Evidence of meeting #8 for Industry, Science and Technology in the 39th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was countries.
A recording is available from Parliament.
Conservative
Bruce Stanton Conservative Simcoe North, ON
Sorry, I don't want to cut you off, but we're under some time constraints here.
The other item was this whole notion of what the multiplier effect is of your industry in terms of there's certain GDP spending, but then there's indirect. I think you used the term “indirect”. Where does that shake out? Do you have any comparisons on that multiplier effect, or return on investment, compared to other industry sectors?
President, Hotel Association of Canada
We're one of the highest out there: 91% of all of our revenue. We did $17.9 billion in revenue last year; about 16.2 or 16.3 is the multiplier effect of it, so it's above 90%.
Conservative
Bruce Stanton Conservative Simcoe North, ON
I have a final question on this issue of the funding for festivals. I know that this government, just this year, committed $30 million over two years. Do you have the numbers on what program that replaced? I tried to get a quick message on that, but I don't have it. As far as I know, this was a new program for festivals. Do you know right off the top of your head whether there was a former program for festivals like this?
President and Chief Executive Officer, Tourism Industry Association of Canada
Not that I can recall. What was deleted under the sponsorship issue allowed for some festival funding, but I don't know if there was a previous program to the festival one.
Conservative
Conservative
Conservative
Liberal
Scott Brison Liberal Kings—Hants, NS
Thank you very much for appearing before us today.
I have a quick question on the visitor rebate program. Our understanding from having met with industry representatives from across the country is that the government's decision to end the visitor rebate program had a negative impact.
It's my understanding from speaking with operators that the interim decision of the government to correct that has in fact not corrected it and that there are still some problems. One issue has been the complexity of the new approach. There are reports that in order for a visitor to receive a rebate under the amended program, they would actually be violating privacy rules in some of their countries of origin, particularly EU states. There are flaws with the new approach.
I'd appreciate your feedback on the visitor rebate program, the importance of it, whether the interim approach the government has taken after killing the program is enough, and whether we ought to go back to the old visitor rebate program.
President and Chief Executive Officer, Tourism Industry Association of Canada
I'll start with the end. We should go back to the old program--an enhanced version of the old program. That's what should happen. If we want Canada to be seen as receptive to foreign visitors, we have to recognize that tourism is an export. Other exports aren't charging their foreign customers GST, so why is tourism the only export that charges their foreign customers the GST at a time when we have a number of other challenges? It's just not right. We need to fix that.
The FCTIP, which is the foreign convention and tour incentive program that replaced the old program, is a welcome announcement. I think it recognizes that the volume segments of what was going to be lost were critical. The tour package element is important for Canada; it's how we price ourselves in foreign countries.
As I already mentioned, without the GST problem, in two to five years from now the conventions are going to be shaking Vancouver, Montreal, Toronto, Halifax. The cities that attract foreign conventions are already going to have a pricing challenge and the GST was going to create a tremendous hardship for our industry. So the convention side is working fine.
We know that with the tour incentive program, the tour package side is an administrative challenge. We're trying to get a handle on that. We don't want to say it's not working without doing due diligence. We talked to the tour operators around the world, who sell Canada, to find out how they are positioning it. Some are saying it's too administratively burdensome, and some are adding the GST and if the customers don't like it they sell them something else. The ramifications of that will be felt two to three years from now. We need to get an indication of the challenges around the tour operator program from all parties, report that to government, and fix this.
We need that individual program. We're the only one of the top 20 OECD countries that doesn't give our visitors the GST back. Are we worried about giving GST back? Are we a poor nation that can't afford it? Is it that we don't care about export revenue to our country? Do we not recognize that the travel deficit is going to hit $8 billion--the highest on record? Do we not care about that?
Most of these people are buying accommodations and goods. I have store owners who are complaining because the crafts they used to sell--whether that's Inuit art or crafts made by Canadians--aren't being sold as souvenirs from Canada because there's no GST rebate.
It's the principle here. We have too readily discounted that individuals don't value their rebate. They do. Even if it's 13%--not the 3% that was reported--it's important.
Conservative
Independent
André Arthur Independent Portneuf—Jacques-Cartier, QC
Thank you, sir.
Good morning, Mr. Williams.
Sir, in a little bit less than a month, in Quebec City, we'll launch the city's 400th anniversary celebrations. Many people in Quebec are skeptical of the international impact these might have, even though the Canadian government has been mightily generous with a more than $100 million subsidy to this organization.
Yet if you read the international press or watch international TV, especially in the United States, you don't see much impact from this celebration, which might very well be a flop if the international community does not react to it and if the organizers are satisfied with their easily found excuses that the dollar is too high, and people won't come, and that it's not their fault it's going to be a flop.
What is your reading of the situation?
President and Chief Executive Officer, Tourism Industry Association of Canada
The 400th anniversary celebration for Quebec City, as we talked about before, is important to the community. It's an important way of animating our country and an important travel generator. People don't go to Quebec City to stay at a hotel; they don't go to Quebec City to travel on Air Canada. They go there because there's something drawing them there. The 400th anniversary is an opportunity to compel people, to motivate them to travel to that city. So it's important that we attempt to promote the 400th anniversary, which is an important landmark. It may not hit all the successes we want it to, but we must try.
Independent
André Arthur Independent Portneuf—Jacques-Cartier, QC
For the last 10 or 11 years, I've had the opportunity of going across the Canadian-U.S. border with groups of roughly 50 people. I've been doing that 10 or 12 times a year. I'll quote three words that I've never heard in the mouth of a border guard: “Welcome to Canada”. Their attitude is horrible; their treatment of people is not nice. They are the first Canadians that Japanese or Americans meet on the way in, be it by road or aircraft, and they treat people with a very haughty attitude as a general rule.
Have you ever tried to change that or bring it to the attention of the Canadian government to change?
President and Chief Executive Officer, Tourism Industry Association of Canada
I've been in travel and tourism since I was 15, and I'm 55 now, so I've been around and never left the industry for over 40 years. Since I was 22 or 23—or for about 33 years now—I've heard of this issue. I've seen letters from guests who stayed at my hotels who were treated poorly at the border. We've made representations at the municipal, provincial, and federal levels. Now that I'm at a more senior level, I've had these discussions. I sit on the Canada Border Service Agency's advisory board, and I have had these discussions directly with Alain Jolicoeur, the president and CEO of the agency. It is a challenge for us.
I travel to other countries. Do I get welcomed by customs agents when I go to Portugal or China or other countries in the world? Not often. But should that be the standard we want? No. We should be a more welcoming country.
The challenge for us is that these customs people, and we are now putting guns on their hips, have been told that the security of our nation is their job, not being welcoming agents for our country. But your three words can be facilitated in a security context as well. It's just a simple little thing, and we'd welcome that kind of initiative and training.
Independent
André Arthur Independent Portneuf—Jacques-Cartier, QC
Can you make a link between the dramatic fall in the number of American tourists to Canada beginning in the year 2000 and the declarations by people around former Prime Minister of Canada Jean Chrétien that the President of the United States was a moron?
President and Chief Executive Officer, Tourism Industry Association of Canada
We can't make a direct correlation with the lost revenue, but obviously the cold relationship Canada had with the United States was a factor, according to some research. Whether it was related to our position on the Iraq war, our missile defence policies, softwood lumber, mad cow.... There was a whole range of things. Whether it was the terrorists coming through Canada and seeping into the United States—
Independent
President and Chief Executive Officer, Tourism Industry Association of Canada
—all of those issues were the ones that contributed to a cold relationship, and that didn't help our visitation, for sure.
Conservative
The Chair Conservative James Rajotte
Thank you.
Thank you, Mr. Arthur.
I'm going to take the next Conservative spot. I have a number of questions and comments. Perhaps what I'll do is put them all out on the table. You can respond to any of the ones you choose to, and then if you'd like to respond later in more detail, I'd certainly appreciate that, as well.
You've made what I would view as some excellent suggestions. One of the suggestions is to put Canada as a destination in the minds of foreigners. How do we do this in a practical sense? What are the most effective modes of marketing? How do you market coming to Canada to a European or to someone in Japan? Do you market the Rocky Mountains? Do you market Quebec City and the history there? Do you market Toronto? How do you grab a person and say “You should come to Canada”? Second, what do other countries do? How do other countries grab someone in another country and make them come to visit?
The second issue is the drop in U.S. tourists. You've done an excellent job, in my view, of explaining the different challenges. What I'd like to know is, prior to that drop, the high year being 2002, why the Americans came here. What were the things drawing them here? Was it the Calgary Stampede? Was it visiting, camping? Was it historical sites? Was it Anne of Green Gables in P.E.I.? Was it shopping? What was drawing Americans northward? Could you explain some of the factors?
The third item would be international sporting events. You talked a lot about business conventions, and that was a good discussion, but on sporting events, how are we doing in attracting sporting events? And are some events better than others?
Edmonton recently held the World Masters Games, which they said raised more money per capita than any international sporting event, because it was seniors who came and spent a lot of money in the community. Do we target certain events over others in the sense that they are better for tourism?
The fourth item was travel within Canada. Are there certain initiatives we should look at to encourage more travel within the country?
The last question is a problematic question. I'm not trying to be a devil's advocate, but we're getting two big, broad messages. One is that we have a massive travel deficit that's a real challenge, and we have to address it. I accept that point. But on the other hand, we have a real labour challenge filling positions to serve the number of travellers we have right now. So if we address the travel deficit issue, are we not exacerbating the labour side? It's a serious policy question. I don't know if you want to tackle that one, as well.
Those are the issues and questions I have, and you can address as many as you want. I only have about two and half minutes left, so perhaps each of you could—
December 4th, 2007 / 10:40 a.m.
President, Hotel Association of Canada
Could I address your last point first?
President, Hotel Association of Canada
It's a very simple thing. If you don't get the people, we don't have the need for the hotels. If you don't have the people in the hotels to serve the greater influx of people coming into Canada.... The two are not mutually exclusive, but in truth, they are. What we need to do is minimize the access problems and expedite the labour issue, because if we have one without the other, we don't have an industry.
I have one other point, and then, Randy, maybe you can answer. How do you promote Canada, a country that's five and a half time zones wide and is really 12 or 13 little countries artificially joined together, to put it bluntly, when we have issues in various parts of the country?
One of the best things I've ever seen anywhere is that you promote gateways. Call it “Welcome to Canada”. If we promote the gateways, then the people in Mr. Brison's riding who are close to yours in Halifax are going to jump up and down and say, “What about Halifax?”, or “What about Winnipeg?”, or “What about up in the Muskokas?”, or whatever.
If you think back to when we were all 20 or 30 years younger—I'm speaking for myself now—what did you think about Britain? Well, you knew that in Britain there was a place called London. When you went there, you went to Westminster and St. Paul's. Then you got there, and you found out that it was really expensive, and you decided to go up to Stratford, or you travelled around.
You have to get the people into the country first, and the method for doing that most effectively is through gateways. That's the solution. But the problem is we're dealing with 10 or 11 provincial governments that all want to promote themselves. The people of Ontario are not going to want to promote Vancouver—let's be honest here—and it's exacerbated by that. The gateways are always great ways to get people into the country.