Public Accounts Committee on Nov. 23rd, 2023

[Chris Forbes]

I'm not aware of the work that the Competition Bureau has done on corporate taxation. Pardon me, but I'm not sure I'm able to answer that question.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Okay. No problem.

It suggests, in Canada's economy, that grocery companies—in particular, Loblaws being one them—are seeing massive increases in their profit margins that are inconsistent with the rate of inflation and inconsistent with supply chain pressures. It suggests that Canada take a stronger role in making sure those companies are enhancing their competition. One of the tools it recommends is ensuring that there be a tax to disincentivize the extreme profit margins we're seeing.

What would you say in terms of that recommendation by the Competition Bureau?

[Chris Forbes]

Thanks for the question.

I would say a couple of things. I think we have a corporate tax system in place that taxes corporate profits, and obviously as a corporation's profits rise, its income tax payable would rise along with that.

I think the question of what the best ways would be to improve competition in Canada would be through measures like the Competition Act itself, if that's what the concern is. I'm not sure the corporate tax system, as it's set up, is a vehicle to, I think your term was, “disincentivize” profit. It's there to tax profits to pay for public services, and that's what its role is.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Just as a follow-up on that, we had the CRA commissioner here last year, and I spoke to him about this direct question, which I'll ask you, in relation to how we can do more to recover the issues the CRA has noted in terms of corporate tax avoidance.

The corporate tax outlined here, of course, is an important piece in ensuring that we have a framework to tax corporations, but when it comes to enforcement, what are some issues you see there? Is there any co-operation between the CRA and your work to see that corporate tax avoidance is ended in Canada?

[Chris Forbes]

We work very closely with the CRA. I would say, indeed, in general, when there are aspects of the tax code that are available or when corporations find a way to reduce or avoid taxes inappropriately, we'll work with the CRA. It's often the CRA that identifies the issues because it sees the tax returns.

We, I think, consistently work to update the corporate tax system to ensure taxes are levied and collected fairly. It starts with the tax code, the tax rules, and then it's about enforcement and having sufficient tools. That means not only having the people but also having the systems in place to detect where corporate taxes are not being paid in the amounts they should be paid.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Do you, Mr. Forbes, find corporate tax avoidance to be a serious issue facing Canadians?

[Chris Forbes]

It's an important issue for us to ensure that everybody pays the taxes they owe.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Why is it that we continue to see tax avoidance in Canada? In your own words, you said you are working with the CRA to ensure that you end some of these procedures. How are you doing that?

[Chris Forbes]

I think I just described it, but, with the CRA, we will look at areas that we know are legislative structures that allow companies to reduce their taxes in what I would call an "inappropriate" way. We can also look at enforcement to make sure that existing laws are enforced. Those are probably the two main approaches we work at with the CRA.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Mr. Forbes, I'm just trying to say—

[The Chair, Conservative, John Williamson]

Thank you very much.

I'm afraid, Mr. Desjarlais, that is the time.

Mr. Nater's going to split his time.

You'll get about 90 seconds in before I suspend for the vote. It's over to you, please.

[John Nater, Conservative, Perth—Wellington, ON]

Thank you, Mr. Chair.

Thank you to our witnesses.

I might start with you, Ms. Hogan.

In volume 3, there's a discussion of losses due to accident, loss, destruction, damage, etc. Some of the concerns I saw—and this isn't new per se—were at the Department of Justice, where there were 68 lost security badges. At Public Safety there were 39 lost or damaged computers, tablets and laptops. At CBSA there were 139 lost access cards or security badges, and at RCMP there were 458 lost access cards or security badges, 144 computers, 65 telecommunications devices and 81 vehicles.

Considering these are our public safety portfolios, is there concern that these departments are losing a significant amount of security-related assets, as reported in the public accounts?

[Karen Hogan]

I think that would be an excellent question for you to ask the RCMP, what they do when something is lost, stolen or damaged and how they dispose of it. I know that in the case of my office, we had some cell phones that were reported lost, and we take steps to remotely wipe them, to change the password and then to deactivate the phone number. Someone might have the hardware, but will not access anything on it.

It's a great question to ask the departments. It's not something we would look at in the financial audit. We would care that they have properly recorded that the Crown asset no longer exists and that it's been removed from the books.

[The Chair, Conservative, John Williamson]

Thank you.

I'm going to suspend you right there, Mr. Nater, but I have stopped the clock for your time. You'll have it back when we return.

Could I ask all the witnesses to remain on the site? You're welcome to get up, walk around and stretch your legs. For members, you're welcome to vote here, of course, or head to the chamber. You can make your way back as soon as possible afterwards.

I will suspend until we're back.

Thank you.

[The Chair, Conservative, John Williamson]

I'll bring this meeting back into session.

Mr. Nater, the floor is yours again. You can dispense with pleasantries so that you don't eat up any of your time. I know that you did so off the top already.

It's over to you, please.

[John Nater, Conservative, Perth—Wellington, ON]

Thank you, Chair. I'm always a pleasant guy.

I think I'll direct this question to Mr. Huppé from the Treasury Board.

I'm looking at page 211 of volume 3 under National Defence. I notice that $7,346 was paid to the Comfort Inn in Brandon, Manitoba, for “Settlement of claim for damage to property”. I'm just curious; is this a normal expenditure to pay for a trashed hotel room by obviously a public servant of some sort?

[Roch Huppé]

I would have to actually follow up with the department to get the details. I can't say if it was normal. It depends on the situation or the circumstances of the damage and how it happened.

I could definitely follow up, sir.

[John Nater, Conservative, Perth—Wellington, ON]

It would be great if you could follow up and provide the committee with a response.

[Roch Huppé]

Absolutely.

[John Nater, Conservative, Perth—Wellington, ON]

I'll move to Mr. Forbes.

I just to want to clarify a few numbers. Page 134 of volume 1 talks about the debt servicing charges, which increased from $22.9 billion in the previous year to $31.5 billion in the current year, an increase of about $8.6 billion. In contrast, the amount for the Canada health transfer increased by only about $8 million. So we're talking about an order of magnitude of about a thousand times increase.

Is that correct? Am I correct in my reading that debt servicing charges increased by a thousand times more than what we transferred for health care?

[Chris Forbes]

Thank you for the question.

I'm just looking at the numbers here. I believe the health care transfers overall went up a bit more than that. I think there was a one-time top-up, but I'll have to confirm that in our numbers.

But you have the right reported.... I mean, I see the table there, so what you have are the numbers that are reported, but I believe there was a one-time top-up for the health care transfers. I'll just have to find where that is.

[John Nater, Conservative, Perth—Wellington, ON]

Okay—but it was a one-time top-up.

Going back to the Treasury Board, in the past fiscal year we saw 11 workdays lost due to the PSAC strike. Would you be able to comment on how much money was saved from those 11 days?

[Roch Huppé]

We don't have that number offhand. Again, we'll try to come up with that from our colleagues at the chief of human resources office to see if they have some kind of estimation based on average salaries.

[John Nater, Conservative, Perth—Wellington, ON]

That would be helpful.

Going back to Finance, we're aware that the Minister of Finance said, “I am right now an MP for downtown Toronto, and a fact that still shocks my dad is that I don’t actually own a car.” On page 211 of volume 2 of the public accounts, it says that the minister was provided with a $90,400 salary for “motor” allowance.

Would that be to drive her around in? Would the $90,000 be to provide her with someone to drive her around?

[Chris Forbes]

The minister would have a driver when she's here in Ottawa, yes.