Evidence of meeting #23 for Industry, Science and Technology in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was need.
A video is available from Parliament.
2:10 p.m.
Liberal
The Chair Liberal Joël Lightbound
Thank you very much, Ms. Gray and Mr. Skelton.
I now give the floor to Mr. Dong for five minutes.
Goodbye, Mr. McPherson. Thanks for joining us today. Have a great weekend.
2:10 p.m.
President and Chief Executive Officer, Mississauga Board of Trade
You too. Thank you so much.
2:10 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
Thank you, Chair.
My question is actually for Mr. McPherson, if he can stay for one more minute.
2:10 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
You mentioned that your members were using the federal assistance programs during COVID, including things like CEBA. Most recently I think there has been HASCAP from BDC, the highly affected sectors credit availability program, for industries like the tourism industry.
Just for the record, are your members familiar with these programs? Have they been using these programs to support their businesses?
2:10 p.m.
President and Chief Executive Officer, Mississauga Board of Trade
Absolutely, they have been using those programs. That's not to say they haven't still accumulated debt with regard to the Canada business account loans and other things like that.
2:10 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
That was going to be my next question.
Let's take CEBA, for example. We know that it's interest free. You pay a portion back starting, I think, at the end of 2023. What kind of feedback have you been getting from your membership, let's say on CEBA, on the portion they have to pay back?
2:10 p.m.
President and Chief Executive Officer, Mississauga Board of Trade
Certainly I think the extension of the payback period was welcome, but I think the government should look at—and perhaps you could look at—those highly affected sectors, particularly in terms of how to alleviate some of that sitting debt for these companies that were hardest hit. For the last quarter of 2021, Statistics Canada noted an increase in insolvencies. Quite frankly, our small and medium-sized businesses are pressed right to the limit, particularly in the sectors that are very much customer-facing like hospitality and tourism. We all know what's been happening there.
I think anything the government can do, such as waiving of interest or granting some forgiveness, should be looked at, because small and medium-sized businesses, as we all know, are where the growth comes from. We heard many speakers today talk about the percentage of their members who are small and medium-sized businesses. That should come as no surprise because growth in our country is driven largely by small and medium-sized enterprises.
That said, I think there's something to be said about the larger anchor enterprises that bring business to those small firms. I don't think you can look at the SME community in isolation. I think you also need to look at those policies that incite investment in Canada as well and that ultimately lead to opportunities for small businesses.
2:10 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
I really appreciate your participation in today's session. The committee is a public platform through which you can broadcast some of these thoughts.
You said you wanted government to play more of a role in helping SMEs come out of the pandemic. What roles do you think the large financial institutions should play, including the commercial ones and the public ones like BDC? What role do they have in helping SMEs?
2:10 p.m.
President and Chief Executive Officer, Mississauga Board of Trade
I think they play a significant role. In particular, a lot of their role goes beyond the straight-up financing of companies. They play a significant educational role, and I think the government should look at other ways to partner with these institutions to provide them with additional knowledge and tools to help them manage their current financial situation.
I would say that we certainly partner with institutions like BDC—BDC is a member of my board—to bring knowledge and expertise in this area to our SME community. I think they're certainly a vital partner.
2:15 p.m.
Liberal
Han Dong Liberal Don Valley North, ON
Thank you so much.
I want to ask Mr. Poirier the same question.
What role do you think the large financial institutions, commercial and public, should play in the economic recovery and the support of the SMEs?
2:15 p.m.
Director, Trade Policy, Canadian Manufacturers and Exporters
I think they're playing it right now.
What I mentioned in my remarks was the unique problem SME manufacturers are having when it comes to accessing components key to their processes. When they talk to us about these problems, it's that they can't get the components, they can't produce, they can't operate and they're terrified of having to shut down and lay off their workers.
Their solution is not to get a loan from the bank. It's more like, how do we bring back the wage subsidy program that helps them keep their people on the payroll and keep them paid even if there's no work? That's how they view this problem. They don't have trouble getting money from the bank. That's not the issue. It's that they have to lay off their workers temporarily until they get the parts so that they can start production again.
2:15 p.m.
Liberal
The Chair Liberal Joël Lightbound
Thank you.
Mr. Dong, I'm sorry, but your time is up. I know time passes quickly when you're having fun.
Mr. Lemire, you have the floor for two and a half minutes.
2:15 p.m.
Bloc
Sébastien Lemire Bloc Abitibi—Témiscamingue, QC
Thank you, Mr. Chair.
I'll do to Mr. Poirier.
Mr. Poirier, as you know, our manufacturing universe in Quebec consists of 3,000 SMEs with 10 to 500 employees each. The proportion of businesses that recruit outside Canada has jumped 11 percentage points since 2019 and now stands at 44%. The number of job openings has increased 36% in only a year, with an average of 12 vacancies per business. So there are 36,000 job openings, a number never previously reached.
I asked the question in the House, and the government answered, through the parliamentary secretary, that it was proud to have accepted approximately 100,000 work permit applications in the last quarter. That's far more than last year, a COVID‑19 year. At the same time, we can see that the number of applications has completely skyrocketed.
I think that labour market impact assessments, LMIAs, have become an obsolete measure. They impede the process of accepting foreign workers for businesses. They also provide information that we already gather in Quebec through labour market partners.
Do you agree that it's time to suspend or abolish the LMIA requirement for foreign worker applications?
2:15 p.m.
Director, Trade Policy, Canadian Manufacturers and Exporters
We understand very well that the program, for political reasons and rightly so, does not want to displace Canadian workers who can fill these jobs, but then we look at it as an association and as an industry that sees 80,000 vacancies—30,000 plus in Quebec—and we say, “Why are we doing labour market impact assessments to get foreign workers?”
It's something that, if not abolished, can be streamlined to the point where.... Look, if our sector is in desperate need of workers, I think we've proven the point that we can't hire from within and we need these foreign workers. Whatever means we can use to help speed up and expedite that, we support it.
2:15 p.m.
Bloc
Sébastien Lemire Bloc Abitibi—Témiscamingue, QC
I think we have proof of that for the manufacturing and export sectors.
I'm also interested in production costs, which are rising as a result of the sanctions on Russia.
Should the government compensate farmers for production cost increases? We're hearing that costs have risen 35% as a result of fertilizer surcharges. That's having a major impact, and it's being passed on through our members.
Is there any action that could be taken in this area?
2:15 p.m.
Director, Trade Policy, Canadian Manufacturers and Exporters
Obviously, manufacturers are feeling the pinch from the sanctions. It's not that they don't support them. They do. We understand the global crisis we're in and the immoral actions of one country, Russia, in all of this. For the most part, manufacturers support the sanctions, but it doesn't mean that it doesn't come without financial hurt and a cost to them.
For the most part, they're sort of dealing with it right now, but as time goes on, that pain will be felt and it will reverberate through into jobs and into production. Maybe we will have to start looking seriously at financial assistance the longer we're in it. Are we there yet? Because it's still just a few months old, everyone is still sort reacting to it.
In terms of supporting them, they are, but again, it comes at a cost.
2:20 p.m.
Liberal
The Chair Liberal Joël Lightbound
Thank you very much.
Mr. Masse, you have the floor for two and a half minutes.
2:20 p.m.
NDP
Brian Masse NDP Windsor West, ON
Thank you, Mr. Chair.
For my friends at the Canadian Manufacturers & Exporters, I always remember Congressman Oberstar, now passed away, a Democrat from Michigan and actually the ranking member for transportation for many years. He always advocated to me for us to actually push “buy Canadian” so that we could negotiate back with the United States and have a seat at the table.
What I'm worried about as we go down this road is how inefficient.... A minivan made in Windsor crosses the border seven times. It doesn't get built and then sent one way or another. It gets built by going back and forth: the engine, the parts and all that stuff. I'm worried about our inefficiency in terms of competing with the east and the west, in going into Asia and other markets, if we have inefficiencies in our structure chain. Could I have your thoughts on that, please?
May 13th, 2022 / 2:20 p.m.
Director, Trade Policy, Canadian Manufacturers and Exporters
Absolutely.
You know the system very well. In terms of the manufacturing of automobiles, it makes no sense to us. As I mentioned earlier, we don't really trade with the U.S. anymore. We produce stuff together, and it does cross the border a number of times. In our messaging, we certainly echo that. We say, “Look, we shouldn't be fighting with each other.” The real competitors are China and other countries that are not necessarily our friends on the trade and manufacturing front.
Within the new NAFTA there is the competition chapter that was included at the insistence of our industry and our partners in the U.S. We envisioned that, at the time, to be the mechanism through which we could sort out these differences and the way in which we could leverage the trade agreement to coordinate and compete against the east and west, rather than fighting with each other.
I don't know. I'm holding my breath to see that chapter used properly, but there is also the challenge of buy America. It seems as though we're not convincing the right people.
2:20 p.m.
NDP
Brian Masse NDP Windsor West, ON
Yes.
Ms. Quaid, your testimony was excellent. It frustrates me, though. How do we deal with things like bread price fixing, and then the wages? There can be almost collusion through lack of competition. How do we deal with that?
I understand that at the end of the day we want to help the workers, so if we do nothing, is that not also an incentive, if we don't have a stick on the companies that are behaving badly? Not everyone is doing that, but some of the stuff is just outrageous.
2:20 p.m.
Associate Professor and Vice-Dean Research, Civil Law Section, Faculty of Law, University of Ottawa, As an Individual
I agree with you that we cannot ignore egregious behaviour. It's just that one has to remember that criminal enforcement, especially in the competition space, is rare. It mostly proceeds through the immunity and leniency program, and these cases end up in deals. Competition offences are not eligible for remediation agreements, the first of which was negotiated just yesterday in Montreal, but there is a workaround that has been developed under subsection 34(2).
If people are imagining that they are going to see executives in handcuffs going to jail, that's not going to happen in Canada. It has never happened. However, I worry that if we hang our hat on that and we don't do the hard work of talking to the provinces and figuring out how we create a framework in which we support workers in this new economy, this is just going to sit there on the books. I worry about criminal provisions that are just added, because everyone seems to dump big, complex problems into the criminal law, and then they get upset when it doesn't work.
That's my frustration. However, I absolutely agree that some egregious behaviour could be dealt with. I worry about how this provision has been structured. I think you need to ask some hard questions about whether the prosecution service has some opinions on this, because I suspect they do.