Government Operations Committee on Dec. 8th, 2009

[Ed Holder, Conservative, London West, ON]

Thank you very much.

The chair was so impressed by my line of questioning that I have an opportunity to ask a couple more questions.

Before I do, I'd like to read into the record something the committee might find very compelling. It's from Mr. Michael Atkinson, the president of the Canadian Construction Association, who said, “While building permit numbers often shift sharply from month to month, there is no doubt...the growth reflects stimulus spending by governments that's finally leading to projects and construction activity, particularly in the education sector.” He went on to say that in some parts of the country, where private sector work is at a standstill, “if it wasn't for [government money], there'd be no construction going on at all”.

I think those remarks give credence to the comments you're all making.

I think it's rather timely that we are discussing jobs and impact here today, because Statistics Canada reported that almost 80,000 jobs were created in November.

By the way, I still don't believe we're out of this. I think we've all said that we have to be careful. This is a fragile recovery and a global recession, but the unemployment rate has gone down another point, from 8.6% to 8.5%, and even in my own city of London, Ontario, where the region has had the second-highest unemployment rate in Canada, in this past month we went down one full percentage point. That hopefully bodes well, and I certainly hope it's an indication of things for the future.

Mr. Rochon, I don't think you had the opportunity, and this would be my question with--

[The Chair, Liberal, Yasmin Ratansi]

You're the last person to ask a question. You're the final one.

See how I like you?

[Ed Holder, Conservative, London West, ON]

You treat me with great regard, Madam Chair. I know that will carry on, and thank you.

Could you expand, Mr. Rochon, on your comments to the chair in response to her questions? Talk about what happens when the stimulus spending is done and about your confidence in being able to handle the deficit.

[Paul Rochon]

In September, the government put out a fiscal projection, and we think we are still on track. Under those projections, the current year's deficit of roughly $56 billion is projected to fall to $27 billion by 2011-12. That reflects a resumption of economic growth and also assumes that the plan winds down as is currently planned. In subsequent years, with ongoing growth in the economy, the deficit falls to about $5 billion by 2014-15. The government has indicated a general approach to dealing with that deficit, if required, that is focused on controlling spending in the first instance.

[Ed Holder, Conservative, London West, ON]

It's rather interesting, because I heard Mr. Martin earlier in his comments reference this as a structural deficit. If I recall, and I want to come back to quoting the finance minister--hopefully not inappropriately--he said it's temporary and targeted spending. To me, that is not defined as a structural deficit.

As a final thing--I want to come back to this as my last point--we talked about this whole issue of jobs and whether it's easier to do a retrospective or a prospective forecast. Obviously, retrospective is always easiest: for obvious reasons it's easier to know.

I know we put a lot of emphasis on jobs created. Are we best just to catch our breath a little bit, knowing there is some positive news out there in the economy; to not sound death knells or dire warnings, but in fact just take a moment to allow some time to tell us how and how well this has been working? Do you have any comments on that?

[Paul Rochon]

I would agree with the general proposition that the focus of the government should be to ensure that amounts are spent as planned and that they're spent effectively and appropriately. We can have a debate on jobs created and on the various sources of information one should use to calculate that. In the first instance, getting the money out is the main priority. In a couple of years we will be able to determine the exact number of jobs. When we're spending $62 billion, we know it's going to have an impact on jobs.

[Ed Holder, Conservative, London West, ON]

Again, let me thank our guests, and our old friends as well, for coming back.

Thank you very much, Madam Chair.

[The Chair, Liberal, Yasmin Ratansi]

Thank you.

I have two items that have been asked for by the analyst and the clerk.

Madam Baltacioglu, I understand you've gone 90% through the second report, the November report. When will it be available so that the analyst can have it? The analyst will do the roll-up, so that even if it's only unilingual, we will be able to get the information.

[Yaprak Baltacioglu]

I think it should be no later than the end of next week. It's just that we're waiting for information back from the provinces.

I'm just writing...signing your letter, actually.

[The Chair, Liberal, Yasmin Ratansi]

Okay.

Mr. Forster, you had some comment to make on why the Quebec information is missing.

[The Clerk of the Committee, Mr. Marc-Olivier Girard]

In the first quarter.

[The Chair, Liberal, Yasmin Ratansi]

Yes; why it was missing in the first quarter.

[John Forster]

In the first report, Quebec did not provide updates on the projects in August. A lot of them were announced in July, so there wasn't much to update. They have reported in November.

[The Chair, Liberal, Yasmin Ratansi]

Okay.

Do you have any closing remarks, Mr. Rochon? No?

Monsieur Robidoux.

[Benoit Robidoux]

I had a question about what would happen if we used other multipliers for the jobs impact. What I could say right now, in fact, is if we would have used the CBO multipliers in the U.S. or the Council of Economic Advisers, what they assume is a multiplier of 0.75 between output and jobs instead of 0.6. This is 25% higher in terms of multipliers.

So instead of 220,000 we would have had something more in the range of 275,000. This gives you an idea, if we would have used U.S. assumptions, of how much higher the estimate would have been.

[Ed Holder, Conservative, London West, ON]

Is it equally as possible, then, that there could be that many jobs created?

[The Chair, Liberal, Yasmin Ratansi]

They say create or maintain, so we do not want to split hairs on this.

I'd like to suspend the committee for 30 seconds. Bells will ring at 5:15 p.m.

Thank you very much for being here. We hope to see you again. We've become such good friends, we'd like to see you.

Committee members, don't get up, I need to finish this up. I have a question for you.

For the Thursday meeting I have three options that have been proposed. Number one is that we discuss future business and utilize the committee for future business. Number two is that, as Madam Baltacioglu mentioned, there are regional development agencies that collect job data. If we want to call them back, we call them. The third, and I'm sure you'll take the third, is that there is enough fatigue on the economic stimulus package, and the analyst needs to finalize the report. We just need the November figures, and the fifth report that we were talking about, so that we give the committee members a break.

[Some hon. members]

Hear, hear!

[The Chair, Liberal, Yasmin Ratansi]

We go away and you promise to e-mail to us what you would like to study for future business.

Which option do you wish?

Yes, Mr. Warkentin.

[Chris Warkentin, Conservative, Peace River, AB]

We like the third option, Madam Chair, and if we could just plan, for the first meeting in January, to have new and arising business, I think there'll be an opportunity for us to think over the break.

[The Chair, Liberal, Yasmin Ratansi]

Committee members, could I request, please, that you send in your suggestions? You will have had a break. You will have been away from here. Your heads will have been cleared. You'll be able to think clearly as to what we need to study.

[An hon. member]

I want to talk to Santa and see what he says.

[The Chair, Liberal, Yasmin Ratansi]

Okay.

Do we need a vote on this number three? We don't need to vote on this.

Number three: done. No meeting, therefore, on Thursday.

Before you leave, the two speakers, the Speaker of the Senate and the Speaker of the House, have invited us for the Quilt of Hope exhibition at 199 Sussex Drive. I was told to advise you that the green buses will be leaving Parliament Hill at 6 p.m. and will go every 20 minutes. If you do not know this, 199 Sussex Drive is the building that the Prime Minister opened. It's the Delegation of the Ismaili Imamat, next to the Saudi Embassy.

Thank you.

[Ed Holder, Conservative, London West, ON]

Whatever way you celebrate, may I just say to the committee Merry Christmas. Joyeux Noël.

[Some hon. members]

Hear, hear!