Industry Committee on May 2nd, 2013

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

But what are the consequences for the firms that are in Canada and are slowly disappearing, the home-grown Canadian firms? Are there consequences to that, the fact that we are loosening and raising the threshold for the thing? That's what my question is about, and the vulnerability of our Canadian economy and the loss of good-paying jobs. That's the concern I raise when I see that threshold being raised.

Again, I want to mention that we are for foreign investment, but we're not sure this act is really protecting Canadian jobs here.

[John Knubley]

I think there's always a question in this domain of balancing the desire to demonstrate openness of the economy to others and to encourage investment. If you look at the needs of the country in terms of investment, they're very large, whether it's in Nova Scotia, Alberta, or wherever. On the other hand, there are the issues of ensuring we have a strong, robust Canadian-based series of companies.

I think the bottom line is that we have a net benefit test that has six criteria, and those six criteria, which have been in place for some time, are really designed to look at these issues that you're raising.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Thank you.

[The Chair, Conservative, David Sweet]

Thank you, Madam LeBlanc.

Mr. Carmichael, you have five minutes.

[John Carmichael, Conservative, Don Valley West, ON]

Thank you, Chair.

Minister Paradis spoke about the VC fund and the angel fund. As a business person, I applaud the effort. I'm very hopeful it's successful. He also mentioned that Canada's open for business. Clearly that is an initiative that we all agree with.

Related to taxes, under Minister Bernier, taxes went from 12% to 11% on SMEs, with a tax credit for hiring—two wonderful provisions. Then he spoke about the Red Tape Reduction Commission, and talked about some 200 irritants that were removed in 18 ministries. Is that number correct? I think that's right.

Then he talked about the one-for-one rule, which I find particularly encouraging. On that one-for-one rule, is there a way of auditing or measuring that so that you know, having been through that process, that its intent will be maintained?

[John Knubley]

My understanding is that each department has basically been tasked with organizing themselves in terms of applying the one-for-one rule. I think most departments, including Industry Canada, have set up new units to deal with the issues around the red tape exercise.

Related to that, Treasury Board, who is the lead on the red tape exercise, has an evaluation approach annually, I believe, with each department assessing how we're doing in terms of implementing the red tape initiative. I think we report annually in terms of a scorecard.

[John Carmichael, Conservative, Don Valley West, ON]

Oh, good. There is a scorecard for it.

[John Knubley]

Yes.

[John Carmichael, Conservative, Don Valley West, ON]

Excellent. That's encouraging.

I wonder if we could just talk about a couple of youth initiatives. Both ministers spoke to youth issues. Minister Paradis talked about youth enterprises, $180 million over four years.

I wrote it down, but I'm not sure if I got the right number there. Is that accurate?

[John Knubley]

I think it's $18 million over—

[John Carmichael, Conservative, Don Valley West, ON]

It's $18 million, then, and not $180 million; clearly I didn't get the right number.

[John Knubley]

That's for the Canadian Youth Business Foundation.

I understand there's an expectation that there would be match funding from the private sector, and John Risley—

[John Carmichael, Conservative, Don Valley West, ON]

Sorry, is that the Canadian youth foundation?

[John Knubley]

It's the Canadian Youth Business Foundation.

[John Carmichael, Conservative, Don Valley West, ON]

Sir, I had two groups written down. There was the Canadian Youth Business Foundation, which Minister Bernier spoke of. I also wrote down “youth enterprises”, which Minister Paradis spoke about.

Are they separate initiatives?

[John Knubley]

I'm not sure what.... I think he must have meant the same, I would guess. We could check with him on that.

[John Carmichael, Conservative, Don Valley West, ON]

All right.

Does anybody have any understanding of how the programs work? Let's talk specifically about the Canadian Youth Business Foundation. Some 5,000 new businesses are being incented to develop under that program, is that right?

[John Knubley]

The Canadian Youth Business Foundation is a not-for-profit organization. I believe John Risley is the chair of the board that advises it. It's been in place since 1996. It basically provides loans and mentoring to entrepreneurs between the ages of 18 and 39.

[John Carmichael, Conservative, Don Valley West, ON]

Excellent.

That's all I have at this point, Chair.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Carmichael.

Monsieur Lapointe, you have five minutes.

[François Lapointe, NDP, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Thank you, Mr. Chair.

Let us talk about SMEs and the Canada Job Grant.

Jordan Gould, who is a consultant at Richter LLP and has adopted a position similar to that of the Canadian Manufacturers and Exporters Association, is not very enthusiastic on the subject. He says that most small business owners find it difficult to access job grants. This grant would better suit large businesses that have the resources to manage the process.

Since the Canada Job Grant is disputed by both the provinces and SME associations, how does the Minister of State (Small Business and Tourism), intend to change this reform so that it can one day help both SMEs and big business?

[John Knubley]

Well, I think what I would want to reinforce is that specifically the action plan of 2013 has taken a number of steps to help small business.

[François Lapointe, NDP, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Do you agree that this reform is less well suited to SMEs than to big business? The regional chambers of commerce and consultants as a whole say it is better suited to big business. If the Canada Job Grant were implemented, despite the challenge by the provinces, small business would receive much less assistance. This is poorly suited to SMEs. Can we agree that there is a problem here?

[John Knubley]

I do not believe so.

I think that on this particular question, though, we'd want to come back to you. I'm not entirely clear on what the issue is.

[François Lapointe, NDP, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

All right.

We talked about reducing red tape. However, I have looked, but the only actual policy I have found for the moment is the policy of having to cancel one form before being entitled to create another.

Unless basic arithmetic no longer works, one minus one still equals zero. How can we say there is a reduction? For the moment, this policy boils down to roughly one minus one, whereas there are I don't know how many hundreds of irritants. Based on all the consultations I have conducted with the chambers of commerce, people say they have not noticed any reduction in federal government red tape in the past two years, absolutely none. It has stagnated. One minus one equals zero. Can we stop talking about reducing it if we are at zero?