SINS Committee Meeting

SUB-COMMITTEE ON THE INDUSTRY OF SPORT IN CANADA OF THE STANDING COMMITTEE ON CANADIAN HERITAGE

SOUS-COMITÉ DE L'INDUSTRIE SPORTIVE DU CANADA DU COMITÉ PERMANENT DU PATRIMOINE CANADIEN

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, February 5, 1998

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[English]

The Chairman (Mr. Dennis J. Mills (Broadview—Greenwood, Lib.)): Colleagues, just to begin with a short preamble before we move to our witnesses, you've all received a black binder. Do all committee members have one of these? This represents the work of our clerk and our officials over the past month while we were in recess. It essentially covers the questionnaire sent to over 300 organizations some three weeks ago. There are also some themes we could discuss. Hopefully most of them, if not all, meet with your approval. My suggestion is that we deal with this as sort of the business of the committee after we've heard from the witnesses today.

Having said that, I would like to welcome Dr. Jean Harvey and Dr. Marc Lavoie.

Professor Harvey is a professor at the School of Human Kinetics and the vice-dean of research with the Faculty of Health Sciences at the University of Ottawa. His research focuses on health policy, sports policy and the political economy of sport. Among other publications, he's the author of a book published by University of Ottawa Press entitled Not Just a Game: Essays in Canadian Sport Sociology.

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Marc Lavoie is a professor at the Department of Economics, again at the University of Ottawa. His research work focuses on monetary policy, macroeconomics theory and the economics of sport. He is the author of a recently released book entitled Avantage numérique: l'argent et la Ligue nationale de hockey, published by Les Éditions Vents d'Ouest. Another book will be released by the same author in the upcoming weeks. It's entitled Désavantage numérique: les francophones dans la LNH. Marc Lavoie was a member of the Canadian Olympic team in 1976 and 1984, more specifically in the discipline of fencing.

Gentlemen, welcome to our committee. The floor is yours.

[Translation]

Mr. Jean Harvey (Professor, Human Kinetics and Vice-Dean (Research), Faculty of Health Sciences, University of Ottawa): Thank you, Mr. Chairman. Ladies and gentlemen, members of the committee, first and foremost we would like to thank you for inviting us to share our research findings with you.

Before I begin, I would like to apologize for the absence of the third person who authored the brief, our colleague Professor Maurice Saint-Germain. He didn't want to cancel his scheduled class, but we will try to be worthy representatives.

This brief presents some data obtained through research projects funded in recent years by the Social Sciences and Humanities Research Council of Canada. We would like to thank the Council for lending its support and for funding research in Canada.

For the next ten minutes, we will review quickly the highlights of the brief. I believe some of you did not receive the document until yesterday and therefore have perhaps not had the time to study it carefully. This will also give us an opportunity to point out a few minor translation errors.

The brief consists of three main parts. The first part examines the economic impact of the sports industry. If you go right away to table 1, you will note that it depicts the sports industrial cluster. It is a graphic depiction of the upstream and downstream economic impact of the sporting goods manufacturing industry. When a sporting good, shoe, or hockey skate is manufactured, this implies economic activity not only upstream, that is in the primary sector, but downstream as well, in the tertiary industry.

This table was created to illustrate the impact of the sports industry in general and the various economic spin-offs.

Table 2 gives an estimate of the jobs and the productivity of Canada's sport economy. If you look at the first and third columns, you will see that according to our estimates—the data relates to 1990—the sporting goods manufacturing industry accounts for 94,961 jobs in Canada and pumps approximately $3 billion into the economy.

The third column, which shows the indirect effects, gives a much broader estimate. If we go back to the sports industrial cluster that I referred to earlier and the impact downstream from primary industries, such as the impact on the primary and tertiary sectors, we note that in Canada, it is estimated that the sports industry generates approximately 237,000 jobs and approximately $5.8 billion in revenues.

I would now like us to take a look at table 3 on the next page.

[English]

Table 3 deals with employment in Canada and as it compares with other countries of the G-7.

[Translation]

If we look at the bottom row, we note that the ratio of the sport economy to the total GDP is 0.6% in Canada, 1.4% in Germany, 1% in France, 1.7% in the United Kingdom and 2% in Italy.

Figure 1 on the following page shows the changes in employment in the sporting goods industry. This industry, which includes sporting goods, boats, clothing and footwear, is at the centre of the cluster.

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We can see from the figure that the number of industry jobs increased between 1960 and 1991-1992 and that this increase mirrors cycles of economic growth and decline.

Lastly, figure 2 contains two pie charts showing foreign trade in sporting goods. We can see that the origins of Canadian imports are quite diversified, but that the vast majority of exports flow to the United States. The figure given is 83%, an indication that we are highly dependant on the U.S. when it comes to marketing our goods.

We have handed out another chart with data on the United States. If we take a similar look at the origin and destination of American goods, we note that the United States imports 7% and exports 14% of their sporting goods to Canada. Therefore, the U.S. are far less dependant on us than we are on them as far as this industry is concerned.

The second part of the brief focusses on the economic impact of professional sport. I will let my colleague Marc Lavoie present that part to you.

Mr. Marc Lavoie (Professor, Department of Economics, University of Ottawa): The trials and tribulations of Canada's professional hockey teams have been in the news a great deal recently. We often here say that these teams should perhaps be subsidized by governments. Two arguments could be advanced in support of subsidizing Canada's hockey teams. First of all, we could do so for reasons of national unity since hockey is our national sport, and secondly, we could do so for economic reasons.

Two very contradictory views have emerged as to the economic impact of professional sport. The first is held by consultants hired by professional teams to drum up support for the construction of an arena or for the awarding of municipal, regional or government grants, or eventually even federal government grants. These persons generally hold that the economic spinoffs of professional sport are considerable.

On the other side of the fence, we have university economists who are virtually unanimous in contending that major league franchises generate virtually no economic spinoffs for a city or region.

Upon arriving here, I distributed a brief, supplementary document. The English version is a one-page summary, while the French version is complete, with a recap on the third page which corresponds to the English summary. What it does is give you a hypothetical example.

Imagine a hockey or baseball club with an annual budget of $100 million. Some experts would argue that the club generates economic spinoffs in the order of $340 million, a rather hefty figure, whereas university economists, using what they feel is a more correct approach, would conclude that the actual economic benefits would be more like 47 or $8 million, perhaps 45 or $10 million, or perhaps even zero.

Econometric studies conducted in the United States have also found no evidence that professional teams have any economic impact on the U.S. cities in which they are located or where a new stadium or arena would be built.

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In conclusion, let me say that before we decide to subsidize this industry, we should prove conclusively that it does in fact generate spinoffs for the economy.

I will now turn the floor over to my colleague.

Mr. Jean Harvey: The third and final part of the brief focusses on the government's role in sport. We give an historical overview of the federal government's involvement in sport. We show, among other things, how changing social policies have had a major impact on the role of the government in this field. We also comment on the withdrawal by the government of its financial support in recent years and on the changing administrative face of sport.

Our recommendations focus on the following areas: the need for adequate funding of amateur sport and elite athletes. In some respects, we consider elite athletes to be a little like government employees since they act as our representatives and ambassadors abroad.

We also feel that the government should not do away with one component of the Fitness and Amateur Sport Act which is still in force and which concerns the promotion of sport for the general benefit of the public. We note that very little is being done in this area right now. Perhaps the economic impact would be greater if more people would be involved in physical activities.

I will conclude on this note. Thank you.

[English]

The Chairman: Thank you very much, gentlemen. I think it's important for colleagues to note that the recommendations are at the back of their formal brief.

We will go right to questions. Mr. Coderre.

[Translation]

Mr. Denis Coderre (Bourassa, Lib.): I am very pleased to see you here this morning because you are asking the questions that need to be asked.

I may not agree with all of your answers, but you are asking the right questions and I think that you have put your finger squarely on the problem. In any event, our committee has been set up primarily to answer the questions that you have raised.

First of all, I would like you to tell me if you consider sport to be a recreational activity or an industry. Perhaps you would care to answer that question immediately.

Mr. Marc Lavoie: I think that it's a little of both. From the consumer's standpoint, sport is a recreational activity, and from the standpoint of the person providing the service, sport is an industry.

Mr. Denis Coderre: I ask the question because clearly, your answer will have a cause and effect relation on the role that the government must play.

Therefore, if you view sport as an industry—I come back to the economic spinoffs that you spoke of earlier—on what do you base yourself to calculate these economic spinoffs?

Professional sport, whether hockey or baseball, generates all kinds of spinoffs. Admittedly, as a Montrealer, I am deeply disturbed by the situation of the Montreal Expos. Sport has an impact on tourism as well as on television rights. It's not simply a matter of the impact on the person who sells hot dogs or on the spectators who buy tickets. We're talking about the economic spinoffs generated by a professional sport. Many industries are directly affected, along with the credibility of a city that has a professional sports team. Have you taken all of this into account in your calculations?

Mr. Marc Lavoie: The consultants hired by professional teams and by the team owners try to gauge the overall impact. Generally, they claim that the impact is very substantial. This is what we were trying to measure directly.

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However, economists try to gauge a second type of impact, namely the synergistic effect. I read the report on the Quebec Nordiques back when team owners wanted a new arena. The company that prepared the report argued that a sports team created a synergistic effect. It claimed that because cities like Quebec City, Montreal or Ottawa have professional sports teams, businesses will want to set up their headquarters in these communities or that other companies will try to do business with teams or businesses located in cities that are home to franchises. This is known as a synergistic effect.

However, consultants cannot measure this synergistic effect. They talk about it, but they cannot gauge its impact. However, one might imagine that it would be significant. For instance, one might imagine that the presence of the Ottawa Senators would attract five to seven companies to Ottawa. If that were the case, when the franchise came to Ottawa in 1990 or 1991, the economy of the greater Ottawa-Carleton region should have grown at a faster pace than the economies of other cities like Hamilton, which was not awarded a franchise.

This is the type of study that U.S. university economists conducted in the United States. Several studies were carried out and all of them arrived more or less at the same conclusion, namely that the presence or absence of a franchise in a U.S. city has no impact on the rate of growth of the metropolitan region or on employment in the city where the franchise is located when compared to neighbouring cities or other municipalities in the country.

Consequently, from a econometric standpoint, it is impossible to gauge this synergistic effect. It may in fact exist and companies may indeed be attracted by the presence of a sports team, but the effect is so minimal that it cannot be gauged.

Mr. Denis Coderre: The fact remains, Mr. Lavoie, that the loss of the Nordiques has had an impact on Quebec City. It may well be true that it is impossible to gauge the exact impact, but it appears nonetheless to be negative when we talk to people like taxi drivers and hotel operators. Perhaps it is only a feeling, but there does appear to be a very direct impact. I don't think we can ignore this. Furthermore, you mentioned Hamilton which, like Saskatoon, is doing everything it possibly can to get a professional sport franchise.

Do you not feel that the presence of a professional sport team lends some credibility to a city, just as the departure of a professional franchise strips the city of some of its credibility? In my view, that's why we can talk about the substantial impact a professional team has on a city. The impact is certainly economic, not merely emotional or political.

Mr. Marc Lavoie: You seem to have asked at least two questions in one.

[English]

The Chairman: Have you finished responding to that point?

Mr. Marc Lavoie: I haven't even started.

The Chairman: I just want to try to keep our timing organized here. You'll respond to Monsieur Coderre's question, then we'll have a short supplementary from Mr. Riis, and then we'll go on to Madame Tremblay. Carry on.

[Translation]

Mr. Marc Lavoie: Certainly there is a socio-psychological impact of some sort. The proof is that when the Montreal Canadians win, more newspapers are sold the next morning. Clearly, there is a psychological impact.

However, it is extremely difficult, if not impossible, to gauge the economic impact. No one has been able to prove that a major league franchise generates positive economic spinoffs for a municipality or a region. There are many reasons why that is so.

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The primary explanation for this is that a major league team siphons off part of the money residents of the municipality spend. Instead of spending their money in restaurants or on the region's ski slopes, they will spend it on tickets to see their hockey or baseball team play. This money which is siphoned off to the hockey team is not subsequently redistributed into the community because most of it goes to pay player salaries. A large part of the revenues goes to taxes. Players save a substantial portion of their salary because they know that their career lasts on average only six years. Only a small portion of the salaries is spent elsewhere. That explains why the presence of these franchises has no significant impact.

[English]

The Chairman: Mr. Riis.

Mr. Nelson Riis (Kamloops, NDP): Thank you, Mr. Chairman.

I think this is an incredibly interesting line of questioning and the response is fascinating. It flies in the face of so much of what one hears in the general discussion around these topics and it's most insightful.

I'd like to take the questioning into a different venue in terms of the value of enhanced athletic and sporting facilities, getting beyond the major league franchise in terms of economic value. You mentioned so much economic decision-making when it comes to locating footloose enterprises that can be located anywhere. You say the existence of a major league franchise isn't much of a determination, perhaps not at all, in where a firm might locate, but what about the other kinds of infrastructure, the sporting and athletic opportunities that are available? I assume that would have an impact, that if you're attracting highly skilled personnel, to have sporting and recreation facilities for them and their families would be perhaps a factor in decisions-making about where you're going to locate a facility.

Prof. Marc Lavoie: This is the point. The point is that having a major league franchise is just one of the factors that may induce corporations to move their head offices to some region or to some city. Certainly the security, how secure the streets are, is also a major factor. How reliable the transportation system is certainly is a factor. How quick the trains are certainly is a factor. How good the education system is, how many universities there are around, how good the public school systems are—all these factors play a very important role. How many arenas where your kids can play hockey—all these things may have an impact on the location of corporations. Having a major league franchise is just one or them. It certainly is one of them, but it's just one of them.

Mr. Nelson Riis: Thank you.

The Chairman: Madame Tremblay.

[Translation]

Mrs. Suzanne Tremblay (Rimouski—Mitis, BQ): I would like to congratulate you on the quality of your presentation. I'm only sorry that we do not have the time to scratch below the surface a little and ask you the questions that do justice to your brief.

I for one am very happy to have been enlightened on the issue of the economic impact of professional sport franchises, an impact which to my mind has always been overstated.

Montreal has always had a fairly successful hockey team. Our baseball team, even though it is comprised for the most part of minor league players, still manages to put on a good show. There are those who would have us believe that if we moved the team into an English-speaking neighbourhood, attendance at the game would go up. However, even when these teams were performing well, and even when the Montreal Alouettes were around, the city lost its status as a business metropolis and many head offices pulled up stakes and moved to Toronto.

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Therefore, this only confirms that people tend to exaggerate the impact that professional hockey teams and all professional franchises have.

When I returned from my vacation, I asked my younger brother which stories had made the headlines in Canada aside from the ice storm. He told me that the only major news item was the refusal on the part of a hockey player to sign a $48 million contract. He also told me that he wouldn't be following the game anymore because the whole thing was becoming ridiculous.

As far as Quebec City is concerned, I don't think the economy has dropped off that significantly since the Nordiques' departure. This confirms what we believe, namely that people go to the theatre or movies more often. Admittedly, in Rimouski, which has a competitive Quebec Junior Major League team, attendance at each game hovers around the 5,000 mark. Therefore, we have no need of a professional team. All we need is people who are dedicated to the sport and who want to play.

I would like to know if the pork, I'm sorry, the sport industry... That's quite a Freudian slip!

Mr. Denis Coderre: It all depends which players you are referring to.

Mrs. Suzanne Tremblay: Is the sport industry so unique that it requires special funding? Maybe existing Industry Canada programs are adequate and the sport industry should be treated like any other industry. What do you think?

Mr. Jean Harvey: As far as professional sport is concerned, our position is fairly clear, but we do have two recommendations concerning the sporting goods industry.

Obviously, these industries produce goods that are not purchased solely by professional players, but also by all people involved in some way in sports. Since Industry Canada is responsible for the industry's development in Canada, we feel the federal government should support Canadian sporting goods manufacturers, particularly when it comes to research and development. Like so many others, this is a labour-intensive industry.

Canada is not always in a position to compete with other countries. However, it may hold an economic advantage and generate some economic growth with its top-end goods, that is those which require high technology. Programs which support research and development do exist. In our view, these programs should be strengthened and universities could play an important role in this area, given their expertise, by helping sporting goods manufacturers to develop top-of-the-line products which would be available to Canada's high-performance athletes as well as to Canadian consumers in general.

If the government moves at the same time to bring in programs which would get more Canadians actively involved in sport, then more ordinary people than professional athletes will buy these sporting goods, which will generate much more economic activity for the sport industry.

Mrs. Suzanne Tremblay: Thank you.

Regarding the specific role of government in sport, you indicate clearly in your report that sport and recreation are more of a provincial responsibility and you recommend the following:

That funding for high-performance sport be geared above all to improving financial assistance and service given to top-level athletes.

Recently, the minister announced the establishment of a program to provide financial assistance to athletes. A total of $10 million will be divided among 300 new athletes identified.

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Do you think that it is better to provide more funding to a limited number of athletes or to provide an average amount of financial assistance to more athletes? Should we be focussing on quantity? I wouldn't want us to see athletes—this is not yet the case, but I wouldn't want it to come to this—acquire a welfare mentality. I wouldn't want to see an athlete think that the State has a duty to support him because he is an elite athlete.

We must also give the private sector the opportunity to subsidize high-performance athletes, as is now happening. Shouldn't the role of the government be more one of providing assistance to those who are not able to secure funding from the private sector? This would lead to an increase in the number of athletes. What are your views on the subject? Do you think the minister's idea is a sound one or are you critical of the way in which funding is to be allocated?

Mr. Jean Harvey:: I think that as such, the Minister's announcement is good news. Nevertheless, there are some problems with the Athlete Assistance Program. As you know, the program operates according to a carding system. In order for an athlete to obtain an A card, for example, depending on the discipline, that athlete must be ranked in the top six in the world.

In the wake of the Ben Johnson incident, the Dubin Commission report was very clear on this point. Doping is a widespread problem, but Canada appears to have an upper hand on the situation. The fact that the cards are tied to the athlete's international performance does present some problems. The Dubin Commission Report suggests that cards should be awarded on the basis of the athlete's performance in Canada.

In some sports, it's an open secret that the top ten athletes use drugs. Doping tests are not yet 100 per cent reliable. No Canadian will therefore be able to get an A card in this discipline. That's one factor to consider.

Another factor is that funding currently provided under the Athlete Assistance Program does not meet the needs of the athletes. We've seen examples of this recently. A Gatineau skater told a newspaper reporter over the weekend that his training was going to cost him $67,000 this year. Of course, he does get some financial assistance from the federal government. I'm not sure which card he has, but it's impossible for him to cover expenses with $800 a month. The skater in question tends bar on weekends and in the evenings to make ends meet. He has no sponsors because he is not a star and has not yet won a medal.

I can give you another example. This is someone we all know a little better, Myriam Bédard. She revealed during a television interview that she needed to raise $300,000. She now has a good sponsor, but she explained that it was extremely difficult for her to find one.

This issue is very complex. On the one hand, we could look to the private sector for sponsorship, but private companies primarily sponsor athletes who are already well-known because they stand to benefit from this association.

Private companies will also sponsor athletes in specific disciplines, those which are commercially viable. It is easier for an alpine skier to get a sponsor than it is for a water polo player, because water polo is not a sport which appeals greatly to television audiences. This leads to all kinds of disparities in athlete assistance.

I would recommend that the program fund the athletes and the infrastructure they need, and that's only if the government wants Canada's athletes to bring home a number of medals and do well internationally. If that's what the Canadian government wants, then that's the first thing it must decide to do.

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A number of other countries fund sport for a variety of reasons: to promote their national image, to strengthen national unity, or sometimes, to promote international relations and harmony among nations. The Commonwealth Games and the Jeux de la Francophonie are examples of this.

We have come to the point where if we want our athletes to continue performing well and if the government wants to minimize inequities in the system, we must take a very close look at the Athlete Assistance Program.

The Minister's announcement gave no specific indication of whether or not funding would be increased. Will we be giving A, B and C card athletes more money, or will they continue to receive the same level of assistance? If there is no change in their funding, they will continue to face the same financial problems. Will we be giving money to a greater number of athletes? Apparently so, but I don't have enough information to give you all of the details. Perhaps you can look into this, as no public announcement has yet been made.

Mrs. Suzanne Tremblay: Do coaches and trainers also receive a significant percentage of the funding?

Mr. Jean Harvey: Most likely, yes. Coaches and trainers do receive financial assistance. That's not a bad thing, because if Canada wants to have top-level athletes, it needs coaches who can earn a living doing this, because this is a full-time job. Sports federations do not always have the means to pay the salaries of good coaches, whereas in other countries, their salaries are covered. It's difficult for us to hold on to good trainers and coaches.

Mrs. Suzanne Tremblay: Thank you very much.

The Chairman: Mrs. Guarnieri.

[English]

Ms. Albina Guarnieri (Mississauga East, Lib.): Thank you very much. You have certainly presented a brief that provokes a great many questions, and you'll see by the eagerness of everyone around the table that you've given us a lot to think about.

I'm intrigued by your quote about salaries of athletes, where you say that the salaries of athletes “are...not reinjected into the community and constitute substantial capital flights which compensate for net injections”. Your conclusion is that there is no economic reason for subsidizing this activity.

My question is, if you regard, let's say, the NHL as a North American industry, an industry where admittedly the majority are Canadians, doesn't it make sense that we should continue to maintain a large share of that industry? If we abdicate from that and we end up with more American players, wouldn't that constitute a net loss for this country and for this particular industry?

Prof. Marc Lavoie: Well, Canadian players play all over the place. They might play in Canada; they might play in the States. We might have Finnish players or Russian players here. I'm not quite sure...

Ms. Albina Guarnieri: My point is that in the NHL we've excelled with respect to Canadian players. You would admit to that. Now, if we say that professional hockey in this country shouldn't be cherished and protected at all costs, using the logic here... You say in your brief here that only a small part of the salaries is consumed, that because the salaries are not reinjected into the community they constitute a capital flight, a net loss for the country. My argument would be that if you have fewer Canadian hockey players in this field—which would happen, right?—wouldn't you say we would then have, for instance, more American players in the NHL?

I'll give you an example. I think most people would admit that hockey is of intrinsic value to Canadians. I think one of the omissions of your brief is that you don't really delve into the tourist dollars and the entertainment dollars.

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There's a large contingent of sports fans who want to splash cash on sports. Last year I had a cousin from England here who wanted to go to an NFL game. I had to take him to Buffalo. If we had those opportunities in Toronto...if Toronto is a boring place, I'm not going to be able to spend my money there.

I don't think anybody would argue, for instance, that Los Angeles wasn't built by the Dodgers, but is it fair to compare hockey to the automobile manufacturing sector? I'm just wondering how you came to your conclusions in this paper.

Prof. Marc Lavoie: All these studies by consultants try to take into account these tourist benefits that arise from the presence of hockey teams or baseball teams in Toronto or Montreal. In the example I made up I also take into account these touristic retombées economiques.

Ms. Albina Guarnieri: Economic spin-offs.

Prof. Marc Lavoie: But despite the fact that one takes them into account, one might still conclude in the end—if we were able to do thorough research on this topic—that despite these tourist benefits more money is being drained out of a city than is being drained in because of the presence of a hockey team.

Again, the reason is what I said before: a big chunk of the expenditures of hockey teams is in the form of salaries, which are very high, and only a very small proportion of these salaries is put back into the economy.

The Chairman: Could I make a short intervention? I need to understand this. The National Hockey League payroll in Canada is approximately $160 million. Under our tax laws in Canada, those moneys are taxed at source. Close to 55% to 60% of those salaries come right back into Canadian treasuries. So could you explain to me where you see this flight of capital happening? Even for those players in Canada—approximately 70% of them reside in Canada—a large portion of what they have left in their jeans gets spent on homes, boats, cars and whatever other investments Canadian hockey league players have.

Prof. Marc Lavoie: Yes, but if consumers were purchasing ski lift tickets instead of purchasing hockey tickets, the treasury would still get the same amount or perhaps even more. From this fiscal point of view, there is no difference, or we can assume there is no difference.

The big difference is that the money is not put back into the economy. The fact that the federal government now has more money in the treasury does not necessarily mean that it's going to spend it. This argument is going on now. Some people argue that with this money we should be reducing the debt. The fact that there are more taxes being collected does not mean that the government is going to spend more of that money. You might make this assumption at the level of a city or a municipality. That may be the case for a city. But it's generally not necessarily the case for a provincial government or for the federal government.

Ms. Albina Guarnieri: There's a question stemming from what you've just said. You talk about economic spin-offs, but what can you tell me about the social spin-offs?

When I was parliamentary secretary for the Canadian heritage department, I had occasion to talk to people in the native citizens program. What they always told me was that if you had a depressed area or an underprivileged area and you built, let's say, a hockey rink, the social spin-offs with respect to less crime and less juvenile crime, etc., would certainly be very beneficial. Have you done studies on these social spin-offs?

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Prof. Marc Lavoie: I agree with you on this. If you build a small arena in a small town like Rimouski, I'm sure there are good socio-economic spin-offs. But if you build a new stadium at a cost of $200 million and you subsidize half of it in downtown Montreal, I'm not sure the socio-economic spin-offs are that large.

Ms. Albina Guarnieri: If you end up not having your stadium in downtown Toronto, let's say, and you want to go to see a professional team playing, where would you go? You'd have to go south of the border, spend your money at the casino, or end up in other activities, right? Don't you see a benefit to having the stadium in your city to inspire people to come to play there?

Prof. Marc Lavoie: In the example I have built up here, I take all these things into account. Yes, there are some people who will go to watch baseball in Detroit. On the other hand, I'm sure there were also many people living in Winnipeg or Quebec City who were going to other Canadian cities or abroad in the States to watch the Jets or to watch the Nordiques. There is money coming out because some people... The camera crews from TSN would come to Quebec City or Winnipeg to broadcast the games, but there were also fans who were moving out.

The Chairman: We have to move on because we have other members who want to ask you questions, Dr. Lavoie. In fairness, however, I think we should remind colleagues that you yourself admit in recommendation 3(ii) in your report that “the direct and spill-over spin-offs of professional franchise have never been shown in independent studies”. In other words, what you have stated quite clearly is that we've never really done a thorough analysis of this particular issue in this country. Is that the way I am to interpret your...?

Prof. Marc Lavoie: I think the sentence has a meaning different from the one you are putting on it. What I meant was that the university researchers who did research on this question couldn't find any evidence of a positive economic impact. This is what I meant.

The Chairman: Do you mean that of all of those jobs that are employed in these facilities—forget the athletes for a second, and just consider all of the regular people who are on payrolls, whether they operate the facility or operate the concessions or are advertisers or printers—none of them has any value?

Prof. Marc Lavoie: If people didn't spend their money buying tickets to watch hockey games, they would have to spend their money otherwise. Perhaps they would be purchasing books.

The Chairman: Okay, I understand where you're coming from now.

Mr. Wood, and then Mr. Provenzano.

Mr. Bob Wood (Nipissing, Lib.): I don't understand where you're coming from, obviously. I think hockey teams have a tremendous spin-off, just as the chairman was saying and as Mr. Coderre started the questioning with. How can you not take that in? It's part of sports. You say there are no spin-offs, then over here you say—and there are a host of consultants listed—that “the Quebec Nordiques had an annual economic impact of $50 million in Quebec City and $100 [million] in Canada.” So in Quebec City all these people said they had an economic impact of $50 million. It's the same with the Winnipeg Jets.

When you're doing this, you have to take in everything—people working in concessions, people taking tickets, people selling souvenirs. If you try to buy a Toronto Maple Leafs sweater at Maple Leaf Gardens, it's going to cost you $100. Certainly that has some spin-off.

My question is the same as the others', basically. Maybe you could explain to me why there's such a discrepancy between your analysis and that of the host of consultants who did analyses. We'll just use the Quebec Nordiques as an example.

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Prof. Marc Lavoie: I'll give you a very straightforward answer: the consultants are paid to find huge economic benefits for professional team sports, whereas the people working in universities aren't paid by anybody, they just do it out of interest. And most of these university economists who have done research on the topic are sports fans.

Why did I take the time to write two books about hockey and sports? It's because I'm a sports fan. But we're not paid by these teams, and therefore we report what we see. What we see there is nothing. Maybe there is some economic impact, but nobody has been able find it.

The Chairman: Go ahead if you have another question, Bob.

Mr. Bob Wood: I have another question, but not on this line.

The Chairman: Okay, if it's not on that line, I think Mr. Riis has short supplementary.

Mr. Nelson Riis: No.

The Chairman: No? Okay, carry on.

Mr. Bob Wood: I'd just like to get back to what Madame Tremblay was talking about on the financial contributions.

Dr. Lavoie, you were an amateur athlete, an Olympic athlete. How are Canada's financial contributions as compared to those of other countries? When athletes like you get together at Olympic venues, you obviously talk about funding, about what other countries are doing. In your mind, where do we stand as far as the federal government being involved and helping out our athletes is concerned? Good? Bad?

Prof. Marc Lavoie: I think the contribution is dismal.

Mr. Bob Wood: For the record, could you give us some ideas, or maybe some examples of what other countries are doing?

Prof. Marc Lavoie: In other countries, first, there are physical education teachers working full-time for various federations. They are paid by the federations, but also indirectly by the governments; therefore they are paid to organize competitions, they are paid to be coaches at various levels for the good athletes and for the not yet so good athletes, the upcoming athletes.

At the level of the help that athletes get, I think there is a huge difference too, especially in the lesser-known sports, as was pointed out by Jean. In the lesser-known sports, most European countries give much more help to their athletes in financial terms than we do here, and they also do so in helping them to go to various international competitions.

Mr. Bob Wood: I just have one more question. On a personal note, when you were representing Canada at the Olympics as an athlete, how much money did you receive from Sport Canada? Can you remember?

Prof. Marc Lavoie: In 1976 I think it was something like maybe $200 per month, plus they were paying my university fees, which in those days were around $600 a year. Around 1984 I think it was around $400 a month.

Mr. Bob Wood: Wow.

The Chairman: We'll now go to Mr. Riis, followed by Mr. MacKay, and then we'll come back.

Mr. Nelson Riis: Thank you, Mr. Chairman. I just have an observation.

I find interesting your fourth recommendation regarding professional sports and NAFTA, and the unfair competition that Canadians are up against.

The Chairman: I'll have to remember that one. That's a good one.

Mr. Nelson Riis: I have to look long and hard to find a benefit accruing to NAFTA, but this may be one under which we could in fact raise with our American counterparts a whole set of unfair subsidies. I think this is perhaps something our committee should look at in terms of using it to our advantage to enhance our opportunities here in Canada if we're in NAFTA. I particularly am pleased for this observation.

To get away from the former line of questioning, I have a rather general comment to make, and a question for you fellows. We have experimented with an infrastructure program in Canada over the last number of years, both in terms of creating short-term jobs and also to develop municipal infrastructure—sewage works, waterworks, roads and so on. What would you think, and what would be the general impact in your judgment, if we implemented a municipal infrastructure program to build sports, athletic and recreation facilities in communities across Canada to, first, obviously generate short-term jobs in the manufacturing and construction sectors and so on? What impact would that have on our country in terms of more socio-economic spin-offs?

• 1205

Prof. Jean Harvey: It sounds like a good suggestion. It would obviously have the impact of increasing opportunities for young kids to be participants in sports instead of spectators. It might create a new bunch of hockey fans. Maybe it would also raise the opportunities for a larger number of boys—and girls now too—to compete in ice hockey and it might generate a bigger Canadian share of professional hockey players in the NHL.

There is the example of women's hockey now. This sport is growing. We have a very strong thing, but the girls now fight to get ice time in the municipalities because these rinks are fully used by boys. It's a tough situation. How can you develop the opportunities for these girls who want to play hockey, and how can you develop women's hockey in Canada if you don't have the rinks? I think the economic impact of that would be much larger than having a professional sports franchise.

Prof. Marc Lavoie: I would just like to add that maybe in hockey there is this problem of getting an arena unless you want to play outside, which is what kids used to do and now don't seem to be doing any more. In general if I'm thinking about other sports, I'd say that the equipment is not the problem. I'd rather say that the problem is l'encadrement.

I was in many countries during my competitive days. I've been to Hungary and Poland, countries with a long sports tradition, and I don't think their equipment or installations were better than ours. I wouldn't say so. Often they had much less space. It's just that they had dozens of coaches around.

The Chairman: Mr. MacKay.

Mr. Peter G. MacKay (Pictou—Antigonish—Guysborough, PC): Mr. Chairman and witnesses, I apologize for arriving late.

I'm very regretful that I wasn't here for your entire presentation. I commend you both for what you are doing. Obviously you both have made and continue to make a great contribution to sports in general.

I'm trying to gauge and break much of your comments down into perhaps far too simple a scenario, but generally speaking we are talking about the Canadian government's participation either at the front end or in the final stages of development of sport.

We talk about the amount of money involved in professional sport, particularly in the area of salaries, and what we are getting back from that as a country, and I couldn't help but pick up on the comment made by our chairman that this money does to some extent stay in the country in terms of direct taxation on players' salaries.

First, is it not fair to say that what we are seeing, though, is perhaps somewhat a result of high taxation in Canada? Canadian players are making the decision to leave and play for American franchises because their salaries are significantly reduced if they're being paid in Canadian dollars. There seems to have been that trend among our better players. I'm talking about the real upper echelon of NHL players leaving Canadian teams and Canadian teams leaving the country. The exceptions are very few. We've seen Mark Messier come back to Vancouver recently, but generally speaking top superstars and some of the franchises that were extremely good, like the Nordiques, which went on to win the Stanley Cup the year after they left Canada... Is taxation a factor here?

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Prof. Marc Lavoie: It's always possible to give counter examples. For instance, Mark Messier, who used to play for the New York Rangers, went back to play for the Vancouver Canucks. Secondly, what happens is that most players, until they reach the age of 32, don't get to choose where they're going.

Mr. Peter MacKay: I'm not sure I follow that at all.

Prof. Marc Lavoie: We don't have the reserve clause any more in hockey, but the so called “free agents” are not all free. You have different categories of free agents. The only true free agents are either players above 32 years old—and from next year on it will be 31—or players who are at the bottom of the league. The others are not really free agents in the sense that if their team offers them a certain type of contract compared to the contract they used to have, then they really have no choice. They don't have this choice; they don't decide where they want to play. They may show they're not really happy where they are, and then in the end the general manager may decide to trade this person, but in general most players don't choose.

Now, with respect to taxation, one of the things we say in the recommendations at the end of the brief is that obviously it is a fact that many American cities do subsidize their sports teams, mainly with respect to how much they have to pay for renting the arena or various types of tax exemptions they have if they themselves buy the arena or the stadium.

Of course, if you're talking about this kind of taxation, yes, the American teams do have some advantage. This is why we recommended that maybe through the NAFTA process some lawyers can have a look at this and find out whether the Canadian cities that are in danger of losing their teams should be complaining that there is some unfair trade practice here.

Mr. Peter MacKay: Mr. Chairman, I'd like to have a follow-up question.

Again, I know I'm flirting with being too general here in putting this question to you, but your brief presents so many very interesting topic areas. I really do regret that I don't have more time to speak with you on a personal level about some of the premises you raise.

With respect to Canadian government money involvement in sport in Canada, not just hockey but generally, is it your overall feeling that the money would be better spent in the development of amateur sport to continue to try to produce superior-level athletes, whether they be at the Olympic level or the professional level? Is this the general direction the government should be looking at; or on the contrary, are we perhaps better to spend our money in an area that is going to keep professional franchises in Canada, continue to produce a very high level of participation in sport at the high end, which will keep us competitive on a national scale and thus perhaps inspire more participation by younger athletes; or should we go back to basics and try to develop athletes within the communities?

I totally agree with the comments that have been put forward by some of my colleagues here, that if we had more rinks, if we had more people participating at that very basic level in our communities, this would help to build the country in a more positive fashion.

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Prof. Marc Lavoie: I think it depends on the ultimate objectives we are pursuing. If we're looking straightforwardly at the economic benefits of professional sport, I don't think there are many. If we are looking at the psychological impacts it might have, well, if it induces people to do more sports, then good.

It's the same with amateur sports: why do we want to subsidize amateur sports? Even giving only $200 a month in 1976... It all depends on the purpose. If the purpose is to make sure Canadians have better health, then you must take the means to arrive at that result.

Mr. Peter MacKay: Do you feel that, in and of itself, should be a significant goal or purpose; that Canadians be healthier as a people, as they are in some European countries?

Prof. Jean Harvey: A few weeks ago a report was released by the Canadian Fitness and Lifestyle Research Institute that states that Canadians do not participate enough. Actually, the Government of Canada and the provinces signed an agreement after the Victoria games saying they will increase the Canadian participation in sport by 2% per year in the next few years. Nothing has been done yet.

Indeed, increased participation in sports for all Canadians will have a good economic impact on industry, but that's not the most important thing for me. Participation in physical activity is a determinant of the health of the population.

So it has all kinds of impacts. If we are looking at controlling health spending, that's a very good means.

The Chairman: Mr. Provenzano.

Mr. Carmen Provenzano (Sault Ste. Marie, Lib.): I would like to follow up on the earlier line of questions. I think now I'm beginning, gentlemen, to understand the parameters of the context in which you've made your conclusions. We start off with an economic impact analysis made by others who might indicate that the benefits would be somewhere between $300 million and $600 million to a community that has a National Hockey League franchise. What you people are saying is that if you take into account four crucial factors, that economic benefit could be nil.

To make sure I understand the context and parameters you're using, let's just take the example of a super-mall locating in a community. I've applied your factors, which you consider to be the crucial ones. Aside from the taxation part of it, if you look at the three other factors—household income rather than business sales is a key economic indicator of the impact of an activity on the welfare of a region—certainly with a super-mall that factor would apply and would be something you would use to conclude it was of no economic benefit, because that's exactly what the super-mall would be based on: business sales.

A large proportion of business sales is made on the basis of products that have been produced elsewhere. Well, in Canada we produce very few goods that would be in that super-mall and that would be sold on a daily basis. So again your criteria fit.

It says if there were no franchise, local households would continue to spend money in the local economy. If there were no super-mall and I apply your factor, the money would get spent elsewhere in the economy.

Based on what you are saying here, if I use your criteria, your factors, I would conclude that the super-mall would be of no economic benefit to a community. Would you agree with that?

Prof. Marc Lavoie: It would be the case to a certain extent, yes. If you just take these Wal-Marts and all that, yes, they are doing pretty well, but at the same time they are destroying Canadian Tire and Zellers. There is substitution to some extent, yes.

• 1220

Mr. Carmen Provenzano: I would like to understand where you're coming from. In this example I'm giving, the fact that a super-mall added to the tourist attractiveness of a particular location...let's say it brought 5,000 people into the community who weren't otherwise going to go there. I think you would say that's a factor, but because you don't have the data you would discount it.

Prof. Marc Lavoie: The difference is that the builder of the super-mall is not going to try to get a subsidy from the federal government. Is he?

Mr. Carmen Provenzano: What I'm trying to understand is why we would discount a factor like that. If the super-mall was bringing 5,000 or 10,000 people from outside an area, if it's added to the fact that this became a destination for tourists, why would we discount such an important factor just because we don't have the data?

Prof. Marc Lavoie: We don't necessarily discount it. It's just that the impact of the super-mall has to be computed correctly. If the future owners of the super-mall want to get some subsidies from the municipality, the federal government or the provincial government, they might just inflate the economic impact and the numbers. If you do the study carefully, you may find out that it has some impact, but most probably the impact will be maybe five or ten times smaller than the impact as measured by the proponents of the project.

Mr. Carmen Provenzano: So you would basically gauge that type of activity and put it in the same category as an NHL franchise, an activity that probably doesn't have an economic benefit for the community.

Prof. Marc Lavoie: The difference, as I've said many times, is that in the case of the NHL franchise a large proportion of the expenditures of the franchise are siphoned off outside of the economy. In the case of the super-mall, all the employees of the super-mall are probably people who live 12 months out of 12 in the area and who spend most of their revenues there. So this has positive repercussions on the economy, whereas in the case of hockey players, they spend maybe 10% of their salaries there. The rest is not spent in that economy.

Mr. Carmen Provenzano: What about the arena employees, the concession people?

Prof. Marc Lavoie: These people have exactly the same impact as the people working for this super-mall.

Mr. Carmen Provenzano: Are you taking them into account somewhere?

Prof. Marc Lavoie: Of course we are.

Mr. Carmen Provenzano: Where? Where do we take them into account when we come to the conclusion that it has basically a zero benefit?

Prof. Marc Lavoie: Again, if you construct this super-mall and all it does is substitute the activity going on in the Zellers stores and the Canadian Tire stores, if it goes into this Wal-Mart, then the additional activity generated by this super-mall would be zero. Now, if you tell me that there are 5,000 people who come every month to this super-mall, then I would say that probably there will be a positive impact.

Mr. Carmen Provenzano: And you don't have that data with respect to National Hockey League franchises, data about people who come to city just to see a hockey game and then go back home.

Prof. Marc Lavoie: The consultants do some of this work.

But then the trick question is the following. For instance, take the example of your friend who came to visit you. Maybe he came to this area because he wanted to visit the Parliament Buildings and all of that. Suppose this person goes to see the Ottawa Senators one night when there is a questionnaire being put out by the consultant. This friend of yours will say, “I've spent five days and $1,000 in Ottawa.” The consultant will attribute this $1,000 of spending to the existence of the franchise, whereas in reality this person came to see you or came to see the Parliament Buildings.

Therefore, it is not $1,000 that should be attributed to the existence of the franchise. It should perhaps be only $50. This person did not come to Ottawa in the first place to watch the Ottawa Senators. This is how the numbers are inflated.

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The Chairman: Colleagues, we have five minutes before we have to go to our business, so we would have a short question from Monsieur Coderre and then a short question from Mr. Riis.

[Translation]

Mr. Denis Coderre: I understand your parameters and what you're getting at, but I totally disagree with you on some points. In my view, professional sport is an ultimate goal to be attained. This being my premise, it is a question of belonging and of culture. In my opinion, the presence of a professional sport franchise does have an economic impact on the community. If you disagree, well then so be it. We respect your opinion.

However, I do wonder about something. It's easier in the case of hockey because there are a number of franchises, but when it comes to baseball, to use your example, Montreal residents aren't the only ones who go to Montreal Expos' games. People from Ottawa and from around the province of Quebec also attend games. If the Expos weren't there, these people would not come out to the ball game.

You may argue that they would spend their money anyway, but first of all, we don't know that this is necessarily so; secondly, in some cases, people do leave and go spend their money in Florida. However, when I look at the percentage of indirect jobs, I say that a bird in the hand is worth two in the bush. People are going to spend money and this will create employment. Clearly, sport franchises have an economic impact.

Would your analysis be different if we were talking about a different type of franchise, whether it be hockey, football, basketball or baseball?

Mr. Marc Lavoie: Let me say first of all, and perhaps this will reassure the Chairman, that these econometric studies on the impact a franchise has on a city apply to the United States, and not to Canada. Strictly speaking, we could argue that this does not apply to Canada. That's my first point.

Secondly, it is also clear that depending on the sport franchise, each case is somewhat unique. Of course, if a very high proportion of Expos spectators come from outside the region and we know they in fact come to Montreal to see the baseball game, not to stroll around the old port, then the impact will perhaps not be the same as it would be in a city like Ottawa, where perhaps not many people from outside the region attend Ottawa Senators' game, at least not at the moment.

Mr. Denis Coderre: It's a fact that people do come into the city to attend a baseball game and then decide to spend money in Montreal's restaurants. To my mind, we must take into consideration that a team's presence does have a direct impact.

Mr. Marc Lavoie: Most assuredly. In the examples that I gave you, I took this into consideration. If we change the figures and the basic premise, of course we will end up with different results.

What concerns me is that these U.S. studies fail to prove that cities with a franchise have a healthier economy than those without a franchise.

There's something that I've been wanting to say for some time now and that I always forget to. In my opinion, Canadian sport franchises, hockey in particular but baseball as well, are in trouble because for the past 10 years now, our economy has been stagnating. Canadians' buying power has not increased at all in the past decade. This is a Canadian phenomenon, one that we are not seeing in the United States where the economy has grown at a rate of about 10%, or perhaps 7% or 8%. Nor is this happening in Europe. Despite very high unemployment in Europe, people's buying power has increased, depending on the country, anywhere from 10%, 14% or 15%.

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Therefore, in my view, there is a cause and effect relation at work here. A thriving economy attracts franchises.

[English]

The Chairman: Mr. Riis.

Mr. Nelson Riis: I just want to make a very short intervention, Mr. Chairman. I think what we're hearing around the table is obviously not that there is no gain for having a franchise. Obviously there are gains. People have mentioned people working in arenas and so on. But there is no net gain. At the end it is actually a loss.

I think Carmen has done us a favour by pointing out the super-mall, because I think all the evidence would point out that when a Wal-Mart comes to an area it sucks money out; there's no net addition to the local economy. It's a good example, I think. Ask anybody who runs a business in these communities what happens to them in the long term.

So I think you've done an immeasurable service by saying that when it comes to objective studies—if what I've concluded is correct—there is no net gain. When you come to studies that are funded by the sports franchises, of course they find benefits. It seems to me that we at this table ought to be listening to the academics in this case and not the sport promoters.

Prof. Marc Lavoie: There might be some net gains, but they're certainly not as huge as we are told by the consultants.

The Chairman: Mr. Riis, over the next few months we will have the opportunity to listen to some of these professional consultants whose numbers obviously have been challenged today, thanks to Dr. Lavoie and Dr. Harvey. They've armed us well with a skeptical thrust...when they come before us with their inflated numbers. So I'm sure the challenge will be interesting.

On behalf of our committee, I'd like to thank both of you for coming here today. Your brief is professional, and to use your expression, it was academic economics. We thank you very much.

Prof. Marc Lavoie: Merci beaucoup.

Prof. Jean Harvey: Merci beaucoup.

The Chairman: Colleagues, we have our binders here. We'll be very brief on this and then we'll adjourn, but I think it's important that all members feel comfortable with the direction our staff have been taking.

I'd like to begin by welcoming and introducing Beverly Isles, who has taken over the clerk responsibilities for our committee. Mr. Radford, of course, who is involved in other committees in the House, has been burdened for some time, and regretfully, because he's done such a good job, we're going to lose him. But at the same time, he's left us with an experienced veteran clerk for parliamentary committees.

Welcome, Beverly.

Does everyone have these binders? You will see there, under suggested themes and issues: coaching and sports; funding of sports, whether it be tax issues or lotteries; women in sports; municipal infrastructure; sports and the media; sports sponsorship; manufacturing in Canada of sporting goods, etc.; the aboriginal community in sports; and of course, Special Olympics. If the members feel comfortable with these themes, our staff will then approach the relevant witnesses to come before us.

First of all, I would ask if we missed anything or if there is something on there that members don't feel comfortable with.

Madame Tremblay.

[Translation]

Mrs. Suzanne Tremblay: Mention has been made of the native community, but I don't know if there is any difference when it comes to access by francophones and by anglophones. Is there some way of knowing if anything needs to be improved, maintained or promoted? I'm not familiar with the situation, but I wonder if something can be done in this area. I also wonder if our allophone population has equal access or if there is any discrimination. I simply want to find out if there is something that needs to be done here.

[English]

The Chairman: That's an interesting question. I've never thought the rinks in Toronto were any different from the rinks in Montreal or Rimouski. I always thought the physical plants were common.

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[Translation]

Mrs. Suzanne Tremblay: No, I'm not terribly concerned about the difference between Toronto and Quebec City. I'm thinking more about Manitoba, for example. Do francophones have equal access in certain towns? Do they experience more problems? I don't know. I'm not talking only about Quebec. I wonder if francophones outside Quebec are experiencing some problems.

[English]

The Chairman: Okay. Well, we can reflect on that and figure out a way to do some kind of analysis of that.

Nelson.

Mr. Nelson Riis: Mr. Chairman, I would like to suggest... I don't know if this makes sense, but to me there are sports that are emerging and sports that are fading. I wonder if we couldn't look at the state of the business today. What are some of the up-and-coming sports? If we're going to talk about facilities or support, we might want to be on the cutting edge of some new breakthroughs in sports, as opposed to fading sports—if there is such a thing as a fading sport; I don't know.

The Chairman: Excellent point. Mr. Wood.

Mr. Bob Wood: I would like to add that you have Special Olympics; why shouldn't we look at just the ordinary Olympic sports, funding and...? I don't know where you would put it in here. I don't see how it would fit it. You have Special Olympics, which is fine, great, but could you not add the Olympic sports themselves?

The Chairman: Yes; and we're actually remiss, because in fact we have confirmed the president of the Canadian Olympic Association, Carol Anne Letheren, who has already appeared before us once. She will be coming back with a full report they are preparing for our committee, linking sport, job creation, etc. I believe she has agreed to appear before us some time in March, after she settles down after Nagano. Absolutely.

Mr. Carmen Provenzano: I think one item I would consider relevant is missing, Mr. Chairman. That's tourism and sports. I would love to hear from the tourism industry on the impact of sport in that industry. That to me is a key factor.

The Chairman: That's an excellent point. We could get Mr. Judd Buchanan, from the Canadian Tourism Commission, and his committee to pull some numbers together on tourism and sport. That's an excellent point.

Mr. Coderre.

[Translation]

Mr. Denis Coderre: We can't cover too many subjects. We must focus on what has been discussed here today. In my opinion, the issue of whether or not the federal government should subsidize the Montreal Expos is quite topical for our committee. Having spoken with Claude Brochu, the President of the Montreal Expos, I believe that it is very timely indeed... The franchise's presence has a significant impact, not only on the Montreal region, but also on the sport as such. If we were to lose this professional sport franchise, whether or not we believe that it does have some kind of impact, we would have to... We have heard from the academics. Perhaps we should now seek out the opinion of the professionals.

[English]

The Chairman: Monsieur Coderre, I totally agree with you. I think the witnesses today put a direct challenge to all those units at the professional level that always bring in their statistics.

I would like to refer you to tab 4 in this binder, which is a draft survey and analysis that one group in the professional realm, the National Hockey League, are circulating to all their member clubs, with a special emphasis, of course, on their Canadian contingent. I understand the National Basketball Association and the baseball group are doing a similar such study. I think it would be smart if we passed the briefs we heard today on to those people, giving them a heads-up that when they come in here their numbers had better be hard and not inflated. Ms. Isles will take Claude Blanchette and he'll be a witness and we'll build from there.

Madam Guarnieri.

• 1240

Ms. Albina Guarnieri: Mr. Chair, I'm interested in exploring whether there's merit in looking at the socio-economic benefits of having a sports infrastructure. If my colleagues on the committee think there's merit in exploring that, I think that would add to the—

The Chairman: Albina, under item 4 it's municipal infrastructure. We've actually given a direction to the Federation of Canadian Municipalities to do an inventory.

First of all, we don't even have an inventory. At this moment even the Federation of Canadian Municipalities does not have a compilation or an inventory of swimming pools, tracks, rinks or whatever. It doesn't exist. They don't even know how many jobs are involved in a collective sense. They are working hard to bring the experience that's going on out there to us in hard numbers, and they're also trying to give us some direction on what it means to the various municipalities or communities when a recreational facility is built.

Ms. Albina Guarnieri: Are they preparing studies that would impact on all three levels of government, though, or would their studies be from strictly a local point of view?

The Chairman: It's strictly from the municipal point of view.

Ms. Albina Guarnieri: Do you think there'd be merit...for instance, there might be spin-offs in health. Is ParticipACTION having an impact? We saw some statistics earlier that showed our dismal performance and I'm just wondering if there is merit to looking at the federal perspective, to looking at whether ParticipACTION is having an impact or not.

The Chairman: Absolutely.

Mr. Nelson Riis: I wonder if it would be useful to look at—and it's a little airy-fairy—sports associated with national wellness, wellness not only in terms of health and so on but also in terms of the feeling about ourselves, about the unity issue and so on. I'd be interested in seeing people who study that and hearing what they have to say about the value. I feel the committee could do a great service by informing Canadians that sports is not only about competition between groups of folks but that it has all sorts of incredibly positive spin-offs in terms of health and just a feeling of wellness.

The Chairman: Absolutely. We can put that on the list in terms of another theme. I want to remind colleagues that we want to have a preliminary part of this report done before we have the summer break. One of the primary thrusts is of course to link what we're doing here to the economic impact. Let's not lose our focus on that.

One of the things is what Claude just mentioned. The staff is proposing that when we have a round table around the coaching realm, which is under item 1, the whole area of the socio-national unity impact will be built into the feedback to us. Okay?

Albina.

Ms. Albina Guarnieri: I just want to say that I think there's a cost benefit too. If you spend less on health care, less on crime, less on putting—

Mr. Nelson Riis: Mr. Chair, when I talk about wellness, this is not a feeling thing, this is an economic thing—

The Chairman: Preventive.

Mr. Nelson Riis: If you have healthy Canadians your costs are going to be really light. Yes, it's the preventive side of things. It might encourage more investment in sports infrastructure by all levels of government if they could see that it would lead to clear economic benefits in the end.

The Chairman: We will organize a round table on that.

Mr. Proud.

Mr. George Proud (Hillsborough, Lib.): Thank you, Mr. Chairman.

First of all, before I get into my favourite one, I think the business Madame Tremblay brought up about the different levels for French or English can be covered under coaching, because I believe no matter whether we're French or English there are areas in this country—and I agree with these people on that—where we have to put more emphasis on this coaching aspect. There are people who are hungry for coaching rather than facilities. I think that's one area we have to look at.

The other area I want to talk about—and Mr. Provenzano can agree or disagree with me on it—is the horse racing industry. It is an industry in Canada. After listening to this group of people this morning, I'm not sure what kind of spin-offs it has, but it has sort of a heritage thing in Canada; it's a culture in some parts of the country.

• 1245

I have asked people in the industry if they'd come before us... It's an industry that's in trouble, by the way, and personally I don't know what government can do about about it. But I'd like us all to hear from an individual who's done a study on harness racing, especially harness racing in North America, who would be willing to come before us. I gave his name to the clerk, and if it's okay, I'd like to have him appear before us.

The Chairman: Terrific. The horse racing industry in this country is mammoth, so absolutely. Everybody feels comfortable with that.

Ms. Isles will then integrate those additional thoughts.

Go ahead, Mr. Riis.

Mr. Nelson Riis: I want to put a topic on the table that people might think is odd, but one of the great recreational sporting competitions throughout Canada, particularly western Canada, is rodeo. It probably conjures up all kinds of odd images in terms of sports, but to us that's sport.

An hon. member: Absolutely.

Mr. Nelson Riis: Every town, every community, every region... In the next month I'm involved in three major international rodeo events. To us, this is probably as important as baseball—

The Chairman: I totally agree.

Mr. Nelson Riis: —certainly more important than professional baseball. So it may work in as an interesting sideline.

The Chairman: Is there a Canadian rodeo association?

Mr. Nelson Riis: Yes.

The Chairman: Can you speak to the president of that and see if they would be willing to be a witness?

Mr. Nelson Riis: Just for the sake of information.

An hon. member: We have to bring up the hats.

The Chairman: Hopefully, where we will go with this in the end is that we will develop a level of respect for all sport in this country that not only will encourage more corporate support—at the amateur level all the way through—but will also touch on all these other areas, such as preventive assets, etc., in terms of health care and so on.

Did you have another point, Mr. Coderre?

[Translation]

Mr. Denis Coderre: I have a question. Could we go review together the list of people who have already agreed to appear? We do have a timetable and a number of issues to discuss. For instance, I have spoken with Mr. Brochu and perhaps we could agree on a date. I know that Ron Corey has been after us to appear, as have Mr. Bettman's people from the hockey world.

[English]

The Chairman: Let me respond to that. First of all, the staff did a tremendous amount of work during the month of January. They have sent letters to the relevant departments in the Government of Canada, from Statistics Canada to Revenue in terms of sponsorship, Industry, etc., to start pulling together hard numbers on all that is linked to the industry, the business of sport.

At the same time, they've sent letters in both official languages to over 300 sporting organizations, mostly of course at the amateur level, all the way through to the professional level. The responses are beginning to come in, and on the last Wednesday of this month the staff will report to us on the number of people who have said they would like to appear in front of us. There will be recommendations to us. We'll circulate them, and ultimately confirming them as witnesses will be subject to this committee. Perhaps we could just let the staff do their work until that Wednesday, and on we go.

Anything else? Yes, Madame Tremblay.

[Translation]

Mrs. Suzanne Tremblay: I believe the scheduling of the Olympic Games could create some problems for associations or individuals who would like to appear before the committee, but who have their plate full with the Olympics. Once the Games are over, they will need to take a breather. Therefore, normally we should be able to slot them in for late March or early April. If we can't get any answer from them, perhaps it's because they have left for the Games.

[English]

The Chairman: Madame Tremblay, out of respect to your schedule, we are not sitting during the Olympic week because we know you'll be over there investigating and working hard with Minister Copps. We've suspended our hearings during that week, and we've allowed for those people involved in the Olympic movement to come towards the middle or latter part of March.

Thank you very much. We're adjourned.