Status of Women Committee on March 13th, 2008

[Maria Minna, Liberal, Beaches—East York, ON]

This is even worse than I thought.

[Prof. Kathleen Lahey]

It's a standard, in corporations—but they mine it better.

What happens is that as the years go by and the tax-free savings accounts get more and more money in them, given the distribution of income in this country.... First of all, it does nothing for low-income people; second, it means that this income is going to increasingly treat all investment income as tax free; and third, it will be splitting the investment income with other family members to get that tax exemption.

It's really the perfect complement to pension income splitting. I gave you some tables last year showing that people with $75,000 or $80,000 worth of income could get $8,000 to $10,000 worth of tax refunds from income splitting. Now they can just take that tax refund and dump it into a couple of tax-free savings accounts.

I guarantee you that within 20 years high-income people in Canada will not have to pay any taxes.

[Armine Yalnizyan]

I'll also mention that there's a section in Budget 2008, which I've submitted, which does dive into the tax-free savings account—who's benefiting and what the long-term implications are.

[The Chair, Liberal, Yasmin Ratansi]

Ms. Minna, you can ask one very short question and then your time is up.

[Maria Minna, Liberal, Beaches—East York, ON]

You presented a table with corporate taxes. Can you now match for me somehow in your conversation, if you have time, what's happening on the personal income tax side and what's happening on the corporate tax side? How is that affecting, for instance, investments in Canada?

[The Chair, Liberal, Yasmin Ratansi]

That's a big question.

[Maria Minna, Liberal, Beaches—East York, ON]

It's a big question, but you know, there are a lot of tax cuts. I want to know now whether they're staying in the country or what's happening. I see a picture today on the personal...she had a corporate tax....

[Prof. Kathleen Lahey]

The answers are actually quite short. Corporate surpluses are now at the level of something like $300 billion. They've got to invest that money, so they send it overseas. It can go tax-free in a growing number of tax haven countries. Canada has not yet closed the door on that.

My own personal calculations show that Canada lost $3.1 billion in tax revenue to overseas investments owned by Canadian corporations last year, and will every year. At the same time, I've estimated that another $3 billion is being lost in the domestic tax cuts. So there is a huge amount of money being released through the corporate sector that is draining the tax system quite dramatically.

How does this compare to individuals? Well, when the corporations are not paying taxes, who's left?

[Armine Yalnizyan]

There's also a very simple hydraulic to answer the question that shows the tax leakage. In the 1960s, personal income taxes contributed about 30% of federal government revenues. Today they account for almost half: 47%.

Look at corporate taxes in comparison. They've gone from about 19% of federal government revenues in the sixties to about 13% today. So it's a sea change; there's more reliance on income taxes. It's like taxing capital less and taxing labour more.

[Maria Minna, Liberal, Beaches—East York, ON]

And then it's going from—

[The Chair, Liberal, Yasmin Ratansi]

No, Ms. Minna. That's it.

Madame Demers, sept minutes, s'il vous plaît.

[Nicole Demers, Bloc, Laval, QC]

Thank you, Madam Chair.

I would like to thank our witnesses for being here today. I listened to your presentations with great interest. You have painted a very dark picture. However, I am not surprised by what you have said this morning. It is a reflection of current society. While 38% of those who don't pay tax are women, 33.5% don't have access to employment insurance. Also, we know that women over the age of 80 are the poorest members of our society.

I believe our government colleagues will also be very interested in what you said. We are really trying to work in a non-partisan manner. I hope that our government colleagues will agree to the Committee making recommendations aimed at ensuring that all the necessary equity and gender-based analysis is carried out appropriately.

In recent weeks, we have met with individuals appointed to be champions in the various departments who are doing gender-based analysis of new measures that are planned, before they are sent to the Minister or the Department of Finance to be looked at one last time, and then put into the system and officially proposed. Unfortunately, we have realized that these individuals have little influence or power within the departments. One of the people we spoke to told us that their role was to give, and I quote: “fearless advice and loyal implementation”.

I found it rather odd that the people who are supposed to be doing gender-based analysis and ensuring that it is part and parcel of government programs and measures have no power to make recommendations, other than to say that the analysis was carried out and to present the results. It doesn't go any further than that.

Ms. Peckford, until we are able to recommend that a commissioner be appointed, or if that recommendation were not to be accepted, I would like to know what we can do to give these people inside the departments more power. What kind of tools could we give them? I believe that Status of Women Canada does provide them with tools and training. Are you aware of what that training and those tools consist of? Are they adequate? Should we change them? Can you enlighten me on this?

[Nancy Peckford]

Thank you, Ms. Demers, for your question.

The situation is really difficult. The system is fairly weak. It is very important to improve the tools they have, of course, but it's also a question of political will. At the present time, we don't know whether there is enough political will to ensure women's equality. In my opinion, it is really important that a commissioner be appointed.

The good work of this committee, and also of the expert panel on gender equality and accountability mechanisms, should be very closely followed. That committee looked at a range of aspects within the federal government in terms of how they were doing gender-based analysis and how to do it better.

One of the best ways to compel

politicians, people making the decision,

to follow the advice of gender-based analysis is to establish a legislative framework. We do it for the official bilingualism act. We actually have a legal framework in which these decisions get made.

I think if you want to establish an imperative,

if the analysis we are doing as a government is really crucial for those decisions,

I think it's very important that we lay it out in a legislative framework so that it's not optional, not dependent upon the deputy minister. I mean, I'm not confident it gets to the ministerial level, so let's look at deputy minister levels—les sous-ministres, tout ça. I think we need something that compels the analysis to be taken into account.

In our experience—in what I've read, in what I've heard, and I think in what other individuals, expert panels, committees, United Nations bodies have considered—a legal framework is incredibly important. Having someone at the Auditor General's office overseeing the work is quite useful.

Finally, one of the things the expert panel recommended was that one of the best indications of a government's commitment to gender equality and women's equality is whether or not it appears in the Speech from the Throne. They said the Speech from the Throne should be utilized as a mechanism through which we articulate our broader, visionary goals for women's equality. No Speech from the Throne in several years under numerous governments has taken that opportunity. I think the time is now.

My fear about an action plan is that it will become a bureaucratic exercise, that it won't have any teeth, that it may sound good on paper and may look like other action plans from around the world, but Status of Women Canada will be charged with this implementation in a way such that it isn't able to compel the decision-makers, the highest levels of government, to implement it.

Thank you for your question. It's very real.

[Nicole Demers, Bloc, Laval, QC]

Ms. Peckford, you say that the person in the best position to ensure that it is in the Speech from the Throne would probably be the Minister responsible for the Status of Women. She is the one that should be convincing her Cabinet colleagues that this is crucial and has to be in the Speech from the Throne. That person has to show unfailing leadership.

[Nancy Peckford]

Yes, exactly. But, in my opinion, the Minister is not the only one who could do that. We need legislation and a legal framework to ensure that the goals are the same all across government. In this way, the goals would be mandatory. The Minister responsible for the Status of Women has a crucial role to play, but that is not enough. It won't work.

[Nicole Demers, Bloc, Laval, QC]

Thank you very much.

[The Chair, Liberal, Yasmin Ratansi]

Thank you.

We now go to Ms. Grewal for seven minutes.

[Nina Grewal, Conservative, Fleetwood—Port Kells, BC]

Thank you, Madam Chair.

I would like to thank all of you for your time and your presentations.

Let me start from here. You know that among the items in Budget 2008 was a significant investment in post-secondary education. Specifically, there is $350 million for a new Canada student grant program beginning in 2009, rising to almost $430 million by 2012 and 2013. There is also another $25 million over two years to establish a new Canada graduate scholarship award. Finally, there is $123 million over four years to streamline and modernize the Canada student loans program.

Seeing that women now are the majority on university campuses in Canada, would it be safe to assume that a gender analysis of these budget items would result in a favourable conclusion? Could you please explain that?

[Armine Yalnizyan]

Thank you very much for this very important question.

Yes, Budget 2008 has $350 million, which is in fact the amount of money that was available in the millennium scholarship fund, which ended this year. So in fact the net new investment in five years—because 2012-13 is when you get up to the $423 million figure—is a net new investment of $123 million.

The total federal budget is roughly $250 billion. The amount of surplus available this year was almost $18 billion. The student loans program that you described this grants and loans money as going to serves 425,000 students. There are 1.3 million students studying in post-secondary education full-time. Tuitions have tripled in the past 20 years. Student loans have exploded.

This is not enough money. Most of those students are women. I appreciate that it is a minor increase—$123 million over a five-year horizon is an increase—but $350 million of that money was there already. There was an additional $50 million given to post-graduate students. If memory serves me properly, it is something like 200 students who will get a benefit out of that.

Again I remind you, there are 1.3 million students. Yes, some students are going to do better, but it is not nearly enough to address the fact, Madam Grewal, that students are coming out of school today with student debt loads that are staggering, that are taking them 10 or 15 years to pay off. They are delaying family formation; they are unable to get their own housing. There's surely more we can do to limit the rise in tuitions or actually provide more grants.

May I also say that we are coming, within the next decade, to a sea change in the labour market. We are completely unprepared in this country for what is going to happen.

The fact is, we don't have enough doctors and nurses today. What is going to happen in five to ten years, given that about a third of doctors and half of nurses are poised to retire in the next five years? We have no plan for how to replace them.

We should be expanding the grants program dramatically to help people actually train to be doctors, nurses, and other health professionals to meet this huge issue that is facing us straight in the face and to make sure that we don't run out of people and that we stop importing them, poaching other jurisdictions that are using their scarce public resources to train people—and then they lose them to places such as Alberta, which can set up job fairs in hotel lobbies throughout Africa.

I think there are ethical considerations, justice considerations, and just plain smart governance, good planning, and forward-looking considerations that would mean you could spend more money on expanding that pool of grants.

[Nina Grewal, Conservative, Fleetwood—Port Kells, BC]

Okay. How about the $282 million over this and the next two years to expand the veterans independence program to support the survivors of veterans? Is this budget item good news for women? Could you please tell me about this?

And how long would it take you to do a comprehensive gender analysis of Budget 2008?

[Armine Yalnizyan]

There is a comprehensive analysis for women, which I have submitted to this committee, on some of the tax-and-spend measures in it. I have not studied the particular measure you have indicated. I have noted it, but I haven't looked at the break-out.

[Nina Grewal, Conservative, Fleetwood—Port Kells, BC]

It's the veterans independence program.

[Armine Yalnizyan]

Yes, there's $282 million for veterans.

There has been a strong emphasis in the past three budgets on the role this government plays through the military and with the military, as well as on security, policing, and trade-related items. There is new spending, it's true. That spending is crowding out the more long-term preventive things that we know can build the resilience of this nation.

This government spent a lot of political capital on conditioning the Canadian public that there was very little room to move as we walked into this next budget: there was a lot of news from the IMF, and “we have huge problems”, and.... It was very reminiscent, actually, of the run-up to the 1995 budget, when we were told that we had hit a debt wall.

There's a lot of political capital spent on telling us, as Canadians, “don't expect much”. But what new spending is there is in a particular direction. There was $5 billion in new spending there; it's in a particular direction.

Women have been told to wait in good times and bad. Can't you invest in some of these things whose repercussions we know are huge? They build resilience, they build communities, they strengthen society, and they prepare the next generation of workers.

There's money there: $43 billion in measures over three years. There was money there to do something, to do more than what you did.

[Nina Grewal, Conservative, Fleetwood—Port Kells, BC]

Madam Chair, do I have time?

[The Chair, Liberal, Yasmin Ratansi]

You have time for a very short question.