Public Accounts Committee on Oct. 5th, 2023

[Simon Kennedy]

With the investments being made, even in coverage in rural and remote areas, Canada, in general, is higher in the league table than many other countries.

[Jake Stewart, Conservative, Miramichi—Grand Lake, NB]

No, we are way behind in rural Canada, and it's a complete stain on this country. I went through the pandemic with four children in school and a wife trying to get on the Internet to go on a portal to do her lesson plans. I couldn't even vote during a budget debate last year. I was walking around my front yard with my government cellphone trying to get connected so I could actually vote. I was sick and I had to be at home—I had a surgery—and I couldn't vote.

[Simon Kennedy]

Mr. Chair, I think the main message I want to—

[Jake Stewart, Conservative, Miramichi—Grand Lake, NB]

No, don't interrupt me. I actually have the floor.

The main message that I'm trying to get across here today is that industry is responsible, the federal government is responsible and the federal government has failed miserably the people of rural Canada and indigenous communities. The evidence is all through everything we've discussed here today.

[The Chair, Conservative, John Williamson]

That is your time, Mr. Stewart. Thank you very much.

Ms. Khalid, you have the floor for five minutes. It's nice to see you.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Thank you very much, Mr. Chair, and I appreciate being here.

Thank you to all of our witnesses for being here today.

I wanted to follow up on a number of points that Mr. Stewart raised. First and foremost, I do believe that we've lifted 153 long-term water advisories amongst our rural communities. The work that we've done over the past number of years has been significant in terms of ensuring that the infrastructure is there. I realize a number of the issues that you all must have to deal with are about the availability and the installation of infrastructure and how much time that takes.

Perhaps I'll start by asking you a question. If 93.5% of Canadians do have access to connectivity and are connected, for the remainder, what are the biggest challenges that you perceive in terms of getting to that 100%?

[Simon Kennedy]

The biggest challenge to get to the 2026 figures that we've been talking about, the 98% plus, is, frankly, a matter of time. Many of these are large infrastructure projects. They take two or three years to build, and a lot of them are in train now. We've seen significant progress from 2018 to the present, but we need to run the line out another couple of years to 2026 before some of these very large projects that have been announced in concert with the provinces actually....

You won't see the percentage jump up until the light gets turned on in the house. The building is happening now, but the fibre optic cable has to be laid, the connection to the pole, from the pole to the house. It's only when the house gets connected and the service is available that we can actually move the needle on the percentage. That work is going on now, but it will take until 2026 for a lot of that cash that's going into the ground now, the building that's taking place, to produce the result of a house that's actually connected.

The biggest challenge at the moment is rolling out major infrastructure projects all across the country. As I mentioned, we have a regular table. We sit and track the milestones, which is one of the reasons I say with a fair degree of confidence that we're very confident that we're going to hit the kinds of percentages we've laid out. We wouldn't be testifying to that if we weren't, and the reason is that we work with these companies. We can see the progress in their infrastructure projects.

The pandemic has definitely created supply chain bottlenecks and those sorts of things, but in a sense, it's just time. It's like building a bridge or something. It's just going to take a bit of time to build it.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

How do those public-private partnerships work when it comes to building that connectivity, and what is a better role that the federal government can play in facilitating these partnerships?

[Simon Kennedy]

There are different kinds of partnerships. For example, for the investments that are made in indigenous communities, we have a pathfinder service. We have a explicit group in the ministry that works a bit like a concierge service to assist indigenous project proponents with their investments. The cost-sharing ratio, for example, with indigenous proponents is different. We fund up to 90% of the project.

For other projects, we're dealing with very large corporates like Bell or Telus or Videotron and others. In many cases, we're really a funding partner. They do the engineering, they execute, and they already have significant capital plans that they're rolling out every year. These companies are very capital-intensive companies that are investing every year. Our funding helps to ensure that the investment is happening in ways that improve the coverage in rural and remote areas.

We also try to ensure a certain balance between very large proponents that have scale and so on, and also smaller ones. In some communities and some regions, they have a smaller provider that people trust and like, and we want to make sure that we're not shutting them out.

The relationship and the way we work in some ways may differ depending on the scale of the provider and the community and so on.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Just to build on that, I'll ask you if you have any recommendations for us as to how those relationships can be better serviced towards ending that connectivity gap.

Also, then, we have signed agreements with six provincial governments to work together in closing that gap. Can you speak to the significance of those agreements and how they impact the work we do in terms of eliminating that gap in connectivity?

[Simon Kennedy]

I will turn to my colleague Mr. Dagenais, because he manages the relationship with a lot of these proponents and actually has been doing a lot of the work with the provinces. I think he might want to speak to that.

[Éric Dagenais]

In terms of the significance of the MOUs, between the six, the federal government committed $2 billion. They've cost matched fifty-fifty in almost all cases, so there's another $2 billion at the provincial level. That's really been, I guess, a game-changer in terms of the ability to move and be confident that we will hit the 98% by 2026.

There's unprecedented scale at the moment. Scale does come with challenges on labour, on access to poles and on permitting. Everyone is asking sometimes small municipalities for permits at the same time. There are challenges, but it's a good challenge to have when everyone is.... It means that everyone is building out the infrastructure into rural communities, so—

[The Chair, Conservative, John Williamson]

Thank you very much.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Chair, can I say one last thing?

[The Chair, Conservative, John Williamson]

No. I let that go quite a bit over—

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

You're so mean.

[The Chair, Conservative, John Williamson]

—and I'm sure you'll have time again and you can cut into some of your colleagues' time. I apologize about that.

My rule, just for new members, is that, if members are able to get their questions in before the time, I do allow witnesses to answer, but if you cut off the witness after your time, I just end it.

In that case, Ms. Khalid, that was about 45 seconds over your time, so that's why I'm going to.... I know. I'm sorry, but I know that your colleagues will generously give up some of their time in the next round.

Madame Sinclair-Desgagné, you have the floor for two and a half minutes.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Thank you very much, Mr. Chair.

I'd like to bring attention back to a notion, for Ms. Shanahan's benefit, among others. In the sacrosanct Canadian Constitution, section 91 stipulates that all areas whose responsibilities were not divided up in 1867, which of course includes Internet and telephone services, will be covered by the federal government. So 100% of these services fall under federal responsibility.

The reason some provinces, notably Quebec, intervened in this issue is because they felt the federal government was taking too long. That's the case in many areas. I think the current government needs to take a good look at some of the areas where it's taking far too long to act, such as employment insurance and seniors' pensions. It's about time the federal government got its act together.

This brings me to affordability, which is very important to me. On this subject, I'd like to ask the CRTC representatives some questions.

At the beginning of the year, Minister Champagne mandated you to look at the level of competition between the various Internet service providers. I believe you had until June to hold consultations. Can you tell us what the situation is?

[Vicky Eatrides]

Thank you very much for the question.

In fact, we received a directive from the government in February about competition and affordability. We're working on that. Regarding Internet services, processes are underway and decisions are coming. This is a central issue for us.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Could you be more specific, please?

[Vicky Eatrides]

We're looking at how to promote competition. It's clear that this is really difficult for smaller companies.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Are you working with the Competition Bureau on this or do you have your own economists?

[Vicky Eatrides]

No. I know that the Competition Bureau has submitted a document to the CRTC during the process, so we'll take into account what they have to say about competition.

At the moment, we're looking at the issue of Internet services. As has been raised in the media, we are also working on the issue of competition in mobile telephony.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

In this regard, did you know that Canada ranks second among OECD countries in terms of the cost of telecommunications?

[Vicky Eatrides]

This is a really interesting question. There are different reports that say different things.