Industry Committee on April 14th, 2016

[Alex Nuttall, Conservative, Barrie—Springwater—Oro-Medonte, ON]

Mr. Chair, thank you.

I will go with your ruling and consider it notice three times. I would also like to go on the record and say that it's another example of this being blocked from a study taking place, and hopefully the minister will encourage his colleagues to conduct the business that the electors, the citizens of Canada, have asked us to conduct and also to ensure that all dollars in a potentially $1.3-billion bailout are allocated effectively.

Mr. Bains, if I could continue on a separate line of questioning, on February 1 of this year you said that you have a plan. On February 3 you said you have a plan, and again on February 18, 23, and 25. Every time you said you have a plan to grow the economy, sometimes in regard directly to manufacturing and other times in regard to economic development as a whole. On March 7 and 8 you also said you had a plan, but in the budget it says through 2016-17 the government will define a bold new plan. On March 22 your budget document basically said your plan is to make a plan.

It seems like the plan you were talking about before the budget was a plan to make a plan to make a plan.

If I may, minister, what is your plan specifically, not talking points, and not answers from the House of Commons. What is your plan? Please tell me it's more than a plan to make a plan.

[The Chair, Liberal, Dan Ruimy]

We're well beyond the time, but I will give you a few seconds if you'd like to answer directly.

[Navdeep Bains, Liberal, Mississauga—Malton, ON]

Sure. I have two observations, if I may share. One is with respect to the motion regarding Bombardier. I want to make it clear that the committee is independent, and they control their own destiny. I think it is important that you guys work among yourselves to determine the path forward.

I know the committee is focusing on manufacturing and that covers many sectors. I suspect it will cover the aerospace sector as well. I look forward to the opportunity to get feedback on that matter.

With respect to the initiatives that we put forward in our budget, we've been very clear that we're making sound investments in different sectors to grow the economy and to focus on manufacturing. One area that we definitely highlighted, Mr. Chair, and I'll be very brief because I know we're tight for time, is the automotive sector.

We enhanced and expanded the automotive innovation fund for the next three years. This is a $500-million commitment. We've also changed the profile to make sure the funds are more accessible to allow for greater investment, which is good for the economy and which is good for job creation. This was well received by many in the manufacturing sector and the automotive sector. This is a clear illustration of us taking action.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

Now we will go to Mr. Masse, and you have seven minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair, and thank you for appearing before committee, ministers. It is a precedent and that's good; industry seems to set those precedents.

I will continue with the automotive. I understand there has been the continuation of funding and the plan has changed a little. My concern is that the fund still is greatly insufficient compared to other countries. In Canada, including with trade agreements, we've gone from number two in auto manufacturing in the world to number 10 over successive governments.

Where we're at now is what's really important. My concern is the lack of competitiveness that we have with our trade agreements related to other countries, when you look at what's happening in Mexico and also in the southern U.S. But I guess I'll finish with this so we don't get into arguments over numbers, because that's not helpful at this moment: what we have is what we have.

There's a commitment to continue to rehabilitate and get CAPC going, the Canadian Automotive Partnership Council. In earlier days when I had less grey hair, Minister Rock, at that time, included not only the CAPC, those that are applying for direct funding, but also the unions, the parts suppliers, the innovators, the third-party repair industry, and a series of others. We created at that time a red light being not good; a caution light meaning we needed to work on those; and a green light being things that were working. One of them at the time was the caution light for transportation being the Windsor-Detroit bridge, which was necessary and is now being built.

I'll conclude with this to let you answer. Do you have a commitment to reinstate that and provide that, especially given that we have comprehensive funds? They're not sufficient in my opinion but they might be for others. We still have to have the discourse and also a business plan moving forward as opposed to what we've been doing now, which is a Hail Mary pass at the last minute to see if we can get something done.

[Navdeep Bains, Liberal, Mississauga—Malton, ON]

Thank you very much.

Chair, through you, I want to take this opportunity to acknowledge Brian's advocacy and hard work when it comes to the Windsor region. I very much understand your concerns around the corridor between Windsor and Detroit.

But specifically around CAPC, if I may, I've had an opportunity to meet with members of CAPC. This was during my visit to the Detroit auto show where I met with global executives and OEM heads to speak to them directly about investment opportunities. I think the key part is this. How do we brand Canada? How do we create opportunities? How do we demonstrate that we're serious about investment in the automotive sector? And we are.

I think the point I made earlier is very relevant, because not only do we extend the automotive innovation fund by an additional three years. The profile change sends a clear signal that we were very serious about making sure that we wanted to be part of the production cycle for these OEMs going forward. Not only the OEMs, Minister Chagger and I had the opportunity in Kitchener a few days ago to make that investment in the automotive supplier innovation fund, and there were multiple companies from Windsor that received funding.

Again, the idea is to say, five years from now where is the industry going to be and where do we want to be? Because when I went to Detroit, it wasn't necessarily horsepower. It wasn't necessarily about how big the vehicle was. It was about software and it was about technology and it was the autonomous vehicle.

Rapid change is taking place in the industry, and we want to make sure that we're at the head of that game. We want to make sure of Canada's position as an innovation hub, so we're working very closely with the OEMs to say we're serious about it. One example is GM. I met with Mary Barra, the chair of GM, and we made it very clear that this is an area we have leadership in and we want to make investments in.

It's very important, because it's not simply about the OEMs, but it's the supplier base. If you look at the footprint in Canada, we have 700 suppliers that feed into the OEM. Then above and beyond that, we've created unique partnerships with universities and colleges, 40 of them, that do research directly with the sector.

We have this comparative and competitive advantage and it's focused around innovation. This is a priority for us and that's why the automotive innovation fund and the automotive supplier innovation fund are two really good tools that we're going to utilize. We're not simply announcing them. We want to make sure those funds are available for industry.

[Brian Masse, NDP, Windsor West, ON]

I appreciate that, and I just hope that CAPC becomes a working group activist spot like we used to have. We hope you consider that.

I would like to move on to one of the programs. Your co-minister responded to a question I had in the House of Commons related to Auto21. It's being sunsetted after 15 years. We had testimony before committee just this week about the success of the program. Auto21 has done everything from improving baby seats to working with the police in Winnipeg, and it has lowered stolen vehicles by 90%. It is being sunsetted merely because of the 15-year duration of that research chair position. I'm just wondering if there's an opportunity to at least review it, because there's over $1 billion of value-added work that they've done through patents and other types of work exiting the program. It has been the centre for many other centres. It has received around $80 million in funding federally and it has also had $70 million in investment from the private sector. I don't know of another 1:1 ratio like that.

I'll look forward to any comments, but also to seeing whether there could at least be a second glance at that, because an arbitrary date is closing such a good operation.

[Navdeep Bains, Liberal, Mississauga—Malton, ON]

Thank you very much, Brian, for raising that, I think your passion about Windsor and the auto sector is clearly evident. That's an initiative that we'll definitely take a look at.

If I may, I would also like to present different opportunities that are available to that region. One is the $2-billion announcement that we made to build the infrastructure and capacity for post-secondary institutions. That's a significant investment. That's $2 billion with the May 9 cut-off that Minister Duncan and I have talked about. That was in the budget. That's one area of opportunity.

The other is the $800-million investment that we were talking about for creating clusters and innovation hubs, and focusing on accelerators. The whole idea with these incubators is to create models where we can bring the research and industry community together. I think Windsor can play a leadership role in that area, and this is an area where we're more than willing to work with you and the institution there. Of course, the granting councils always exist as well. We've increased the funding there by $95 million.

Not only can we examine current program funding, but we've provided additional opportunities for that region and for the university to enable it to play a more meaningful role in looking at areas where they can really help advance the automotive agenda.

[Brian Masse, NDP, Windsor West, ON]

Do I have any more time, Mr. Chair?

[The Chair, Liberal, Dan Ruimy]

Actually, no.

[Brian Masse, NDP, Windsor West, ON]

Okay.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

Now we will move to Mr. Baylis. You have seven minutes.

[Frank Baylis, Liberal, Pierrefonds—Dollard, QC]

Thank you.

My first question will be directed to Minister Chagger. First, I'd like to have an idea of how we define “small business”. Then, could you elaborate on the steps that this budget specifically is taking to help small businesses? Could you look at areas of innovation and technology? I'd like to have an understanding of how the government sees small business and what concrete actions are in the budget to help move forward their opportunities for innovation.

[Bardish Chagger, Liberal, Waterloo, ON]

Thank you for the question. It's an excellent question.

I can start off by saying that small business is implicit throughout the entire budget. I've made the statement time and again that it's important that we recognize that middle-class Canadians are small business owners and are the people who work for them.

The commitment and investments we are making within the nation actually all help small businesses. We say they are the backbone of the economy, and this goes to prove that point. No matter who it is, everyone either knows a small business owner or knows someone who is related to a small business owner. We all have that in common.

As for what defines a small business, a small business is defined as having fewer than 100 paid employees. Medium-sized would be the next step up, having fewer than 500 paid employees.

My mandate clearly states that it's important that we help these small businesses grow through innovation and trade. We need them to be more productive. We need it to be easier for them to grow and be successful. I've said on several occasions that the success of small business is the success of the nation, and I wholeheartedly believe that.

Within the budget, there are many different places I can point to. I will start off, and Minister Bains may choose to step in as well.

The innovation agenda actually will be driving our economy forward. A healthy economy is good for small business.

If I can touch on the middle-class tax cut, the middle-class tax cut puts more money into the pockets of Canadians. One thing I hear time and again is that small businesses want to sell their products and services. How do we help make that happen? We help make it happen by allowing consumers to be strengthened. One way to do that is by allowing them to have more dollars in their pockets.

The Canada child benefit helps those same families who end up buying from local businesses. Anywhere I've had the opportunity to travel across this nation, I try to stay at a small business and I try to shop at a small business, because I know this not only helps them and their families but helps their community. It helps them create jobs within those communities. That is what will strengthen our nation.

If I can continue, not only will the historic infrastructure investment grow our nation but it will also support small businesses, because it allows us to get to work. A few weeks ago, I was in a riding and visited a market. At that market the number one complaint was that their trucks get stuck on the highway. Fresh produce can't get to their stores, they can't sell those goods, and they therefore sometimes lose the products or are not able to provide that service.

The $500 million for broadband in rural and remote areas is a big deal. I do not believe you should not be able to do business because of where you live. We need our small and medium-sized businesses to be successful. We need all communities to be able to consider international markets. That commitment to broadband, in rural and remote areas especially, will be quite beneficial.

The industrial research assistance program has received very good news: the $50 million in the IRAP program. It is an additional commitment, which allows us to invest into more businesses that need that support.

The $4 million for Canadian technology accelerator initiatives will take us forward. It speaks to that innovation and commitment that we're making long term. We are not only trying to grow the economy for today but are trying to create jobs for tomorrow. That's part of it as well.

The list could go on, and I'm sure you probably have other questions, but if you'd like me to go on, I can.

[Some hon. members]

Oh, oh!

[Frank Baylis, Liberal, Pierrefonds—Dollard, QC]

No, that's great. There's a lot there and I'm very grateful.

Do I have time to squeeze another question in here?

[The Chair, Liberal, Dan Ruimy]

You have two and a half minutes.

[Frank Baylis, Liberal, Pierrefonds—Dollard, QC]

I have a question for Minister Duncan.

I know you've already been quite busy travelling up and down Canada, meeting with a lot of our universities, research centres, and all that.

I'd like to know whether you see particular areas of opportunity for Canada wherein we could excel.

[Kirsty Duncan, Liberal, Etobicoke North, ON]

I'd like to thank MP Baylis for the question. I think one of the greatest joys of this job is seeing the tremendous work that's being done in our institutions across the country. I'll highlight a few areas.

You have TRIUMF out at UBC. It had just celebrated its 40th anniversary when I was there. It was good to see the international co-operation; every person we met in that lab came from a different area.

The Perimeter Institute received $50 million in this budget. It's one of the three most...theoretical physics institutes in the world.

We're also making major investments in clean tech and sustainable technology. Two new Canada excellence research chairs were announced in budget 2016, for clean tech and sustainable development.

But we have so many areas where our scientists excel. There's a $237-million investment in genomics; $32 million to the Canadian Centre for Drug Research and Development; $20 million to Brain Canada; and then $14 million to Mitacs. Mitacs is important because it's where academia and industry come together, those partnerships that are so important. We need that discovery research, but we have to have that continuum from the fundamental research. It is a continuum all the way to the commercialization of ideas so we can sell our products and we create jobs. It's not an either-or. It's a continuum, and we need those strong links.

[Frank Baylis, Liberal, Pierrefonds—Dollard, QC]

Does Mitacs help do that?

[Kirsty Duncan, Liberal, Etobicoke North, ON]

Mitacs is a wonderful program. It has three programs. There's accelerate, elevate, and globalink. In budget 2016, Mitacs received $14 million so that we could bring the best and brightest to Canada, but also to allow our students to have that international experience.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

We will now move to Ms. Gallant.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Thank you, Mr. Chairman.

My question goes to the industry minister. I see that we no longer have a FedNor minister. We don't have separate ministers for the different development agencies. Were there no members of Parliament in your caucus from northern Ontario who could best, one on one, deal with the economic development issues in that region?

[Navdeep Bains, Liberal, Mississauga—Malton, ON]

Thank you very much for that question. I do appreciate the tone because I understand your concern.

One of the things I want to take this opportunity to highlight, and I mentioned in my opening remarks, is that this government is doing things differently. We really believe that we have a unique opportunity to bring all the regional development agencies together to really leverage them in a way that can bring about meaningful change when it comes to economic development.

As I mentioned, all the economic development agencies now have a collective portfolio of a billion dollars. We're focusing on innovation, clean tech, and scale-up, all key priorities to growing the economy. The idea is to share best practices, to leverage good will, to be able to design programs that also at a national level drive the agenda but meet the local needs.

I'm very happy to say that, when it comes to FedNor and the program we have there, we've been making meaningful investments in that region in aboriginal people, in the forestry sector, and in the mining sector. These investments are leveraging good return on investment with the private sector, with academia, and with local communities. It's really great to be able to collaborate together and to be able to leverage those government initiatives and government funds to be able to get a good return on investment, and it's creating good jobs. So far, the response has been very positive.

As I said earlier on, I have an open-door policy, so it doesn't matter where you live in the country, you can come and speak to me, my team, and my colleagues. My parliamentary secretary does a tremendous job as well in making sure we do a lot of outreach proactively. We have a tremendous team from northern Ontario who are punching above their weight, providing good input and good feedback, and making key investments for us. I'm proud to be part of that team.

I must say that economic development now has become more prominent with a portfolio that's better leveraged with innovation and science as well. I think that sends a clear signal that we have a more coordinated and collaborative approach when it comes to growing the economy and creating jobs.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Well, knowing the players on the ground and allowing the FedNor minister to have the sole control over the decisions made in that portfolio has traditionally been the best way to ensure the dollars were spent in the best way possible.

The budget talks about green infrastructure and social infrastructure. In terms of the FedNor program spending, can you tell me the types of projects that will be funded through that type of infrastructure nomenclature?