International Trade Committee on Oct. 16th, 2018

[Bill Morneau, Liberal, Toronto Centre, ON]

There are clearly demonstrated companies that are making use of this, because the remission orders are moving forward on a significant number of companies. I think what you're identifying—and I think it's important for us to listen to us—is that we need to keep our ear to the ground to make sure that we, to the extent there are issues, improve this process, which as I mentioned is really unprecedented. We are keenly interested in getting the information from this committee on what you've heard specifically. We are seeing many companies make use of the remissions process and make use of the loans. We're aware of many companies that are using the duties relief program, and there will be more that will come in. There is every expectation that those will continue to come in even after this tariff action is, we hope, resolved.

[The Chair, Liberal, Mark Eyking]

Thank you, Minister.

We're going to move over to the Liberals now.

Mr. Peterson you have the floor.

[Colin Carrie, Conservative, Oshawa, ON]

I'm totally out of time.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Thank you, Minister, for being here, and thanks to the officials from your department as well for being here today.

As you indicated and as you properly noted, this is a dynamic situation and I don't think there's a one-size-fits-all solution. It's clear that the suite of relief measures is working for some who have applied, but I think we all agree that we want it to work for everybody who is eligible. I think we're all in agreement that's the goal of this committee. The ultimate goal obviously is to get rid of these unjustified tariffs. Short of that, we need to have a relief program that ensures that everyone eligible for the relief gets it in a timely manner. I think we can all agree with that, and whatever steps you can take to make sure that happens would be most appreciated.

I want to talk about a little case study from my riding. We have a lot of manufacturing in my riding, but not so much steel and aluminum. I have a rather large building product supply company that relies on aluminum for things like eavestroughs, siding and those types of products. The problem is that they can't buy any of their inputs from Canada. They buy all their inputs from the States, which are obviously taxed and tariffed as they come north, and then they sell a lot back to the States. So they're getting a double whammy, so to speak. We're helping them navigate through some officials from your office, and I think we've been successful in getting them hooked into the program that applies to them. I think they will be able to apply for some of the stuff that was announced Thursday.

It took a lot of work on the part of my staff. Is there any way we can equip local MPs with maybe...? It's just getting the message out there that there's the program there and then helping our constituents navigate through the program, hopefully successfully. At the end of the day, we're in different parties on this committee and all that, but every MP around this table, for sure—and I know every MP in the House—wants to help their constituents in any situation. In this particular situation it is urgent, as we said.

Is there something we can do? Maybe you can elaborate on some of the communication tools that are out there. Is there anything on the finance website that we can direct our constituents to that maybe wasn't there even a week or two or a month ago?

[Bill Morneau, Liberal, Toronto Centre, ON]

To start, in the situation of the company that you're talking about, to the extent that they are purchasing product from the United States, importing it into Canada, fabricating or changing it here, and sending it back to the United States, in many situations they should be eligible for duties relief. I think that's an important feature that enables companies in that situation. It may be that since there's very little aluminum production in the United States, it may actually be more complicated than that. It may be going from Canada to the United States and from the United States to Canada and back again, which is not that unusual. Maybe I can ask Michèle or Patrick to talk about the information sources that could be helpful.

[Patrick Halley]

There is information on the website, which we can certainly share with the committee to make sure that it's properly disseminated. As I mentioned before, we're in touch with the companies that made requests for remission and are trying to work with them on that.

Also, I must say that for the tariffs into the United States we've been helping companies to get in touch with our embassy in Washington to make sure that they are also aware of the process in the U.S. where they can get an exemption from the U.S. section 232 tariffs through the Department of Commerce. We've been trying also to address that. Of course, we don't have complete control over that, but we're at least trying to help them in that direction.

[Kyle Peterson, Liberal, Newmarket—Aurora, ON]

Thank you.

I think I have a minute left. Mr. Dhaliwal would like to use that minute, Mr. Chair.

[The Chair, Liberal, Mark Eyking]

You have one minute, Mr. Dhaliwal.

[Sukh Dhaliwal, Liberal, Surrey—Newton, BC]

Thank you, Minister, for coming today.

SMEs play a key role in getting opportunities for Canadians. The SMEs came forward previously and said that they cannot follow the process, that they don't have resources to access the programs you have. Is there a way that you can help those SMEs to come forward and access the programs?

[Bill Morneau, Liberal, Toronto Centre, ON]

It's an important question. We have worked to make sure that the information on how they can come forward is available. There's a demonstration that a significant number of them are coming forward because we actually are seeing the results in terms of the loans, the duties relief and the remission orders.

While we need to potentially improve it, based on what I'm hearing from all the members here, I think there is evidence that at least for some it's working as intended. To the extent that this committee has ideas for how more information can go out, we would be very keen on hearing that. Getting information to members of Parliament is certainly something that we would be pleased to do.

I think that businesses that are in the business of purchasing steel would likely be able to come to the website and see the process. If there's a concern that it's too complicated, we would like to hear that, in order to try to improve it. But we are making progress through these firms that have applied for remission requests and expect to make further progress.

[The Chair, Liberal, Mark Eyking]

Thank you, Minister.

As Ms. Ramsey stated, she wanted more on the committee that you were talking about, so maybe in the future.... We're going to be doing the study for a while and you'll be able to bring officials or somebody here to give us a brief on the makeup of that committee as it goes forward.

We still have time for a few more questioners.

Mr. Hoback for the Conservatives, you have five minutes. Go ahead.

[Randy Hoback, Conservative, Prince Albert, SK]

Thank you, Minister, for being here. It's interesting that you're here today of all days, because we just voted to put the TPP through to the Senate. We finally got it through the House of Commons three years from when it first hit the House of Commons.

Let's go back three years and look at that stage and that scenario. You had President Obama and our Prime Minister being best buds, and our Prime Minister wouldn't sign on. President Obama was basically begging him. If he had, we wouldn't be talking about this today. In fact, the TPP was the new NAFTA. It was the new agreement that was to replace the existing NAFTA, but that's behind us.

There's not much we can do about that now. It is what it is, but now we're hearing about some realities in the business community that have to be addressed. There has to be an assumption made that you may or may not get this tariff resolved. If you do not get it resolved, the programs you have in place right now are not functioning in a manner that is bankable and workable. We're hearing that very clearly. You can go to any of our meetings. You'll see the blues. That's stated by business after business.

What are you going to do and how are you going to budget the allocation of funds, the tariffs collected, and make sure that all the tariffs collected will actually be put to the small and medium-sized enterprises that require this fast? Also, how do they make that program in such a fashion that it's bankable, so that when they start to put out their price lists next week, they know exactly what they're paying for their steel and exactly what they're going to get back from the government? Right now, they don't know, so what they're telling us is that if they get a better offer in the U.S., that's where they're going to go.

Look at our direct investment into Canada. It comes back to our whole competitiveness factor and this factor with the U.S. Nothing is happening to change that. In fact, it's disappointing. When we did the U.S.-Mexico-Canada agreement, a lot of businesses in their talks with us were so excited. They said, okay, finally the steel and aluminum will be done and we'll move forward. Then they found out that you did an agreement without doing the tariffs on steel and aluminum, and they said, “Well, what good is it?” In fact, today in committee I asked them if they are any better off today than they were before we started the negotiations and the agreement. They said, “No, we're actually worse off.”

What do you have for a game plan? How much money are you going to budget to help these companies stay afloat? What are you going to do in taxation changes so that they can be competitive in the international marketplace in this scenario?

[Bill Morneau, Liberal, Toronto Centre, ON]

Well, there are many questions there. I'll answer as many of them as I can in the allotted time.

First, if there are companies coming to this committee that are saying they can't get through the system, we want to get information on them.

[Randy Hoback, Conservative, Prince Albert, SK]

I genuinely believe you, but it's not happening. Those companies have been telling us all summer that it isn't working, that it won't work for them. It's three months later, four months later, and there has been no indication that this government is saying, “You know what? Maybe we should change it.” Nothing. How do they stay bankable?

You're a businessman. How do you go back to your employees and say, “You know what? I can't bid on this project, because I can't price the steel for it. So I'm sorry, we're going to go to work share”? That's what they're doing.

[Bill Morneau, Liberal, Toronto Centre, ON]

We would like to hear the instances that are coming forward. It is clearly the case that there are companies, both steel companies and users of steel and aluminum, that are impacted by these tariffs, and there are also companies that are very clearly able to make use of the programs that we've put in place. There are companies that have applied for and received remission orders—

[Randy Hoback, Conservative, Prince Albert, SK]

I'll stop there. Here's a classic example, Minister—

[The Chair, Liberal, Mark Eyking]

Let him finish.

[Randy Hoback, Conservative, Prince Albert, SK]

Let me finish my question, because I want to make sure he's aware of this.

You have 20 employees. You're working from eight in the morning until eight at night, and then you're going back and you're doing a 90-page submission. I was talking to a company; that's what they're doing. When does he have the time to do that paperwork? So what are they doing? They're not doing it, or else they're creating a new industry to do the paperwork for them. You have to figure out a better way. Tell me you have a better way that's bankable, because that's what they need today. That's what they're demanding. We hear it over and over again in committee.

Obviously, you've been hearing it. You can't tell me you haven't been.

[The Chair, Liberal, Mark Eyking]

Mr. Hoback, give the minister time to answer your question.

[Bill Morneau, Liberal, Toronto Centre, ON]

Again, we would be very pleased to hear from the firms that you're talking about. We are working through those firms that have put forward orders for remission. It's important that we ensure the market remains stable, and we think the safeguards will have an important impact on that. It's also important that we consider the remission requests with an eye towards ensuring they're valid.

We put in place the tariffs on the United States on a dollar-for-dollar basis because we wanted to demonstrate very clearly that the tariffs they put in place were inappropriate. I share your outrage. This is not a situation that we want to be in. But if we go ahead with putting in remission orders without doing our homework, we'll be reducing the impact of those tariffs. We will do that if it's appropriate and if people are really being impacted. That is absolutely our goal. We do not want Canadian firms to be impacted. By the same token, we also want to have the ability to negotiate a conclusion with the United States, and we believe those reciprocal tariffs are instrumental in our ability to do that.

We acknowledge we have to do many things at the same time here. To the extent that these programs can be improved, we are keen to hear your advice, but we're not going to back down from the tariffs and we're going to keep working with companies to deal with the impacts.

[The Chair, Liberal, Mark Eyking]

Thank you.

We have time for one more MP.

Ms. Ramsey, you have three minutes. Go ahead.

[Tracey Ramsey, NDP, Essex, ON]

Thank you.

Global dumping is at peak levels due to the inaction of this government. I think that's why we're facing these tariffs. We didn't act quickly enough. We've shown that our country is being used as a conduit for the illegal dumping of steel that's passing through. Canada has now become a bull's eye, which is also threatening many of the industries. The list you put out on the safeguards is not comprehensive. We need more safeguards in place. We need to ensure the sector is protected in its entirety, not piece by piece, bit by bit.

To be frank, Minister, denying the facts won't save jobs. You need to please pay attention to the work this committee is doing on this issue and to the businesses coming forward that are already laying people off. Canadians are losing their jobs today because of the lack of action.

Now, we can't control what's going on in the U.S. No one wants what's happening in the U.S., but it's our current reality. What do we do now? What we're doing isn't working. We have to do something else. We have to do better. We have to look at the idea of some type of task force, something that's nimble, that has resources and can move quickly to help the SMEs that are being completely written out this plan.

This is what we're looking to hear from you today. We have heard what your plan is. We know what you're doing. We need more. Businesses need more. Canadians need their jobs protected.

What are you willing to do now going forward?

[Bill Morneau, Liberal, Toronto Centre, ON]

You know, I appreciate your counsel, and we will be keen on hearing ideas that come from this committee. In terms of what we've put in place thus far, the response we've had from the industry, the manufacturers, is that they've appreciated the approach we've taken to safeguards. We've heard much positive. To the extent that as the market is dynamic, things change—

[Tracey Ramsey, NDP, Essex, ON]

Every job is positive, Minister. With all due respect, telling us how amazing your program is isn't saving those jobs, because some of them are not working. I hear what you're saying, but we need a plan going forward that's going to work to protect these jobs here in Canada.

We haven't even touched on the secondary list that's been sideswiped, in an attempt to put pressure on the U.S., that isn't working either. Our boating, our manufacturers—there are a lot of different folks in that group.

I urge you to bring everyone together to save our manufacturing sector, and to do it immediately with funds attached, like my colleague has said. There are good examples of things that we can be doing that we've heard here. We could lower the threshold on the strategic investment fund. There are a lot of things that you can be doing, but we need to hear from you that there is a will to save manufacturing in Canada, and save those jobs in an urgent fashion.

[The Chair, Liberal, Mark Eyking]

That pretty well wraps it up.

Ms. Ramsey, you had a question that you wanted to have followed up by the minister or officials, and Mr. Allison, you have one quick question for the minister or his staff.