Industry Committee on Feb. 8th, 2022

[Ian Scott]

The approach the commission takes—I and fellow commission staff with respect to meetings—is grounded in well-established rules. Our meetings are recorded. Meetings are required by parties—for example, with me—to be reported through the lobbyist registration process as they are, I assume, with all of you.

[Nathaniel Erskine-Smith, Liberal, Beaches—East York, ON]

Can I pause? I have a good question on that front.

[Ian Scott]

If I—

[Nathaniel Erskine-Smith, Liberal, Beaches—East York, ON]

Professor Dwayne Winseck has said that the CRTC has refused to let policy analysts visit his university class because of perceived conflicts of interest.

How do I square that statement he's made and the feedback he's gotten with your having a beer with the CEO of Bell?

[Ian Scott]

I have no idea what the context is of the latter point you raised. I have spoken at classes at the University of Ottawa, the University of Victoria and Ryerson during my term. I have never dictated who could and could not attend. That is a matter for the university and the professor, so I have no idea what you are referring to.

As to the meeting, I meet with everyone pursuant to the rules. I meet with the heads of consumer groups, with individual Canadians, with small broadcasters and with members of Parliament. We meet, as we must, as a public body and we follow the rules.

[The Chair, Liberal, Joël Lightbound]

Thank you, Mr. Scott and Mr. Erskine‑Smith. That's all the time we had.

I'll now give the floor to Mr. Lemire for six minutes.

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

Thank you, Mr. Chair.

First of all, allow me to address you and salute your audacity following your speech this morning, which I listened to with great interest. I commend you for that.

Mr. Scott, thank you for being here today. Obviously, your recent decisions have led us to have a number of questions during the year. The context of an election, which we all could have done without, has brought us here today. That being said, your decision is a very courageous one, and I want to stress that.

I would like to ask you a question. Has the COVID‑19 pandemic allowed you to think about a telecommunications strategy in Canada and to realize that, ultimately, solutions must be found to the problems of Internet accessibility, which affect people in the regions more? These solutions will help more people, wherever they are, and not just people in large urban centres.

[Ian Scott]

Your question contains several questions. I'll answer you in English, Mr. Lemire.

I'm trying to think. Does the pandemic have a profound impact on our processes or our direction in terms of bridging the digital divide? The answer is absolutely, yes. It has never been more obvious and important in Canada and throughout the world to ensure that all Canadians have access to reliable broadband service.

As I mentioned in my opening remarks, we have a fund, but also all levels of government—municipal, provincial and territorial—have been doubling their efforts and, frankly, doubling the amount of funds available to extend the service.

However, this issue is still very complex, but it is very important. Right now in Canada, I think about 70% of the population has access to high‑speed Internet at 50 and 10 megabits per second, but there is about 50% of the population in rural areas—

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

—rural areas.

[Ian Scott]

That's it. Thank you.

In indigenous areas, about 30% of the population has access to high‑speed Internet.

We, along with other government departments, and at all levels of government, are trying to address it.

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

I was glad that you talked in your presentation about fostering competition, market access, understanding the notion of affordability, but also accessibility, which is part of the discourse and which I didn't necessarily feel as strongly about when I was elected as an MP two years ago.

Once it is recognized that competition is necessary and that infrastructure deployment must be allowed, will the new MVNO, or mobile virtual network operator, framework, which the CRTC has defined, create incentives for regional providers to expand their respective networks to more locations, particularly in underserved areas? Will this address this need?

[Ian Scott]

We hope so. Certainly that is the nature of the framework.

The logic of that framework is that, if you will, the new entrants or service providers who have been building out in most parts of Canada are best positioned to compete with the three large national wireless providers. What that framework does is it will allow them to expand more quickly and, frankly, to compete more aggressively with the three national providers.

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

The crux of the matter, from now on, seems to me to be to establish the terms and conditions that will open negotiations between network owners.

In this sense, when will we see the tabling of these terms, which will make it possible to establish where the various players stand on the chessboard so that they can negotiate more effectively?

I understand that these negotiations are over. Will it take weeks or months?

[Ian Scott]

I'll ask my colleague Mr. Kent to answer the question because he's working on this file.

However, I'll reiterate what I said at the end of my opening remarks, which is that we can't really talk about the [Technical difficulty—Editor] that are before the CRTC.

Mr. Kent, could you elaborate on the process?

[Philippe Kent, Director, Telecommunications Services Policy, Canadian Radio-television and Telecommunications Commission]

Of course.

We're in the process of reviewing the terms. The companies have made proposals, and we've heard from the parties. We asked questions and received answers at the end of January. We're reviewing this matter.

That said, the decision won't be made for a few weeks, and companies can, if they wish, negotiate off‑rate and offer a service now, which doesn't seem to interest them at present. Cabinet will therefore have to look at the terms and conditions.

[The Chair, Liberal, Joël Lightbound]

Mr. Lemire, you have only 15 seconds left.

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

Thank you, Mr. Chair.

The situation is quite different on the ground. If we're talking about months, then let me stress the urgency, because everyone should have access to the Internet. Acting on these terms and conditions will allow people to negotiate with each other and establish connections in the regions. This is very important, and I urge you to act quickly.

[Ian Scott]

Thank you.

[The Chair, Liberal, Joël Lightbound]

Thank you, Mr. Lemire.

Mr. Masse now has the floor for six minutes.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

I don't think it's that complicated. We have an industry here that is entirely regulated. I'm a former city councillor. You don't get access to the infrastructure without conditions and terms. Federally we have a spectrum auction and we own the airwaves—we own the air rights. We're at a point right now where it's failed in a huge way. Even before the pandemic there were a lot of problems for access.

Mr. Scott, where would you find some type of option for us to enhance programs—which I don't like because I disagree with this government and the previous one with regard to how they actually auction off the spectrum—or how do we actually use the tools that we have right now to connect Canadians in a way that's actually affordable?

It's not fair right now. We have kids trying to do school. Some are doing it remotely. Some are actually in urban centres. Then we have all kinds of businesses and a whole series of different things.

Where can we actually improve in the short term some of the structures that are working really well, versus actually remoulding the CRTC? You may disagree with that and that's fine, but I think it needs to be done.

[Ian Scott]

I won't comment on the latter point. It's not my place.

Where to begin? The first thing I would say is—and I know you are well aware of this—we don't regulate retail rates. The Telecommunications Act says that we ought not to unless there is no other choice. That kind of detailed rate regulation left most advanced economies in the late 1990s or even the early 1990s and moved more to various forms of incentive regulation and so on.

The driver for lower rates and better service is competition. Again, you know that we don't regulate spectrum. That is a matter for the industry department, so I won't try and answer for them. The CRTC's approach is to focus on competitive models. There is competition and competition has produced some desirable results.

When we talk about wireless, we have excellent coverage in Canada. We have the latest technology. We have not done as well on rates, so the commission's work has been focused on trying to enhance competition. Through various means, a number of entrants have entered the market. In our recent examination of the marketplace and our recent framework [Technical difficulty—Editor] accelerate that competition to drive down those rates.

With respect to the specific measures in relation to affordability, we have targeted some measures to low-income Canadians. The government has introduced some programs. As you alluded to generally, they recently enhanced, if you will, a program for Internet access that is $20 for a 50/10 service for qualifying Canadians. They expanded those criteria beyond the original child benefit, but also to other lower-income Canadians.

If you don't have detailed rate regulation, then we can't direct specific rates for specific target markets. I think, in fairness, the ultimate answer is that we need to continue to enhance competition. That's what's going to drive down rates and meet the needs of consumers.

[Brian Masse, NDP, Windsor West, ON]

One of the other things I want to ask you about to get a perspective about resourcing is this. One of the biggest complaints that I get is the time duration of CRTC decisions. I'm not going to get into the details, but for you and your team, what would we have to do resource-wise to escalate the time decision process? If we mandated a timeline, what complications would that have in terms of windows, so people and businesses know when a decision will be made?

[Ian Scott]

It's a fair question. I could argue with the premise of this taking a long time, but certain things do take a long time. We've talked quickly about the wholesale access, and that is a very long period of time. It is because of the nature of the costing exercise, the number of parties and the fact that it's a large process being contested. When you have large policy proceedings like the wireless [Technical difficulty—Editor], then you need to gather evidence from all parties, have public hearings and then examine the record.

You could add resources, and it would incrementally change and improve the timing, but fundamentally, we do remain a transparent quasi-judicial agency that follows administrative law principles, so that means we can only rely on the information filed with us. We encourage all Canadians to participate, and then we have to examine that large record.

We're not slower than other regulators dealing with similar issues. Some of these issues are complex and take a long time. I do understand it's frustrating, but it also reflects the significant economic and business aspects of the matters that are being decided.

[The Chair, Liberal, Joël Lightbound]

Thank you, Mr. Masse and Mr. Scott.

Mr. Généreux, you have the floor now for five minutes.

[Bernard Généreux, Conservative, Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC]

Thank you, Mr. Chair.

My question is for Mr. Scott.

Has the current or previous cabinet tried to influence in any way the decision that was made to set wholesale rates for Internet service providers in August 2019?