Chapter One: Introduction

Canada experienced a period of high inflation between 2021 and 2024, like many other advanced economies. While inflation was brought back down to its target rate in 2024, many Canadians are still impacted by high price levels, notably in respect of housing and food. In addition, Canada’s economy – similar to that of other nations' – continues to be affected by global challenges, including in relation to productivity growth, renewed geopolitical and trade tensions, and the transition to a net-zero economy.

Against this backdrop, the House of Commons Standing Committee on Finance (the Committee) launched its pre-budget consultations in advance of the 2025 federal budget and asked interested Canadian groups and individuals to make submissions. Selected witnesses were also invited by the Committee to present their priorities for the upcoming budget. The Committee received 828 submissions and held nine pre-budget hearings in the fall, during which it heard from 74 groups and individuals.

Chapters Two through Five summarize the proposals made by witnesses during this year’s pre-budget hearings and present the Committee’s recommendations for the 2025 federal budget. The witnesses’ proposals are also set out in Appendix A and a list of the submissions, categorized by the main topics they addressed, can be found in Appendix B.

Chapter Two: Innovative and Productive Businesses

Artificial intelligence (AI) is one of the most transformative technologies of the 21^st century, representing significant progress in creating machines capable of performing tasks that once required human intelligence. Fuelled by rapid advancements in machine learning, deep learning, and large-scale data processing, AI has already begun to influence various sectors, from manufacturing to healthcare, finance, and even government systems. One of AI's most notable developments in recent years is the rise of generative models and large language models (LLMs), such as OpenAI’s GPT-4, which can produce human-like text, images, and even sophisticated analysis in response to simple prompts. These models represent the cutting-edge of AI research and have the potential to radically change industries, societal structures, and our understanding of intelligence.

According to some, AI could have significant impacts on productivity, innovation, and economic growth. For example, a McKinsey & Company report estimates that AI could boost the global economy by between $17.1 trillion and $25.6 trillion USD, while others, such as economist Daron Acemoglu, find that AI could have more modest impacts. However, the complexity of AI also raises important concerns about this technology’s impact on labour markets, inequality, and the ethical risks associated with its use.

While it may revolutionize certain industries by automating routine tasks and augmenting human creativity, AI also poses challenges. The dual-edged nature of AI’s power has been recognized by both its advocates and critics. On one hand, as highlighted by this Microsoft Research paper, AI could significantly raise living standards and facilitate innovation through its ability to learn and generate new ideas. On the other hand, certain researchers warned that the misuse of AI poses significant risks.

Furthermore, concerns about AI replacing human labour have sparked debates about its role in the workforce. While some argue that AI will primarily displace jobs, others suggest it could follow historical patterns of complementing human labour, creating new types of employment and reshaping industries.

Given the potential role of AI in driving economic growth and innovation, the federal government has made a number of policy commitments and investments related to AI. Central to this effort is the Pan-Canadian Artificial Intelligence Strategy, which supports Canada’s AI ecosystem. The Strategy relies on three pillars:

• Initiatives to support the commercialization and adoption of Canadian AI technologies through the National Artificial Intelligence Institutes and Global Innovation Clusters;
• The development and adoption of AI standards related through the Standards Council of Canada; and
• Programs to attract, retain and develop research talent and provide computing capacity for AI research through the Canadian Institute for Advanced Research and the Digital Research Alliance of Canada.

According to the Organization for Economic Co-operation and Development (OECD), this strategy helped Canada position itself as a leader in AI research, talent and start-up growth globally. As shown in Figure 1, Canada ranked third globally in 2023 in terms of total funding raised per capita by generative AI companies.

Figure 1—Total Funding Raised per Capita by Generative AI Companies, By Country, 2023 (USD)

Source:  Figure prepared by the Library of Parliament using data from Deloitte, Impact and opportunities: Canada’s AI ecosystem – 2023, 2023, p. 22.

However, the OECD pointed out that one key challenge the Canadian AI sector is facing is the country’s lack of computational capacity, which is currently lower than that of other G7 countries. Computational capacity is needed to develop and test AI systems and Canada’s relative low capacity could limit its ability to attract investments in the sector.

Recently, Budget 2024 announced investments of $2.4 billion to support Canada’s AI sector, including:

• $2 billion over five years to launch a new AI Compute Access Fund and the Canadian AI Sovereign Compute Strategy, to ensure access the computational power and support the development of Canadian-owned AI infrastructure;
• $200 million to support AI start-ups and accelerate adoption in sectors such as agriculture, clean technology, healthcare, and manufacturing;
• $100 million for the National Research Council’s AI Assist Program, which assists small and medium-sized enterprises in building and deploying new AI solutions; and
• $50 million for skills training programs aimed at workers in sectors more at-risk of being impacted by AI, such as creative industries.

Recognizing the potentially harmful impacts of AI, Budget 2024 also announced funding for the establishment of the AI Safety Institute of Canada to promote the safe and responsible development of AI technologies, the enforcement of proposed AI regulations by the AI and Data Commissioner, and Canada’s participation on the Global Partnership on Artificial Intelligence.

The Committee received a range of proposals from witnesses across different economic sectors to foster innovation, competitiveness and sustainability. Examples of proposals included green strategies, a consumer-driven banking framework, strategic support for manufacturing, energy security, and sustainable agricultural practices.

Industry and Innovation

On the topic of industry and innovation, witnesses made several proposals aimed at fostering innovation, enhancing commercialization, and supporting entrepreneurs. A number of witnesses advocated for the development of a green industrial strategy to align production systems with shared goals, while others proposed modernizing Canada's industrial strategy by emphasizing the importance of innovation, productivity and intangible assets.

With respect to supporting innovation, witnesses presented proposals to reform key programs like the Scientific Research and Experimental Development (SR&ED) tax incentive program, ensure policies do not unfairly penalize innovators, particularly regarding changes to the capital gains inclusion rate, and enable better commercialization of intellectual property. Regarding AI, witnesses made proposals to prioritize its commercialization and ensure data sovereignty strategies are in place.

The Committee also received proposals for strengthening support for startups and small businesses, particularly in underrepresented communities. Several witnesses suggested increasing investments in deep-tech incubators, offering specialized support for high‑priority sectors like AI and clean energy, and creating financial tools to support businesses entering new markets. Proposals were also made to streamline approval processes for government support and to harmonize due diligence procedures for high‑growth companies. Furthermore, witnesses emphasized the need to attract more capital, such as through tax credits for angel investors, risk-mitigating loan guarantees, and the adoption of successful models from other jurisdictions like the United Kingdom (U.K.) and the United States (U.S.).

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 1

Support Canadian businesses in leveraging AI for economic growth by prioritizing domestic AI commercialization and data sovereignty strategies.

Recommendation 2

Encourage strategic investments in AI.

Recommendation 3

Make Budget 2023’s investment in the College and Community Innovation Program permanent.

Recommendation 4

Establish a polytechnic and college research growth fund to propel applied research solutions to Canada’s major challenges.

Recommendation 5

Evaluate the economic benefits of innovation granting councils and refocus their mandates towards intellectual property and R&D.

Recommendation 6

Increase investments to support deep-tech incubators and commercialization to stimulate Canadian innovation and support SMEs.

Recommendation 7

Support research partnerships between organizations and universities to increase research and development activities, especially of SMEs.

Recommendation 8

Implement framework legislation with specific mechanisms and measures to strengthen the Social Innovation and Social Finance ecosystem in Canada, following the lead of jurisdictions around the world and in Quebec.

Recommendation 9

Invest in an advanced technology accelerator for industries at the heart of the northeast semiconductor and quantum technology corridor.

Recommendation 10

Support university hubs in quantum science and technology to strengthen collaborative relationships between universities as part of the renewal of Canada’s National Quantum Strategy.

Recommendation 11

Reform the SR&ED program, such that all Canadian companies doing research and development in Canada have equal access to the program.

Recommendation 12

Finalize the reform of SR&ED tax credit to commercialize intellectual property.

Recommendation 13

Promptly announce changes to the SR&ED program, raise the base rate and the eligible expenditure threshold, and make capital and pre-marketing expenditures eligible.

Recommendation 14

Implement a national innovation box (patent box) regime.

Recommendation 15

Reduce barriers for entrepreneurs from underrepresented groups and communities – including Black, Indigenous and women – by providing additional financial support, including renewing funding for the Black Entrepreneurship Program.

Recommendation 16

Implement a series of measures to promote intrapreneurship within Canadian companies and encourage this model’s implementation to increase productivity and business growth.

Recommendation 17

Implement an economic spillover lens to foreign direct investment.

Recommendation 18

Provide new funding for sustainable tourism and local economic development.

Recommendation 19

Promote business conversions to co-operatives for corporate succession planning.

Financial Institutions

Regarding financial institutions, several proposals were made to enhance Canada’s consumer-driven banking framework and regulatory systems. Key suggestions included fair access to consumer-driven banking for all entities, strengthening oversight by the Financial Consumer Agency of Canada with sufficient expertise and budget, and establishing an industry advisory committee to represent credit unions. Additional proposals addressed barriers to combining federal and provincial credit unions, discussed revisions to federal financial sector statutes, and aimed to ensure credit unions and cooperatives can receive the Canada Carbon Rebate for Small Businesses. Other proposals focused on streamlining federal transitions for credit unions, reducing credit card interchange fees, encouraging pension funds to increase domestic investments, and adopting a taxonomy for green and transition investments.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 20

Promote a harmonized, pro-innovation regulatory approach for the financial sector based on the key principle of “same activity, same risk, same regulation.”

Recommendation 21

Finalize and implement Canada’s Consumer-Driven Banking Framework in 2025.

Recommendation 22

Continue funding the Financial Consumer Agency of Canada to support its new mandate of overseeing the open banking framework.

Recommendation 23

Establish an industry advisory committee, including credit unions, to ensure the needs of the sector are communicated and taken into account as the Financial Consumer Agency of Canada takes on its new mandate of overseeing the open banking framework.

Recommendation 24

Consider the crucial role it must play in Canada’s legal and regulatory balance in the financial sector and take into account the provincial frameworks already in place, particularly with regard to Canada’s Consumer-Driven Banking Framework.

Recommendation 25

Encourage initial public offerings and stimulate institutional investment in Canadian public and private companies, specifically by promptly eliminating the 30% rule for domestic investments by large pension funds, encouraging a minimum allocation of pension fund assets to venture capital, and eliminating eligibility criteria for tax incentives related to Canadian-controlled private corporation status.

Recommendation 26

Amend the Pension Benefits Standards Regulations, 1985 to require pension plans to adopt transition plans and reconcile their climate-related policies with their investment portfolio and require that federally regulated pension plan administrators, under their current obligations to establish a written statement of investment policies and procedures, determine how their climate resilience policies (mitigation and adaptation) pertain to the plan’s portfolio of investments and loans.

Recommendation 27

Study the possibility of removing the federal qualifier from section 39.02 of the Bank Act and simply refer to a financial institution, an inclusive expression that already exists in the Act.

Recommendation 28

Develop a green and transition finance taxonomy, in accordance with the Sustainable Finance Action Council’s recommendations, as quickly as possible to set standards for classifying climate-related financial instruments and benchmarking climate risk management.

Recommendation 29

Make climate disclosures mandatory for companies incorporated under the Canada Business Corporations Act.

Recommendation 30

Adopt a coherent legislative framework that will enable the financial sector and federally regulated entities to align their activities with Canada’s international commitments and nationally legislated targets, as minimally defined by Bill S-243, An Act to enact the Climate-Aligned Finance Act and to make related amendments to other Acts, especially as it relates to the annual reporting on credible climate transition plans.

Recommendation 31

Clarify its climate resilience commitments and investments, particularly with respect to housing and the national flood insurance program for properties at high risk of flooding.

Recommendation 32

Fully fund the core operations of the Canada Mortgage Housing Corporation reinsurance subsidiary, which is needed to govern and implement a low-cost, high-risk National Flood Insurance Program.

Recommendation 33

Reduce credit card swipe fees and remove credit card interchange fees on the tax portion of sales made by credit card, as was committed in 2019.

Manufacturing

With respect to manufacturing, witnesses made proposals to support the aerospace, steel and automotive industries.

On the topic of aerospace, proposals included repealing the luxury tax on aircraft sales and imports, developing an aerospace strategy focused on certification processes, sustainable aviation fuels, and scientific research incentives, and establishing a national industrial strategy alongside a dedicated funding program. Witnesses also suggested creating an aerospace development council to coordinate stakeholders and implement the national strategy.

The Committee received proposals for strengthening Canada’s steel sector, with calls to enhance protections from unfair imports, align with U.S. anti-circumvention standards, and provide sustained support for decarbonization efforts. Proposals included imposing tariffs on Chinese steel imports and updating the Customs Tariff to include labour, environmental and national security provisions.

For the automotive sector, witnesses advocated for recapitalizing the Strategic Innovation Fund for transition-focused investments, extending and increasing rebates under the Incentives for Zero-Emission Vehicles program, as well as establishing a benchmark for electric vehicle charging infrastructure.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 34

Increase incentives and enact reforms to stimulate innovation, investment, and the adoption of advanced technologies in Canada’s manufacturing sector.

Recommendation 35

Amend the Clean Technology Manufacturing Investment Tax Credit to include manufacturing of carbon capture and storage facilities.

Recommendation 36

Create a national strategy for the aerospace industry and create an aerospace development council consisting of sector stakeholders, including the unions, to put the strategy into effect.

Recommendation 37

Support innovation and research infrastructure in aerospace technologies developed by the École de technologie supérieure and its industrial partners.

Recommendation 38

Enhance protection from unfair steel imports through improved trade tools and enforcement, including through a better alignment with anti-circumvention standards in the United States.

Recommendation 39

Grow Canada’s share of the global zero-emission vehicles supply chain.

Recommendation 40

Increase zero-emission vehicles supply chain capacity, security and resiliency.

Recommendation 41

Make the 10% tax credit more flexible for investment in the electric vehicle supply chain in order to open eligibility to businesses operating in at least one segment of the chain.

Natural Resources

The Committee received proposals for strengthening Canada’s natural resources sector, which focused on energy security, sustainable forestry, and critical mineral production.

On the topic of energy security, witnesses suggested prioritizing affordability, reliability, and acceptability in ministerial mandate letters, and they advocated for legislation and regulation to be assessed through this lens. Proposals included creating a parliamentary caucus and a Canadian Centre of Energy Excellence to foster innovation, as well as extending investment tax credits to technologies that promote affordability and sustainability in the energy sector. There was also support for expanding gas infrastructure to rural and Indigenous communities, with increased funding for clean energy solutions in these regions. Additional proposals were made to enhance infrastructure to reduce emissions across the oil, gas, and chemical supply chains, and eliminate subsidies for fossil fuels. Witnesses also advocated for a national strategy to secure Canada’s nuclear supply chain that would ensure new nuclear projects prioritize Canadian technology and materials.

With respect to the forestry sector, witnesses proposed developing a sustainable, value-added forestry industry, including the creation of a multi-stakeholder council to support climate adaptation. Proposals emphasized expanding support for forestry workers and affected communities and increasing incentives for sustainable practices.

For critical minerals, witnesses proposed addressing capital gaps, modernizing regulatory processes, and bridging infrastructure gaps to support sustainable mineral production. Additional proposals included direct funding for renewable energy adoption in off-grid mines and establishing research partnerships to advance low-carbon chemical production, aiming to bolster the sector’s sustainability.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 42

Eliminate all subsidies, public financing, and other fiscal supports provided for the extraction of fossil fuels and the production of petrochemicals.

Recommendation 43

Ensure that oil, gas and petrochemical companies fund the complete costs of the environmental clean-up of their operations.

Recommendation 44

Create a climate recovery fund by imposing a new tax on oil and gas companies.

Recommendation 45

Continue its support and funding for the deployment of clean energy and regional electricity transmission infrastructure.

Recommendation 46

Support electrical grid modernization by relaunching the Smart Renewables and Electrification Pathways Program and investing in a grid support program to align with rapid housing and infrastructure development.

Recommendation 47

Expand eligibility of the Clean Technology Investment Tax Credit to include intra-provincial transmission.

Recommendation 48

Invest into the Iqaluit Nukkiksautiit Hydro Project.

Recommendation 49

Expand the Clean Fuels Fund eligibility criteria to include hydrogen production and infrastructure to level the playing field with the United States.

Recommendation 50

Invest in domestic biofuel production and green solutions to power Canada’s transportation network.

Recommendation 51

Support the production and supply of Canadian-made sustainable aviation fuel.

Recommendation 52

Prioritize the production and supply of Canadian-made low carbon fuels.

Recommendation 53

Put in place a loan program that enables lumber companies to borrow a portion of the duties collected on their exports to the United States.

Recommendation 54

Provide a federal support package for lumber companies with mechanisms to deal with bonding requirements.

Recommendation 55

Provide adequate support for workers in the forestry industry who risk losing their jobs because of decrees intended to protect woodland caribou, and invest to support and diversify forestry activities.

Recommendation 56

Incentivize investment in the composite wood products manufacturing sector with dedicated measures that directly support the sector’s capital projects, growth and decarbonization.

Recommendation 57

Encourage the production and use of sustainable, long-lived wood products by incenting and stimulating market acceptance of structural and non-structural wood products through the Canada Green Building Strategy and associated tax incentives for the private sector.

Recommendation 58

Establish a personal silvicultural savings and investment plan for Canadian forest owners.

Recommendation 59

Support the rapid development of Canada’s critical mineral supply chains.

Recommendation 60

Invest in the Grays Bay Road and Port Project by:

• allocating amounts from the Critical Minerals Infrastructure Fund to enhance the project’s capabilities and develop connections to critical minerals projects and to the Northwest Territories;
• designating Grays Bay as a Northern Operational Support Hub; and
• ensuring that Canada is the primary construction funder once the project is shovel ready.

Recommendation 61

Renew the Mineral Exploration Tax Credit and the Critical Mineral Exploration Tax Credit for a minimum of 5 years, thereby aligning availability of these two incentives.

Recommendation 62

Amend the Clean Technology Manufacturing Investment Tax Credit to reduce the 90% threshold applicable to qualifying mineral activities to 50%.

Agriculture and Fisheries

The Committee received proposals for strengthening Canada’s agriculture sector through sustainability, financial support and trade protections. Witnesses made proposals to promote sustainable practices, including investments in research and technology transfer, while advocating for improvements to existing support programs like the Advance Payment Program, AgriRecovery and AgriStability. A number of witnesses also proposed support for organic farming through certification cost-sharing and regular standards reviews. Regarding trade, witnesses urged protections for supply-managed sectors, including support for Bill C-282, An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management) to prevent future concessions.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 63

Use the Sustainable Agriculture Strategy to help producers in Canada be leaders in sustainable and innovative agriculture, with a resilient and diversified food system.

Recommendation 64

Invest in research, technology transfer and programs to support farming businesses in adopting beneficial management practices and in their efforts to fight climate change.

Recommendation 65

Provide a cost-sharing program for organic certification and provide permanent funding for the process of reviewing organic standards every five years.

Recommendation 66

Foster sustainable agricultural practices by funding the ecosystem services provided, maximizing the economic and environmental performance of marginal land, and implementing a soil health strategy.

Recommendation 67

Develop programming and infrastructure that support the adoption and implementation of sustainable technology on Canadian farms.

Recommendation 68

Permanently set the interest-free limit for advances under the Advance Payment Program to $350,000.

Recommendation 69

Continue funding and improve the AgriRecovery program to intervene promptly among agricultural businesses that have suffered serious losses due to extreme weather events.

Recommendation 70

Expand the AgriStability program by increasing the coverage rate to 85% of the reference margin while keeping the compensation rate of 80% as introduced in the Sustainable Canadian Agriculture Partnership.

Recommendation 71

Protect family farmland and facilitate succession by creating an Agricultural Gifts Program and a fund to support access to farmland.

Recommendation 72

Create a new funding program that supports agriculture aid and partner initiatives in developing countries that share the skills, expertise and practices of Canadian farmers.

Recommendation 73

Provide a 40% tax credit to small-scale agricultural businesses that purchase equipment to ensure growth and profitability.

Recommendation 74

Enact policies that promote farmers’ ability to repair and choose their equipment.

Recommendation 75

Improve tax assistance for food donations made by an agricultural producer.

Recommendation 76

Create a limited statutory deemed trust, as established in Bill C-280, the Financial Protection for Fresh Fruit and Vegetable Farmers Act, to provide critical financial protection to produce sellers.

Recommendation 77

Upholds its commitment to protect supply-managed sectors in all future trade negotiations and continue to roll out, in a timely and efficient manner, the mitigation programming to egg and poultry farmers as a result of the market concessions granted under recent trade agreements.

Recommendation 78

Make no further concessions on supply-managed products in future trade negotiations by supporting Bill C-282, An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management).

Recommendation 79

Ensure the reciprocity of production standards – including animal welfare measures and food safety practices – between domestic and imported products, and increase resource allocation to the Canadian Food Inspection Agency to ensure capacity for enforcement.

Recommendation 80

Establish food labelling guidelines and standards of identity for simulated or imitation product alternatives to increase transparency in the Canadian marketplace and allocate resources to the Canadian Food Inspection Agency to ensure the enforcement of guidelines and regulations.

Recommendation 81

Ensure the Canadian Food Inspection Agency is appropriately resourced during a time of crisis regarding animal health to better support Canadian farmers.

Recommendation 82

Increase funding resources for core fisheries science in support of management decision‑making.

Recommendation 83

Prioritize the hiring and retention of fisheries scientists specializing in quantitative stock assessment.

Recommendation 84

Recognize that marine conservation and sustainable use cannot be viewed as mutually exclusive.

Recommendation 85

Implement rebate programs to incentivize the adaptation of more sustainable commercial fishing gear and technologies.

Recommendation 86

Support a national seafood marketing and communications program.

Regulatory Environment

With respect to regulatory reform, witnesses called for federal leadership in reducing interprovincial trade barriers and advocated for streamlining regulatory processes. A number of witnesses opined that new regulations should be less restrictive than previous ones, promote mutual recognition of products approved elsewhere, and expedite environmental assessments. As well, the Committee heard about restoring convenience stores’ ability to sell nicotine replacement therapies to adults.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 87

Exempt regulated utilities from the Excessive Interest and Financing Expenses Limitation rules.

Recommendation 88

Mandate an economic lens for regulators, where appropriate, to attract new economic opportunities to Canada, reduce red tape, and increase economic growth and competitiveness.

Recommendation 89

Modernize Canada’s regulatory system and reduce red tape to support the Canadian manufacturing sector.

Recommendation 90

Cut red tape for small businesses.

Recommendation 91

Modernize Canada’s regulatory framework to increase investment, economic growth, and jobs by addressing the web of overlapping regulations between Canadian jurisdictions, so businesses are better able to trade within Canada and beyond.

Recommendation 92

Create a transparent registry of interprovincial and regulatory barriers to trade that inhibit productivity and efficiency.

Recommendation 93

Expedite credential recognition to let qualified workers fully use their skills wherever they are needed across the country.

Chapter Three: A Healthy Population and A Skilled Workforce

Between January 2021 and 2024, prices for food purchased from stores increased by 34.3%, which has led to an increase in the percentage of Canadians experiencing food insecurity. According to Statistics Canada food insecurity resulting from a lack of money for food can be:

• marginal, when a household worries about running out of food and/or having a limited selection of food;
• moderate, when a household makes compromises in the quality and/or quantity of food; or
• severe, when a household experiences missed meals, reduced food intake or, at the most extreme, goes day(s) without food.

The share of individuals in food-insecure households, which refers to those in situations of either moderate or severe food insecurity, has increased from 11.2% in 2020 to 16.9% in 2022. As shown in Figure 2, certain groups were more likely to be suffering from food insecurity in that year:

• 21.0% of children compared to 16.9% for the general population;
• 20.7% of people from visible minorities compared to 15.4% for those who are not from a visible minority;
• 29.0% of Indigenous persons compared to 16.5% for the non-Indigenous population; and
• 21.2% of immigrants who arrived within the previous 10 years compared to 15.4% for those born in Canada.

Figure 2—Percentage of Persons Experiencing Moderate or Severe Food Insecurity, by Selected Demographic Characteristics, 2022 (%)

Source:  Figure prepared by the Library of Parliament using data from Statistics Canada, “Table 13‑10‑0835‑01: Food insecurity by selected demographic characteristics,” Database, accessed on 18 November 2024.

This rise in the prevalence of food insecurity has led to an increase in the number of Canadians visiting food banks. According to Food Banks Canada, there were about 2.1 million visits to food banks across Canada in March 2024, which represents an increase of 6% in the number of visits compared to March 2023 and 90% compared to March 2019. Due to the increase in demand, 30% of food banks affiliated with Food Banks Canada reported instances of running out of food before demand was met and 56% reported giving out less food than usual over the last year; these figures were 10% and 20% in 2021, respectively.

As indicated by the University of Toronto’s PROOF research program, persons experiencing food security are more likely to be affected by a wide range of health conditions, such as infectious disease, poor oral health, diabetes, heart disease, hypertension, arthritis, back problems and chronic pain. Food insecurity also has an impact on mental health, especially for children. Those that experience food insecurity at an early age are more at risk of suffering from problems such as hyperactivity and inattention and “developing depression and suicidal ideation in adolescence and early adulthood.”

The federal government combats food insecurity through a variety of initiatives. Notably, the Local Food Infrastructure Fund provides funding to not-for-profit organizations that support community food security initiatives, including food banks and community kitchens, particularly those that focus on or are led by Indigenous and Black communities. Furthermore, poverty-reducing measures, such as the Canada Child Benefit, Old Age Security benefits, the Guaranteed Income Supplement and the Canada Disability Benefit, contribute to reducing food insecurity.

To address food insecurity among children, Budget 2024 announced the creation of a National School Food Program, which aims to provide $1 billion over a five-year period to expand access to school food programs to 400,000 more children each year in collaboration with provinces, territories and Indigenous partners. In September 2024, Newfoundland and Labrador was the first province to reach an agreement with the federal government to expand its school food programs.

In addition to food security, witnesses discussed measures related to income security and other social policies, health, employment, labour and immigration, as well as education and skills training. The Committee also received proposals concerning Indigenous Peoples and on the topic of equity, diversity and inclusion through briefs.

Income Security, Food Security and Social Policy

On the topics of income security, food security and social policy, witnesses argued in support of a basic income and enhancing income program benefits and coordination at the federal level, while others raised the importance of ensuring equitable access to social programs. Witnesses also discussed the Canada Disability Benefit, the Disability Tax Credit and the National School Food Program and funding to support Indigenous families. Finally, witnesses proposed measures to reduce food insecurity and support caregivers as well as the not-for-profit childcare sector.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 94

Create dignified income support programs to support people aged 18 to 64 living in households experiencing food insecurity and poverty by transforming the GST/HST credit into a Groceries and Essentials Benefit and, the Canada Workers Benefit, into an enhanced Canada Working-Age Supplement.

Recommendation 95

Develop a national basic income program using one of the provinces as a demonstration pilot.

Recommendation 96

Increase Old Age Security benefits for seniors aged 65 to 74.

Recommendation 97

Enhance the Old Age Security program indexing formula to ensure that annual indexation is the highest of the Statistics Canada’s Consumer Price Index or salaries.

Recommendation 98

Commit to reducing food insecurity by 50% and eliminating severe food insecurity by 2030, relative to 2021 levels.

Recommendation 99

Continue and extend funding for the National School Food Program.

Recommendation 100

Embed the National School Food Program into legislation to secure long-term funding and stability for students.

Recommendation 101

Increase the Canada Disability Benefit to lift all Canadians living with disabilities above the poverty line and detach eligibility from the Disability Tax Credit.

Recommendation 102

Establish a pathway to eligibility for the Canada Disability Benefit through provincial and territorial income assistance programs for people with disabilities.

Recommendation 103

Expand the home accessibility tax credit to explicitly cover home modifications that address the needs of all people living with disabilities.

Recommendation 104

Convert the Canada caregiver credit from a non-refundable tax credit to a refundable tax-free benefit, per the 2021 Minister of finance Mandate letter commitment.

Recommendation 105

Implement a monthly refundable tax credit for home support services to enhance the affordability and accessibility of senior care, using the Quebec model as a blueprint.

Recommendation 106

Close the parental leave gap to ensure that every newborn in Canada has the right to protected time with a parent or caregiver with adequate income during at least the first 6 months (26 weeks) of life.

Recommendation 107

Expand non-profit and publicly owned early learning and child care by increasing the federal transfers to the provinces and territories under the Canada-wide Early Learning and Child Care Agreements.

Recommendation 108

Re-structure and advance funding under an Act Respecting First Nations, Inuit and Métis children, youth and families to advance the reduction of the number of Métis children in care.

Recommendation 109

Support the development of a Métis-specific “Child First Initiative” aimed at enhancing family support and community resources to realize greater social, educational, and health outcomes.

Recommendation 110

Commit funding to meet the long-standing target of 0.7% Official Development Assistance to gross national income over five years, in support of achievement of the Sustainable Development Goals by 2030, with a focus on the rights and needs of children.

Recommendation 111

Address climate goals through targeted actions for children, including expanding ambitious nationally-determined contributions and embedding a child-rights lens to climate action.

Recommendation 112

Designate an annual Nonprofit Day of Appreciation to recognize the economic and social contributions of the non-profit organizations across Canada.

Recommendation 113

Continue to support the important work of the United Nations Relief and Works Agency for Palestine Refugees in the Near East and increase Canada’s contributions.

Health

Regarding health, certain witnesses raised the issue of patient safety and the use of private nurse staffing agencies, while others discussed pharmacare’s funding and formulary. Some witnesses also argued for additional support for people living with diabetes and to expand employees’ health care benefits. Finally, witnesses discussed digitization in the health care sector, long-term care as well as funding for extended primary care teams.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 114

Support the Canadian Cardiovascular Society in defining wait times targets for screening, diagnosis, and management of heart failure as part of Canada’s health systems’ recovery from COVID‑19.

Recommendation 115

Provide funding for bi-annual visits to podiatrists for individuals living with diabetes to proactively manage foot health and prevent complications.

Recommendation 116

Provide funding for annual podiatric visits for senior citizens, particularly those in rural or underserved areas, to manage age-related foot conditions, improve mobility, and prevent falls and complications that may lead to hospitalization.

Recommendation 117

Provide earmarked funding for the implementation of the National Autism Strategy.

Recommendation 118

Create a new refundable income tax credit to help offset the high cost of gluten‑free foods.

Recommendation 119

Invest in research and work with health charities to enhance research in Canada.

Recommendation 120

Enhance the quality of arthritis statistics and health data.

Recommendation 121

Ensure that the barriers in cancer clinical trials are addressed as the federal government continues to modernize clinical trial systems.

Recommendation 122

Accelerate multiple sclerosis (MS) research for a cure by supporting MS Canada to co-lead a global initiative to prevent MS with an investment in leading-edge MS research.

Recommendation 123

Invest to expand CAPTURE ALS from a pilot initiative to a world-leading platform to enable Canadian and global researchers to understand why people experience ALS symptoms and progression differently and, in turn, help identify treatment targets, support earlier diagnosis, strengthen clinical trials, reduce economic burden associated with the disease and improve the quality of life for the more than 4,000 Canadians affected by ALS.

Recommendation 124

Invest in cures research for type 1 diabetes, with a focus on cell therapy research to get closer to functional cures for the disease.

Recommendation 125

Implement an ambitious vision for health research and innovation in Canada, supported by increased funding, that fosters a strong research ecosystem.

Recommendation 126

Establish a universal, comprehensive and single-payer pharmacare program through promptly negotiating bilateral agreements with the provinces and ensuring adequate funding for the program.

Recommendation 127

Ensure equitable and comprehensive access through national pharmacare and other federal pharmaceutical policy initiatives.

Recommendation 128

Maintain Quebec’s universal and mixed pharmacare plan and telemedicine services, including the coverage offered by Quebec employers through private providers.

Recommendation 129

Prioritize patient needs and preferences, comprehensive medication access, quick approval for new drugs, and the sustainability of Canadian health care in developing the national pharmacare program.

Recommendation 130

Finalize funding for the National Strategy for Drugs for Rare Diseases to include all provinces and territories and expand the plan to consider the broader aspects and issues related to rare disorders.

Recommendation 131

Make research on the brain and mental health a national priority with stable, targeted funding for the creation of a Canadian brain research initiative, and a dedicated, sustained commitment to fund this priority to improve health outcomes and quality of life for people in Canada.

Recommendation 132

Restore funding for the national Dementia Strategy.

Recommendation 133

Invest to implement national standards for diagnosis, treatment and care for Alzheimer’s disease and dementia.

Recommendation 134

Invest in a Community Mental Health Fund to build capacity for mental health organizations.

Recommendation 135

Provide funding, starting in 2025-2026, to the Public Health Agency of Canada to develop a National Suicide Prevention Strategy.

Recommendation 136

Provide funding in 2025-2026 to Health Canada to develop a strategic framework on youth mental health.

Recommendation 137

Increase access to culture-based, and intergenerational trauma-informed mental health and wellness interventions for First Nations communities.

Recommendation 138

Improve health outcomes of Métis citizens through self-determination by investing in the Canada-Métis Nation Health and Wellness Sub‑Accord.

Recommendation 139

Establish a federal fund to create a national network of addictions treatment facilities administered in accordance with the Canada Health Act and provide a five-year investment to secure and expand supervised consumption and harm reduction services nationally, as part of a comprehensive suite of measures.

Recommendation 140

Create a national peer-support fund through a funding allocation to the Substance Use and Addictions Program.

Recommendation 141

Work with the physical activity sector to develop and implement the Active Canada Action Plan.

Recommendation 142

Enhance the First Nations health workforce to bring accessible care closer to home.

Recommendation 143

Ensure the ongoing collection of pan-Canadian health sector workforce data across the public and private sectors.

Recommendation 144

Expand the list of countries eligible for automatic certification by the College of Family Physicians of Canada.

Recommendation 145

Work with other orders of government to introduce limited certification options for international medical graduates from qualifying countries so that they can provide care in Canada as they work towards full certification.

Recommendation 146

Work with other orders of government to investigate the possibility of condensing the current time requirements prior to full certification of international medical graduates.

Recommendation 147

Work with other orders of government to build mentorship and exam preparation processes to ensure success and smooth adaptation to the Canadian work environment of international medical graduates.

Employment, Labour and Immigration

On the topic of employment and labour, witnesses discussed ways to improve work conditions, address shortages and workplace closures in specific sectors and achieve pay and employment equity. In addition, witnesses made proposals regarding Employment Insurance and argued for providing job and training opportunities for youth and support for workers in the context of the transition to net-zero. Finally, witnesses raised the need to collect workforce data in the health sector.

On the topic of immigration, witnesses discussed the need for a cross-departmental and flexible approach, in addition to sharing proposals for reforming the immigration system to adapt it to Canada’s labour needs and protect workers’ rights.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 148

Restore the Employment Insurance (EI) temporary measures including a lower, uniform entrance requirement of 420 hours and other measures to increase access to EI benefits and active labour-market programming.

Recommendation 149

Prioritize a reform of the Employment Insurance program that adequately and permanently solves the “black hole” problem, establishes a universal entrance requirement based on a hybrid criterion of hours and insurable weeks, allows for the stacking of special benefits and regular benefits, and limits disentitlements from benefits.

Recommendation 150

Review how the Employment Insurance system functions in order to increase eligibility, make benefits more generous and correct the discrimination that this system perpetuates.

Recommendation 151

Extend the Employment Insurance benefit period to a maximum of 52 weeks for caregivers who temporarily quit their jobs to care for a family member.

Recommendation 152

Place the Employment Insurance fund outside its accounting parameters.

Recommendation 153

Restore the top-up to provincial and territorial Labour Market Development Agreement transfers withheld from Budget 2024 and take other steps to strengthen training and workforce development.

Recommendation 154

Restore funding for the Labour Market Development Agreements and the Workforce Development Agreements.

Recommendation 155

Increase workforce attraction and training funding in the aerospace industry, in partnership with provincial governments, which have jurisdiction in these fields.

Recommendation 156

Introduce a refundable career extension tax credit to compensate experienced workers for reductions in Guaranteed Income Supplement benefits and encourage them to remain in the workforce.

Recommendation 157

Increase the total earnings exemption on income from employment or self-employment to $6,500 in calculating the Guaranteed Income Supplement.

Recommendation 158

Scale up investment in workforce preparedness by creating green job and training opportunities for youth, expanding regional workforce development approaches, enabling Indigenous economic pathfinding, and undertaking the labour market analysis needed for a smooth transition to a low-carbon economy.

Recommendation 159

Establish a Youth Climate Corps to provide jobs and training for Canadian youth aged 35 and under to address the climate crisis with an investment that would grow to accommodate demand.

Recommendation 160

Increase funding for the Canada Summer Jobs program and prioritize job programs that provide staffing for accessible camp and physical activity experiences for children, youth and adults in all parts of Canada.

Recommendation 161

Develop an “All of Ministries” approach to immigration that coordinates support and funding from different federal departments in addition to Immigration, Refugees and Citizenship Canada.

Recommendation 162

Implement a more flexible funding model for the settlement and integration sector.

Education and Skills Training

Regarding education and skills training, witnesses proposed extending the student loan forgiveness program and providing funding and support for training and workforce development. Proposals were also made regarding work-integrated learning programming and experiential learning. Other witnesses discussed the needs of school boards and teachers, particularly in light of the influx of newcomers.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 163

Continue its expansion of the Canada Student Loan forgiveness program to include audiologists, dietitians, chiropractors, denturists, occupational therapists, optometrists, and speech-language pathologists.

Recommendation 164

Provide an additional amount to the Terry Fox Humanitarian Award to increase the value of the scholarship while maintaining the number of awards granted to Canadian youth.

Recommendation 165

Increase the maximum Canada Student Grant.

Recommendation 166

Provide proportional official language education funding, both in English and French, to accommodate the influx of newcomers to Canada.

Recommendation 167

Maintain competitive Canadian graduate student funding levels by indexing awards to inflation.

Recommendation 168

Narrow the Indigenous post-secondary education gap by raising the funding for Post-Secondary Student Support Program and equivalent Métis and Inuit Post-Secondary Education Strategies to reflect increasing Indigenous secondary school graduation rates.

Recommendation 169

Reinvest in and reopen applications for the Post-Secondary Institutions Strategic Investment Fund (or create a new green campus fund) to help campuses across the country lower GHG emissions, build capacity to help meet Canada’s labour market needs, and grow for the future.

Recommendation 170

Permanently increase the College and Community Innovation Program budget and allocate funding to equitably fund and expand the Technology Access Centre program.

Recommendation 171

Build on past investments in skills training by making a strategic reinvestment to support the Business + Higher Education Roundtable’s national work-integrated learning programming.

Recommendation 172

Undertake an inventory of critical skills training infrastructure to ensure Canada has the training space necessary to meet the needs in key economic sectors going forward, in conjunction with the Critical Skills and Training Infrastructure Fund.

Recommendation 173

Restore support for the three nationally recognized institutions for professional training in the audiovisual sector by reintroducing the National Training Program and the Film and Video Sector.

Recommendation 174

Attract the next generation of tradespeople by increasing funding to the Apprenticeship Incentive Grant.

Recommendation 175

Foster a net-zero economy by investing in workforce development to provide training and skills development paths that are aligned with projected growth sectors in a clean economy and providing paid internship and training programs for young people seeking careers in climate- and nature-related sectors.

Recommendation 176

Invest in the Student-Work Placement Program to create work-integrated learning opportunities for post-secondary students.

Recommendation 177

Announce ongoing investments under the Student Work Placement Program until 2030.

Recommendation 178

Invest in workforce readiness through continued investment in the Student Work Placement Program and in artificial intelligence work-related learning opportunities for students.

Recommendation 179

Renew the Global Skills Opportunity program to send Canadian students abroad to equip them with the skills required to thrive in a rapidly changing labour market.

Recommendation 180

Replace the Canada Training Credit with a voluntary professional development savings plan.

Recommendation 181

Expand funding for applied research at Canada’s colleges, cégeps and institutions to drive ongoing innovation in new and emerging technologies.

Recommendation 182

Support the development of interdisciplinary research, issues-oriented research and the international missions of the new umbrella organization for research funding through a new dedicated investment.

Recommendation 183

Expand financial support for research commercialization and knowledge mobilization programs.

Recommendation 184

Leverage the skills of academic researchers to grow research and development and commercialization opportunities.

Recommendation 185

Provide the budget increases promised in Budget 2024 to the granting agencies now and use the funds to rebalance the funding system as follows:

• allocate the increase to the base budget of the three granting agencies among them on a pro-rata basis to faculty, students and post-doctoral fellows in the disciplines they cover and allocate this increase to core grant programs to enable researchers toincrease the number and value of scholarships available to students under their supervision; and
• establish a minimum gradual Canada Research Chair quota within two years based on the institution’s relative faculty weight of the overall Canadian faculty; use the same formula to establish the minimum quota for Canadian graduate scholarships, applied t the graduate student population and post-doctoral fellows; and distribute a minimum of 50% of the funds of the relevant programmes within five years.

Recommendation 186

Explicitly state the duty to support research development across Canada’s academic regions and cities in the mission statement of the new framework organization and the three granting agencies.

Recommendation 187

Dedicate a significant portion of new research investments to supporting the production and dissemination of scientific research results in French.

Recommendation 188

Create grant programs for cross-disciplinary research groups, particularly to address health issues.

Recommendation 189

Match Budget 2024 investments with increased support for the full costs of research through the Research Support Fund and Incremental Project Grants.

Recommendation 190

Fully support enhancing Canada’s digital research infrastructure as an enabler of world-class research initiatives.

Recommendation 191

Act immediately to maximize support for the development of research collaborations through Canada’s participation in Horizon Europe.

Indigenous Peoples

The Committee was presented with proposals by witnesses and in written submissions related to First Nations, Métis and Inuit, as well as Indigenous languages.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 192

Provide funding for full participation in the United Nations Declaration on the Rights of Indigenous Peoples Act’s implementation oversight mechanisms, and targeted Action Plan Measures implementation activities.

Recommendation 193

Provide investments to support the resolution of specific claims, and joint legislative and policy reform, including funds to establish an Independent Centre for the Resolution of Specifics Claims.

Recommendation 194

Develop new fiscal arrangements for First Nations.

Recommendation 195

Pursue legislation to institutionalize the Canada-Métis Nation Accord and Permanent Bilateral Mechanism.

Recommendation 196

Advance Métis women and gender equality through Métis Nation governance, support for capacity-building and core funding for Métis women and gender equality initiatives.

Recommendation 197

Advance economic reconciliation with Indigenous Nations and support the North and remote communities.

Recommendation 198

Expand and coordinate existing investments and programs to deliver retrofits that integrate health, affordability, and adaptation targets, and accommodate the unique needs of Indigenous, northern and remote communities.

Recommendation 199

Provide investments to fully implement the Indigenous Languages Act.

Recommendation 200

Provide financial support to the National Aboriginal Capital Corporations Association to provide strategic top-ups to Indigenous financial institutions that require additional support to increase their capital base and ensure consistency across the network.

Recommendation 201

Fund the Aboriginal Savings Corporation of Canada to establish a national First Nations home ownership program.

Recommendation 202

Provide ongoing, stable, flexible and sufficient financial support to National Aboriginal Capital Corporations Association to develop permanent tailored services for young Indigenous entrepreneurs.

Recommendation 203

Provide ongoing, stable, flexible and sufficient financial support to the National Aboriginal Capital Corporations Association in establishing a permanent program aimed at supporting Indigenous entrepreneurs in tourism.

Recommendation 204

Fund the National Aboriginal Capital Corporations Association to establish and administer a First Nations-Led Procurement Organisation.

Recommendation 205

Provide funding to establish a dedicated infrastructure monetization fund and for fund operations for First Nations seeking innovative ways to address their housing and infrastructure needs, and for loan servicing on First Nations Finance Authority’s infrastructure “Reconciliation Debenture.”

Recommendation 206

Support the development of a bonding and surety fund to provide the required collateral for on-reserve Indigenous-led contractors that enables them to get market-price insurance to fairly bid on infrastructure contracts, and support the research, engagement and creation of a stand-alone not-for-profit authority, governed by Indigenous contractors.

Recommendation 207

Support regulatory changes, enabled under section 141 of the First Nations Fiscal Management Act, to allow First Nations Finance Authority to lend directly to special purpose vehicles where a federal or provincial loan guarantee is applied or where provincial or territorial backed entities is providing long-term guaranteed agreements.

Equity, Diversity and Inclusion

The Committee was presented with proposals by witnesses and in written submissions on a range of topics related to equity, diversity and inclusion, including gender equality, and the prevention of racism, Islamophobia and anti-Semitism.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 208

Allocate annual funding to Women and Gender Equality Canada’s Women’s Program for core funding or renewable capacity building grants for feminist organizations that operate at the national level.

Recommendation 209

Increase the international assistance envelope to build on Canada’s leadership in supporting women’s rights and feminist movements globally and ensure that further assistance to Ukraine be provided in addition to the existing aid envelope so that it does not impinge on the increase of assistance to the rest of the world.

Recommendation 210

Support diversity and inclusion in the skilled trades by mandating Community Benefits Agreements on federally funded infrastructure projects.

Recommendation 211

Continue to implement Canada’s Black Justice Strategy, in consultation with Black communities across Canada, to address anti-Black racism and systemic discrimination in the criminal justice system.

Recommendation 212

Renew and enhance the Supporting Black Canadian Communities Initiative.

Recommendation 213

Ensure the permanence of the Black-Led Philanthropic Endowment Fund by supporting full rights and interests to the Foundation for Black Communities.

Recommendation 214

Review all federal grant programs to ensure that only projects that align with Canada’s Anti-Racism Strategy receive federal funding.

Recommendation 215

Invest in a dedicated national anti-Islamophobia strategy that includes increased funding both to Canada’s Special Representative Office on Islamophobia, as well as to the York University Islamophobia Research Hub and an investment into public education campaigns to drive down anti-Muslim sentiment.

Recommendation 216

Dedicate funding to develop a five-year program to enhance the literacy of the International Holocaust Remembrance Alliance working definition of antisemitism amongst post-secondary aged Canadians.

Recommendation 217

Provide funding for the Holodomor National Awareness Tour Program.

Chapter Four: Affordable, Vibrant and Safe Communities

Housing demand can be influenced by a range of factors, such as employment and income levels, population growth, the availability of mortgage loans and tax measures that affect the return of homeownership relative to other types of assets. The rise in housing prices since 2020 has raised concerns about young Canadians’ ability to afford a home. Bank of Canada data shows that the share of mortgaged home purchases by first-time homebuyers has decreased from 46.8% to 44.0% between the first quarter of 2020 and the first quarter of 2024, while the share purchased by investors increased from 22.3% to 30.5%.

Figure 3—House Purchases Financed by Mortgage Loans, by Type of Borrower (%)

Source:  Figure prepared by the Library of Parliament using data obtained from Bank of Canada, Indicators of financial vulnerabilities, 20 September 2024.

In response to this situation, the federal government has announced a number of measures to make it less attractive to purchase housing for investment purposes, on the one hand, and measures to support prospective first-time home buyers, on the other hand, including through changes to mortgage rules.

The rules applicable to residential mortgage loans issued by federally regulated financial institutions are set out in a number of laws and regulations. The Bank Act provides that a bank cannot make a mortgage loan for a residential property if the loan-to-value ratio exceeds 80%, subject to a number of exceptions, including loans insured through the Canada Mortgage and Housing Corporation (CMHC) and the two private sector mortgage insurers. Other federally regulated financial institutions, such as trust and loan companies, are subject to similar provisions.

In order to be eligible to insurance, mortgage loans must meet a number of requirements set out under the Insurable Housing Loan Regulations, which apply to mortgage loans insured by the CMHC, and the Eligible Mortgage Loan Regulations, which apply to mortgage loans insured by private sector mortgage insurers. In particular, these regulations set out requirements with respect to the amortization schedule, down payment, the value of the property to be insured, credit scores and debt service ratios.

Furthermore, federally regulated financial institutions are also subject to the Residential Mortgage Underwriting Practices and Procedures Guideline (B-20 Guideline) issued by the Office of the Superintendent of Financial Institutions (OSFI). The B-20 Guideline sets OSFI’s expectations for prudent residential mortgage underwriting, including an institution’s assessment of the borrower’s capacity to service their debt obligations on a timely basis and the value of the underlying property. In particular, the B-20 Guideline establishes a minimum qualifying rate (MQR) for uninsured mortgages, also called “stress test,” which is applied to the calculation of the gross debt service ratio to test a borrower’s ability to continue to make their mortgage payments in the event of a negative financial shock. The MQR is revised annually and is currently the greater of the mortgage contract rate plus 2%, and 5.25%.. The Department of Finance also sets an MQR for insured mortgages, which is also subject to review and periodic adjustment and is currently the same as the MQR for uninsured mortgages .

The federal government announced a number of changes to mortgage rules to make it easier for prospective first-time homebuyers to acquire a home. Budget 2024 announced that starting on 1 August 2024, 30‑year insured mortgage amortizations would be allowed for first-time homebuyers purchasing a new construction. Otherwise, the maximum amortization period for insured mortgages is 25 years. The Department of Finance then announced in September 2024 that this change will be expanded to all first-time homebuyers and all purchasers of new builds, and that the maximum property value criteria for insured mortgages will increase to $1.5 million, up from $1.0 million. These additional changes will become effective starting on 15 December 2024.

Regarding the purchase of homes for investment purposes, the federal government announced measures to discourage such behaviour. Specifically, it introduced legislation to:

• Tax the profits from the sale of a residential property held for less than one year as business income;
• Deny income tax deductions on income from non-compliant short-term rentals; and
• Prohibit the purchase of certain residential property by non‑Canadians.

Budget 2024 also announced the government’s intention the restrict the purchase and acquisition of single-family homes by very large corporate investors and that it would lead consultations on this initiative.

In addition to housing-related issues, witnesses discussed measures on infrastructure and transportation, arts, culture and telecommunications, as well as safety and security. The Committee also received proposals concerning environmental protection through briefs.

Housing

A number of witnesses called on the federal government to increase its support for the development and maintenance of non-market housing, including that provided by not-for-profit and cooperative organizations, in order to respond to the housing needs of lower-income households. In particular, proposals were made in respect of the Affordable Housing Fund, the Rapid Housing Initiative, the Federal Lands Initiative and the Co-op Housing Development Program. Certain witnesses emphasized the need to better support tenants, such as through the Canada Rental Protection fund, the Federal Community Housing Initiative and the Tenant Protection Fund.

In addition, the Committee heard proposals related to housing demand, specifically to encourage prospective first-time home buyers and discourage speculative investment in housing. Others advocated for increased cooperation between orders of governments to find solutions to increase housing supply and deal with encampments. Lastly, witnesses made requests related to energy use in the residential sector, an Indigenous housing strategy and retrofit programs.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 218

Extend the current GST/HST relief for purpose-built rental housing to include non-profit affordable ownership housing.

Recommendation 219

Remove the GST paid on the sale of affordable homes built by non-profit affordable homeownership providers until those homes are sold to market.

Recommendation 220

Extend GST exemptions to not-for-profit builders and social service providers operating and building transitional housing units.

Recommendation 221

Significantly improve the GST new housing rebate.

Recommendation 222

Relaunch Canada Mortgage and Housing Corporation’s First-Time Home Buyer Incentive, with improved eligibility criteria.

Recommendation 223

Implement a punitive capital gains tax on speculative investments of non-principal residence, single-family homes, if not held for at least two years.

Recommendation 224

Support new financial instruments that track speculative housing demand.

Recommendation 225

Secure existing affordable rental homes through an accelerated and sector-led Canada Rental Protection Fund to enable co-operative and non-profit housing organizations to purchase rental properties that are for sale.

Recommendation 226

Increase funding for the new Canada Rental Protection Fund and reserve this funding exclusively for various forms of social housing.

Recommendation 227

Support and incentivize purpose-built rental housing, including by allowing capital gains deferral where proceeds are re-invested in social housing.

Recommendation 228

Continue funding and further enhance the Tenant Protection Fund.

Recommendation 229

Tie federal housing funding to a 5-year moratorium on rent increases beyond inflation targeted at temporary rent control across the country.

Recommendation 230

Increase the Canada Housing Benefit and reform unnecessarily restrictive qualifications.

Recommendation 231

Place conditions on federal funding for purpose-built rentals to ensure that at least 25% of all new rental units have a form of rent control or are rent-geared-to income units.

Recommendation 232

Adjust the affordability criteria so that rents are affordable for the clienteles targeted by various programs and invest the necessary funds to make the projects sustainable.

Recommendation 233

Continue to invest a portion of the Affordable Housing Fund into affordable homeownership.

Recommendation 234

Earmark the Affordable Housing Fund to the non-profit sector, increase funding for the Rapid Housing Stream and enhance its “subsidy” stream with the expectation that government funding will be sufficient to complete project financing packages.

Recommendation 235

Provide sufficient funding for the Affordable Housing Fund and the Apartment Construction Loan Program so that all projects that meet the criteria can be funded.

Recommendation 236

Commit to creating 500,000 new affordable housing units within 5 years, and allocate a sizable portion as non-market or rent-geared-to-income public housing.

Recommendation 237

Establish targets and timelines for increasing non-market rental housing’s share of Canada’s total housing stock to align with other developed OECD countries by 2034.

Recommendation 238

Aim to achieve a Canadian non-market housing rate of 20%.

Recommendation 239

Increase investments in non-market housing, including not-for-profit and co-operative housing, to match average funding for social housing by other developed OECD countries.

Recommendation 240

Reallocate all funding for the construction, maintenance and renovation of housing in Canada’s Housing Plan as well as additional funding to significantly expand social housing in Canada, including public social, cooperative and non-profit housing units.

Recommendation 241

Make the Federal Community Housing Initiative permanent.

Recommendation 242

Offer low-cost loans to non-profit and co-op housing providers and builders by reallocating existing financing or opening new finance options.

Recommendation 243

Eliminate taxes for non-profit and co-op housing providers and builders to reduce financial burdens, including developers of student housing.

Recommendation 244

Prioritize the allocation of surplus public land for housing to non-profits and co-ops instead of private developers at no or very low cost and provide new, recurring and predictable funding for the Federal Lands Initiative for this purpose.

Recommendation 245

Create a federal financing program targeted at building significantly more co-operative homes across Canada, informed by the measures implemented by the Canada Mortgage and Housing Corporation in the 1970s and 1980s to stimulate the creation of affordable housing units by non-profit co-operative housing.

Recommendation 246

Ensure that the eligibility criteria for the new Co-op Housing Development Program require that affordability thresholds be met to ensure low- and modest-income renter households have adequate housing.

Recommendation 247

Maintain and fund a pre-startup fund for social housing in a loan or grant form, like the Canada Mortgage and Housing Corporation’s Seed Funding program, that is sufficient to meet needs, to support the initial phases of project development.

Recommendation 248

Reach agreements with provincial and territorial government to pool funds under a self-sustaining program specifically designed to fund community and social housing to create a funding continuum that accelerates project delivery.

Recommendation 249

Continue discussions with other levels of governments to ensure that funding related to housing financing programs are rapidly deployed.

Recommendation 250

Adjust federal programs that help fund affordable housing to align with Quebec programs sponsored by the Société d’habitation du Québec and other public or private funders to encourage their inclusion in the same funding package, and thereby speed up product delivery.

Recommendation 251

Ensure that the affordability criteria used to determine base rent costs by region are adjusted to the local reality of each community and social housing construction program to maintain consistency with Quebec programs and encourage their inclusion in the same funding package.

Recommendation 252

Adjust the grant application forms by retaining the same references and definitions to ensure program compatibility.

Recommendation 253

Establish gender-responsive budgeting processes to address differing impacts on the housing experiences of women and gender-diverse persons that recognizes the distinctive and urgent obligation to protect the right to life of Indigenous women, girls and gender-diverse people in accordance with the National Inquiry into Missing and Murdered Indigenous Women and Girls’ Calls to Justice.

Recommendation 254

Advance Indigenous housing rights by fully implementing the Urban, Rural and Northern Indigenous Housing Strategy.

Recommendation 255

Address the critical housing needs of the Métis Nation by re-allocating Urban, Rural, and Northern Indigenous Housing funding through a distinctions-based approach.

Recommendation 256

Provide Yänonhchia’ Housing Finance with funding to establish its capital facility and support its phase I activities, which will enable it to expand its on-reserve housing renewal and financing activity outside of Quebec to five additional regions in Canada to support residential construction and employment, and mitigate the housing crisis in Indigenous communities.

Recommendation 257

Add students to the National Housing Strategy’s priority populations.

Recommendation 258

Further integrate funding for student housing construction and renovation projects into funding programs for affordable housing.

Recommendation 259

Create a specific fund for the acquisition, construction, renovation and operation of student housing for new constructions and existing residences.

Recommendation 260

Support the development of student residences in all regions, not just in large urban centres.

Recommendation 261

Renew the Women and Children Shelter and Transitional Housing Initiative as an ongoing initiative of the National Housing Strategy.

Recommendation 262

Amend the National Housing Strategy to establish a new ten-year investment for the dedicated acquisition, conversion, and construction of 100,000 supportive mental health housing units and strengthen intergovernmental coordination to unlock access to operational dollars.

Recommendation 263

Move quickly to reach agreements with the provinces and territories on the conditions for using the funding for addressing homeless encampments.

Recommendation 264

Adopt a Special Advisor on Homelessness and Homeless Encampments to coordinate, oversee, and implement an interjurisdictional plan to address and prevent homelessness and encampments on a priority basis.

Recommendation 265

Adjust investments in homelessness programs in alignment with the Parliamentary Budget Officer report, with a view to ending homelessness within clear timelines and monitoring processes to track progress.

Recommendation 266

Invest in deeply affordable housing and reduce chronic homelessness by partnering with the non-profit sector.

Recommendation 267

Develop a capital funding program for temporary housing and vulnerable populations.

Recommendation 268

Allow continuous type funding for programs specifically aimed at building community housing and social housing for vulnerable clienteles instead of falling back on the project proposal approach.

Recommendation 269

Prioritize projects aimed at housing low-income households and specific vulnerable clienteles rather than following the “first come, first served” principle until all funds have been expended.

Recommendation 270

Stimulate offsite construction technologies and supply across the housing continuum through various funding streams, including incentives under the Housing Accelerator Fund and the new Homebuilding Technology and Innovation Fund.

Recommendation 271

Establish a permanent mechanism to collaborate and coordinate housing policy and development, such as a national housing secretariat or roundtable, that brings together all levels of government with housing stakeholders to coordinate housing policy and development across the housing continuum and address the housing crisis.

Recommendation 272

Consider allowing mortgages on new energy-efficient certified homes to have an increased maximum amortization period.

Recommendation 273

Consider extending the maximum amortization period for insured mortgages to 30 years for all buyers.

Recommendation 274

Ease the stress test by relaxing or eliminating the mortgage renewal test, periodically reviewing increases in the mortgage contract rate based on financial market conditions to avoid amplifying real estate market cycles, and allowing borrowers to qualify for a five-year fixed rate when taking out a mortgage – regardless of the type of loan – if it is more advantageous.

Infrastructure and Transportation

On the topic of infrastructure, witnesses discussed public transit, including in relation to the Canada Public Transit Fund, the development of a comprehensive national public transit strategy and measures to help municipalities and public transit agencies to improve procurement processes for transit. As well, the Committee heard about a proposed kilometric tax for vehicle users, the revenues of which would be used to fund public transit and active transportation initiatives. Witnesses also spoke about improving telecommunications, transportation corridors, an Inuit-led fund for Nunavut infrastructure and adapting infrastructure to climate change.

Regarding transportation, witnesses addressed the trucking, rail and air transportation sectors. On the topic of trucking, witnesses requested that the government address noncompliance with labour and tax laws in the trucking. Certain witnesses also advocated for better working conditions for workers in the industry, such as long-haul and taxi drivers. Speaking about the rail sector, witnesses discussed expanding VIA Rail’s passenger services, developing regulations to guide the industry’s technological transitions and prolonging the extended interswitching pilot project in the Prairies. Finally, with respect to air transportation, calls were made to improve working conditions and prohibit the “profitization” of airports.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 275

Engage with stakeholders to develop and implement a National Infrastructure Assessment and create a long-term strategy for addressing infrastructure needs in communities across Canada.

Recommendation 276

Involve industry stakeholders in the early stages of all federal infrastructure projects to ensure optimal return on investment and cost assurance.

Recommendation 277

Acknowledge the need for long-term, consistent infrastructure spending – particularly for the underground infrastructure sector – and renew funding for the Investing in Canada Infrastructure Program.

Recommendation 278

Increase the funding allocated to the Canada Community-Building Fund and move quickly to reach agreements with the provinces and territories to ensure that the funding provided for under the Canada Housing Infrastructure Fund is made available to municipalities.

Recommendation 279

Reinvest in parks, sport, and recreation infrastructure to ensure the health and well-being of the population.

Recommendation 280

Significantly increase its investment in the Disaster Mitigation and Adaptation Fund to accelerate the deployment of climate-resilient infrastructure.

Recommendation 281

Help fund the AdapT Institute to promote resilient infrastructure and a sustainable economy in Canada.

Recommendation 282

Bring forward the start date for the funding provided for under the Canada Public Transit Fund to ensure public transit systems have equitable and rapid access to capital funding and move quickly to reach agreements with the provinces and territories on the terms for using this funding while respecting municipal jurisdiction over land-use planning.

Recommendation 283

Streamline the application process and remove barriers to the Canada Public Transit Fund to maximize participation.

Recommendation 284

Increase funding to the Canada Public Transit Fund to account for asset maintenance needs in the sector.

Recommendation 285

Support public transit development through financial support for operations.

Recommendation 286

Protect the Canada Public Transit Fund by enshrining it in legislation and including an annual funding escalator tied to the cost of construction to ensure the fund maintains its value over time.

Recommendation 287

Establish a national taskforce with provincial and local governments, and transit agencies to develop a national public transit strategy with a new funding model for Canada’s public transit agencies.

Recommendation 288

Take immediate and concrete actions to increase investments in Canadian trade-enabling infrastructure at ports, marine terminals, inland terminals and railways to remain competitive in the global market and respond to the significant investment made by the U.S., in collaboration with private sector partners, and prioritize projects that address bottlenecks and build surge capacity.

Recommendation 289

Take action to secure the effective movement of goods across Canada’s ports and railways.

Recommendation 290

Develop a re-financing plan for the National Trade Corridors or introduce a new long-term trade infrastructure funding program to drive tangible progress and alleviate infrastructure challenges in the supply chain into the future.

Recommendation 291

Commit to long-term investment through a Canada Trade Infrastructure Plan, which includes solidifying supply chains for international and domestic trade corridors, to establish Canada as a reliable business partner.

Recommendation 292

Advance the development of the National Supply Chain Strategy and explore the creation of a national industrial strategy.

Recommendation 293

Replace Canada’s winter road network with all-season alternatives built to a gravel road standard.

Recommendation 294

Make transformative investments in Canada’s airport infrastructure.

Recommendation 295

Address the sustainable infrastructure and energy efficiency needs of all Canadian airports.

Recommendation 296

Significantly increase the funding allocated to the Airports Capital Assistance Program.

Recommendation 297

Invest in regional, northern and remote airport infrastructure, including the construction of food terminals and warehouses, to address food and economic security in the North.

Recommendation 298

Support the Pearson Economic Zone Strategy.

Recommendation 299

Implement airport lease model reforms for airport stability and growth.

Recommendation 300

Adopt digital tools to enhance passenger experience in airports.

Recommendation 301

Modernize the Duty Free Shop Regulations to allow for the sale of duty-free products to all international arriving passengers at Canadian international airports.

Recommendation 302

Establish a Tourism Infrastructure Fund and an incentive tax credit to drive major capital investments in the sector, especially from private capital markets domestically and internationally.

Recommendation 303

Support the viability of the Canadian airline industry by taking concrete and immediate actions to address pilot supply challenges in Canada.

Recommendation 304

Establish a special program with dedicated funding that addresses the maintenance and infrastructure needs of small craft harbours and harbour authorities.

Recommendation 305

Adjust criteria for Canada Port Authorities’ access to Canada Infrastructure Bank funds.

Recommendation 306

Ensure Canada Border Services Agency’s funding is dedicated and increased in predictable and sufficient manner to support port and supply chain services and trade facilitation.

Recommendation 307

Renew funding for the National Trade Corridors Fund, or provide more focused funding for the ports that are unable to leverage capital to borrow or capitalize subsidiaries or joint ventures.

Recommendation 308

Put in place more direct and indirect assistance programs for shipoperators making the green shift, to better support them through their energy transition, in particular by reinvesting in the Green Shipping Corridor Program.

Recommendation 309

Adequately support shipyards with specific assistance programs to help them modernize, including assistance for automation and technological innovation, so that shipyards can retain and develop their expertise, as this expertise is highly strategic for the country.

Recommendation 310

Accelerate the program to build new icebreakers for the Canadian Coast Guard, if built in Canada, to ensure adequate and continuous service to keep essential waterways in service.

Recommendation 311

Make new investments in outdoor waterway infrastructure, such as boat ramps and access points.

Recommendation 312

Provide resources for a consultation process with other levels of government so regional and local boating authorities are consulted when new restrictions are proposed under the Vessel Operation Restriction Regulations.

Recommendation 313

Close the First Nations infrastructure gap.

Recommendation 314

Meet First Nations community infrastructure needs, including buildings, ports and wharfs, transportation infrastructure, and utilities.

Recommendation 315

Continue to invest in a distinctions-based Inuit-led fund for Nunavut infrastructure.

Recommendation 316

Increase funding and accelerate the development of digital infrastructure, including broadband, mobile and satellite Internet services, and energy infrastructure in rural and remote and northern communities.

Recommendation 317

Ensure First Nations meet the standards outlined in Canada’s Connectivity Strategy.

Recommendation 318

Address barriers to zero-emission vehicles adoption.

Recommendation 319

Continue purchase incentives for new passenger zero-emission vehicles but focus on value for electric-only range.

Recommendation 320

Make zero-emission vehicles more accessible for low- and modest-income households.

Recommendation 321

Remove caps on incentives for zero-emission vehicles for carshare, rideshare or other ride-hailing fleets.

Recommendation 322

Increase funding for electric vehicle consumer education programs, including test drives and dealership training programs, to support salesforce and to implement these programs across Canada.

Recommendation 323

Offer a vehicle scrappage program for all types of vehicles.

Recommendation 324

Continue the transition of the heavy-vehicle subsector by increasing dedicated funding for electric school buses, in addition to offering a point-of-sale rebate.

Recommendation 325

Make the transition to electric transit buses more affordable.

Recommendation 326

Work across jurisdiction to accelerate electric school bus adoption.

Recommendation 327

Accelerate the integration of electric trucks into commercial fleets.

Recommendation 328

Electrify vehicle fleets in ports, airports, and similar federal facilities.

Recommendation 329

Support the electrification of Canada’s ferry services.

Recommendation 330

Modernize the incentives for the Zero-Emission Vehicles program, green levy, Zero Emission Transit Fund and Zero Emission Vehicle Infrastructure program.

Recommendation 331

Reduce the kilometres travelled by personal and freight transportation vehicles and replace them with kilometres travelled by electric bicycles through a grant.

Recommendation 332

Increase investments in electric vehicles charging infrastructure and establish specific targets for construction and deployment.

Recommendation 333

Make 1,6 million condominiums and apartments ready for electric vehicles by 2030.

Recommendation 334

Add electric vehicle charging requirements to national building codes.

Recommendation 335

Establish public charging “hubs” on underutilized government-owned lands.

Recommendation 336

Provide a connection rebate to cover costs levied by utilities when building large-scale charging stations.

Recommendation 337

Support regulatory reform to allow for proactive grid upgrades and fund utilities to establish capacity maps.

Recommendation 338

Include electric vehicle charger installation in home and public building energy retrofit programs.

Recommendation 339

Create a fund dedicated to improving tourism infrastructure vis-a-vis electric vehicle charging stations in rural areas enabling Canada to meet its 2030 Emissions Reduction Plan.

Recommendation 340

Invest in electric vehicle level 2 infrastructure in parking space in multi-unit residential buildings across Canada.

Recommendation 341

Work with provinces and industry to develop programs and funding to ensure electric vehicle infrastructure are more rapidly and widely expanded to service rural regions across the country.

Arts, Culture and Media

A number of witnesses made proposals for stable funding for artists, such as through the Canada Council for the Arts and the Canada Music Fund, as well as for more diversity among Canadian creators. Witnesses spoke in favour of initiatives to support festivals, events and performing artists as a way to attract tourists to Canadian cities and regions and foster their development. The Committee also heard proposals regarding the protection of music copyright holders, media and news organizations.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 342

Increase its allocations towards arts, culture, and heritage in 2025-2026 by providing funds to the Canada Council for the Arts and funds to the Department of Canadian Heritage, and permanently allocate at least 1% of its overall spending towards arts, culture, and heritage thereafter.

Recommendation 343

Integrate the additions made to the Building Communities through Arts and Heritage program and the Canada Arts Presentation Fund since 2019-20 into the programs’ base budgets.

Recommendation 344

Deliver on its commitment to permanently increase the Canada Music Fund.

Recommendation 345

Create a labour-based tax credit for the live performance industry similar to those that exist for the film industry.

Recommendation 346

Renew funding for Artsvest, a national program which provides skills training to arts and culture organizations across Canada.

Recommendation 347

Make the Major Events and Festivals Support Initiative permanent.

Recommendation 348

Provide permanent and stable funding for urban festivals, with particular emphasis on those festivals which provide accessible programming.

Recommendation 349

Provide funding to the 2026 Toronto Biennial of Art.

Recommendation 350

Provide immediate funding to the Toronto Caribbean Carnival, as well as over the next three years.

Recommendation 351

Create a tourism-focused program dedicated to the growth and marketability of Canadian festivals and events, managed by the regional development agencies.

Recommendation 352

Fund the Black Screen Office to make Canada’s screen industries’ practices free of anti-Black racism and to proactively empower Black Canadians working in screen industries to thrive and share stories from uniquely Black perspectives.

Recommendation 353

Allocate funding for the Canadian Independent Screen Fund for Black and People of Colour Creators to support important new and existing projects by Canadian creators.

Recommendation 354

Implement the Minister of Canadian Heritage’s mandate letter commitment to support Canadian authors and book publishers by increasing funding for the Canada Book Fund and the Canada Council for the Arts.

Recommendation 355

Provide additional annual funding for the Public Lending Right program, which should be in the form of a directed allocation to the Canada Council for the Arts.

Recommendation 356

Enforce the Revised Foreign Investment Policy in Book Publishing and Distribution, with more meaningful assessments of “net benefit to Canada.”

Recommendation 357

Review the definition of sound recording in the Copyright Act so that rights holders can receive remuneration when the fruits of their labour are incorporated into an audiovisual work.

Recommendation 358

Revise the private copying regime in the Copyright Act, so that it is technologically neutral and allows royalties to be collected on media such as electronic tablets and smart phones, and confirm the ability of the Copyright Board of Canada to set levies for unlicensed private copies made on audio recording media and audio recording devices.

Recommendation 359

Withdraw the exemption applicable to commercial radio stations under the Copyright Act allowing them to pay only $100 on the first $1.25 million of their annual advertising revenue.

Recommendation 360

Implement solutions that encourage fair remuneration of rights-holders for use of copyright protected work through reform of the Copyright Act and ensure that the Act protects all creators and copyright holders and that the educational publishing industry is sustainable.

Recommendation 361

Immediately amend the Copyright Act to repair the damage to the cultural economy from unregulated educational copying of published works.

Recommendation 362

Ensure that artificial intelligence systems comply with transparency obligations, such as publicly disclosing the copyright-protected works they use as well as with fair market principles to obtain licences and compensate copyright owners for the use of their works; and that no new exceptions from copyright or other intellectual property rights are created.

Recommendation 363

Amend the language of the exemption at section 32.2(3) of the Copyright Act to clarify that the exemption only applies where an organization acts “without motive of gain.”

Recommendation 364

Implement new financial and fiscal resources to support the traditional media and identify predictable and sustainable funding for CBC/Radio‑Canada.

Recommendation 365

Explore options to better support ethnic media.

Recommendation 366

Allocate funds to community, Indigenous, and campus radio.

Recommendation 367

Introduce tax measures to incent businesses to advertise with private sector Canadian news outlets and eliminate the tax-deductibility of advertising purchased from foreign websites to ensure media organizations are not deprived of revenues.

Recommendation 368

Return to the long-standing policy of exempting community newspapers with commercial inserts from the Consumers’ Choice program.

Recommendation 369

Dedicate more of the Government of Canada’s advertising expenditures to Canadian-owned media.

Recommendation 370

Extend the refundable labour tax credit for costs related to content production for all media, including print, television and radio.

Recommendation 371

Extend the Canadian journalism labour tax credit to broadcast news organizations.

Recommendation 372

Continue to invest in magazines eligible to receive support through the Special Measure for Journalism (SMJ) component of the Canada Periodical Fund (CPF) by making the SMJ a permanent component of the CPF, starting in 2025‑26.

Recommendation 373

Increase the core funding allocated to National Sport Organizations to adjust for inflation since 2005, adequately resource organizations for the long-term to address critical sport system priorities, and eliminate the forecast funding gap these organizations require to effectively deliver on their mandates.

Recommendation 374

Make the amounts included in the most recent Action Plan for Official Languages permanent to ensure the sustainable and sustained development of minority language communities.

Safety and Security

On the subject of safety and security, witnesses called on the federal government to address mortgage fraud, the sale of contraband tobacco and firearms smuggling, and to amend the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, the Criminal Code, and the Bank Act. As well, the Committee received suggestions related to NATO’s defense spending target, cybersecurity, counter-terrorism, police recruitment, Royal Canadian Mounted Police protocols, and the bail system.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 375

Provide dedicated, ongoing funding for police of jurisdiction, the Royal Canadian Mounted Police, and the Canada Border Services Agency to support their delegated responsibilities as it relates to port security, and improve information sharing between these and other actors and Canada Port Authorities.

Recommendation 376

Play its coordinating role with the provinces and municipalities in efforts to combat vehicle theft and adopt measures in areas under its jurisdiction, such as border services and vehicle safety standards.

Recommendation 377

Stabilize the violence against women shelter and transition house sector and address fundamental funding gaps in the National Action Plan to End Gender-Based Violence by adequately funding the core community-based, feminist, survivor-serving organizations.

Recommendation 378

Support First Nations-led Implementation of the National Inquiry into Missing and Murdered Indigenous Women and Girls’ Calls for Justice.

Recommendation 379

Enhance the First Nations Policing Program to establish new forces, achieve equity with federal services, provide wrap-around and culturally reflective services, and transition to legislation recognizing First Nations jurisdiction and policing as an essential service.

Recommendation 380

Make new investments to support and strengthen Canada’s ability to monitor and prevent terrorism, including funding to enhance the capacity and expand the capabilities of Integrated National Security Enforcement Teams.

Recommendation 381

Go further in leveraging Canadian flagged ships and infrastructure operating in the North to ensure sovereignty and improve Arctic intelligence gathering about environmental and security situations.

Recommendation 382

Implement a co-ordinated, cross-sector anti-scam action plan to protect Canadians.

Recommendation 383

Ensure adequate resources to hold individuals accountable for financial crimes under the Criminal Code.

Recommendation 384

Continue to improve Canada’s anti-money laundering regime to focus on priority risks, high value reporting, prosecutions and statistics that enable evidence-based policies.

Recommendation 385

Strengthen Canada’s anti-corruption and anti-money laundering efforts by introducing a national and comprehensive whistleblower reporting and protection framework.

Recommendation 386

Grant a digital income verification tool to the mortgage industry to help crack down on fraud.

Recommendation 387

Address non-compliance in the trucking sector, including labour abuse and tax evasion, by ensuring labour and taxation laws are enforced.

Recommendation 388

Support domestic innovators’ capacity and leverage it to strengthen national cybersecurity and meet NATO’s 2% of GDP defense spending target.

Recommendation 389

Create a new tax credit or other financial incentives for SMEs that implement cyber-security measures.

Recommendation 390

Conduct an audit of existing endpoint cybersecurity strengths and gaps across all departments and agencies in order to identify the investment needed to reduce vulnerabilities and ensure comprehensive security measures are taken.

Recommendation 391

Establish and fund a Centre of Excellence for Peace and Justice focused on research, education and training in conflict resolution, diplomacy, and peace operations for Canadian civilians, police, military personnel, and the international community.

Recommendation 392

Increase wildland fire resiliency as identified in the Canadian Wildland Fire Prevention and Mitigation Strategy, including expanded investments in prevention and mitigation.

Recommendation 393

Provide funds to the Université du Québec to establish a consortium for eastern Canada on the resilience of forests, infrastructure and communities to forest fires.

Environment

The Committee was presented with proposals by witnesses and in written submissions on the topic of protection of biodiversity, greenhouse gas emissions reductions and the transition to a net-zero economy.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 394

Renew and expand existing funding to continue Canada’s leadership on nature protection and deliver on Canada’s 2030 Nature Strategy and the Kunming-Montreal Global Biodiversity Framework obligations.

Recommendation 395

Provide financial assistance to municipalities so that they can acquire land in order to protect biodiversity and fight climate change.

Recommendation 396

Dedicate additional resources to identifying and combating aquatic invasive species (AIS), and support additional programs and initiatives for AIS prevention or management.

Recommendation 397

Provide dedicated funding for First Nations-led conservation to act on key Biodiversity Strategy and Action Plan themes.

Recommendation 398

Invest in the development of additional Nauttiqsuqtiit Conservation Centres.

Recommendation 399

Strengthen First Nations-led water stewardship, including research and monitoring, and engagement on freshwater legislation, policies, and programs.

Recommendation 400

Advance First Nations-led marine conservation and engagement in Crown-led conservation initiatives, advancing their commitment to protecting all forms of biodiversity.

Recommendation 401

Extend the Natural Heritage Conservation Program beyond 2026.

Recommendation 402

Ensure Parks Canada has sufficient resources to conduct meaningful consultations for the expansion of urban parks.

Recommendation 403

Work with industry to develop an investment plan, including investment incentives, to build recycling infrastructure to keep plastic products out of the environment and in the economy.

Recommendation 404

Limit the production of residual materials by creating a home appliances and electronics repair fund and a reusable container and packaging fund.

Recommendation 405

Implement the Canada Green Building Strategy and support measures with adequate funding.

Recommendation 406

Recapitalize the Green and Inclusive Community Buildings Program or create a successor program.

Recommendation 407

Invest in measures that promote green affordable retrofits for low-income households.

Recommendation 408

Adjust program parameters so that the additional costs involved in achieving reduced building energy consumption and greenhouse gas targets do not limit housing affordability for low and moderate-income households.

Recommendation 409

Support transformative climate action through the implementation of the Assembly of First Nations National Climate Strategy.

Recommendation 410

Move quickly to reach agreements with the provinces and territories so that funds from the Local Leadership for Climate Adaptation program and the Growing Canada’s Community Canopies program are transferred to municipalities.

Recommendation 411

Implement a Net Zero Action Plan to support and invest in SMEs in relation to a National SME Industrial Path To Net Zero Program in order to measure and quantify carbon and GHG emissions from SMEs and their supply chain.

Recommendation 412

Provide the necessary education, training, and financial support for quantification of carbon emissions from SMEs and their supply chain.

Chapter Five: A Competitive Fiscal Policy, Sustainable Finances and Efficient Government Operations

Federal taxation plays a pivotal role in funding public expenditures and directing economic activity to sustain and enrich the Canadian economy. As shown in Figure 4, personal income tax is the largest source of government revenues in Canada, followed by corporate income tax. Tax policy is also a major mechanism to motivate taxpayers to engage in activities that are deemed beneficial to society or, on the contrary, dissuade taxpayers from engaging in activities that are thought to be harmful to society.

Figure 4—Composition of Federal Revenues, 2022-2023

Source:  Figure prepared by the Library of Parliament using data from Government of Canada, Annual Financial Report of the Government of Canada Fiscal Year 2022-2023, Chart 2, 18 November 2024.

A receipt of money by a taxpayer for their own benefit is generally considered as being either a receipt of a capital nature or one of income. Speaking broadly, a receipt of income is derived from a source – such as dividend payments from the ownership of shares or the profit from a business – while a receipt of capital is derived from the sale of a source of income, such as the sale of the shares or of the business itself.

With respect to capital, and contrary to the receipt of income from a source, gains and losses in value are generally only subject to taxation in Canada when they are “realized,” which commonly occurs when the underlying source of income is sold. For example, any gain in the value of a taxpayer’s share is not taxable in the year in which the gain occurs, but only when the share is ultimately traded.

Capital gains are given preferential tax treatment in Canada as only a portion of the realized gain is taxable – in contrast to receipts of income which are generally subject to axation in their entirety. The proportion of capital gains that have been subject to taxation – referred to as the “inclusion rate” – has varied over time. Prior to 1972, capital gains were not subject to tax in Canada. Thereafter, the inclusion rate has fluctuated between 50% and 75%.

Internationally, the use of an inclusion rate for preferential capital gains tax treatment is uncommon. For example, the United Kingdom utilizes threshold amounts of capital gains realized annually by individuals to determine the applicable tax rate. The rate is 0% for gains under £3,000, after which capital gains up to £37,700 are taxable at a rate of 10%, and generally thereafter at a rate of 20%. For U.K. corporations, capital gains are generally subject to the normal corporate tax rate. In the United States, the capital gains tax rate is either 0%, 15%, or 20% according to the taxpayer's taxable income and marital status for that year. For U.S. corporations, capital gains are also generally subject to the normal corporate tax rate. Many other countries impose tax on all capital gains at a flat rate, and this rate is generally lower than the highest statutory personal income tax rate of those nations.

A country’s approach to capital gains taxation can be said to balance economic goals, tax policy philosophies, and unique fiscal considerations. Lower taxation in this regard may stimulate investment but limit a government’s redistributive capacity. This international diversity in policy underscores the complex trade-offs between equity, simplicity, investment incentives, and revenue collection.

Income Tax

With respect to the taxation of businesses, witnesses drew attention to the federal corporate tax rates, the small business deduction, and country-by-country reporting, while others discussed an excess profit tax, Real Estate Investment Trusts, the Canadian Entrepreneurs’ Incentive, and agriculture-related taxation.

With respect to the taxation of individuals, witnesses proposed deductions for certain expenses, changes to the federal tax rates, a wealth tax, and the Lifetime Capital Gains Exemption.

A number of witnesses remarked on the proposed changes to the treatment of capital gains, including providing for carve-outs for certain sectors and financial products, its reversal, and the adoption of such changes following a more comprehensive tax reform.

More broadly, witnesses highlighted qualified investment rules and the objectives of the tax system, such as incentivizing investment and economic growth.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 413

Implement a new single senior non-refundable tax credit equivalent to half of the basic personal amount.

Recommendation 414

Increase the pension income amount for single seniors.

Recommendation 415

Increase the income clawback thresholds under the Old Age Security Act and for the purposes of claiming the age amount for single seniors.

Recommendation 416

Mitigate barriers to accessing the Canadian Disability Benefit for low-income people with disabilities by improving and investing in accessibility and outreach measures, including:

• mandating that the Canada Revenue Agency implement automatic tax filing for all Canadians and provide resources to accelerate its implementation;
• funding for non-profits to support benefit uptake;
• training for Service Canada staff to support eligible recipients in successfully applying; and
• addressing barriers to applying for the Disability Tax Credit.

Recommendation 417

Amend section 209 of the Income Tax Regulations to allow taxpayers to receive a digital version of all tax slips for investments from the same financial institution.

Recommendation 418

Add additional top income tax brackets.

Recommendation 419

Implement a progressive wealth tax.

Recommendation 420

Introduce targeted investment tax credits to spur innovation and productivity.

Recommendation 421

Ensure co-operative entrepreneurs and their related Canadian-controlled private corporations can access the small business deduction.

Recommendation 422

Address corporate greed by closing loopholes and implementing fair tax reforms.

Recommendation 423

Amend the Income Tax Act to make the tax-deferred cooperative share measure permanent.

Recommendation 424

Support international coordination on the taxation of multinationals and ultra-high net worth individuals.

Recommendation 425

Keep its commitment to the OECD/G20 Inclusive Framework on BEPS to promote the inclusiveness and fairness of the process, including by reviewing and improving the instruments already implemented such as Pillar Two (the global minimum tax).

Recommendation 426

Support and contribute to setting up international tax cooperation governance under the aegis of the United Nations.

Recommendation 427

Continue its sustained efforts to reform Canada’s tax system by studying and implementing unilateral measures to help curb tax avoidance.

Recommendation 428

Continue to combat tax havens, specifically by abolishing arrangements that allow the tax-free repatriation of dividends declared in a country that has a Tax Information Exchange Agreement with Canada.

Recommendation 429

No longer provide charitable status to anti-abortion organizations.

Recommendation 430

Amend the Income Tax Act to provide a definition of a charity which would remove the privileged status of “advancement of religion” as a charitable purpose.

Recommendation 431

Follow-through on the Budget 2022 commitment and plan for a review of the disbursement quota rate by 2027 and commit to a regular review.

Recommendation 432

Invest in the further development of the Community Volunteer Income Tax Program (CVITP) and CVITP Grant program to support free tax-filing assistance for Canadians with low incomes delivered by community organizations.

Excise Duties, Consumption Taxes and Carbon Pricing

With respect to excise duties, witnesses raised issues of sector-specific rebates and a more progressive application of certain taxes.

On the topic of carbon pricing, witnesses touched on carbon tariff policy and its application by various levels of government, sector-specific carve-outs, and the removal or suspension of carbon pricing until greater technological advancement is achieved.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 433

Adopt a progressive, growth-oriented, federal excise rate schedule that would notably reduce the excise duty for the first 500,000 hectolitres of beer produced, allowing Canadian breweries to grow to without encountering a significant increase in the excise rate.

Recommendation 434

Provide a significant excise duty exemption on the first 50,000 litres of absolute ethyl alcohol (LAA) of production of distilleries, and an increasingly smaller excise duty exemption on the next 50,000 LAA, and the last 100,000 AA, respectively, bringing production to 200,000 LAA.

Recommendation 435

Remove the GST from all essential goods and services, including home heating, basic home and cellular telephone and internet services, children’s clothes, school supplies, and all food and health products.

Recommendation 436

Repeal the luxury tax on the sale of aircrafts made in Canada.

Recommendation 437

Exempt acers (maple wines) from excise duty in the same way as meads (honey wines) and ciders (apple wines).

Recommendation 438

Begin collecting taxes from foreign online platforms selling in Canada.

Recommendation 439

Introduce a new Visitor GST/HST Rebate Program.

Recommendation 440

Amend the Excise Tax Act to resolve the ambiguous application of the GST/HST based on where the goods are released into Canada when imported.

Recommendation 441

Develop carbon tariff policy tools to prepare for global developments regarding carbon border adjustments.

National Finances

On the topic of national finances, witnesses made suggestions pertaining to the transparency and timing of the tabling of government financial documents, overarching fiscal policy, the cost of the federal public service, leadership on the protection of biodiversity, humanitarian assistance, federal-provincial and territorial transfers, and other federal expenditures into matters of provincial jurisdiction.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 442

Focus on fiscal prudence, recognizing the need to balance strategic investments with rigorous management of government spending.

Recommendation 443

Implement a government-wide productivity agenda to focus public policy on securing Canadians’ future prosperity.

Recommendation 444

Continue with the implementation of a progressive fiscal and budgetary policy, which means running low budget deficits as a share of GDP with a view to present a plan to balance the budget within five years and subsequently pass balanced budget legislation.

Federal Departments and Procurement

Witnesses underscored various topics pertaining to federal departments and agencies, which included integrating non-profit organizations, increasing oversight of the Canada Revenue Agency, and developing publicly accessible archives, restoration programs and conservation centres. Witnesses also discussed the use of “outcome finance” and “outcome procurement methodologies,” and the public service’s role with respect to environmental justice.

With respect to federal procurement policy, witnesses highlighted reciprocal procurement trade, dedicated technology procurement funding, “buy clean” public infrastructure initiatives, weapons export permit and procurement policies, an Indigenous outcomes procurement fund, aerospace procurement, and broader procurement reform.

In consideration of the testimony heard before this committee, as well as the briefs it received, the Committee recommends that the Government of Canada, in accordance with the powers of each jurisdiction:

Recommendation 445

Invest in and increase the number of Canada Revenue Agency auditors.

Recommendation 446

Provide the Competition Bureau with additional funds in accordance with the new powers and responsibilities it was given to better protect Canadians and promote affordability.

Recommendation 447

Establish a federal construction secretariat or department.

Recommendation 448

Ensure that all departments, especially Innovation, Science and Economic Development, and all regional economic agencies, recognize the non-profit social enterprise business model as a strategic means to meet their economic, social, and environmental goals, and expand and fund support for non-profit social enterprise business capacity and access to finance.

Recommendation 449

Earmark a sufficient budget to establish a sustainability taskforce within the Competition Bureau to ensure it has expertise and capacity to act on greenwashing and sustainability issues.

Recommendation 450

Re-establish and fund a co-operatives secretariat or dedicated centre.

Recommendation 451

Expedite the formation of a Cabinet-level National Space Council, consisting of key Cabinet Ministers with the Privy Council Office acting as secretariate.

Recommendation 452

Provide funding to establish a unit within Statistics Canada whose mandate is to collect, analyze, and share data on the non-profit sector.

Recommendation 453

Provide funding for creating and maintaining a Canadian Non-profit Data Lab.

Recommendation 454

Continue and strengthen the critical partnership between the federal government and the non-profit and charitable sector.

Recommendation 455

Establish and adequately resource a unit within the federal government to act as a champion of the non-profit sector.

Recommendation 456

Maximize Canadian content in all aerospace-related government procurements.

Recommendation 457

Implement and optimize “buy clean” policies to reduce emissions from public infrastructure and prepare the industrial and construction sectors for a net-zero future.

Recommendation 458

Implement reciprocal procurement policies to generate North American market demand for clean, locally produced materials and attach reciprocity conditions to any federally funded projects, wherever possible.

Recommendation 459

Strengthen and increase the transparency of Canada’s weapons export permit and procurement processes to ensure that Canada does not support war crimes.

Recommendation 460

Support Métis entrepreneurs through the Métis Business Directories and a Métis Procurement Institute.

Recommendation 461

Ensure the inclusion of social enterprises in the implementation of the Policy on Social Procurement, as a strategic means for government to meet the policy’s objective of enhancing best value in procurement.

Recommendation 462

Reform the public sector innovation procurement regime to spur economic growth and deliver for Canadians.

Chapter Six: Conclusion

The Committee wishes to extend its gratitude to everyone who submitted a brief or shared their perspectives for this report. Once again, these insights remain invaluable in shaping its recommendations to the government. As the pre-budget consultations come to an end, the Committee encourages the government to give thoughtful consideration to these recommendations when developing the 2025 budget and future economic statements.