Health Committee on Oct. 5th, 2006

[Bill Jeffery]

I can start.

[Dawn Black, NDP, New Westminster—Coquitlam, BC]

Thank you.

[Bill Jeffery]

I think this is coming up to the fourth year that we have made submissions to the House of Commons finance committee with regard to reforming GST. Simply put, our recommendation is that the Department of Finance, in conjunction with Health Canada, look at the definition of basic groceries in the Excise Tax Act and examine it to see if it applies economic incentives in ways that are consistent with the nutrition promotion messages that Health Canada purports to advance. The economic incentives must be consistent with what they're trying to tell Canadians to do.

We've also recommended that the government consider sponsoring a national school meals program. Every other OECD country does it. The United States spends about $1 a child a day on it, I think to good effect. It's long overdue for Canada to take such actions.

I've circulated my written brief. It has a blue card attached to it with a number of other recommendations--restricting advertising direct to children and that sort of thing. There's lots that Health Canada and other departments could do, and I just hope they do it.

[Dr. Sean B. Cash]

My first recommendation would be to take a careful look at, and do a thorough review of, those existing programs that already affect food prices in this country, some of which have their genesis in historical concerns that go back the better part of a century and do not in any way reflect our current public health concerns. Some of those could be reformed or reformulated in ways that would address those tensions.

Looking at tensions within the tax policy as well, the current tax policy is a good idea; however, when you try to start drawing a lot of bright lines around certain food items, there are the problems I mentioned about targeting and substitutions, and there's also just the administrative complexity of it. A system that might be taxing a large number of food items differentially from others would be very difficult to administer, both for government agencies and for the retailers involved, and that cost should not be ignored.

Finally, looking at trade policies and the like, while keeping an eye out for the effect of those on public health, we must also keep in mind that public health concerns pursued in other countries have sometimes run afoul of trade regulations. An example rather recently is a tax the Mexican government tried to implement on high-fructose corn syrup beverages; it was seen as a technical barrier to trade and was struck down. The United States complained about it because they are a major exporter of high-fructose corn syrup to Mexico. We need to keep in mind that we also have various treaties in place that might also restrict our ability to do some of the things we've been talking about today.

[The Chair, Conservative, Rob Merrifield]

We must go very quickly; the time is gone, but we'll allow the answer.

[Dr. J. Stephen Clark]

The more I look at the numbers, the more it seems to me consumers are responding in the way we were expecting them to. They are buying healthier foods and they are eating less.

I keep coming back to this idea of exercise. My thought on exercise is that if I want healthier food, I can always get the butcher or somebody else to cut off some fat, especially if I'm willing to pay for it, so that's easy, but in exercise you can't get somebody else to do it for you; you have to do it yourself. As the value of our time goes up, it becomes harder and harder for us to get out and actually do that. Anything that could make people get out, get some exercise, and keep fit would be a policy that I think would work.

[Dawn Black, NDP, New Westminster—Coquitlam, BC]

I know we don't even have compulsory physical education anymore across the school systems in the country.

Thank you.

[The Chair, Conservative, Rob Merrifield]

Thank you very much.

Mr. Batters, you have five minutes.

[Dave Batters, Conservative, Palliser, SK]

Thank you very much, Mr. Chair.

I'd like to welcome all the witnesses here at committee today. They were excellent presentations, each and every one of them.

I want to focus in a bit on the GST to start with. Whoever feels comfortable answering can please just dive in.

Has the imposition of the GST on unhealthy foods ever been evaluated in terms of its impact on the consumption of these products? Has that been studied? I am interested to hear if it has and what the results of that study were. If not, would it be possible to analyze the costs and the benefits of the current GST tax system regarding what we're trying to accomplish toward getting people to eat healthier and improve health outcomes?

Secondly, regarding the same point, under the current GST tax structure, would it be feasible to create—and I like this idea today, I hadn't heard this before—a nutrition criterion that could be used to distinguish taxable from non-taxable foods in the effort to promote healthy eating and prevent obesity? I think that would definitely send a message to consumers. If there is a big red GST sticker on something, people will know it's not a healthy food. If it doesn't have that sticker, it is a healthy food.

But within the context of this whole debate, I'm quite torn here today, because there's certainly a balance in the nanny state. Granted, the nanny state in this country thankfully pays for health care, angioplasty, and bypass surgery, but there is a conflict between the nanny state and the libertarian, the individual's freedom of choice—I choose to eat cookies—and not punishing people for choosing certain foods. So there's really a balance going on.

So if you would comment on those two little matters about the GST, that would be greatly appreciated. I like this idea of a nutrition criterion.

I'll wait for the answer before asking the second question. I'm always a bit leery that you're going to cut me off, Mr. Chair.

[The Chair, Conservative, Rob Merrifield]

That is a possibility.

Go ahead.

[Geoff Trueman]

I can probably only remember so many questions at one time, but turning to address the first question in terms of the existing GST system that we have, as I say, the GST is generally reported and data is presented at an aggregate level. To the best of my knowledge, then—and the academics may correct me—I have not seen any studies, nor would I expect there to be any readily available data that would allow for an analysis of a particular food that is subject to GST vis-à-vis a food that is not subject to GST.

[Dave Batters, Conservative, Palliser, SK]

We're picking favourites in terms of healthy and unhealthy right now, in terms of the GST. Do you mean to tell me there's no data as to whether or not that's having any impact whatsoever on consumption?

[Geoff Trueman]

No, I'm saying simply that I don't think the GST data would be available in terms of its breakdown or its application to a particular food group such as cookies or ice cream, if that's the type of study to which you are referring, to monitor consumption of those goods.

[The Chair, Conservative, Rob Merrifield]

Mr. Jeffery.

[Bill Jeffery]

I can address that question.

You're quite correct, we are already making distinctions in the GST rules as they are. With regard to your side point, I guess, about the nanny state, in this particular context we're talking about children. Children have nannies, and that's probably a good thing.

But on the general question of the GST, there aren't any studies done. There are some data available that can be used to forecast the effect of the GST on shipments of soft drinks, and those data are actually quite interesting. When the GST came into effect in 1992, it actually lowered the tax on domestically consumed soft drinks because they had previously been subject to the manufacturer's sales tax, which was 13.5%. Domestic consumption went up a little bit, but exports went up quite considerably because they were no longer subject to tax whatsoever.

Although the GST revenue data are only collected on an aggregate level, the officials at the Department of Finance could do a fairly good estimate of the impact by looking at historic A.C. Neilson sales data, which can be broken down by product category. They could just look at the rules and see which ones would be subject to tax.

With regard to the question about how we could develop nutrition criteria to make the distinctions, there's a professor at the University of Oxford in the United Kingdom who was contracted by the U.K. Food Standards Agency to come up with what they call a food scoring system. I think it's a very promising technique. What he did was assign foods to three levels of nutritional quality: very helpful, mediocre, and low.

[The Chair, Conservative, Rob Merrifield]

I'm sorry, your time has gone.

We'll move on to Ms. Bennett.

[Carolyn Bennett, Liberal, St. Paul's, ON]

Thank you.

I'd like to follow up on what Bill just said.

Bill, I understand that certainly PepsiCo had tried to do that. The new wave president there tried to assign three levels to foods--decadent foods, healthier foods, healthy foods. It was a red light, amber light, green light, based on fat content, sugar, salt, and whatever.

I couldn't agree with you more about the food guide and I couldn't agree with you more about that chart on the back of the stuff. I'm a physician and I never have a clue what it means. I think that if we're going to give a simple message to people that we do have a preference that they eat healthier things, and that we're going to attack it somehow by trying to make sure the healthier things are cheaper, then we have to demonstrate to Canadians in everything we do, whether it's environmental or nutritional or health impact or in some way, that we do have a preference.

Could the panel comment on this? If there was an expert panel that could help us with a red light, amber light, green light approach, and if you put the GST on the red light products, are these things we could do at the same time? As I've heard the witnesses say, we have to do something about getting green light products into schools, like the apple program in the U.K. The ancient meddler in my riding, Fiona Nelson, always says that when she was a kindergarten teacher 40 years ago, she could order how much milk the kids needed in the morning and it just showed up in the classroom the next day. We've somehow gone backwards from getting kids what they need--and I guess we certainly hear about the distance thing.

Tell me what the expert panel is looking at on the physical activity piece. What's their mandate?

Also, could we have an expert panel in this country that just decided whether stuff was red or orange or green light and we put GST on the red?

[The Chair, Conservative, Rob Merrifield]

Let's open it up for answers. Who would like to start?

Mr. Clark.

[Dr. J. Stephen Clark]

If consumers are buying food and they're trying to figure out how healthy it is, at this point in time what they have to do is look at that label. That doesn't make any sense to a lot of people. It's very difficult to understand. If consumers want to decide how to make healthy choices, we ought to make it easier for them to do that. And one of the ways to do that is what you're talking about.

I believe there is a blue brand that you can buy at the Superstore, or something like that, that's supposed to be healthy. This is helping consumers decide, when they buy food, how healthy it is. That should be enough. If you're interested in the health of the family, it should allow consumers to look at that thing and make up their minds. The most important part of it, though, is that it should give them a good idea that the food that they're actually buying truly is healthy and it should make it easy for them to do so. They shouldn't have to run around and look at all the backs of things to try to figure out how healthy a meal is going to be. So I would support that.

The only issue I would have is with how close that is to their health. As I understand it, this can change over time. There's the good fat and the bad fat; there's the good cholesterol and the bad cholesterol. We learn these things over time. The best science we have now may not be actually promoting the best health that they can get. I'm hoping that will be correlated over time, but it could be a problem. That needs to change, and I don't know how they would weight them and things like that.

[The Chair, Conservative, Rob Merrifield]

Thank you.

Mr. Jeffery.

[Bill Jeffery]

First of all, I should say that my impression is that the new nutrition facts labels are much easier to read than the voluntary ones that preceded them. The text is easier to see and the information is reported in a way that's easier to understand. That said, they could be even easier. I know other witnesses have suggested that some stoplight scheme might be advisable, and I think that's a great idea to at least get the ball rolling and think about how that might look.

The important thing is that the nutrition criteria have to be set up right and set up by an independent body. You mentioned the PepsiCo example. There are other examples of company logo systems out there. They have been roundly criticized in The Globe and Mail and the National Post by the nutrition columnists for those newspapers, because to some great extent they're self-serving, and the nutritional criteria often reflect that.

[The Chair, Conservative, Rob Merrifield]

Thank you.

I'll allow another quick comment.

[Geoff Trueman]

I'd like to follow up on that. I think the red, yellow, green system is very interesting, and I also wonder if maybe we're not giving consumers enough credit. If we give them a red, yellow, green system, if we give them proper food and nutrition labelling, do we really need to impose a tax? I'm not sure we do. I think one of the things we'd want to give very serious consideration to is reviewing how consumers would react to a red, yellow, green system. Are they using the labels that are on food? Does it help inform their choices? What information do they need to make those best choices? Before we move to a punitive tax on individuals, I think we really have to explore fully the benefits of a labelling system.

I don't think the two necessarily go hand in hand. I think that labelling and food guidance and requirements can certainly stand on their own.

[The Chair, Conservative, Rob Merrifield]

Thank you very much. Your time has gone.

Ms. Davidson, five minutes.

[Patricia Davidson, Conservative, Sarnia—Lambton, ON]

Thank you, Mr. Chairman.

Thanks to the members of the panel. Certainly, we've heard some very interesting comments here this afternoon.

I think everybody would have to agree that although we've heard a lot of very interesting things and we've heard a lot of different things, I'm not so sure we are getting a whole lot closer to determining what is the best route to take to tackle this huge dilemma of childhood obesity we're facing. We've talked about fitness, we've talked about tax credits in different forms, we've talked about fat tax, imposing taxes on different things.

I guess, Mr. Trueman, I would agree with what you've said. I'm not sure that the correct way to go is to start imposing more taxes on people. But the one thing that I think is a reality is that good eating and healthy eating is not cheap. It costs a lot to eat well and to eat healthy. Whether that's imposing a fat tax or whether it's doing something else with our food pricing system, I don't know, but I think that's very much a reality. I think that's one reason there are so many people who don't eat properly. I think Dr. Clark said we can choose the right food, we know we can get the right food, but it's exercise we need to promote more. But everybody in this country can't get the right food, and I think that's where we need to start.

Another thing we talked about was sugared soft drinks and those not being a healthy choice in most cases. But I must hear two or three times a week about people saying, “Are you drinking that diet pop? That's not healthy.”

I'd like to hear some comments on those issues, about the cost of eating healthy and issues such as people being concerned about non-sugared soft drinks.