Debates of Dec. 4th, 2017

Question No. 1237

[Peter Kent, Conservative, Thornhill, ON]

With regard to the decision taken by the World Heritage Committee of the United Nations Educational, Scientific and Cultural Organization (UNESCO) on July 7, 2017, to inscribe Hebron and the Tomb of the Patriarchs as a Palestinian site on the World Heritage List and on the List of World Heritage in Danger: what is the government’s official position on the UNESCO decision?

[Chrystia Freeland, Liberal, Minister of Foreign Affairs]

Mr. Speaker, Canada is disappointed by the continued politicization of the work of the world heritage committee as evidenced by the decision to include the Old Town of Hebron/Al-Khalil on the list of World Heritage in Danger.

This decision hurts UNESCO? and it does nothing to advance prospects for the comprehensive, just, and lasting peace to which we aspire for the sake of all Israelis and Palestinians.

Canada is not a member of UNESCO’s world heritage committee. Therefore, Canada could not vote against this decision, but expressed our opposition during the world heritage committee meeting in Krakow, Poland, in July 2017.

Question No. 1238

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

With regard to the conflict of interest screen for the Minister of Finance: (a) since November 4, 2015, how many times did the chief of staff warn or notify the Minister that he may be contravening the conflict of interest screen; (b) when did each instance in (a) occur and what was the nature of each warning or notification; (c) for each instance in (a), was action taken as a result of the warning or notification, and if so, what action was taken; (d) did the Minister disclose the fact that Morneau Shepell relocated its headquarters to Barbados in 2016 to his chief of staff; (e) did the Minister attend any meetings concerning the Barbados tax treaty or the use of Barbados as a tax haven, and if so, did the Minister inform his chief of staff about the meeting; and (f) did the chief of staff advise the Minister that the changes proposed in the consultation paper “Tax Planning Using Private Corporations” could benefit Morneau Shepell or the Minister personally, and if so, on what date was the advice given?

[Joël Lightbound, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, the Conflict of Interest and Ethics Commissioner is an independent officer of the House of Commons who administers the Conflict of Interest Act and the Conflict of Interest Code for Members of the House of Commons. The Conflict of Interest and Ethics Commissioner is responsible for helping appointed and elected officials prevent and avoid conflicts between their public duties and private interests.

Per her recommendations, the conflict of interest screen is administered by the minister’s chief of staff and supported by the department. Instances that are caught by the conflict of interest screen are reported to the Ethics Commissioner’s office.

Minister Morneau continues to work closely with the Ethics Commissioner to ensure all the rules are being followed, and has gone above and beyond her recommendations.

Question No. 1239

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

With regard to correspondence, in both paper and electronic format, between the Premier of Ontario and the Prime Minister, in relation to the proposed tax changes announced by the Minister of Finance on July 18, 2017: what are the details of all such correspondence, including the (i) date, (ii) format (email, letter), (iii) sender, (iv) recipient, (v) title, (vi) summary of contents?

[Peter Schiefke, Liberal, Parliamentary Secretary to the Prime Minister (Youth)]

Mr. Speaker, the Privy Council Office does not have any correspondence, neither in paper nor electronic format, between the Premier of Ontario and the Prime Minister, in relation to the proposed tax changes announced by the Minister of Finance on July 18, 2017.

Question No. 1241

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

With regard to the Minister of Finance’s paper entitled “Tax Planning Using Private Corporations” and the consultations, which closed on October 2, 2017: (a) how many submissions did the Department of Finance receive by (i) mail (paper), (ii) email, (iii) phone; (b) for each submission in (a), what are the details, broken down by submitter’s (i) profession, (ii) province; (c) how many submissions were in favour of the government’s proposed changes to passive income rules; (d) how many submissions were opposed to the government’s proposed changes to passive income rules; (e) how many submissions were in favour of the government’s proposed changes to so-called “income sprinkling” rules; (f) how many submissions were opposed to the government’s proposed changes to so-called “income sprinkling” rules; (g) how many submissions were in favour of the government’s proposed changes to so-called “income stripping” rules; (h) how many submissions were opposed to the government’s proposed changes to so-called “income stripping” rules; (i) how many submissions were received after the deadline, and what did the government do with these submissions; (j) which section of the Department of Finance was responsible for receiving submissions; (k) what is the government’s estimation of revenue to be generated by the proposed changes to passive income rules; (l) what is the government’s estimation of revenue to be generated by the proposed changes to so-called “income sprinkling” rules; and (m) what is the government’s estimation of revenue to be generated by the proposed changes to so-called “income stripping” rules?

[Joël Lightbound, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, with regard to part (a), over 21,000 submissions were received in response to the consultation on tax planning using private corporations via email in the dedicated consultation mailbox. This total includes over 11,000 form letters. In addition to the emails received through the consultation mailbox, over 10,000 related items of correspondence to the Minister of Finance were received by the department.

With regard to part (b), the department has not kept a record or a tally of submissions based on their source, such as place of residence, occupation, etc. Individuals and groups making submissions to the consultation mailbox were not asked to provide this information .

With regard to parts (c) to (h), the department is in the process of reviewing submissions to ensure that comments and proposals are properly taken into account in the further development of the policy. Through this process, the department is not keeping a record or a tally of all these submissions based on their degree or type of support. That said, various opinions were expressed.

With regard to part (i), the consultation mailbox received over 200 submissions via email from October 2, 2017 to October 17, 2017, i.e., the date of the question. Concerns raised in these submissions will be considered by the Department of Finance.

With regard to part (j), the tax policy branch of the Department of Finance is receiving the submissions directly.

With regard to part (k), as announced in the fall economic statement 2017, the government will propose measures to limit tax deferral opportunities related to passive investments, and will release draft legislation as part of budget 2018. The department will provide a revenue estimate after key design aspects are determined.

With regard to part (l), the government’s estimation of revenue to be generated by the proposed measures to limit income sprinkling using private corporations is about $215 million in 2018-19, growing to $245 million by 2022-23.

With regard to part (m), the government announced in the fall economic statement 2017 that it is no longer moving forward on the proposed changes regarding the conversion of income into capital gains and that the draft legislative proposals released with the consultation will not proceed.

Question No. 1242

[Pierre Poilievre, Conservative, Carleton, ON]

With regard to the working group referred to by the Minister of Finance’s spokesman in the Toronto Star on February 28, 2017, “to collaborate on transparency and beneficial ownership”: (a) what is the mandate of the working group; (b) on what date was the working group created; (c) on what date does the working group anticipate concluding; (d) since being created, on which dates has the working group met; (e) for each meeting in (d), what were the items on the agenda; (f) what is the membership of the working group, broken down by (i) position or title, (ii) level of government, (iii) department, (iv) responsibilities related to the working group; (g) who was present for each meeting in (d); (h) was the Minister of Finance present for any items pertaining to Barbados being used as a tax haven; (i) If the answer to (h) is affirmative, did the Minister disclose the fact that his company, Morneau Shepell, relocated its headquarters in 2016 to Barbados; (j) if the answer to (i) is affirmative, did the Minister inform his chief of staff; (k) if the answer to (i) is affirmative, did the Minister inform the Conflict of Interest and Ethics Commissioner; and (l) if the answer to (i) is affirmative, did the Minister inform the Prime Minister?

[Joël Lightbound, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, with regard to parts (a) and (b), the Government of Canada is committed to implementing strong standards for corporate and beneficial ownership transparency that provide safeguards against money laundering, terrorist financing, tax evasion, and tax avoidance, while continuing to facilitate the ease of doing business in Canada. Timely access for competent authorities to accurate and up-to-date beneficial ownership information is vital for combatting illicit financial flows, including money laundering, terrorist financing, and tax evasion and avoidance.

The federal-provincial committee on taxation is a committee composed of senior federal, provincial, and territorial tax officials who meet generally on a semi-annual basis to discuss common tax policy issues and examine their consequences for the national and provincial/territorial economies. The proposal to create a working group of federal, provincial, and territorial officials to examine tax avoidance and evasion, with the first issue proposed for examination being strengthening the collection of beneficial ownership information, was first adopted at the federal-provincial committee on taxation held June 6-7, 2016 in Winnipeg and support for the formation of this working group was confirmed by finance minister at the federal, provincial, and territorial finance ministers’ meeting on June 19 and 20, 2016. Key objectives for the working group are to raise awareness and understanding of the international standards and importance of corporate and beneficial ownership transparency, and collaborate on identifying and advancing options to improve availability of accurate beneficial ownership information.

With regard to parts (c) to (e), the work of the working group is ongoing. The working group met via conference call on September 26, 2016, February 14, 2017, September 12, 2017, and September 29, 2017.

The objective of the working group is to collaborate to advance the issue of strengthening the transparency and collection of beneficial ownership information. The agenda for the first meetings centered on the development of the working group’s objectives and terms of reference and an analysis of the current state of the corporate registry requirements in each of the participating jurisdictions. Subsequent working group meetings have focused on an international comparison regarding what other jurisdictions have proposed or introduced to strengthen the collection of beneficial ownership information and a discussion on potential options for strengthening the collection of beneficial ownership information.

With regard to parts (f) to (l), the working group operates at the officials’ level. Participants at the federal level are officials from the Department of Finance responsible for tax policy, in the tax legislation division, and financial sector policy, financial crimes, and officials from Innovation, Science and Economic Development Canada responsible for federal corporate law policy, marketplace framework policy and Corporations Canada. The working group is supported by at least one official from each of the provinces and territories with responsibility for tax and/or corporate law policy.

Various officials from the Department of Finance, from Innovation, Science and Economic Development Canada, and from most or all provinces and territories participated in each working group meeting, but specific attendance was not recorded.

The working group has not discussed items pertaining to the use of any particular jurisdiction for the purposes of tax avoidance or tax evasion.

Question No. 1244

[Arnold Viersen, Conservative, Peace River—Westlock, AB]

With regard to the relationship between the Canadian Standards Association (CSA), the Standards Council of Canada and the Department of Industry, since January 1, 2016: (a) what role does the CSA play in the development or recommendation of regulations imposed by the Department of Industry; (b) what specific measures are in place to ensure that groups recommending standards or regulations are not influenced by foreign money; (c) what specific regulations, which were recommended by the CSA, have been put into place by either the Standards Council of Canada or the Department of Industry; (d) what is the website location of any regulations referred to in (c); and (e) what are the details of any memorandums at the Department of Indsutry, which reference the CSA, including the (i) date, (ii) sender, (iii) recipient, (iv) title or subject matter, (v) file number?

[Navdeep Bains, Liberal, Minister of Innovation]

Mr. Speaker, with regard to part (a), the Canadian Standards Association, operating as CSA Group, is one of nine standards development organizations accredited by the Standards Council of Canada, SCC, which can be found at: www.scc.ca/en/accreditation/standards/directory-of-accredited-standards-development-organizations. CSA Group is not a regulatory entity and does not report to the Minister of Innovation, Science or Economic Development, ISED, either directly or indirectly through the SCC. SCC is a federal crown corporation whose role includes the coordination of Canada’s voluntary standardization network. SCC does not have any regulatory authority in its mandate.

With regard to part (b), SCC is not aware of any specific measures in place to ensure that groups recommending standards or regulations are not influenced by foreign money. SCC takes its mandate from the Standards Council of Canada Act, its governing legislation, to promote efficient and effective voluntary standardization in Canada, which can be found at: http://laws-lois.justice.gc.ca/eng/acts/S-16/index.html. SCC promotes the participation of Canadians in voluntary standards activities and coordinates and oversees the efforts of the persons and organizations involved in Canada’s standardization network.

With regard to part (c), neither SCC nor CSA Group is a regulatory entity. SCC is not aware of any regulations put in place that have been recommended by CSA Group.

With regard to part (d), neither SCC nor CSA is a regulatory entity.

With regard to part (e), ISED officials have confirmed that there are no active memoranda referencing the CSA since January 1, 2016.

Question No. 1248

[Bob Benzen, Conservative, Calgary Heritage, AB]

With regard to the decision by the Ontario Superintendent of Financial Services to appoint Morneau Shepell as the administrator for the pension plan of Sears Canada Incorporated: (a) when did the Department of Finance first become aware of the decision; (b) which other departments or agencies were notified of the decision, and when were they notified; (c) was any government agency or department consulted prior to naming Morneau Shepell as the administrator, and if so, (i) who was consulted, (ii) on what date did consultation take place; (d) did the Minister of Finance recuse himself from this matter; and (e) if the answer to (d) is affirmative (i) what specific steps were taken by the Minister, (ii) on what date did the Minister recuse himself, (iii) who is replacing the Minister with regard to ministerial responsibility on this file?

[Joël Lightbound, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, private pension plans are regulated under the applicable pension standards legislation, which can be either federal or provincial, depending on the employer’s business operations. Plans sponsored by employers in federally regulated industries, which include banking, interprovincial transportation, and telecommunications, are regulated under the federal Pension Benefits Standards Act, 1985, PBSA.

The Sears pension plan falls under provincial jurisdiction and is regulated by the Ontario Pension Benefits Act. Decisions pertaining to the supervision and administration of this plan are the sole responsibility of the Ontario Superintendent of Financial Services. The federal Department of Finance is not involved in any way.

Question No. 1251

[Pierre Poilievre, Conservative, Carleton, ON]

With regard to appointments by the Office of the Superintendent of Financial Institutions (OSFI) of administrators to wind-up the pension plans of bankrupt or insolvent companies, since January 1, 2004: (a) has OSFI hired Morneau Shepell; and (b) if the answer to (a) is affirmative, what are the details of each instance, including the (i) internal tracking number, (ii) name of the company for which OSFI was seeking an administrator, (iii) date OSFI commenced its search for an administrator, (iv) date Morneau Shepell was hired, (v) date the contract was approved by the Treasury Board Secretariat, (vi) value of the contract, (vii) position or title of the public servant who approved the contract, (viii) date Morneau Shepell concluded its work?

[Joël Lightbound, Liberal, Parliamentary Secretary to the Minister of Finance]

Mr. Speaker, the Office of the Superintendent of Financial Institutions, OSFI, is an independent federal government agency, established under the Office of the Superintendent of Financial Institutions Act, that regulates and supervises more than 400 federally regulated financial institutions and 1,200 private pension plans to determine whether they are in sound financial condition and meeting their regulatory and supervisory requirements.

OSFI is funded mainly through assessments on the financial institutions and private pension plans that it regulates. The deputy head of OSFI is the Superintendent of Financial Institutions, who is appointed for a seven-year term and may not be removed without cause.

OSFI does not hire replacement administrators, rather it has the authority to appoint a replacement administrator under subsection 7.6(1) of the Pension Benefits Standards Act, 1985, PBSA. As such, there is no formal contract between OSFI and an appointed replacement administrator. OSFI does not consult with the Department of Finance on the appointment of replacement administrators.

As per the provisions of the PBSA, a replacement administrator is appointed if the plan administrator is insolvent or unable to act or the Superintendent of Financial Institutions is of the opinion that it is in the best interests of the members, or former members, or any other persons entitled to pension benefits under the plan that the administrator be removed. Replacement administrators may recover their reasonable fees and expenses from the pension fund.

Questions Passed as Orders for Returns

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, if the government's responses to Questions Nos. 1240, 1243, 1245 to 1247, 1249, and 1250 could be made as orders for return, these returns would be tabled immediately.

[The Speaker, Liberal, Geoff Regan]

Is that agreed?

[Some hon. members]

Agreed.

Question No. 1240

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

With regard to buildings owned or operated by the Department of Public Works and Government Services for government employees, as of October 17, 2017: (a) what is the complete list of buildings; (b) what are the details of each building, including the (i) address, (ii) building name, (iii) occupancy limit (maximum number of employee workstations); and (c) what is the current occupancy or number of employee full-time equivalents assigned to each building?

(Return tabled)

Question No. 1243

[Pierre Poilievre, Conservative, Carleton, ON]

With regard to all contracts signed since September 19, 2016, between the government and Morneau Shepell: what are the details of each contract, including the (i) internal tracking number, (ii) contract purpose or title, (iii) goods or services provided, (iv) value, (v) department, (vi) position of the government employee who initiated the contract, (vii) date of signature, (viii) date of approval by the Treasury Board Secretariat, (ix) expiration date?

(Return tabled)

Question No. 1245

[James Bezan, Conservative, Selkirk—Interlake—Eastman, MB]

With regard to the government’s discussions with the Australian government, leading up to the submission of the Expression of Interest of September 29, 2017, regarding the potential purchase of F/A-18 fighter aircraft and associated parts: (a) how many aircraft has the Australian government made available for purchase; (b) how many aircraft has the government expressed an interest in purchasing from Australia; (c) when does the government expect to receive the first used F/A-18 fighter aircraft from Australia; (d) when does the government expect to receive the last F/A-18 fighter aircraft from Australia; (e) what is the anticipated acquisition cost per aircraft; (f) when did each aircraft available for purchase become operational within the Royal Australian Air Force; (g) what is the anticipated life-span of the Australian fleet of F/A-18 fighter aircraft; (h) how many flying hours has each of Australia’s F/A-18 fighter aircraft intended for purchase accumulated; (i) were the economic benefits to Canada discussed; (j) what are the economic benefits to Canada from the potential purchase of F/A-18 fighter aircraft and associated parts from Australia; (k) what type of repairs, upgrades and modernization will Australia’s F/A-18 fighter aircraft require before being operational within the Royal Canadian Air Force (RCAF) and, for each repair, upgrade and modernization (i) what is the anticipated timeline, (ii) what is the anticipated cost, (iii) will the manufacturer of Australia’s F/A-18 fighter aircraft be involved in any of them; (l) has any analysis been done to determine if any spare parts from currently active or recently retired aircraft can be used in the repairs, upgrades and modernization of Australia’s F/A-18 fighter aircraft; (m) if the answer in (l) is affirmative, what were the findings of this analysis; (n) will Canadian CF-18 pilots require additional training before flying Australia’s F/A-18 fighter aircraft; (o) if the answer in (n) is affirmative, what is the timeline for the additional training; (p) what analysis was done to determine that Australia’s F/A-18 fighter aircraft could (i) be operational within the RCAF, (ii) satisfy the RCAF’s commitments to domestic security, NATO, NORAD, and other international obligations; and (q) what are the details of communications which have been received from the Australian government from November 1, 2015, to date, related to the purchase of F/A-18 fighter aircraft, including the (i) date, (ii) sender, (iii) recipient, (iv) title, (v) relevant file number?

(Return tabled)