the prospect of large increases in taxes or spending reductions in the future.

[Paul Calandra, Conservative, Oak Ridges—Markham, ON]

If I may, when I was back in my riding I spent a great deal of time.... I represent a riding that has four communities, from small towns to Richmond Hill and Markham. I spent a lot of time with the mayors, members of council, and town staff looking at potential infrastructure projects, projects they would have had no ability to do on their own. I've been extraordinarily excited by their response, which includes sending back to me potential projects they are very excited to bring forward.

For me, part of this was not only to see what they're interested in doing but also to assess the impact it would have on the community, the types of jobs, the person hours this would create.

I can tell you that in King--the small town of King has 17,000 people--the number of jobs this stimulus will create is extraordinary. They're very excited. But the same goes for Richmond Hill. The same goes for Markham. The same goes for Stouffville. The working relationship between me and my Liberal provincial counterpart, in order to assess what the communities need and to bring that forward, and their willingness to cooperate have been extraordinary.

If I may say, they have been extraordinarily happy about how quickly the government and the public service have been working. They have nothing but praise for how quickly we are getting things done. I want to pass on, on behalf of the mayors of Markham, Stouffville, King, and Richmond Hill, a thank you to you and to all the people who are helping support small-town Ontario to get the economic stimulus out the door and to help create as many jobs as possible. I thank you very much. I know you've been in front of the committee many times. So on behalf of my riding, thank you. This is going to mean a very big difference for the people of Oak Ridges—Markham. We're ready to go. We have the money. You've been right there with us to get this done.

[The Chair, Liberal, Derek Lee]

Mr. Warkentin, for five.

[Chris Warkentin, Conservative, Peace River, AB]

Thank you very much.

Before I get into my questioning, I think it's important that we clarify something. I know you didn't venture down this...but I can, for my colleague, Mr. Regan. He was asking specifically if there were dollars through the Building Canada Fund allocated in the last budget...or Canada's action fund. There was $500 million allocated to double-up the commitment for the communities component in the last budget. That was included in the last budget. So that's helpful information for my colleagues and also for the people who may be looking at what we're doing today.

I want to ask Mr. Smith if you might just talk about.... I know we can't ask Treasury Board about a lot of the stimulus spending, because it's other departments. But I know Treasury Board itself has undertaken some initiatives that will stimulate the local economy and will create jobs.

Specifically, there was the announcement on behalf of the president of the Treasury Board, and that was with regard to the hiring of Canadian students for the summer. These students will be working under the federal student work experience program, the cooperative education/internship program, and the research affiliate program.

I'm wondering if you could talk a little bit about that in terms of the dollars your department is allocating and spending on that--what these allocations include and how many additional jobs will be created as a result of that spending. In addition to that, is this a statutory vote, the funding for this particular program, including the increase?

[Alister Smith]

Thank you very much.

In fact, the federal public service student employment initiative is about $20 million, $10 million in 2009-10 and $10 million in 2010-11, to improve or increase federal public service student employment. In 2007-08 we had 23,000 students hired by the public service across the country. This will provide room for an additional 2,000 students over the next couple of years, according to the information I've seen. This represents a 7.5% increase in the funding and a good increase in the number of students.

The jobs are in several programs. One is called FSWEP, the federal student work experience program, another is the cooperative education/internship program, and the third is the research affiliate program. Students can apply for these jobs on the government website, jobs.gc.ca.

This is not statutory, so this is one of the programs that will be funded through either supplementary estimates or TB vote 35.

[Chris Warkentin, Conservative, Peace River, AB]

Well, I wondered if that was the case, so I thought I would go on my little excursion to do some investigating. Maybe it helps to satisfy all of us to know there are funds being spent possibly out of vote 35. Obviously, there's nobody around this table who would oppose the hiring of students by the government. For one thing, it creates jobs for people who are looking for jobs, and for another, it gives them practical work experience that might assist some of them as they enter the public service down the road. We hope some of them enter the public service, because we know there are challenges in finding qualified people in certain areas. We, as a committee, have ventured to investigate that issue in other hearings, so we appreciate your involvement in recognition of that important task.

My colleague across the table affectionately characterized the home renovation tax credit as something other than worthwhile, talking of decks on cottages. I thought it would be important to tell yet another story of my friend Wayne, who works across the hallway from me in my constituency office. He approached me some time ago about the seniors complex that he and his wife and many other families live in. He was concerned about the tax credit and whether it applied to condominiums. He and the other seniors living in this complex have been unable to fund the repaving of the street around the complex for some time for two different reasons. One is that they haven't been able to get a qualified person to do the work because everyone's been so busy; the other is the financial side. I was pleased to convey to him, and I'm pleased to convey to anybody else who's listening, that condominiums do qualify for the tax credit. As a result of this tax credit, the seniors at Coachman Village in Grand Prairie will receive brand-new pavement this year. I know there are other condominium associations across the country that will receive the same.

In addition to this tax credit, other important infrastructure is being funded either through tax incentives or through contributions by the federal government. Just recently, I had the opportunity to announce in my own riding two very important infrastructure projects. They relate to some of the most disenfranchised Canadians out there. Our aboriginal people are significant beneficiaries in terms of infrastructure funding in this most recent budget. We had the opportunity in our community to see that we will have a new school built in place of one that was originally built for 100 students. The population now is some 600 students in a very remote area in my community. This is a project that's going to be undertaken this summer. In addition to that, we have another community that's receiving significant investment in a new water treatment plant. These are the types of projects that are going forward even this summer and will benefit some of the most disenfranchised, folks who haven't seen investments like this in decades.

Although my colleague references decks on cottages, I would not take offence at that because I'm hoping there are some decks on cottages that are built. Perhaps I would leave this as a comment: there are people who desperately need infrastructure in their communities who are going to be beneficiaries as a result of the stimulus spending, and we're hearing those announcements and seeing projects start every day.

[The Chair, Liberal, Derek Lee]

Thank you.

Mr. Brown, you have five minutes.

[Patrick Brown, Conservative, Barrie, ON]

Thank you.

I know in the stimulus package there was information about funds allocated for the Canada Health Infoway—$500 million—and the Canadian federal laboratories. Could you explain the timelines on that and the effects of the potential stimulus from those investments?

[Paul Rochon]

Let me start with Health Infoway. As you know, it is an organization that's been in existence for a number of years. It does important work related to electronic health records in particular. My understanding is that these funds will flow over three years and will be managed by Infoway themselves.

I'll let Mr. Smith address the federal laboratories component in more detail, but that is an effort that involves a number of departments. The allocation of funds for this, I understand, is being administered by the Treasury Board Secretariat. It involves an initial scan, for which a lot of the work was done at the time of the budget, and then a selection process, which I understand will be completed towards the end of May.