Human Resources Committee on Dec. 8th, 2020

[The Chair, Liberal, Sean Casey]

I call this meeting to order.

Welcome to meeting number 10 of the House of Commons Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities. Today’s meeting is taking place in a hybrid format, pursuant to the House order of September 23, 2020. The proceedings will be made available via the House of Commons website.

So that you are aware, the webcast will always show the person speaking, rather than the entirety of the committee. I'm going to dispense with the rest of the formalities, because all of the parliamentarians and witnesses have heard it all before.

I'm going to point out two things. Please open the mike before you speak and close it when you don't have the floor. Also, please address all comments and questions through the chair.

Pursuant to Standing Order 108(2), the committee will continue its study of the supplementary estimates (B).

We have with us here this evening the Honourable Ahmed Hussen, Minister of Families, Children and Social Development. From ESDC we have Lori MacDonald, senior associate deputy minister, Employment and Social Development and chief operating officer for Service Canada; Catherine Adam, senior assistant deputy minister, strategic and service policy branch; Cliff Groen, senior assistant deputy minister, benefits and integrated services branch, Service Canada; Janet Goulding, associate assistant deputy minister, income security and social development branch; and Mark Perlman, chief financial officer and senior assistant deputy minister. We have, from CMHC, Romy Bowers, senior vice-president, client solutions; and Lisa Williams, chief financial officer.

Minister Hussen, thank you for being with us. You have the floor for five minutes.

[Ahmed Hussen, Liberal, Minister of Families]

Thank you very much, Mr. Chair.

It’s a pleasure to join you and all the committee members and to stand before you again today to speak to the 2020-21 supplementary estimates (B) for Employment and Social Development Canada.

As I already spoke to the issues in the estimates during my appearance last month, I would like to focus on other important updates for the committee.

Since my last appearance before the committee, our government has taken major steps towards a Canada-wide early learning and childcare system.

In last week’s fall economic statement, our government took a major step in laying the foundation and the groundwork for a Canada-wide early learning and child care system. First we announced a significant investment of $420 million for provinces and territories to support the retention, attraction and training of early childhood educators.

We are also investing $20 million over the next five years in the creation of an ELCC secretariat to build capacity and work with stakeholders to build this very new Canada-wide system.

Budget 2021 will lay out the plan to provide affordable, accessible, inclusive and high-quality child care from coast to coast to coast. This is something that's very important to parents. This will also include enhanced support for before- and after-school care for older children, in order to provide all parents with the flexibility needed to balance work and family.

The fall economic tatement offers great news for families related to the Canada child benefit.

We recognize that the challenges facing parents through the COVID-19 pandemic have been very significant and that bills continue to pile up. That is why we made a commitment to increase the Canada child benefit next year by nearly 20% for middle- and low-income families with children under the age of six.

Households making less than $120,000 per year will receive an additional $1,200 per child, spread out over four payments in 2021. For those making over $120,000 and who receive the CCB, they will receive half this amount. This will help 1.6 million families keep up with the increasing costs of raising children during these challenging times.

Allow me at this time to talk about our work towards ensuring that every Canadian has a safe and affordable home.

Our government strongly believes that all Canadians should have a safe and affordable place to call home. As communities across the country continue to deal with the impacts of COVID-19, we know that having a safe and affordable place to live is more important than ever before.

In light of that, the rapid housing initiative is the newest program under the national housing strategy that aims to address the urgent housing needs of at-risk Canadians. This program will quickly create some 3,000 new, permanent affordable housing units for Canadians who are experiencing homelessness or living in temporary situations, including in shelters, as a result of the COVID-19 pandemic.

The funds will be split between two envelopes. The major cities stream will have $500 million going to the 15 municipalities that have the highest concentrations in numbers of Canadians experiencing homelessness. The projects stream will have another $500 million envelope going to other municipal governments, provinces, indigenous governing bodies, organizations and not-profit organizations.

We will be in a position to provide more details concerning funding to these cities in the coming days. In fact, this morning, I had the pleasure of making the first announcement for funds to the City of Ottawa related to the rapid housing initiative.

In addition to the initiatives I just mentioned, we've also announced funding of more than $400 million for communities under Reaching Home. This is Canada's anti-homelessness strategy to deal with the COVID-19 pandemic.

Finally, we've just announced, through the fall economic update, an additional $299.4 million for Reaching Home for the year 2021-22. These funds will enable communities to extend and expand their emergency response and it will provide them with the flexibility to deliver more permanent housing solutions. It will also help prevent at-risk Canadians from becoming homeless in the first place by supporting targeted interventions to enable people to stay housed.

The Government of Canada will continue its work to support all Canadians, especially those who are most vulnerable, as we build a more resilient country that is safer, fairer and more inclusive for everyone.

I will be pleased to answer your questions.

Thank you very much.

[The Chair, Liberal, Sean Casey]

Thank you very much, Mr. Minister.

We're going to begin with Mr. Vis for the Conservatives for six minutes, please.

[Brad Vis, Conservative, Mission—Matsqui—Fraser Canyon, BC]

Thank you, Minister.

In the supplementary estimates, CMHC sees close to $361 million in total voted spending and $512 million in total statutory spending, which is over $870 million. From the perspective of a taxpayer, what is one area in CMHC or ESDC where you've noticed your government could do a better job with the funds allocated? Where are you falling behind?

What could be improved in your department or would you recommend no changes to the operation of Employment and Social Development Canada?

[Ahmed Hussen, Liberal, York South—Weston, ON]

I'll focus on CMHC because that was the first part of your question. I believe, and I've said this before in response to your question and others, that the processes for processing applications under the national housing co-investment fund could be sped up a little bit, and it has. The processing time has been improved by over 50%, but I believe there's still room for improvement there.

There are other processes that we can speed up, together with municipal governments and other bodies, to speed up the approvals process for affordable housing proposals that come to CMHC. That's the first one I would focus on.

[Brad Vis, Conservative, Mission—Matsqui—Fraser Canyon, BC]

Thank you. I appreciate that response.

In the response our committee received yesterday, you did state that you would look at process improvements. On the other hand, as it relates to the co-investment fund, are you doing anything to look at simplifying the actual application? Are you doing anything to make it easier for external organizations and to help them conduct and complete the applications in a more timely way?

[Ahmed Hussen, Liberal, York South—Weston, ON]

We want that fund to be used extensively by non-profits, other organizations and governing bodies from coast to coast to coast. As I said, we've sped up the process. Kudos to CMHC for doing that. They recognize that there's still some work to do there.

There is seed money available as part of helping proponents be in a position to put together a very compelling application. That seed money has been used extensively by many organizations.

Beyond that, I'll also turn to Ms. Bowers to provide any additional comments.

[Brad Vis, Conservative, Mission—Matsqui—Fraser Canyon, BC]

Thank you. I'll just go forward with another question. I appreciate your response.

Housing providers and contractors, including those in my riding, have highlighted that the modular construction-only requirement for new builds under the rapid housing initiative excludes local suppliers, tradesmen and contractors from involvement in those projects and revitalizing local economies. Instead, these benefits will flow to larger companies in established urban centres.

Will the restriction be lifted in a future funding round to support rural and remote livelihoods, where they might benefit more from sourcing their materials locally?

[Ahmed Hussen, Liberal, York South—Weston, ON]

I will turn to Ms. Bowers for this aspect of the question.

[Romy Bowers, Senior Vice-President, Client Solutions, Canada Mortgage and Housing Corporation]

Thank you, Minister, and thank you very much for the question.

As the minister mentioned, there are two project streams—the major cities stream and the project stream. When we're evaluating the applications for the project stream, which is due at the end of December, we will take into consideration local factors like the ones you've mentioned.

[Brad Vis, Conservative, Mission—Matsqui—Fraser Canyon, BC]

I'll ask one more question to Ms. Bowers, just quickly.

Following up from our last committee meeting, when I asked for a breakdown of the Government of Canada housing investments, I did receive that list of information totalling $1.1 million, give or take, on families or individuals who have been helped by government programs, but the disclaimer stated that these numbers were conditionally committed. Can we get an updated table for this committee with the actual number of households that have been helped by the government or CMHC?

[Romy Bowers]

We'll provide that clarification. Thank you.

[Brad Vis, Conservative, Mission—Matsqui—Fraser Canyon, BC]

Thank you.

I'll come back to you, Minister Hussen, on the first-time homebuyer incentive.

CMHC was expecting 20,000 borrowers in the first six months of the original program, yet only a quarter of those estimates have actually been approved for funding in the first seven months. This failure has proven that a shared equity mortgage is not what prospective homebuyers want. I understand in the recent economic statement that your government doubled down on the program.

Do you expect the amended incentive to perform better in Toronto, Vancouver and Victoria? What metrics will you be using to determine the success of this program or whether it should be cancelled?

[Ahmed Hussen, Liberal, York South—Weston, ON]

Our government introduced Canada's first-ever national housing strategy, and the first-time homebuyer incentive is an aspect of that. This will help middle-class families achieve the dream of home ownership by lowering monthly mortgage payments without increasing down payments. The fall economic statement, as you say—

[Brad Vis, Conservative, Mission—Matsqui—Fraser Canyon, BC]

I understand the parameters, but what metrics are you going to use for success in the three new categories for Victoria, Toronto and Vancouver?

[Ahmed Hussen, Liberal, York South—Weston, ON]

Mr. Chair, I think the honourable member can appreciate that this is something we've announced that we intend to work on, and obviously we will talk to all concerned to make sure that we get it right and that we expand the eligibility. We want to make sure that this program works for these three areas, and the way to do that is to work hard to expand eligibility and get to the point where we have more folks from those parts of Canada who use it. That work is ongoing, and I can't prejudge the incentives that we'll put in there to make sure that there are more folks who will use it.

[The Chair, Liberal, Sean Casey]

Thank you, Mr. Vis. You're well past time.

[Brad Vis, Conservative, Mission—Matsqui—Fraser Canyon, BC]

Thank you, Chair.

[The Chair, Liberal, Sean Casey]

Thank you, Minister.

Next we go to Mr. Turnbull, please, for six minutes.

[Ryan Turnbull, Liberal, Whitby, ON]

Thanks, Mr. Chair, and thank you to the minister for being here tonight. It's great to see you, as always, and I really appreciate you and your team, and your leadership during this pandemic.

As you know, Minister, I'm extremely passionate about social innovation and social finance. You are also well aware that Canada is blessed with a very strong charitable and non-profit sector that is becoming more and more entrepreneurial. Earned revenue streams have been predicted, for quite some time, to continue to grow within the charitable sector. We also have many social entrepreneurs and co-operatives across Canada, estimated at about 30,000 plus, the last I checked.

Minister, can you tell us about how our government is moving forward on the social innovation and social finance strategy for Canada? In particular, how does this work take on new significance and relevance in the context of COVID-19 and the impending economic recovery?

[Ahmed Hussen, Liberal, York South—Weston, ON]

I'd like to recognize the work that the member has conducted with respect to really highlighting the importance of supporting the social innovation and social finance sector. Our government understands that for us as a country to solve the often complex challenges faced by communities, we have to look beyond traditional approaches. That is why we will be creating a social finance fund, so that we can find new ways of helping Canada's most vulnerable people while continuing to focus on strengthening the middle class.

This fund will give charitable, non-profit and social purpose organizations access to new financing to implement their innovative ideas, and by investing $755 million in a social finance fund, we'll also help generate up to $2 billion in economic activity and help create and maintain as many as 100,000 jobs over the next decade. So far, with the investment readiness program, we've seen the oversubscription of that program. We've seen how critical it has been to build the capacity in social purpose organizations. COVID has actually highlighted the need for more investments in the space as a way for us to not only recover better but to recover stronger.

[Ryan Turnbull, Liberal, Whitby, ON]

Thank you, Minister.

I have just a quick wrap-up question on this before I move to another topic.

In your view, then, does the work on social innovation and social finance really help us solve systemic problems, support the non-profit sector and create a more inclusive and resilient economy at the same time?

[Ahmed Hussen, Liberal, York South—Weston, ON]

Yes, it does. When you look at everything from creating jobs to solving the housing crisis in many parts of Canada to tackling poverty and all the various kinds of challenging and complex social problems we face, the social purpose organizations and the social finance approach really do offer an alternative, and in fact sometimes a more sustainable funding stream for organizations to do amazing work.

I always point to a small social purpose organization in London, Ontario, as an example. It uses a business approach to generating profits to build affordable housing units for homeless youth, while also hiring them in the local business. It's like a very interesting virtuous circle, and they have managed to leverage it to attract more investments, not just from the community but also from the Government of Canada through the national housing strategy.

[Ryan Turnbull, Liberal, Whitby, ON]

Thank you, Minister.

I want to talk now about the early learning and child care investments, which are extremely important.

I was paying attention to the fall economic statement and was very pleased to hear the Minister of Finance talk about some substantial investments in a Canada-wide system. I've heard from many constituents just how important it is to have a more equitable economic recovery.

Can you speak to the specific investments in training and retention within the early child care educators space? Tell us why they are so important.

[Ahmed Hussen, Liberal, York South—Weston, ON]

First of all, I appreciate your bringing up this topic. For many parents in Canada, especially women who are not in the workforce because of the lack of affordable and high-quality child care, this is a necessity, and they need action on this now.

It's difficult to speak about setting up a truly national system of affordable, inclusive and high-quality child care and increasing the affordable spaces without seriously engaging in a workforce development strategy. This means we have to make necessary investments, together with the provinces and territories, to not only retain the existing early childhood educators but actually increase their numbers. We have to provide supports for training and provide tuition supports, bursaries, wage top-ups—whatever it takes—to make sure that this is a sector that is supported. This is because, without them, it will be difficult to increase the affordable spaces and it will be difficult to deliver high-quality child care.