Industry Committee on March 4th, 2022

[Mary Ng, Liberal, Markham—Thornhill, ON]

This program went through an RFP process independently assessed by the non-partisan civil service.

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Minister, are you aware if Magnet had received other contracts?

[The Chair, Liberal, Joël Lightbound]

Thank you.

MP Gray, I'm sorry to interrupt, but that's all the time you had.

We'll go to MP Dong for six minutes.

[Han Dong, Liberal, Don Valley North, ON]

Thank you very much, Chair.

It's really good to see the ministers. I don't see them a lot now, but I hope to see them more as Parliament normalizes.

My first question is for Minister Champagne.

About 30 years ago, the Clinton-Gore administration in the United States consulted with I think it was over 500 industry elites for a lengthy period of time, then came out and made a very deliberate decision to move resources from military research to civilian technology research. This set the tone, or the base, for IT research in particularly life sciences, as you know. That is so important. Looking back to 30 years ago, that was a very innovative and brave investment direction made by the government.

North of the border, the Canadian economy has often been characterized as risk averse. Many analysts believe we should take some risks and at least seek some high-risk, high-reward investments.

Your mandate letter, as well as the 2021 Liberal Party platform, reference a Canada advanced research projects agency to help in the development of such an ecosystem. Can you expand on what that means for Canadians and the Canadian research and innovation industry?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

I'm also very happy to see you. To be able to see colleagues in person is a great thing.

What I see are great opportunities to frame a new innovation and research ecosystem in Canada. You said it; DARPA in the United States, which you were referring to, is at the origin of the Internet and GPS. What we've been trying to think about in Canada is what in the ecosystem we can have as an organization that would support a moon shot type of approach to research.

If you look at the world today, we're faced with two existential challenges. One is COVID-19, and I think we've done great things to protect the health and safety of people. The other one is climate change. For me, we're going to create an agency or structure that would allow us to tackle some of these moon shot challenges of our generation. I think of climate change as one. Canada will be following in the footsteps of what we've seen there, but making it in a Canadian way, and one that will be integrated in the research and innovation ecosystem making sure we can support the work that's being done. I'll be creating a committee of advisers to make sure we do that in the best possible way.

I think it's an exciting moment, and I see a number of members of the committee nodding their heads. It's pretty exciting because this is at the forefront of the research and it's really thinking not about what's happening today, but how you position the country 20 to 30 years from now, taking immediate action with a long-term vision and really being at the forefront of the innovation and technology of the future. One that comes to mind is climate change.

[Han Dong, Liberal, Don Valley North, ON]

I definitely think it's the right decision.

In my previous life as an MPP, the Ontario government invested in something called the Vector Institute, to launch research into AI and put us at the forefront of that technology.

Speaking of AI, quantum computing is fundamental for us to reach true AI. Last month, I presented a motion, which was supported by all colleagues of this committee, to do a study on quantum computing.

Can you speak a bit about the opportunity you see in that frontier of new technology and why it is so important for the Canadian economy and future employment opportunities?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

First of all, I welcome the work of the committee. I value the opinion of our colleagues. A lot of good things have come out of this committee in many ways.

Quantum is going to be changing the future, and I'm very excited. If you look at the building blocks of the future, you see AI, quantum and cybersecurity as the foundational blocks of future prosperity for the economy of the 21st century. I think we have done great things in AI.

I can tell you that in my first visit to Washington, my counterpart noted, as the first comment she made, that Canada had a head start when it came to AI. I said, “Madam Secretary, I intend to do the same on quantum.” That's why we have a pan-Canadian quantum strategy.

I'll give you a very specific example of why it's helping the competitive advantage of Canada. There's a company called Xanadu, in Toronto. I invite members of the committee, if you do site visits on quantum, to visit them. It's a very Canadian story. It's a start-up, which now has the only quantum computer in the world—there aren't two; there's one in the world—that is focusing on battery chemicals and the recipe you need for the battery of the future. This is happening in Canada.

Every time I talk to someone in the battery ecosystem, I say, “You go visit Xanadu. Xanadu is at the forefront of the research in the world on the battery and the recipe you need.” Some of them have told me, “Minister, what you've told us will probably save us two years of R and D.”

This is a Canadian icon on quantum. I'm taking a very practical example, because of the people watching at home. When we talk about quantum, it's exciting.

The chair is asking me to leave it there.

[The Chair, Liberal, Joël Lightbound]

Thank you, Minister.

This is certainly a very interesting subject, and with a little luck there will be other opportunities to talk about it.

Thank you, Mr. Dong.

We will now move on to Mr. Lemire.

You have the floor for six minutes, Mr. Lemire.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you, Mr. Chair.

We hope that many people at home will be listening to us.

I am going to start with the Minister of Innovation, Science and Industry.

Regarding the national critical minerals strategy, many observers in the mining community say that they have been impatiently awaiting the strategy. In fact, at the committee, we have brought up the subject through the study on the green economic recovery, during which we heard witnesses who explained why it is so urgent. Since then, we have felt that things were moving along. That is part of your mandate letter.

Guy Saint-Jacques, who came to speak before the committee, said the following in the Journal de Montréal: "What I would criticize would be more the absence of a national strategy to encourage the exploitation of these resources in Canada and make sure that Canada is able to play a key role in this sector."

Can you come forward and give us a date when this strategy will be tabled, and explain the commitments that the government will be making in this regard, Minister?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Thank you for your question, Mr. Lemire.

First, I would like to say hello to Mr. Saint-Jacques, a former ambassador whom I know well, who served Canada for a long time and always has a strong presence.

To answer your question, I am working with my colleague, the Minister of Natural Resources. Clearly, a national critical minerals strategy is important.

You saw the announcement this morning. I think all of Quebec is celebrating today, if I may say so, since you come from the Abitibi-Témiscamingue region of Quebec. We have just seen a big European company, BASF, choose a piece of land in Bécancour, which means that the Centre-du-Québec region is kind of going to be the hub, not just for cathodes, but also for everything they are going to bring in terms of critical minerals and refining. As Canadians and Quebeckers, we know that what we want to do is not just mining—and you come from a mining region—but also refining the ore here at home, to have the entire value chain located in Quebec and in Canada.

I am pleased with the announcement this morning because it shows that Quebec is making a comeback in the great 21st century auto industry. Historically, GM was in Quebec, along with other companies. I think Hyundai was also there at one point.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you, Minister.

And that is consistent with the wish I had expressed earlier to see the mining paradigm change a bit, to see processing being done near the resource, where the people are, particularly in the regions. We must not turn them into simply resource regions, that being a development model that has been adopted too often.

In the most recent Government of Canada budget, the government proposed $9.6 million in funding over three years to create a critical battery minerals centre of excellence.

At the committee, I recommended that the centre be in Abitibi-Témiscamingue, where there already is the Institut de recherche en mines et en environnement of the Université du Québec en Abitibi-Témiscamingue, UQAT, which is also associated with the Polytechnique Montréal. And there is the Centre d'excellence sur les minéraux critiques et stratégiques Élements08 of UQAT, the Cégep de l’Abitibi-Te´miscamingue and the Centre technologique des résidus industriels: the CTRI. In addition, there will be the Rouyn-Noranda mining innovation zone. We have had some good meetings on this with the government of Quebec this week. Obviously, this involves the whole enterprise collaboration culture.

Would you look favourably on the possibility of a centre of excellence like the one I have described being located near the resource, near lithium, in particular, in Abitibi-Témiscamingue?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Mr. Lemire, you are an excellent advocate for your region, and I would expect you to be putting your region forward. I visit it often, and I know there is a lot of talent and expertise there.

Personally, I'm open to everything. We are currently considering various possibilities. People often ask us where we are at, in terms of the ecosystem for electric vehicle batteries in Quebec and in Canada. Today, this is just the beginning, because more good news is going to be announced in this regard.

I come from Mauricie. We talk about restoring value at home, and I think this is a fine example. We are certainly going to be working with the mining companies in your region, Mr. Lemire.

I want to say that you do a remarkable job of representing the people and industries in your region.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

I participated in a meeting in Washington with your colleague Ms. Ng, and I know how important the development of these minerals is. It is part of the solution when it comes to our relations with the United States.

I would now like to talk briefly about the aerospace sector, one that is very important in Quebec. In fact, the Quebec aerospace sector is the third largest in the world. This industry needs a special investment fund and a long-term development strategy. We have to invest in research and development and offer refundable tax credits.

Do you intend to introduce a policy for the aerospace sector?

What is preventing you right now from responding to the industry's needs?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

We have answered the call.

I would like to say hello to Ms. Ng. You are entirely correct about critical minerals. What we have done with the United States, we are also doing with Germany.

I am going to come back to the aerospace sector.

We have answered the call. As Minister of Industry, one of my priorities is bio-manufacturing and the aerospace sector. I would point out that investments have been announced in connection with CAE Canada, Pratt & Whitney, and Bell Helicopter.

The big question that I asked the industries at the time was not whether they wanted 100,000 square feet to be added to their plants, but where the aviation sector would be in 20 or 30 years. That was when we talked about hybrid drive.

I recently spoke with Suzanne Benoît, the CEO of Aéro Montréal. If my memory serves, the premier of Quebec at the time said this was the biggest announcement in the aerospace history of Quebec.

Funds are still available. I would also like to have the benefit of the committee's expertise, because I actually am looking for projects. There is still money available to ensure that that the aerospace industry is at the heart of 21st century aerospace.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

We have heard your request. The committee has already talked about the industry's need for predictability. There will be a report tabled shortly, in fact.

I would like to ask you one last question.

You talked about the Moderna plant in your opening remarks. As we know, traditionally, pharmaceutical industry expertise is in Quebec.

Can we expect that the Moderna plant will be built somewhere other than Quebec? I think it would be scandalous if it were built somewhere other than Montreal or Quebec City.

Can we get any news about this?

[The Chair, Liberal, Joël Lightbound]

I'm going to ask you to give a brief answer, Minister.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

I will be brief.

I speak with the CEO of Moderna regularly to get progress on this subject. They have chosen Canada, and I can say that yes, Quebec is in a good position in the discussions between the company and the various provincial governments.

As I said before, there will soon be good news about this.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Thank you, Minister.

[The Chair, Liberal, Joël Lightbound]

Thank you.

Mr. Masse, the floor is now yours for six minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

Thank you to the ministers for being here.

On December 6, I wrote to Minister Champagne and Minister Ng about electric vehicles in the United States and what's taking place. That was on December 6. On December 14, in Washington, D.C., the Prime Minister was quoted in the Financial Post as saying, “There are a number of solutions we’ve put forward. One of them would be to align our incentives in Canada and in the United States, to make sure that there is no slippage or no unfair advantages on one side or the other. We are happy to do that.”

For the ministers, is it the policy for Canada to align our incentives for EV vehicles, yes or no?

[Mary Ng, Liberal, Markham—Thornhill, ON]

Thank you so much.

It's always nice to see my colleague. It's too bad that we aren't here in person. You and I used to sit on this committee together in person a number of years ago.

The answer to the question is that we continue to find a range of solutions, because that's what we're trying to do here with the United States to make sure that our auto sector is—

[Brian Masse, NDP, Windsor West, ON]

Thank you, but I have to interject.

Is that the policy or not? Is the Prime Minister saying that? I'm sorry to cut you off, but I need to know whether that's our policy or not. That's what I've asked before.

[Mary Ng, Liberal, Markham—Thornhill, ON]

We're exploring a range of options. Everything is on the table, that one included.

[Brian Masse, NDP, Windsor West, ON]

Well, okay. Here's what I don't understand, then, and perhaps you could shed some light on it. I wish I were there in person with all of my colleagues—and I will be soon—who can appreciate this.

Right now, the United States has EV incentives on the Chrysler Pacifica, built in Windsor, Ontario, at $7,500, which is almost $10,000 Canadian, and you can get that twice. In the United States, you get that twice. In Canada, it's once, for $5,000.

If the Prime Minister wants to prepare himself and also wants to be seen as, I guess, to a word.... Why has it been 81 days later and we don't at least do the same thing? Isn't it embarrassing or shameful that right now the U.S. actually has better incentives for the Windsor-built Pacifica versus that of the United States...? It's been 81 days. Why don't we make this happen?

[Mary Ng, Liberal, Markham—Thornhill, ON]

I appreciate the member's perspective, but here is where I will disagree.

What we have been doing is absolutely creating incentives to encourage our consumers to move towards the purchasing of electric vehicles. You just heard my colleague, Minister Champagne, about the range of investments we are making in order to build out the kind of investment and ecosystem—