Government Operations Committee on May 4th, 2020

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Good afternoon. I'd like to ask a few questions.

I hope that you're already looking ahead. That's what my questions presuppose.

Of the measures already in place, which ones will need to be extended or modified in order to promote economic recovery and the employment connection?

My question is for an official from the Treasury Board or the Department of Finance.

[Alison McDermott]

I can try to answer your question.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you.

[Alison McDermott]

Good afternoon. I'm Alison McDermott. I'm an associate assistant deputy minister at the Department of Finance.

We find that it's early to decide to extend the measures. This is an extraordinary crisis. The support that the government has provided is very important. We hope that economic activity will resume. Of course, should the government decide to extend the measures in the coming months, it would be in a position to do so. However, it's a little early to decide that now.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Okay.

Among the existing measures, are there any that could be modified to promote recovery and the employment connection?

[Alison McDermott]

It's true that we'll have to consider these aspects. It's difficult to give information on it at the moment, but they are important considerations.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

We're experiencing something out of the ordinary. The last pandemic was 100 years ago. We realize that there are positive impacts on the environment, especially when it comes to air quality.

Does the government intend to take steps to use the current circumstances—which are sad, but which we still have to face—to ensure a viable and responsible economic transition, both ecologically and socially?

If that's the case, how much might such a transition cost?

[Alison McDermott]

That's a very good question.

We're thinking about the next step. Right now, our priority is to provide support to people who have lost their jobs or who can't work. We want to stop the transmission of the virus. That's why we're focusing on that.

In the coming months, we hope to be in a situation where economic stimulus will be necessary. At that time, we could consider the measures you mentioned, including promoting investment in the economy of the future, a more sustainable economy.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Okay.

Last week, we talked about business subsidies, and I'd like to discuss that further. There was some waffling: we said that companies using tax havens were being given subsidies, then we said the opposite.

So I'd like to know where we stand. Are we giving subsidies to companies using tax havens? If that's the case, why aren't we stopping it? Do we have the names of these companies to tell them that we don't approve of this unethical practice? Are we there yet? If not, is there a problem that would explain why?

[Andrew Marsland]

The whole issue of tax evasion and tax avoidance is one on which the government has taken a number of important steps. Probably most importantly, recognizing that this is truly an international challenge, we work closely with the OECD and others in building an international architecture that helps us deal with base erosion and profit shifting. The government has invested significant amounts over the past number of years and in recent budgets in bolstering CRA's capacity to address aggressive tax planning.

When you look at the specific measures such as the wage subsidy, in particular, this is about ensuring that employers can keep staff on, can rehire staff, and so on. That's really the objective here. One doesn't preclude the other in the sense that the objective is to preserve jobs, preserve employment, and to position the economy to revive after the crisis. That doesn't mean there aren't important steps being taken to address inappropriate tax avoidance.

[The Chair, Conservative, Tom Lukiwski]

Mr. Marsland, unfortunately, I'm going to have to interrupt you there, because we're completely over time.

We will go now to our next intervention, from Mr. Green, for six minutes, please.

[Matthew Green, NDP, Hamilton Centre, ON]

Thank you very much, Mr. Chair.

For the benefit of those who might be watching at home, I'll just explain that the emergency response benefit, the CERB, provides $500 per week for up to 16 weeks to workers, including self-employed workers, who have involuntarily stopped working due to COVID-19. The government estimates that this program will cost $35 billion. On April 15, the government announced amendments to the CERB that will allow recipients to earn $1,000 per month, and will expand access to some workers and seasonal workers who have exhausted their employment insurance benefits. However, we know, from I believe it was last week or so at the Standing Committee on Finance, there are a lot of people who are still left out of this program.

In the design of these means-based, tested programs, when you are proactively determining and identifying who is eligible for them, can you comment on who's left out?

The time is ticking.

[The Chair, Conservative, Tom Lukiwski]

Mr. Green, could you direct your question to a specific witness?

[Matthew Green, NDP, Hamilton Centre, ON]

It is to whoever is responsible for directing the program. I believe it's Mr. Marsland, if he's tax policy, or whoever is responsible for the CERB.

[Alison McDermott]

I can say a few words, and I think my colleague Suzy McDonald might want to add to what I have to say.

In terms of general design principles, the government tried to move quickly with its response, recognizing that it was important to get support out the door to those who needed it most. It has very much been focused on supporting those most affected by the crisis, and that led to the decision to develop the CERB, which is, of course, for folks who have lost their jobs or are unable to work.

Since introducing the first tier of measures, the government has been looking at filling gaps and expanding access, as you've noted, to EI exhaustees and others. That work continues. Our sense is that we have a good deal of support out there that is very generous by international standards in the level of support being provided to them.

Suzy might want to add a little more on other groups. I know we've added support for students recently, not through the CERB but other mechanisms. There has been a lot of support for other vulnerable members of the population, so I'll see if she wants to add anything to that.

[Matthew Green, NDP, Hamilton Centre, ON]

In addition, maybe she can provide us with what the current projections are for the cost of the CERB.

[Suzy McDonald, Associate Assistant Deputy Minister, Federal-Provincial Relations and Social Policy Branch, Department of Finance]

Sure. Adding to what Alison has said, we have evolved the policy of the CERB over time to ensure that it meets a broader range of people, including allowing people drawing down dividends to use that as their $5,000 of income. We've extended it to EI seasonal workers who've exhausted their benefits. They are now able to draw from their benefits and still have some income of up to $1,000. We continue to make changes with parental and maternity leave, and medical/disability leave [Technical difficulty--Editor].

[The Chair, Conservative, Tom Lukiwski]

Excuse me, Madam McDonald, I know that for my side your testimony is very difficult to hear.

Mr. Green, are you able to hear clearly or is it difficult for you?

[Matthew Green, NDP, Hamilton Centre, ON]

Not as much. I'm just really cautious of the six minutes that I have. I want to make sure I claim my time.

[The Chair, Conservative, Tom Lukiwski]

Sure, you'll have extra time for my intervention.

Madam McDonald, if you could try to please speak slowly and clearly, that might assist our translation.

[Suzy McDonald]

I will try my best. I won't repeat what I just said. Hopefully, you've heard most of it.

I'm saying that we are continuing to evolve the program. The CERB is not intended to meet the needs of everyone. It was intended to be used as a complement to the existing systems.

In addition to the CERB, there are a number of other programs we have put in place including, as Alison noted, new supports for students. We're supporting vulnerable populations through other programs, including for people living in homelessness, and providing additional support to not-for-profit organizations to help meet the needs of vulnerable Canadians.

Perhaps just moving on to the last question, which was on the overall costing [Technical difficulty--Editor].

[The Clerk of the Committee, Mr. Paul Cardegna]

Mr. Chair, the interpretation's had to stop. We can't hear Ms. McDonald. I'm sorry.

[The Chair, Conservative, Tom Lukiwski]

All right. We'll take a temporary suspension.

Mr. Green, don't worry. We'll make sure we add time to your intervention while our technicians try to clear up the sound quality.

[Matthew Green, NDP, Hamilton Centre, ON]

Shall I proceed with other questions, perhaps, that other members might be able to pick up?

[The Chair, Conservative, Tom Lukiwski]

That's a great idea. If you have other questions for different witnesses, please go ahead.