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Evidence of meeting #3 for Special Committee on Cooperatives in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was cooperatives.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Claude Carrière  Associate Deputy Minister, Agriculture and Agri-Food Canada
John Connell  Associate Assistant Deputy Minister, Strategic Policy Sector, Department of Industry
Jeremy Rudin  Assistant Deputy Minister, Financial Sector Policy Branch, Department of Finance
Denyse Guy  Executive Director, Canadian Co-operative Association
Marion Wrobel  Vice-President, Policy and Operations, Canadian Bankers Association
Stephen Fitzpatrick  Vice-President, Corporate Services and Chief Financial Officer, Credit Union Central of Canada
Nicholas Gazzard  Executive Director, National Office, Co-operative Housing Federation of Canada
Frank Lowery  Senior Vice-President, Senior Counsel and Secretary, The Co-operators Group
John Taylor  President, Ontario Mutual Insurance Association
Michael Barrett  Chief Operations Officer, Gay Lea Foods Cooperative Ltd.
Bob Friesen  Farmers of North America

10:45 a.m.

Conservative

Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON

Oh, okay.

10:45 a.m.

Vice-President, Corporate Services and Chief Financial Officer, Credit Union Central of Canada

Stephen Fitzpatrick

—so they aren't....

Honestly, I'm not sure. I know that when they came in they purchased the branches of another credit union. I think for that arm they were operating under the Ontario rules, so they were really operating in two different regimes.

10:45 a.m.

Conservative

Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON

So basically they had two separate —

10:45 a.m.

Conservative

The Chair Conservative Blake Richards

Sorry, the time has expired. Could we have just a yes or no response then on that? It was a yes to that last question?

10:45 a.m.

Conservative

Pierre Lemieux Conservative Glengarry—Prescott—Russell, ON

I was just asking if they were therefore operating under two different sorts of credit union structures to comply with each of the provincial regulations of two provinces.

10:45 a.m.

Vice-President, Corporate Services and Chief Financial Officer, Credit Union Central of Canada

Stephen Fitzpatrick

Yes, they were.

10:45 a.m.

Conservative

The Chair Conservative Blake Richards

Thank you. Your time has expired.

We move now to Mr. Bélanger.

July 10th, 2012 / 10:45 a.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

On that, I believe Desjardins also operates caisses populaires in Ontario. It would be interesting to find out how that's structured. I believe Caisses populaires de l'Ontario operates as an entity and is affiliated. It would be useful, Mr. Chairman, to make sure that at some time among our witnesses Desjardins be included, as well as the Conseil canadien de la coopération et de la mutualité, which is the francophone pendant of Madam Guy. I believe you've received a request to that effect, and I think it would be very important that we include them as well.

Madam Guy, I'm asking not for a response now but for you to do some homework, if I may be so bold. I know it's summer, but I would love to get a detailed paper on the six items you identified. Or to put it differently, what are the needs or the gaps, as one of our previous witnesses, the gentleman representing Industry Canada, mentioned? Where there are gaps, the government might want to create some capacity to help fill them, especially in the case of environment or initiatives such as co-ops, which are very positive. What are the things that are not being addressed, or on which co-ops come up short because of administrative matters and so forth? We can then look at those in detail and perhaps they could be included in the committee's report.

Mr. Fitzpatrick, I want to make sure I understand. When you say credit unions have assets of $140 billion, that's just the credit unions. It doesn't include Desjardins, correct?

10:45 a.m.

Vice-President, Corporate Services and Chief Financial Officer, Credit Union Central of Canada

Stephen Fitzpatrick

That's correct.

10:45 a.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

Because they have about the same amount or even more.

We've heard comments that there are $350 billion of assets out there, but surely to God that's not the money that's available to co-ops. That's the money, or a good chunk of it, the co-ops are holding, which belongs to their clients. Is that correct? We need to understand the difference here, because when I asked the minister in the House what the government had done since announcing its intentions in January 2012, he responded by saying they got $350 billion of capital and therefore they don't need our help. So I want to make sure that I understand what the nature of that capital is. Is it basically members' assets or members' own personal assets?

10:50 a.m.

Vice-President, Corporate Services and Chief Financial Officer, Credit Union Central of Canada

Stephen Fitzpatrick

In our case, the $140 billion in assets would be largely loans to members.

10:50 a.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

But it doesn't belong to you or to the co-ops. It belongs to the members?

10:50 a.m.

Vice-President, Corporate Services and Chief Financial Officer, Credit Union Central of Canada

Stephen Fitzpatrick

Yes, for member-owned institutions, the assets are owned by the members.

10:50 a.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

I want to explore very briefly the insured mortgage purchase program that was instituted by the government, which made available $125 billion. Over two years, $69 billion was taken up. Does anyone have a sense of how much was taken up by the banks and how much may have been taken up by the credit unions? Does anybody have those numbers?

10:50 a.m.

Vice-President, Policy and Operations, Canadian Bankers Association

Marion Wrobel

The vast majority would have been taken up by the banks, but we do understand that some degree of that was taken up by the credit unions through Central 1, which is the Central for Ontario and British Columbia.

10:50 a.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

Could you elaborate a bit on that, Mr. Fitzpatrick? How did that work?

10:50 a.m.

Vice-President, Corporate Services and Chief Financial Officer, Credit Union Central of Canada

Stephen Fitzpatrick

There are two entities in the credit union system: Central 1, as Mr. Wrobel referred to, and Concentra, which is based in Saskatchewan. They're both federally regulated, and they have both participated in the mortgage lending programs.

10:50 a.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

Do you have a sense of to what extent that was?

10:50 a.m.

Vice-President, Corporate Services and Chief Financial Officer, Credit Union Central of Canada

Stephen Fitzpatrick

I don't have the total number.

10:50 a.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

If it's possible to attain that, could you send it to the clerk so that it could be distributed to the members of the committee?

I've been told—and I've had it pretty well confirmed—that the banks paid bonuses last year to their staff and the executives of $9.2 billion. Is that figure accurate, Mr. Wrobel?

10:50 a.m.

Vice-President, Policy and Operations, Canadian Bankers Association

Marion Wrobel

I don't know the number.

10:50 a.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

Well, for the top five banks, it's $8.87 billion, and that doesn't include the national, though I expect—

10:50 a.m.

Vice-President, Policy and Operations, Canadian Bankers Association

Marion Wrobel

I would simply point out that within the context of banking, bonuses are part of the compensation system for a wide range of employees. When we talk about bonuses, they're not just for very senior executives. They're for all rank and file....

10:50 a.m.

Liberal

Mauril Bélanger Liberal Ottawa—Vanier, ON

But $9.2 billion were paid in bonuses over and above the salaries. Is that correct?

10:50 a.m.

Vice-President, Policy and Operations, Canadian Bankers Association

Marion Wrobel

That could very well be.