Industry Committee on May 2nd, 2013

[Maxime Bernier, Conservative, Beauce, QC]

For the FTQ fund, for example, we are talking about $8.8 billion, but only 15% of that amount is invested in small start-ups in Quebec.

We in the government believe that this fund is currently very well capitalized and that the cost to all Canadian taxpayers must also be taken into account. Here we are talking about a revenue loss of more than $200 million a year for the Government of Canada. The fund still has the means to carry out its mission, that is to say to invest. I hope it invests more than 15% in small start-ups in Quebec. As my colleague the Minister of Industry said, other venture capital vehicles can promote start-ups.

[The Chair, Conservative, David Sweet]

Thank you.

Thank you, Mr. Lapointe.

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

As you know, these venture capital vehicles are not established in the regions with the SMEs, or at least far fewer of them are.

[Maxime Bernier, Conservative, Beauce, QC]

Your region is a kingdom of the SME, and I congratulate you on that. That is also the case of the Beauce region. However, why have entrepreneurs managed—

[The Chair, Conservative, David Sweet]

Our time has run out on that, Minister.

[Maxime Bernier, Conservative, Beauce, QC]

All right.

I simply wanted to explain to him that the free market enables entrepreneurs to make do and find capital when they need it.

[The Chair, Conservative, David Sweet]

We have two minutes for Mr. Braid.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you, Mr. Chair.

I want to continue on the theme of tourism and ask Minister Bernier a question.

It's exciting to see the profile of Canada increase as an international tourist destination. I think it makes eminent sense that you're focusing on both China and India as sources of tourists to Canada. I'd like to hear more about that strategy, and unlike my colleague across the way, I won't rudely interrupt your answer.

[Maxime Bernier, Conservative, Beauce, QC]

Thank you very much.

I'm going to use that question to also answer what our colleagues from the NDP asked about the expenses at the CTC. As you know, the Government of Canada invested a lot in tourism not only through the CTC but also with other agencies and departments. If you look at the global budget of the government, $939 million was spent on projects and program activities that benefited the tourism sector in 2010 and 2011. This is money that is being spent by other departments and that will have a positive impact on the tourism industry.

We have to look at the budget of the CTC, but we also we have to look at the global budget of the government. I'm very proud of the work they are doing at the CTC. Yes, they had to manage a 9.8% cut of their budget, but that's a cut that they can manage pretty well. They are very competent. Now they will focus their energy and their money on markets where there is a lot of growth, like India and China. As well, we won't forget the U.S. and other markets that we know. The way to do that is by focusing marketing activities on what is nice to see in our country. I can tell you that there are a lot of participants around the CTC, and they are promoting all the great things that visitors can visit here in Canada—the Stampede, Old Quebec, the Rocky Mountains, and all that. They're doing this under the CTC umbrella, the Canadian Tourism Commission.

I was very proud to be in India and to speak with entrepreneurs from the tourism industry. They were very happy for the support that they received from the CTC, and they were also excited about the potential in India for new visitors. If you want details on the markets that the CTC will focus on, the key market is China. We've seen the biggest increase in arrivals from China. In 2010, 2011, and 2012, the number of arrivals from China increased by 20%. So what they're doing at the CTC is working. In 2012, China overtook Australia in Canada's five top inbound markets. Nearly 300,000 visitors from China came to Canada in 2012. The same thing also occurred for India and other markets like that. It's because of the work of the CTC and of the industry as well.

[The Chair, Conservative, David Sweet]

Minister Bernier.

[Maxime Bernier, Conservative, Beauce, QC]

We have an efficient and very good organization in Vancouver promoting our country.

[The Chair, Conservative, David Sweet]

I'm sorry, I'm interrupting you for your schedule. I understand that your commitment is done. I wanted to say thank you very much for your time here before the committee.

We'll suspend for a moment while the ministers go and then we'll have time with the officials. Those who can stay, please stay. I understand that some people have commitments to travel.

[The Chair, Conservative, David Sweet]

We'll begin with the NDP. We have a gentlemen's agreement that now we'll just be questioning witnesses and taking evidence.

I want to let you know that the last bus will be delayed until 6:10, so if we go right until six o'clock they'll wait for you to pack things up and get on the bus.

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

Mr. Chair, I have a point of order.

Just to make sure that we're clear, should we actually move a motion regarding rules or anything like that?

[The Chair, Conservative, David Sweet]

I—

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

I just want to make sure that—

[The Chair, Conservative, David Sweet]

I think it's on the record.

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

So people can feel comfortable with the consent that this was the case.

[The Chair, Conservative, David Sweet]

I saw consent on that, so you don't have to worry.

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

Okay, good.

[The Chair, Conservative, David Sweet]

Okay, thank you.

Now we'll move to Madam LeBlanc.

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

Thank you very much, Mr. Chair.

I would like to thank our guests for staying a little longer and taking the time to answer our questions.

My question is for Mr. Knubley. In fact, I would like to ask him the same question that was put to the minister.

Division 6 of Bill C-60 makes quite significant amendments to the Investment Canada Act.

Fewer and fewer transactions will be covered by the Investment Canada Act. Has Industry Canada studied the impact that this might have on the Canadian economy? Does it intend to conduct studies on the subject and to examine those consequences in greater detail?

There was a kind of uproar over the CNOOC-Nexen transaction. The issue was whether it was a good thing for Canada. At the Prime Minister's press conference, we suddenly saw that the rules would be changed. We seem to be operating on a somewhat piecemeal basis.

Does the government really intend to determine the consequences of the fact that fewer transactions would be examined under the Investment Canada Act?

[John Knubley, Deputy Minister, Department of Industry]

As the minister mentioned, that subject was addressed in a series of reports. First there was the study by Red Wilson approximately three years ago. Then that of Tom Jenkins also addressed the subject and examined it.

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

Yes, thank you very much, Mr. Knubley.

I read those reports. The fact remains that, in this instance, the act cannot in any case be subject to the parliamentary process or to in-depth review by a committee. Those provisions have been added, but they are not subject to debate in the House of Commons. The government relies on reports prepared by outside experts, but that does not require approval by the Canadian population.

Ultimately, I see that no one has really examined the consequences that these significant changes could have on Canada's economy, particularly on its industry.

[John Knubley]

Maybe one thing I will say is that I worked in strategic investment analysis at Industry Canada 20 years ago, before I came to become deputy minister. Really, these issues have been discussed for many years and there have been many reports on these issues.

One thing I was very impressed with as a deputy minister who joined the department in September and worked through these issues in the fall is how, since 2009, there's really been a series of changes to the act that have built towards the announcement that occurred in December.

There was the national security review changes that were introduced. There were changes related to the Red Wilson report in terms of the thresholds. There was the introduction of the new guidelines.