Transport Committee on Feb. 25th, 2021

[The Chair, Liberal, Vance Badawey]

Okay, folks, we'll get going. Welcome to meeting number 19 of the House of Commons Standing Committee on Transport, Infrastructure and Communities.

Today's meeting is taking place in a hybrid format pursuant to the House order of January 25, 2021. The proceedings will be made available via the House of Commons website. Just so you are aware, the webcast will always show the person speaking rather than the entirety of the committee.

To ensure an orderly meeting, I will outline a few rules to follow. First off, members and witnesses, you may speak in the official language of your choice. Interpretation services are available for this meeting. You have the choice at the bottom of your screen of the floor, English or French.

For members participating in person, proceed as you usually would when the whole committee is meeting in person in the committee room. Keep in mind the directives from the Board of Internal Economy regarding masking and health protocols.

Before speaking, please wait until I recognize you by name. If you are on video conference, please click on the microphone icon to unmute yourself. For those in the room, your microphone will be controlled as normal by the proceedings and verification officer. I remind everyone that all comments by members and witnesses should be addressed through the chair. When you are not speaking, your microphone should be on mute.

With regard to a speaking list, the committee clerk and I will, as always, do the best we can to maintain the order of speaking for all members whether they are participating virtually or in person.

Members, pursuant to Standing Order 108(2) and the motion adopted by the committee on Thursday, October 29, 2020 the committee is meeting today to continue its study on the Canada Infrastructure Bank.

Now I'd like to welcome our witnesses.

First off, we have the Honourable Catherine McKenna, Minister of Infrastructure and Communities. Minister McKenna, welcome.

Following her, we have witnesses from her department, the Office of Infrastructure Canada: Kelly Gillis, deputy minister, infrastructure and communities; Glenn Campbell, assistant deputy minister, investment, partnerships and innovation; Mary McKay, director general, alternative finance, investment, partnerships and innovation; and Lisa Mitchell, senior director, investment, partnerships and innovation.

Members, we will start off the meeting with Minister McKenna and her five-minute opening.

Minister McKenna, the floor is yours.

[Catherine McKenna, Liberal, Minister of Infrastructure and Communities]

Thank you very much.

I'd like to start by acknowledging that I'm in Ottawa on the traditional unceded territory of the Algonquin Anishinabe peoples. I'm really delighted to be here with my deputy, Kelly Gillis, and her amazing team.

Good afternoon to everyone on the committee. It's great to see you again.

Thank you very much for inviting me to discuss the importance of investing in infrastructure for Canadians and the role that the Canada Infrastructure Bank plays in our infrastructure plan. I want to thank the committee for undertaking this really important study.

First, I'd like to say that our government is committed to making critical infrastructure investments across the country that will help us build back better, create good jobs, grow our economy, create inclusive communities and tackle climate change.

There is no question that the Canada Infrastructure Bank plays an important role in our plan. The bank has already committed to infrastructure projects that contribute to creating jobs and growth, building inclusive and resilient communities, and helping us meet our climate targets.

By attracting private sector and institutional investors to infrastructure projects in the Canadian public interest, the Canada Infrastructure Bank brings a new approach that will impact how infrastructure in Canada is financed.

There is no question that the Canada Infrastructure Bank plays an important role in our plan. The bank has already committed to infrastructure projects that contribute to Canada’s economic growth, building inclusive and resilient communities, and that help meet our climate targets.

By attracting private sector and institutional investors to infrastructure projects in the Canadian public interest, the Canada Infrastructure Bank is taking a new approach that will impact the way infrastructure is funded in Canada.

The pandemic of the last year has challenged Canadians in countless ways. On top of the impact of the illness, death and public health measures to stop the spread of infection, we're now facing the challenge of building our economy back. The work we do and the decisions we make in the coming months and years will define our country's path for decades to come.

This is why the government is undertaking Canada's first national infrastructure assessment. By mapping out where we need to go, where gaps exist, what needs to be prioritized and how we will finance the investments in infrastructure that we need, we will enable provinces, territories, municipalities and indigenous communities to identify projects of key importance and get them built in the best interests of Canadians.

Let me take a couple of minutes to talk about where the Canada Infrastructure Bank is today. It has entered a new phase of development under a strong and capable leadership team. The bank is committed to developing and executing $35 billion in investments to get maximum long-term benefits for Canadians in five priority areas: clean power renewable generation, storage and transmission; broadband in underserved communities; building retrofits; agriculture irrigation projects to help prairie farmers; and zero-emission buses and charging infrastructure.

As the CIB is an arm's-length Crown corporation, the government sets the policy priorities and the CIB's board of directors is responsible for the organization's management and investment decisions. To ensure the organization's priorities remain aligned with the government's, last month I updated the CIB's statement of priorities and accountabilities. It now includes a target for the bank to invest at least a billion dollars in total across its five priority areas in revenue-generating projects that benefit indigenous peoples.

Additionally, last fall, our government joined the Canada Infrastructure Bank in announcing its growth plan, a clear plan for the crucial next three years. The three-year, $10-billion growth plan will be a key driver of our plan to build back better through its five major initiatives: clean power, broadband access, energy-efficient buildings, agricultural irrigation, and zero-emission buses.

The CIB has taken immediate action to implement its growth plan, first with a $407-million investment towards the largest agricultural irrigation project in Alberta. Recently, it announced an engagement with what is anticipated to be the largest battery storage facility in Canada, working with an indigenous community. The bank is also backing the REM, the largest public transit project in Montreal in half a century, and it's looking at how to expand the capacity of the New Westminster rail bridge in B.C. to boost trade and transportation.

The CIB now has priority sectors, an investment plan and a strong leadership team to play significant role in getting more and better projects built for Canadians across the country.

I am confident that the Canada Infrastructure Bank's investments will help to drive Canada's economic recovery and build the infrastructure we need, in all communities, for Canada's long-term success.

Canada's infrastructure plan is investing in thousands of projects across the country, creating jobs and building more inclusive communities.

Thank you.

[The Chair, Liberal, Vance Badawey]

Thank you, Minister McKenna. Well done.

We're now going to move to our first round of questions.

Starting off, we have Mr. Scheer from the Conservative Party, followed by Ms. Jaczek of the Liberals, Mr. Barsalou-Duval of the Bloc and Mr. Bachrach of the NDP.

Mr. Scheer, the floor is yours for six minutes.

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

Thank you very much, Mr. Chair, and thank you, Minister.

Minister, you referenced a couple of times in your opening remarks that the intent of the Canada Infrastructure Bank was to unlock private sector investment. Can you inform this committee of how much private sector investment this bank has been able to secure to date?

[Catherine McKenna, Liberal, Ottawa Centre, ON]

Thank you very much.

I'd like to thank the member opposite, who is also my critic. It's great to see you here. I have a list of projects in your riding that I know you'd be very interested in. We've approved 43 projects worth over $763 million.

The Canada Infrastructure Bank is moving forward on a number of really great projects. One that is probably close to your heart is the investment in irrigation in Alberta. That's a great project with the Government of Alberta, which clearly recognizes the critical importance of the Canada Infrastructure Bank in getting major projects built and bringing in the private sector.

There's the REM project in Montreal.

Our friends in Montreal see that it is under construction today.

That's another great example of a project with the Caisse de dépôt that is moving forward. I can give you a whole range of examples of projects that are good projects that will make a difference.

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

Minister, I can find a list of those projects on the government's website as well.

However, the bank was designed in a very specific way to not be a traditional funding envelope. The promises that were made were that the bank would leverage private sector investment. The way it was operating, the innovative way you were designing this program, was that not only would Canadian tax dollars be put into these projects but also that private sector investment in the ownership of these types of projects would follow.

It's a very simple question. You must keep track of this. How much private sector investment has been committed to the projects that the Canada Infrastructure Bank is currently involved in?

[Catherine McKenna, Liberal, Ottawa Centre, ON]

I want to confirm that I totally agree. The bank has an important role in attracting private sector investment, in particular institutional investors, because our Canadian workers' dollars are at work. If we look at the REM project, which is an investment with the Caisse de dépôt, the latter has invested $3 billion.

Also, I think it's not just about bringing in the private sector; it's also about getting good projects built in the public interest. That's why we've got the bank, because we can get more infrastructure built.

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

In fairness, you haven't got any built. This bank has been around for almost four years now. You've completed zero projects. The criticism of the Réseau project was that the Canada Infrastructure Bank's commitment was just replacing what normally would have been allocated from different funding envelopes within Infrastructure Canada.

You've got 12 or 13 projects on the Canada Infrastructure Bank's website. For many of these projects, their current status is that they are just providing advisory services or memoranda of understanding. The question is: Where is all of this private sector investment? What is the total amount? Promises were made about unleashing and leveraging two or four times the amount in private sector investment. This is a $35 billion bank. How much private sector investment has been committed through the Canada Infrastructure Bank's current list of projects?

[Catherine McKenna, Liberal, Ottawa Centre, ON]

The REM project is really important.

The Government of Quebec is very proud of the REM project, in which the Caisse de dépôt et placement du Québec has invested $3 billion. So it's an investment by both the Quebec government and by institutional investors.

We'll talk about that project. It's the biggest transit project in Quebec in over 50 years; 680,000 tonnes of greenhouse gases will be reduced over 25 years and there'll be 34,000 jobs. These are really important projects, and the bank is advancing on a whole range of projects.

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

Minister, I'm asking for a total amount of private sector investment. That's the question. We can all agree. Our party made commitments to public transit. We committed to expanding the GO line. We've made commitments for infrastructure in Montreal and those types of public transit.

Here's the thing with the infrastructure bank; this was supposed to be a marquee institution. This was a marquee project. This was the Prime Minister's brilliant new innovative way to build the country. Your government courted investors worth hundreds of billions of dollars, the richest bankers and the wealthiest hedge fund managers. You even held a fancy party with all the bells and whistles at the Shangri-La Hotel, trying to unlock $16 trillion in institutional funds that you claimed were floating around the world waiting to invest. So far you haven't been able to complete a single thing.

Your government, your ministers and your CEOs at the bank have all made amazing claims that the $35 billion in taxpayers' money the infrastructure bank has would be able to unlock twice or four times, and even seven times the investment from the private sector. You've got a dozen or so projects listed on your website. Most of them are at the memorandum of understanding phase or the advisory services phase. It doesn't seem to me that providing advisory services on a project is going to unleash and unlock that private sector investment.

Where is all of this private sector money that you claimed would be coming in to take an ownership position to replace the need for taxpayers' money? In other words, what is the total—not just one project, but the total, so that we can evaluate if you're hitting your own metric? Your own metric is at least twice, and maybe four times, in private sector investment. What is the grand total of private sector investment in ownership of the projects that the Canada Infrastructure Bank is currently involved in?

[Catherine McKenna, Liberal, Ottawa Centre, ON]

I would like to clarify a number of things. The idea of the Canada Infrastructure Bank came to the Prime Minister from the advisory council on economic growth. This is an idea about how you get more infrastructure built. I would hope that the member opposite, being from a conservative party, would think it's a good idea to work with our pension fund, some of the largest investors—

[Andrew Scheer, Conservative, Regina—Qu'Appelle, SK]

You haven't got it done. That's the problem. You've got zero completed.

[Catherine McKenna, Liberal, Ottawa Centre, ON]

I think the member opposite is probably sophisticated enough to understand that projects don't get built in a day and that advisory services matter, because you need to develop the projects. We are moving ahead, and if you look at the REM project, it brought in $1.28 billion with CDPQ. If you take the Alberta irrigation project, which reached financial closure in December, it includes $163 million in investment from private irrigation districts.

My goal is to get more and better infrastructure built at a time when it could not be more important. We're in the deepest recession since the Great Depression. We're very fortunate that our government is investing in infrastructure.

It would be interesting to know if your party is going to run again on a campaign to cut $18 billion in infrastructure investments, including to kill the Canada Infrastructure Bank.

We're about getting more built. We're about working with institutional investors in Canada so we can do that and can make sure that we leverage the private sector to manage risk and get more and better infrastructure built. That is in the public interest for Canadians.

[The Chair, Liberal, Vance Badawey]

Thank you, Minister McKenna.

We're now going to move to the Liberals.

Ms. Jaczek, you have the floor for six minutes.

[Helena Jaczek, Liberal, Markham—Stouffville, ON]

Thank you very much, Mr. Chair.

Thank you, Minister McKenna, for being with us today with your officials.

On Tuesday we heard some very interesting testimony, in particular from Mr. Bain with Concert Infrastructure, who also worked at Infrastructure Ontario and is very experienced in delivering projects. His comment was that, of course, project don't happen overnight. Also, as I think we're well aware, the Canada Infrastructure Bank is particularly charged with looking at complex projects.

Could you comment on how you see the process that was initiated a number of years ago, how it's developing and how you're making progress on those projects?

[Catherine McKenna, Liberal, Ottawa Centre, ON]

It was really interesting testimony. I think you get good witnesses who have very different perspectives on the Canada Infrastructure Bank.

As Mr. Bain pointed out, the real opportunity is to look at how we can get more infrastructure built. However, these projects take a number of years. You have to start somewhere. You have to start with feasibility studies, with MOUs, and work up to building the projects. This is a real opportunity.

If you look at some of the projects.... I've talked about the REM in Montreal and the Alberta irrigation project, that's a partnership with a Conservative premier who understands the importance of the Canada Infrastructure Bank.

A really great project is the Oneida Energy storage project. That's a partnership with a first nation community, and it's going to be the largest battery storage project in North America, I believe. This is really about how we get more built, but also how we bring in indigenous people so they share in the these benefits.

There's Kivalliq hydro-fibre link MOU. That would be a 1,200 kilometre, 150 megawatt transmission line from Nunavut to New Brunswick. There's the Taltson hydroelectricity expansion project. I could go on. A whole range of diverse projects are in the priority areas.

As I said, it's about getting more infrastructure built for Canadians. When I go to communities across the country—to mayors, premiers and Canadians—they want more and better infrastructure built, because it creates jobs and growth; it increases Canada's competitiveness; it improves the quality of life for Canadians and, of course, it drives us to a net-zero future. Climate change is the other crisis we're in. We're in a health and economic crisis now, but we're also in a climate crisis.

The infrastructure bank is not the only way we are funding infrastructure, that's for sure, but it is a critically important part of our plan and an opportunity to get more and better infrastructure built.

[Helena Jaczek, Liberal, Markham—Stouffville, ON]

Thank you, Minister.

I will turn to a priority area for my constituents in Markham—Stouffville, and that's public transit, as you know, Minister. You have visited us in York Region a number of times. I have four GO train stations in my riding, and I was very pleased to see the GO expansion as one of the priority areas.

Beyond that, could you detail for us what the CIB is going to be doing overall in public transit?

[Catherine McKenna, Liberal, Ottawa Centre, ON]

I think this is a critical area of investment for Canada and the Canada Infrastructure Bank. We need to deal with congestion. We also need to deal with air pollution caused by transportation, one of our largest categories of emissions. Over 20% of our emissions come from transportation. We just made a very big announcement of a separate commitment by the government to permanent public transit funding—$15 billion in additional money.

In terms of the bank, public transit is one of its five priority areas. There is $5 billion for the bank to invest in projects. We've seen them already investing in the REM, but there are obviously a lot of other opportunities.

In its growth plan, which is a more recent plan focused on the pandemic in the next three years and creating jobs and growth, it has committed $1.5 billion to zero-emission buses and related infrastructure. I think this is incredibly important. I'm sure that in your community folks would love to be riding in zero-emission buses. They are quieter and cleaner. Often they are made in Canada. It's a great story about Canadian innovation by bus companies, from New Flyer to Nova Bus to Lion Électrique to Ballard fuel-cell buses.

This is a real opportunity for Canada to be leading the way in creating, jobs, growth and, of course, building cleaner and more inclusive communities.

[Helena Jaczek, Liberal, Markham—Stouffville, ON]

Finally, in terms of the CIB model, some statements were made that there was some sort of mandate that assets would return to the private sector or become owned by the private sector. Could you please tell us if there is any mandate like that for the Canada Infrastructure Bank?

[Catherine McKenna, Liberal, Ottawa Centre, ON]

I want to be clear that this isn't about privatizing public assets. It's actually bringing in private sector investments so we can support more infrastructure in the public interests for Canadians. I think that's a really important point. I think this is really about how we leverage dollars, how we leverage the pension plans of Canadian workers, so that when they go to work, those dollars go to work in Canada to building more infrastructure. This isn't a plan to go and privatize all public infrastructure.

[Helena Jaczek, Liberal, Markham—Stouffville, ON]

Thank you.

[The Chair, Liberal, Vance Badawey]

Thank you, Ms. Jaczek, and thank you, Minister McKenna.

We're now going to move on to the Bloc.

Mr. Barsalou-Duval.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you very much, Mr. Chair.

I'll start where we left off with Ms. Jaczek's questions.

Ms. McKenna, you just said that the bank's goal is not to privatize infrastructure and that rumours that private investors might run away with infrastructure investments are false.

To my knowledge, nothing is preventing the Caisse de dépôt et placement du Québec from selling the REM project, if that is its intention.

[Catherine McKenna, Liberal, Ottawa Centre, ON]

Is that a question?

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

It is a question and a statement. Could you actually comment so that I can find out whether what you just said makes sense?