Industry Committee on Nov. 16th, 2011

[Diane Brisebois]

I think it's terrible. I don't think there's much that needs to be said, especially in an environment where the merchant has no choice. The problem here is that the customer sees the advertising: if you use this product you'll get five points instead of one, or you'll get points, but if you use this other product you won't. You create the demand at the consumer level, because it's not costing them more, and you're making the middle guy pay.

You have products residing on the same card, and the mechanism they say you have to put on your cash or on your counter to accept that card is controlled by someone else. So you cannot ensure that the transaction is going through the cheapest route--

[Glenn Thibeault, NDP, Sudbury, ON]

So would we have some concerns?

[The Chair, Conservative, David Sweet]

That's it, Mr. Thibeault. I apologize. Time is always our enemy here.

Mr. Lake is next, for five minutes.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Thank you, Mr. Chair, and I again thank the witnesses for coming and being patient.

Diane, thanks for coming here twice now.

[Diane Brisebois]

It's always a pleasure.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

I still don't think you got your full two hours.

[Diane Brisebois]

I know. I'm trying really hard though.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Mr. Roche, I'll start with you. In budget 2011 we announced the provision of $80 million in new funding over three years for IRAP to help the small and medium-sized businesses accelerate the adoption of technology through collaborative projects with colleges. I just want your thoughts on that. How important is that right now?

[Jim Roche]

I think it's an excellent program. I'm a very strong supporter of IRAP. My background is in high-tech entrepreneurship, and I have benefited from the programs that IRAP offers. I see many of my colleagues in other companies benefit from those programs. It's a very strong and effective program in Canada.

The additional $80-million program you talked about will help Canadian small and medium-sized enterprises learn how to adopt technologies. It addresses the problem we were discussing earlier. I was hoping to have a chance to talk about it, so thank you for giving me the opportunity.

I think Minister Paradis made an announcement--

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

On Monday.

[Jim Roche]

--on Monday about this program. So we don't have any evidence yet on whether the program will be as effective as the core IRAP program, but I think the delivery mechanism is an effective one, and the way the program is structured is well thought out.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

What's the challenge? Why has Canada lagged in adopting that over a long period of time?

[Jim Roche]

That's a very big question. The Council of Canadian Academies tried to address that question and looked at the various components that would have contributed to this gap. One of their conclusions was that it has to do with the culture of our business. Canadian companies are less aggressive. They tend to be less willing to take risk compared to their American counterparts. I think that is true. Interestingly, although our adoption of ICT is much less than that of our U.S. counterparts, our companies are as profitable as our U.S. counterparts.

So we haven't yet seen the economic impact of not adopting ICT in our Canadian companies. I expect that with time we will see an economic impact, and that will have the biggest impetus in getting small and medium-sized companies in particular to learn how to use these technologies to their benefit.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Diane, do you want to weigh in on that? You represent some of those businesses.

[Diane Brisebois]

It's an excellent question. I think I would have to agree with Jim. We found that with more international players in the marketplace, Canadian companies in retail started thinking more seriously about investing in technology. I use the term “technology” generally here, but even specifically in e-commerce, they were not as aggressive.

This was a very contained market. There was competition but not over-competition. The world has changed substantially in this country in the last ten years, for good and for bad...but for good. It's because Canadian companies are now realizing that if they do not have a very strong e-commerce presence they will not survive in the retail market locally or internationally.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Mr. Campbell--just a complete change of direction here--your being here today highlights a combination of two real challenges we face: the need for increased financial literacy, and the need for increased digital literacy. You kind of represent the merging of them in the conversation today.

What is the CBA or banks doing to address those challenges? I think they will become more pronounced over time, and we've already had some indication in our conversation today of that.

[Terry Campbell]

That's really the right question. Financial literacy and digital literacy go across the whole spectrum here, and they're absolutely critical. We're very active. We think what Minister Flaherty is doing on financial literacy is great. We are strongly supportive of that. But that's only part of it. It's not in the schools yet and it needs to be there. We have our own non-partisan, non-commercial programs that we try to put into schools on the financial literacy side.

But on digital literacy, I think there is a role all players--the banking industry, this committee, the government--need to play to foster awareness in the Canadian population about the importance of security. It's very often through the customer's computer system that the bad guys get in. With greater awareness comes greater comfort and greater confidence in being able to use the systems, and that will go a long way.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Campbell. I'm sorry, but that's all the time we have.

I want to thank the witnesses very much. I want to particularly commend Mr. Campbell and Madame Brisebois on the great spirit that you showed us, of being of different minds and yet having such a great level of diplomacy between the two of you.

Thank you very much.

[Terry Campbell]

I appreciate that.

[The Chair, Conservative, David Sweet]

The committee is adjourned.