[Recorded by Electronic Apparatus]
Tuesday, November 5, 1996
.1316 
[English]
The Vice-Chair (Ms Whelan): Ladies and gentlemen, I want to apologise for the delayed start. We were a little bit late starting the first session due to some technical difficulties, but everything has now resolved itself.
I'll just explain the format for you, in case you're not 100% aware of what's taking place. We are having a round table discussion for pre-budget consultation. Everyone has been asked to make a brief presentation. If you have a written presentation, please don't feel you must read the entire presentation. I'm going to ask you to give a brief synopsis of it, of three minutes, so that we can lead into questions. The sooner we get into questions the more lively, I guess, the debate can be.
If a question is not directed to you and you wish to respond to it, just indicate so to the chair.
I'd like to introduce the members of the finance committee who are with us on our western tour. Just to let you know, the other half of the committee is meeting in the east coast.
I'm Susan Whelan; I'm the vice-chair of the committee, and I represent the riding of Essex - Windsor in the province of Ontario. We have with us Mr. Rocheleau, who represents the riding of Trois-Rivières in the province of Quebec; Monte Solberg, who represents the riding of Medicine Hat in this beautiful province of Alberta; and Ron Duhamel, the member fromSt. Boniface, Manitoba. We also have Gary Pillitteri, the member who represents Niagara Falls in the province of Ontario. Rod Fewchuk is joining us; he represents the riding of Selkirk - Red River in the province of Manitoba.
With that, I'm going to begin by asking Rebecca Aizenman, who has an individual presentation, if she would be willing to commence, with approximately a three-minute brief synopsis. Thank you.
Ms Rebecca Aizenman (Individual Presentation): I'll do my best. Thank you for allowing me the privilege of presenting to you and taking part in this round table. The comments and suggestions represent my own point of view, but they are also representative of my closest group of friends, whose time is spent mostly in monitoring the crisis in the health care system in Alberta and the current state of the Canada Health Act and medicare in Canada.
I believe our most basic Canadian value is access and affordability and equality and universality within the principles of the Canada Health Act. Nowhere in Canada more so than in the province of Alberta are some of these principles in danger of becoming extinct.
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You heard from health care professionals this morning. I am not a health care professional, but in my own way I have to echo some of the concerns that we have as citizens, as Albertans.
I find it refreshing that the most powerful committee of the Government of Canada, the Standing Committee on Finance, can take time to travel the country and listen to individual input, for which I sincerely thank you as an individual Canadian.
I come from the city of Calgary, where the most powerful committee - not the city council on which my colleague John Schmal sits, but the Calgary Regional Health Authority - has no time for a process like this, has no time for public input. I commend the finance committee. Let others take a lesson from this type of discussion.
The issues I have chosen for our presentation are the threats and dangers to medicare and the principles of the Canada Health Act as a result of decreased funding by the federal government, and if time allows, a brief comment on the need for tax reform - not tax relief, not tax breaks, but tax reform - as viewed by an average Canadian.
The health care crisis in Canada has already been referred to by several witnesses appearing before the finance committee. The decrease in transfer payments to the provinces, coupled with severe slashing and burning of health care budgets at the local level here in Alberta, have endangered the existence and delivery of viable health care, particularly at the acute care level.
Because of a particular ideology that exists in this province, the Canada Health Act is in danger. Its principles of universality, accessibility, comprehensiveness, affordability, and public administration of the act are in many cases severely challenged. Its principles must be upheld, enforced and rigorously maintained almost at any cost.
A recent poll indicated that Canadians were even willing to pay extra taxes to maintain medicare. In Alberta the spirit of entrepreneurialism has invaded health care. Given the shortage of hospital beds and the need for an immediate turnover, one can now check into the Hospitality Inn in Calgary and receive care after childbirth or surgery at only $235 a day. I will leave an original copy of this article with the clerk of the committee. It makes for interesting reading.
We now privatize post-hospital care because there is such a shortage of beds for whatever reason - poor management, in my humble opinion - that nursing groups go out and set up businesses that capitalize on the shortage of acute bedside care in the city from which I come.
A shortage of funds for home care as required for post-hospital recovery resulted in a backlog of 442 people awaiting this service in Calgary in October. My figures come from Saturday's paper. Only 5,818 people are waiting for home care service in my city, as a result of mismanagement of funds.
I realize that home care is not a component of health care as covered in the Canada Health Act, but it is critical to recovery and is viewed as an adjunct to the system. It does become a critical component.
There should be provision made for people who provide home care to their aging relatives - to the elderly, to immediate members of the family. Some sort of tax credit has to be given to these people, because women, and particularly women, have to take time off work for this. Sometimes they lose their jobs. A difficult decision has to be made. They become the nurses; they become the immediate care provider.
Hundreds of examples can be given where quality health care and patient care and professional delivery of services have been compromised. You heard from the professionals this morning. Let me add to that. Drive-in deliveries, in and out in six hours. We have a management person in my city who says, if you can sit in a wheelchair you don't have to be in the hospital. We have no overnight stays for mastectomies unless the doctor pulls rank.
We have early releases, resulting in re-entries through the emergency wards. We have a lack of beds every single week at the centre of excellence, supposedly, in my city, for necessary surgeries.
You heard about overworked, stressed out, burnt-out medical staff and personnel. Necessary patient care is being given by unqualified personnel, to do the level of care that is needed.
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I can tell you a story of an 86-year-old woman who needed hospitalization. Every eight hours she had to be brought into the hospital to have an antibiotic intravenous drip changed. One of the changes required her presence at 3 a.m. Is that health care?
``A decision by the local regional health authority will close Calgary's only real downtown hospital'', according to Robert Sheppard of The Globe and Mail. That city, my city, is bidding for Expo 2005. The site is on the edge of downtown Calgary and yet we are not going to have a real hospital there.
Members of the finance committee, it is absolutely necessary to maintain national standards, i.e., the principles of the Canada Health Act. If it takes extra funding or a revision of the amount of moneys forwarded to the provinces, so be it.
Under no conditions - and I repeat under no conditions, because I live in Alberta, I experience, I live, eat and breathe what is happening here every day - should there be a further devolution of health care, that is, transfer of health care powers to the provinces. Let be what already is; allow no further devolution or we will witness the final demise of medicare as we know it.
Mr. Klein would gladly encourage and support further erosion of medicare -
The Vice-Chair (Ms Whelan): Excuse me, Ms Aizenman, we have to stick to the time limit. So if you want to give us one final comment on your presentation, we will read the presentation in detail.
Ms Aizenman: The principles of the Canada Health Act must be maintained. Should there be extra funds available as the budget is put together, I would ask that they go into extra funds for health care funding and not necessarily as part of a block funding, as is now the practice under the CHST agreement.
The Vice-Chair (Ms Whelan): Thank you very much. I will remind you that during the question period, if there are points you would like to bring out further, please do not hesitate to signal to me, the chair, that you would like to respond or question, even if it is not directed to you.
Dr. Joel H. Weiner (Associate Dean of Research, Faculty of Medicine, University of Alberta): Thank you very much. Thank you for the opportunity to present today.
I speak to you today as an active laboratory researcher and associate dean of Research in the faculty of medicine and oral health sciences at the University of Alberta.
My perspective on the issues I will address also the reflect my role as chair of the research committee of the Association of Canadian Medical Colleges. I am also president-elect of the Canadian Society of Biochemistry and Molecular and Cell Biology, one of the largest biological societies in Canada. I have also being appointed by the Prime Minister as a member of the Medical Research Council.
The problem I wish to address, and which I heard a little bit of discussion about earlier, is the lack of funding for basic research in this country, which has reached a crisis level. I want to put this up. I know you have seen it before. It was in The Globe and Mail on July 15, 1996. But it is a graph we should all be ashamed of in this country.
It shows that compared to our international competitors, where funding for basic research has been increasing over the past five years, in Canada it continues to decrease and the trend prognosis is not very good.
I also have another graph, which is the per capita spending on an adjusted purchasing power basis. Canada is down here at the bottom, and Switzerland is at the top; the United States and then our western European and Pacific competitors are there as well. So we're not doing very well.
The lack of funding for research, as I said, has reached the crisis level. The majority of our global competitors will see their budgets for health research grow by over 40% in the period of 1990-98, whereas the budget in Canada will fall by at least 10%.
In the United States the National Institutes of Health have received a 6.9% budget increase this year. Japan has recently announced a new five-year, $150 billion U.S. investment in basic research. Japan has made the commitment to transfer funds previously used for building bridges, airports, highways and port facilities to the development of sciences.
These countries all have fiscal problems to some degree. So what do they know that Canada fails to see? The answer of course is that basic research provides two key ingredients: the engine for innovation to create new products to grow and diversify our economy, and the education and training environment for future generations so they will have the knowledge to take advantage of scientific discoveries.
The Globe and Mail, on August 10, 1996, stated that Canadians want government involved in health care education. In fact, a recent opinion poll found that Canadians would prefer to see federal government spending more money in health care and education rather than giving tax breaks with the new money found and directed towards better control of our national deficit.
University research funded through the granting councils, including the Medical Research Council, is at the heart of both of these expectations. How better for government to focus on these highly regarded Canadian issues.
The loss of basic research funding occurs within a backdrop of an apparent increase in total funding for medical research in Canada. However, the increases have occurred in those facets of research that have been derived from basic research. For example, the passage of Bill C-91 has resulted in the patents...multinational pharmaceutical companies spending hundreds of millions of dollars on research in Canada. This is money that could have gone elsewhere in the highly competitive world of multinationals. In addition, private money in venture capital for medical technology transfer, patent protection, and establishment of start-up companies has grown rapidly.
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Unfortunately, very little of this new money finds its way to the basic science university research lab and affiliated teaching hospitals. Obviously, most industry investment money is not to fund basic research, but rather the development and introduction of products so that the companies can make a profit for their investors.
There is a quote from the Hon. Paul Martin on October 9 in which he said
- There are things business and the markets can't and won't do. The private sector can't succeed
in providing universal health care. Business doesn't do enough basic research.
Dr. Weiner: Okay. I won't go through the various points except to discuss two solutions.
One is a short-term solution. The figures provided by the Medical Research Council indicate that for every $1 million in grant funding they fund, this creates 60 direct and indirect jobs at a cost of $16,000 per position. These are high-quality jobs as principal investigators, technical support personnel, graduate students, and post-doctoral fellows.
In 1995 the Medical Research Council peer review committees were asked to look at what grants must be funded. They identified those and they identified the minimum level of funding required. In the final analysis, the council was able to fund only a fraction of those grants, and those grants that were funded were funded at perhaps 70% to 80% of the level of funding.
A large gap has developed between what must be funded and what is being funded. The total gap last year amounted to $82 million. The provision of that money would make nearly 5,000 new high-quality jobs. I ask you to compare that with the $60,000 per job that was created by the infrastructure program, or the cost of creating a job in the oil sands sector in Alberta.
A short-term solution would be to provide money to meet this cap in funding. The grants are there. They have been written and approved, and we are in a state now where we could move very quickly to create those jobs.
There is a longer-term solution, a very interesting one, which was presented at the conference on Innovation in Funding Health Research in the New Millennium in Ottawa earlier this month and which was described in the October 25 issue of Science Magazine.
It is a proposal by Dr. Cal Stiller, who I am sure you are acquainted with and who was really at the heart of creating the Canadian medical discoveries fund, which has been really very successful.
He proposed the creation of a national health science endowment equity fund, for which the government would provide money at the rate of $100 million per year for a fixed 10-year period. That money would be accessed by universities to partner with the private sector in order to create capital investment for new start-up companies from the discovery research that is going on in universities.
The assumption is that after the 10-year period this would be a self-sustaining fund. The equity the universities would have created in this 10-year period would pay back that investment, and universities would be able to maintain a level of funding of about $100 million for the future.
This effect, added on to the roughly $250 million that the government spends currently on health research, would create a tremendous increase in our funding.
The Vice-Chair (Ms Whelan): Thank you very much, Dr. Weiner. We will have to move along again.
I am not sure who is presenting from the Borrowers' Action Society. I have Larry Whaley and Tim Madden. Mr. Whaley, please.
Mr. Larry Whaley (President, Borrowers' Action Society): Thank you. This is the third time the Borrowers' Action Society has had the opportunity to make a presentation to this committee. I want once more to thank you for taking the time and incurring the expense to travel here to Alberta rather than requiring those who might be making evidence to go to Ottawa. It does make the world a lot simpler doing it this way.
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As I mentioned, we've presented twice in the past. On those occasions we concentrated on what we see as being real solutions to Canada's real financial problems. You committee members as a whole, and not just this section, decided that you preferred the position of vested financial interests over the positions presented by our organizations and others like us.
For the record, we have included our five key proposals for solving the real problems, but for today we'll concentrate on the kind of tinkering that we think this committee might be prepared to recommend to government.
To begin with, if you think tax reduction is going to stimulate the Canadian economy, forget it. The financial institutions have so much outstanding debt that any tax reduction by and large is simply going to be absorbed into consumer debt payments that have little or no impact on the Canadian economy.
Don't do tax reductions thinking that you're going to stimulate the economy. If you want to do it because you think you're going to get both, that's a different question, but don't do it to stimulate the economy.
There are other ways to stimulate economic growth. The first I would raise is to provide consumers with an assurance that they will be able to obtain justice should they run into a problem with a financial institution.
A second way is to ensure that financial institutions provide full, accurate and complete disclosure of interest charges and costs of borrowing as an annual percentage in compliance with the Criminal Code and other laws. That is not happening now.
The third way to stimulate economic growth is to enforce existing laws. We've brought along a visual aid that lists the sections of the Criminal Code and other legislation that we see being violated daily by Canada's major financial institutions. We can talk about that in a little more detail if you want during the question period.
The point is that consumers are being lied to. They may not know how, but they know it's happening. They are reluctant to get back into a marketplace that requires borrowing. This government has done absolutely nothing to provide an assurance that the catastrophes that people went through in the beginning of the 1980s, and later in the 1980s in Ontario, will not be repeated. There is nothing to indicate that this won't happen again, and consumers know it.
If you want to solve the crisis in consumer confidence, investigate pro-lender bias in Canadian courts. The Canadian courts simply will not allow a borrower to succeed in a court action, where that action involves a precedent that will impact on more than one lender.
Attached to our presentation today is a detailed analysis of the court cases since 1880 that indicate the attempts consumers have made and the fact that the courts are clearly biased. No matter how ridiculous the decision has to be the courts will rule in favour of the lender each and every time.
Another point is to provide for the establishment of a consumer financial organization. Democracy Watch presented you with a brief in August 1995 explaining how that could be done. That's an Ottawa organization. You should follow those suggestions and provide for the establishment of a consumer financial organization to provide some protection to consumers.
You should end the government participation in and tacit support of the Criminal Code violations and other violations that credit card companies are involved in. Those violations include violations of the GST Act and the collecting of GST on interest charges, where those charges are specifically exempted under the Interest Act.
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The Vice-Chair (Ms Whelan): Thank you very much, Mr. Whaley.
I'll now turn to Mr. Elwood Hart from the Canadian Association of Agricultural Fairs and Exhibitions, please.
Mr. Elwood Hart (Executive Director, Canadian Association of Fairs and Exhibitions): Thank you, Madam Chair.
First of all, let me express our appreciation for the opportunity to provide input into the pre-budget consultation process. I'd like first to explain a little bit about who we are and where we're coming from.
We're the Canadian association of agricultural fairs and exhibitions. We're a national organization that represents the interests of members across Canada. The industry itself consists of some 800 fair organizations. They're located in all provinces in Canada, in the Yukon and in the Northwest Territories. They're all non-profit identities and are established under provincial society acts. About 25% of all of the members of the association also have charitable society status.
In 1994 we conducted an economic and social impact study of the fair industry. To put into perspective the size of the industry, we would like to report that the industry annually generates $1.32 billion in economic impact. They are directed and managed by some 90,000 volunteers. Their activities reach 23.2 million Canadians annually. Their focus is primarily on rural economic development. They have a long tradition of working with federal and provincial governments to address national and regional priorities.
As an industry we support the efforts of government to encourage and stimulate growth and development in the rural communities. We also recognize that limited financial resources must be managed in the most effective and efficient manner.
The new direction of government encourages the participation of not-for-profit organizations and the private sector in the delivery of government programs and services at the community level. This approach assumes that organizations are and will continue to be viable while adapting to the changes taking place in the economy.
Many not-for-profit organizations, including those in the fair industry, need to restructure their own operations and activities to meet the challenges of the new global economy. This is consuming considerable amounts of their available human and financial resources, leaving little opportunity to respond to the new directions of government.
To encourage the proper delivery of programs and services at the community level, we suggest that the government needs strong, progressive organizations that are capable of responding to current needs. It is our opinion that investing some of the available government resources in helping rural organizations restructure and adapt to the new economy would advance the process change.
The fair industry itself has four specific concerns that we feel should be addressed. The move towards self-sustainability among rural organizations has increased the need for not-for-profit organizations to engage in profitable commercial activities in an effort to stabilize their revenue base. This scenario contributes to the following: first is a conflict with the fundamental mandate of non-profit organizations themselves; second is the negative -
The Vice-Chair (Ms Whelan): Mr. Hart, would you please provide a brief summary, because we're quickly going over our time allocation. I'd really like to get to questions. So please try to keep your comments to three minutes.
Mr. Hart: I appreciate that. The brief is available to the committee in whole.
We are concerned about the ability of not-for-profit rural organizations to maintain themselves and respond to the new direction of government, and this we're bringing to your attention. The fair industry also has some concerns in the area of the GST and proposed copyright revisions, which we will be prepared to discuss further.
They are an established institution in this country, and they've made a major contribution to the growth of Canada as a nation. During this period of significant change, this valuable resource can be effectively and efficiently used to help secure the future of this country.
Thank you.
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The Vice-Chair (Ms Whelan): Thank you very much. I am now going to turn to Alan Skoreyko of Northlands Park.
Mr. Alan Skoreyko (General Manager and Chief Executive Officer, Northlands Park): It's one of the agricultural fairs Elwood was talking about.
Welcome to Edmonton, home of Canadian Finals Rodeo, if you have not noticed, which happens to be Canada's largest rodeo and the largest indoor sporting event in western Canada. That is one of the things we do at Northlands.
Thank you very much for the opportunity to be here, and I will be brief. There is a large document that I have handed in to the committee for its review, and it is really to follow up on the comments that Elwood has made.
We have been in existence for 117 years. We are Alberta's oldest business. We are a community not-for-profit organization.
Recent changes in federal legislation and federal regulations have put a severe strain on our industry, the community not-for-profits. To put it in perspective, we have developed $120 million in community-owned assets and we generate over $150 million a year in economic benefit for this city. We do so without any cost to the taxpayer.
We would like to see it carry on. We feel we are an important contributor to this community, to northern Alberta. However, if the government is not careful in dealing with all the fairs, all800 across Canada, there could be some dire consequences.
I will answer any questions later on. Thank you very much.
The Vice-Chair (Ms Whelan): Thank you very much.
I will now turn to the Alberta Association of Social Workers. I believe Mr. Jake Kuiken is going to be presenting.
Mr. Jake Kuiken (President, Alberta Association of Social Workers): That is correct. Thank you very much, Madam Chair. Like others, I would like to thank my national government for taking the time to consult with us as Canadians.
The theme of our presentation and the theme we would like you to adopt in the 1997-98 budget is one of hope and renewal. We think Canadians need to come out from under the ideological abuse of recent years, perpetrated largely by an 18th century liberalism. We think the theme of hope and renewal is something that needs to be injected into the budget process.
I think it has begun in part with this consultation of Canadians, but it needs to be extended and begun much earlier in the overall budget process, which we think should really include discussions about social standards related to housing, income, child care, social services, health, and education. We think that through that kind of consultation around standards and collaboration, reduced costs and avoidance of duplication can be achieved.
It is really the Canadian social programs that have been the competitive advantage, as some have put it, that has enabled Canada to be the leading nation in the world. We would like to make the point that those kinds of programs, which have provided the competitive advantage, should be encouraged and built up, in particular as the federal government moves from a preoccupation with debt and deficit to look at increased revenue. By injecting hope and renewal, not only for children but also as security for our older citizens, the opportunity for maintaining the competitive advantage is genuinely there.
I must tell you that at the same time there are some indications that child poverty in this country is increasing dramatically. Canada is second to the Americans, who have a 22% rate of child poverty. Canada has 14%, and my understanding is that it is increasing.
We would like to encourage the federal government to develop a national infrastructure program, which should focus primarily on the third sector, with specific reference to social development objectives, including child care and community-based employment programs. The national infrastructure program should include employment equity principles, so that the distribution of jobs represents the true diversity of the community and is not targeted to sports palaces for over-valued and under-performing athletes.
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We would also like to suggest a very small step that the committee could recommend to the finance minister, which is that the GST be eliminated for those people who use social work and like services. That exemption is already available to some health professionals, but we think it should be eliminated for all designated health professionals. Social work, at least in this province, is one of those health professions that provides a direct benefit to clients using the social work services.
Finally, we would like to encourage, as a way of introducing some hope and renewal, that tax reform be a high priority so that we no longer have situations in which rich Canadians who own their own businesses can have a 50% tax-free lunch while children go to the food bank for breakfast.
The Vice-Chair (Ms Whelan): Thank you very much for those comments, Mr. Kuiken.
If anyone would like to make a formal, written presentation, I would remind them that if they have not done one today and want to submit one, they should submit it to us within ten days.
I will now turn to Ms Hazel Wilson from the Alberta Council on Aging, please.
Ms Hazel Wilson (Past President, Alberta Council on Aging): My comments also will be brief.
The finance committee is to be commended for the principles developed to guide the reform of the Canada Pension Plan. It is hoped that the government will adhere to these principles when changes are introduced.
Commendation is not merited for the way other pension policies have been handled.
Certainly the proposed seniors benefit program was announced with no public consultation, even though we were promised that a paper on aging would be released and there were many rumours it was going to be released. The consequences of this proposal, other than financial, were never considered. This benefit transfers our universal national pensions by right of citizenship for all elderly Canadians to a targeted program in which it will become income tested.
In essence, this becomes a welfare system. Everyone is aware of the attitude towards people on welfare. Welfare bums are a common theme.
Those of us in Alberta have experienced increased ageism with the introduction of the seniors benefit program here. We can anticipate this will happen throughout Canada if the seniors benefit program is introduced in its present form. There are many flaws in the proposals, which indicate there should be public consultation before legislation is introduced.
My third comment is about transfer payments. Please ensure that adequate money is transferred to the provinces to maintain the principles of the Canada Health Act. We could spend all this time discussing the problems in health care in this province.
The introduction of a two-tier system is a distinct possibility in the province unless something is done to deter it. I have a document called Drop the Other Shoe, which indicates what has happened to seniors in the last two years.
My final comment is about New Horizons funding. Funding for the New Horizons: Partners in Aging program is scheduled to end on March 31, 1977. It is important for the well-being of seniors that funding for this program continue, and I would ask that you look into this seriously.
I appreciate the opportunity to appear before this committee on behalf of the elderly.
The Vice-Chair (Ms Whelan): Thank you very much, Ms Wilson. That was brief, and we appreciate it.
I would like to now turn to the Edmonton City Centre Church Corporation, Mr. Martin Garber-Conrad.
Mr. Martin Garber-Conrad (Executive Director, Edmonton City Centre Church Corporation): Thank you. I will simply ditto all the other thank-yous. We appreciate that very much.
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I work for a medium-sized social service, non-profit organization that works primarily in Edmonton's inner city. Thousands of Canadians in this town, in this province, are struggling in low-income communities. This province, while not at the very top, is a leader in this field, so I have had lots of occasion to observe what happens to families.
I would like to make four brief points. The income tax system needs to be made more progressive. There are people paying income tax who cannot afford to feed their children. It is as simple as that. We need to raise the floor, particularly for low-income families. Clearly, one way to offset any revenue loss is to make some sort of move on corporate taxes back toward the way things were 20 or 30 years ago.
Second, the Canada health and social transfer needs to be increased to the provinces, but it needs to be tied to compliance, to the principles of things like the Canada Health Act. I am not arguing specifically against block funding, but some sort of compliance needs to be encouraged and maintained by the federal government.
Third, in addition to those transfers to the province, the federal government needs to maintain direct spending, particularly in the areas of health, social assistance and human resources. Some very good examples of that are the kinds of unpopular causes and broadly based population health measures that Health Canada undertakes. Other examples include some of the youth employment initiatives that HRDC has undertaken.
In that particular area, I can tell you how delighted we in the community are with the recent federal task force on youth employment. Their June 1996 report provides some excellent suggestions on how all levels of government can respond to this crisis in our communities.
Fourth, to the extent that social responsibilities are already downloaded onto communities and voluntary organizations, there needs to be a way to increase tax credits for charitable donations, for community-based work, religious-based work, and other things that are threatened in those ways. There is certainly no problem with having requirements and standards for charitable registration, but in general the tax credit is not terribly appealing.
Finally, in spite of all the other forces that are encouraging you to download, please maintain a strong federal presence in funding, especially in things like health and social assistance. This country's social safety net must be maintained, and special projects need to be funded, even if they are not seen as provincial priorities.
The Vice-Chair (Ms Whelan): Thank you, Mr. Garber-Conrad.
I would now like to turn to the Seniors' Action and Liaison Team with Ms Phylis Matousek.
Ms Phylis Matousek (Chair, Seniors' Action and Liaison Team): Thank you. Old sayings have a life of their own. For example, there is the old saying you can fool some of the people all the time, and all the people some of the time, but you can't fool all the people all of the time. I think Canadians are more and more becoming aware that something is wrong.
They have not quite come to the conclusion yet that it is political ideology, it is not money. When a country can find $23 million to buy flags to give out to everybody, there is something fishy, something wrong with the priorities.
Governments say we cannot afford this any more. This is so phoney it would be laughable if it were not so tragic. No government spending is involved in the Canada Pension Plan. There are no tax dollars going there. It is strictly a pay-as-you-go plan.
The hysteria that was stirred up by money market people who want to make more money themselves - they jumped on the fact that the media didn't quite understand the Canada Pension Plan. So misstatements came out and everybody picked up on it, everybody got hysterical. It's just totally -
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Statements are taken out of context and misinformation is passed off as true information. The media picked up on a portion of a comment made by the chief actuary in 1955 and said the sky is falling, the pension plan will be broke by 2015. It was absolutely false. There was no basis for that hysteria that was whipped up.
I recently attended the National Forum on Health conference in Vancouver. The one comment that was made consistently and approved was that the biggest enemy of good health is poverty. Children who do not get the proper nutrition, proper clothing and proper housing will probably forever be customers of a health system, although probably not a public health system. In this province, we believe that the agenda for what is being done in the public health system is a lead-in to privatization, because that's what this government wants.
There are so many problems involved in privatization, I couldn't even begin to talk about them here and now.
With all of this hysteria about the Canada Pension Plan, everybody wants to get more customers. Invest in this, invest in that, buy RRSPs. What about the millions of Canadians who are working part-time jobs with no benefits? How are they supposed to buy RRSPs in sufficient quantity to support themselves when they reach retirement age?
I've cut so much out of this to try to keep within the time limit that I've forgotten where I am now.
With corporations and governments continuing to downsize, there are fewer people working. This means there are fewer people making contributions to the CPP, if they are able to make contributions, and there are fewer people paying taxes. Where is the economic benefit of that?
As far as the Alberta seniors' benefit is concerned, and this gets me briefly into the federal benefit plan, which I'm not sure I really understand because I keep getting different interpretations of this.... It must be the same fellow who was here and developed the Alberta seniors' benefit - and I use that term very loosely because it would be better referred to as a cutback, because it's no benefit. Many seniors lost up to 17% of their disposable income when that so-called Alberta seniors' benefit came along.
I lost $1,000 in disposable income the first year, and $2,000 the second year. That is money I no longer have because of new user fees and higher co-payments. This is money that is not being spent in the local economy. Where is the benefit? Where is the economic benefit?
The CPP being privatized is a nightmare that not many of us even want to consider. So is devolution of power. Can you imagine what would happen in Alberta if this government got complete, total power? It's too horrible to even contemplate. I don't even want to try to think about it. In some provinces and territories I'm sure it would work well, but not in this province, and possibly not in Ontario either.
In conclusion, I don't have initials after my name. I am not an economist. I am just an old-timer who has survived. I've worked since I was 16. I've paid my taxes and I'm paying my health care premiums. There's one more word about health care - what's happening to people here could very well constitute the legal definition of abuse. What is being done to Albertans who are not wealthy, who are not young and healthy with no ailments - what is being done to those people constitutes abuse.
Thank you.
The Vice-Chair (Ms Whelan): Thank you, Ms Matousek.
I would now like to turn to John Schmal, city councillor, City of Calgary.
Mr. John Schmal (Alderman, City of Calgary): Thank you, Madam Chairman and members of the committee. I am here to talk to you about interdependency and partnerships between municipalities and the federal government.
Federal members of Parliament, provincial MLAs and municipal councillors all serve the same public in different ways. We must all be aware of how decisions made by one level of government can affect the costs and effectiveness of services provided by another, to either the benefit or detriment of the people we serve.
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A partnership that has worked very well is the national infrastructure program. It is an example of a successful partnership among governments, where the federal government responded to requests from Canadian municipalities, through the Federation of Canadian Municipalities, to create the program to the benefit of all Canadians. Subsequently, the federal and provincial governments consulted with municipalities to implement the program. It has created many jobs and improved the quality of infrastructure in communities across the nation.
The City of Calgary supports the extension of the national infrastructure program, and while much has been accomplished, there is still more to be done, and consultation with municipalities on the terms and conditions of the program should also be continued.
It is not sufficient that these matters be discussed only between the federal government and the provinces. Municipalities will be paying a portion of the cost and therefore must be involved in the discussions.
In Calgary, another example of effective consultation was the involvement of all three levels of government in hosting the 1988 Winter Olympics. This cooperation is being repeated in our current bid to host the 2005 world's fair.
The same model of partnership among federal, provincial and municipal governments should also be extended to social programs. Like the national infrastructure program, municipal governments are the traditional partners of the federal and provincial governments in social policy and social services. It is a collaborative initiative to mitigate the negative repercussions on vulnerable families living within available public resources, while strengthening the quality of individual and community life.
As stated in the Federation of Canadian Municipalities position paper, which is on behalf of all municipalities in Canada, this partnership needs to continue. Federal input at the policy and financial level must be maintained and not be left solely to the municipal tax base.
As one of the three government partners, the City of Calgary contributes $20 million in mill rate funds yearly to support locally designated social services such as Meals on Wheels and school-aged child care. To address the needs of working families of those attending education, training and upgrading programs - I'm going to go through this a little faster here - we also have a concern about ensuring that child care programs and policies are developed to fit with local needs.
The federal government and its crown corporations make payments in lieu of municipal property taxes under the rules of the federal Municipal Grants Act. The federal government is able to set its own assessment values, and that's where municipal government has a problem. They feel those values should be market values, not different from the private sector.
Eliminating the public utilities income tax transfer: the federal government has increased costs to privately owned utilities. This has affected the City of Calgary electric system and Calgary ratepayers.
There are many other examples, both positive and negative, of the interdependencies between different levels of government. Some of these will be outlined in a written report from Calgary's city council to your committee later this month.
In considering the next federal budget, I encourage you to bear in mind how, by consulting and developing partnerships with municipalities, the Government of Canada can ensure that we will work together for the benefit of all our citizens.
The City of Calgary is prepared and willing to work with our federal and provincial partners to develop policies that address the needs of the citizens and some of the issues that I have mentioned.
Thank you.
The Vice-Chair (Ms Whelan): Thank you, Mr. Schmal.
I'd now like to turn to Mr. Al Opstad.
Mr. Al Opstad (Individual Presentation): Thank you to each and everyone of you. I've appreciated hearing the prior comments. I'm going to present a few ideas that I hope are well related to what we're talking about.
I think there are times in our country when we have to consider major changes. I'm going to suggest two. You can modify them or change them or whatever you want.
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Number one, instead of having ten provinces and two territories, I feel we should take our country and merge it into three provinces. We have too much government, too much duplication and too much bureaucracy. Many people talk of the same thing. The chamber of commerce, as I understand it, says that we have too many barriers. When I was at the Meech Lake accord years ago, they said we don't give a darn about your high standard of education, we want universality, so we go from one province to the other. Basically, that's my first proposition for you to consider.
You'll have to watch the time for me. Everyone else ran over, or at least most of them did, but I'll try to keep within the framework.
The other idea is that we have a deal with our banking system. We can't let them run us from the back room as they're doing now. We have to rein them in.
My main proposal is that the federal government should be using the Bank of Canada far more than it does. It uses it only a little bit. The reason is that when the Bank of Canada makes a profit, it puts it back into general revenue - around $1.8 billion last year, according to the reports, and the federal government is only doing 2% to 5% of its borrowing from the Bank of Canada.
If you don't like that and you want to be a free enterpriser, then we had better do something with these chartered banks. We can't have this stupid free enterprise. You can't have 60 people doing the same job - it's stupid - so merge them into one, two or three or whatever you want. We have to get competitive on a global basis. We can't sit around here wasting our time making laws. We have too many of them. We could throw half of them in the garbage.
I think I've pretty well used up my three minutes and shot my wad. I have it in writing for you. By the way, I made some banking models. I think you've got them. I'm quite proud of them, so you can have a look at them. I think this goes for the Bloc too - I think there are some good ideas for you. I don't know what you'll do, but you'll have to decide.
Anyway, thanks to everyone.
The Vice-Chair (Ms Whelan): Thank you, Mr. Opstad. You did keep it within three minutes, and we appreciate that. We will read your detailed brief and we hope you'll participate in the discussion.
I'd now like to turn to our last speaker, Bronwyn Cole Shoush from the Canadian Breast Cancer Institute.
Ms Bronwyn Cole Shoush (Member, Management Committee, Canadian Breast Cancer Research Initiative; Member at Large, National Cancer Institute of Canada): Bienvenue à Edmonton. Je vais parler en anglais la plupart du temps.
Thank you for the opportunity to participate in this round table discussion. I am a lawyer, notwithstanding my friend's comments here, and I have a chemistry degree and a special interest in constitutional law and public policy issues that affect us all. I've written a very extensive paper on the federal spending power.
But I'm here today as a volunteer, as a member of the management board of the Canadian Breast Cancer Research Initiative, and a member at large of the National Cancer Institute of Canada. I'm here specifically to talk about the serious health issue facing Canadian women, namely breast cancer, and the role the Canadian government should continue to play in supporting research for breast cancer. I fully agree with my friend Professor Weiner's comments on the importance of basic research to Canadians' health and to the economy of this country.
As you know, the Canadian Breast Cancer Research Initiative was established by the Government of Canada in 1993 - the founding partners were the Medical Research Council and Health Canada, the Canadian Cancer Society and the National Cancer Institute - with $30 million. Of that, $20 million came from the federal government and $10 million from the Canadian Cancer Society, which is the volunteer sector that contributes to cancer research in all areas of cancer. As a management board we have taken this money, which is to be used over five years.... The initiative is for a five-year period.
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What we are here to say is that the Canadian government should and must continue this initiative with the financial support, by way of money and other resources, if we are to beat breast cancer and the other serious cancers that afflict us all. I'm thinking in particular of prostate cancer, which is affecting men in increasing numbers.
I know you have so many issues to decide on in determining how the budget will be allocated. I'm here to say to you that if the federal government must choose between allocating resources for public safety and well-being through the Solicitor General and the court system in Canada and devoting resources to Canadians' health, I say the resources should go to health and to research in that area. The threat to Canadians' lives and well-being is threatened more by disease than by the issues that the Solicitor General must face.
For your information, in Canada 18,600 new cases of breast cancer will be diagnosed by the end of 1996. That's one Canadian woman every half hour. In 1996, 5,300 Canadian women will die of the disease. These are women who have been productive, who have led productive lives, who continue to lead productive lives, and make contributions to our economy and social well-being. We must not leave those issues aside when looking at the health and welfare of Canadians.
It's a valid and pressing issue, and I urge you to take into account the statements of my friend from the University of Alberta. I know you'll also be hearing from many others across the country on the importance of research. I don't believe it can be overestimated. The contributions of the brightest minds in this country are towards health care and to resolving really serious health issues. If we don't support research, we're going to lose those minds to other endeavours or perhaps to other countries. We can't afford, as Canadians, to do that. We have to provide adequate resources to research, directed in particular towards health care and disease.
Those are my submissions. Thank you.
The Vice-Chair (Ms Whelan): Thank you very much.
Ms Shoush, if you have a written presentation you'd like to submit to the committee, I welcome you to do that at the end of the hearing. We can make a copy of it if you have only one copy.
Ms Shoush: I provided copies to the lady over there.
The Vice-Chair (Ms Whelan): That's great. Thanks.
Ms Shoush: Thanks.
The Vice-Chair (Ms Whelan): We'll now start our questioning. I'll remind you again that you have translation units in front of you. We're going to begin with Monsieur Rocheleau from the province of Quebec, so everyone please get ready. Thank you.
[Translation]
Mr. Rocheleau.
Mr. Rocheleau (Trois-Rivières): Once again, I have been most impressed by the wide variety of witnesses we have heard from. If I have enough time, I would like to ask questions of four different witnesses, and I should say now that I hope the witnesses will be brief but to the point. My first question will be to Ms Aizenman, the second to Ms Wilson, the third to Mr. Whaley and the fourth to Mr. Kuiken.
I found your testimony very touching, Ms Aizenman, and I am wondering what led you to speak publicly about what you are thinking and feeling. I assumed that something happened to someone you know and that is why you made the effort to appear before us today.
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[English]
Ms Aizenman: I was deeply touched by the nature of your question, Mr. Rocheleau. My background is that of a high school educator. At the same time, as a Canadian I'm keenly interested in social policy.
In recent years the situation in Alberta has become such that you must take care of yourself. You have to watch what's going on in order to be informed, so I took it upon myself to educate myself in health care issues. I put my university training to good use and I've learned as much as I can as a layman about health care.
I sit on an advisory committee. I sit on a committee that is attempting to prevent the closure of a downtown hospital. I'm a liaison from my own community to the neighbourhood community hospital, and so on and so forth.
I took an interest in this area. As health care issues became more and more critical both in Alberta and at the federal level with decreased funding, I felt it was necessary for me and other people like me to speak out on those issues that are of most basic concern to Canadians. Health care is one of them.
A member of my family has breast cancer. I'm deeply touched by the lady who spoke about the need for research in this area. We can't have a healthy economy, we can't be a productive nation, we can't be first among first, if we undermine our health care system and the social safety net that protects the people in our country who need protection the most.
I thank you for your question.
The Vice-Chair (Ms Whelan): Thank you very much, Ms Aizenman.
Mr. Rocheleau, your second question.
[Translation]
Mr. Rocheleau: Thank you very much. Ms Wilson, you are interested in the Canada Pension Plan. Have you looked at what will happen to women as a result of the changes introduced to the Canada Pension Plan with respect to husbands?
[English]
Do you know what I mean?
Ms Wilson: No, I really am not familiar with the changes. I've read some of them, but as I indicated I'm really impressed with the principles and hope you adhere to them. I'm much more concerned about the senior benefit program. I think it will be disastrous for the country in the future.
The Vice-Chair (Ms Whelan): Mr. Rocheleau, your
[Translation]
third question.
Mr. Rocheleau: Mr. Whaley, I'm wondering what point you are trying to make with your very well-thought-out criticism about lenders. Are you still trying to make the rich pay?
[English]
Mr. Whaley: The point is that the system is unjust, particularly with regard to the GST that the federal government is collecting. We estimate that $210 million a year is not due and owed by Canadian taxpayers and yet they're required to pay it. We want to see a situation where consumers can justifiably feel they have the opportunity to be protected, to fight back, to have a fair shake in the court system and to have truth given to them when they borrow.
The Vice-Chair (Ms Whelan): Thank you, Mr. Whaley.
Your last question, Rocheleau.
[Translation]
Mr. Rocheleau: My final question is to Mr. Kuiken. You mentioned the fact that you would like health care workers to be exempted from the GST. Could you explain your proposal further, please?
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[English]
Mr. Kuiken: Madam Chairman, it's my understanding that persons using the services of some health professionals are currently GST exempt. The point I'm raising is that all designated health professionals and the services they provide, in particular, should be GST exempt.
Social work, which in this province is a health profession, is not GST exempt. My request is that this committee recommend to the minister that social work services for Albertans be GST exempt.
The Vice-Chair (Ms Whelan): Thank you, Mr. Kuiken. Merci, monsieur Rocheleau.
Mr. Solberg.
Mr. Solberg (Medicine Hat): Thank you very much, Madam Chair.
I welcome once again your appearance before the finance committee. I have a question forMr. Garber-Conrad.
Mr. Garber-Conrad, you made a remark earlier that the taxation system needs to be more progressive. You suggested that higher-income Canadians should pay more. I'm wondering if you have any kind of research that indicates how much high-income Canadians pay now. Do you have some ideas on how much more they should pay?
Mr. Garber-Conrad: I don't have that information at my fingertips, and I'm not particularly interested in this ``bad wrist grab from rich Canadians'' argument. I'm much more interested in the other end, where the Canadians who are living below the poverty line and who have difficulty feeding their children still have to pay, admittedly not very much, but enough that it's a burden on their children, their families and their communities, and therefore somebody else has to perhaps make it up.
I think for me that's the most affected part. I can't imagine, even if you added it up across a whole lot of poor people, that it adds up to so much that the government can't live without it.
Mr. Solberg: There are two points I'd like to make. First of all, some kinds of people do say you should raise taxes on high-income Canadians, but they never really imply who those high-income Canadians are.
Just by way of interest, the top 10% of income earners in this country pay 50% of the tax according to statistics we have. These are people who earn $50,000, so we're not talking about really high incomes, but I think it's important to mention this so that people understand what we're talking about when we say high-income people.
Mr. Garber-Conrad: I appreciate your better grasp and having the figures on the tip of your tongue. We can get into some adjustments for the relatively small number of people in your situation. So I don't have blinders on; I know... [Technical Difficulty - Editor]
Clearly that's not the way to make the big changes, even if you do quite a significant increase on the over $200,000 income. The real taxation issue that I see is back to getting a slightly more substantial portion of the revenue from corporate taxes rather than depending on personal income taxes at any level. I don't want to suggest we go all the way back or anything, but let's go 10% of the way back to what it was in 1970 or whatever.
The Vice-Chair (Ms Whelan): Ms Wilson would like to respond to that as well.
Ms Wilson: I would comment that the National Council on Welfare publishes a very good document on poverty. The National Council on Welfare has also recently published three publications on pension that are worth looking at. I don't agree with all they say, but certainly they indicate some of the inequities that have been brought out.
Mr. Solberg: My party has suggested raising the married exemption and the personal exemption. According to a StatsCan model, it would take 1,007,000 low-income Canadians off the tax rolls altogether, so I think that idea does get at what you are proposing. Obviously that's just part of an overall plan, but we recognize the need to help out low-income working families who just need a break.
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I just want to switch gears here and talk a little bit about health care. Health care has been raised. It's a huge issue. It's very important to people. A couple of weeks ago we had the head of the CMA, Dr. Judith Kazimirski, before our committee. She pointed out that in this country it takes an average of 43 days for a woman to get treatment once she's diagnosed with breast cancer. That's an incredible amount of time, and it makes early intervention impossible. This is terrible news and we should all be concerned about it, and I also point out that the federal government has cut their health care transfers by over $3 billion since they came to power.
Now, it's easy to rail against the government for making the cuts. What I would like to know, though, is what we can do to restore the funding on the one hand, while ensuring that we don't continue to run deficits over the long run and that we eventually balance our budget so that we're not paying so much money toward interest, which currently eats up about $49 billion a year out of the total overall budget.
Ms Aizenman: I would like to respond to that question. I think it's a matter of looking at every single one of your expenditures and developing some sort of a checklist to see if each expenditure is absolutely necessary. I don't like to use this example because it may be considered un-Canadian, but I agree with the lady at the table that the $23 million - yesterday it was only $18 million - used to give out flags could better be spent in areas such as breast cancer research or the alleviation of child poverty. It's a question of what you choose to spend money on. It's a question of going through the Auditor General's statement and looking at every single expenditure and, in the next round of departmental estimates, asking how many of these activities or how many of these programs are necessary.
Let me give you another example - and again I could be criticized for using this. In this day and age when we're so concerned about deficit cutting and debt reduction, social program spending and others, is it really necessary to have some of the committees in existence? Yes, it's an academic exercise to learn about parliamentary governments elsewhere within the Commonwealth, it's very useful; but compared to spending money on bread-and-butter issues, how would it rate on a scale of 10?
I think you need to develop some sort of a point-scale system and grade them against a 7-point scale, a 10-point scale, develop a matrix against which you take expenditures into account. I think you have to sharpen your red pencils and go through them even a little bit more carefully, and at the same time be careful of where you take the money from. In the past few years, there's been a preponderance of taking money out of social programs. I'm sorry, but to me it's a reflection of a little bit of ideology. Yes, I acknowledge that deficit cutting had to be done, and we've done it quite well. Now let's do other things equally as well.
The Vice-Chair (Ms Whelan): Thank you, Ms Aizenman.
Ms Shoush, please.
Ms Shoush: You asked a very important question that I think is at the heart of the deliberations that you have to consider. I think it goes to the federal spending powers, the use by the federal government of a power that's not enumerated in the Constitution. The federal government strips tax money out of people from every province and then sends it back to the provinces on the terms and conditions that they establish programs they may not want or that may be too expensive. It uses money as well to provide direct grants to institutions and to individuals for activities that fall under provincial jurisdiction.
I think that when it's deciding how to allocate budget moneys, it's extremely important for the federal government to consult very closely with the provinces in each area in which they're going to provide some funding. I can't overstress that as far as health and education and welfare are concerned, because the provinces have to carry the can on those issues in the end. And they face the electorate on those issues as well.
The Vice-Chair (Ms Whelan): Thank you very much, Ms Shoush.
Mr. Whaley, please.
Mr. Whaley: In response to your question, we have at the beginning of our brief five points that I didn't discuss in my opening remarks. I think that if those five points were applied, your problem would be resolved.
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I want to mention two of those very quickly. The first is to replace the GST with a financial transactions tax. That would basically solve a great deal of the problem. The second is to use the Bank of Canada to provide low-interest loans or 0% interest loans to local and provincial governments to repay debt as it comes due - that is the current debt that's bearing interest - and to use that same system, the Bank of Canada at 0%, to stimulate job creation throughout the country. If it's good enough for Bombardier, it ought to be good enough for municipalities and provinces in this country.
I have one word of caution on the Bombardier thing, and it is that this money, as I understand it, comes from the Government of Canada and bears interest for the Government of Canada. It should have come from the Bank of Canada if it's going to be given out at 0% interest. There is a major difference.
The Vice-Chair (Ms Whelan): Thank you, Mr. Whaley.
Mr. Kuiken.
Mr. Kuiken: I'd like to make four suggestions. First of all, I'd suggest an introduction of the Tobin tax or some movement in that direction.
The second point is the Canadian tax... [Technical Difficulty - Editor]
The fourth point is that the federal government should begin immediately to negotiate...
[Technical Difficulty - Editor] I think it's the harmonization that is putting an extreme amount of pressure on the federal government to do what they've been doing in terms of debt and deficit.
[Technical Difficulty - Editor]
Mr. Opstad: I wanted to mention here that, if I put it in terms of a pie, rather than just discussing how we can change the cuts in the pie and who gets more and who gets less, the ideas I presented were in the sense that maybe we should look at trying to increase the pie so we have more pie. That's basically what I'm saying here. Look at that aspect.
The Vice-Chair (Ms Whelan): Thank you very much. Thank you, Mr. Solberg.
Mr. Pillitteri.
Mr. Pillitteri (Niagara Falls): Thank you, Madam Chair.
It's refreshing to come back to Edmonton again. Of course, Mr. Opstad, I do recall that the last time I was here - two years ago, I think it was - we did have quite an exchange, if I recall right. Of course, there were some of the same presenters. Mr. Whaley I do recall. You're back again.
We could keep on printing money. Many have this presentation.
I'll just make a little remark. Mr. Opstad, I think we would have a better chance of getting rid of the federal government through merging the ten provinces and two territories into three provinces.
Having said that, I want to direct a question about the seniors to Ms Hazel Wilson. You did make a remark about the senior benefit as being almost similar to a welfare system. As I understand it now, the old age security and the supplement to the old age security are income tested. In regard to the seniors' benefit in the year 2001, how do you think it's any different, and what is the difference whereby you think of it as being a welfare system?
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Ms Wilson: Old age security was a universal benefit that everybody received at age 65. It is now changed to a seniors' benefit program, which means it is income tested. According to your income, then, you will get -
Mr. Pillitteri: The clawback was no different from what it is today.
Ms Wilson: It's entirely different from the clawback, entirely different.
Mr. Pillitteri: But it's still income tested.
Ms Wilson: Yes, the clawback is taken back, but they're changing the old age security completely. It is truly a welfare system.
Mr. Pillitteri: That is your perception of it.
Ms Wilson: It is entirely. You have to apply for it and -
Mr. Pillitteri: You have to apply today.
Ms Wilson: - it is welfare. It's targeted to people...it is welfare. I think, as I indicated in my speech, it will increase ageism and downgrade the value of seniors in this society.
The Vice-Chair (Ms Whelan): Ms Shoush, would you like to respond?
Ms Shoush: Thanks. I'd like to respond to what Ms Wilson has said concerning old age security being a welfare payment. In the sense that under the Constitution it is a federally administered program for the benefit of those people who require that assistance, it's not welfare. Welfare comes under provincial jurisdiction in the Constitution, and that's where such a contribution to the benefit of people in need would come from if it was a welfare payment. So that's a distinction. It's just a minor distinction I'm making.
The Vice-Chair (Ms Whelan): Thank you, Ms Shoush.
Mr. Whaley.
Mr. Whaley: You commented, sir, that you thought we were advocating printing money. I want to give Mr. Madden an opportunity to respond to this, but I would remind you that.... I guess you weren't in Calgary last year, but the chairman of the committee at that time in my view scoffed at the idea of 0% interest loans, but Bombardier has one. So maybe the ideas are not so far off.
I want to give Mr. Madden an opportunity, if I may, to comment on the printing money idea.
Mr. Pillitteri: Bombardier was an investment by the Government of Canada, a partnership in research and development. It is not a free -
Mr. Whaley: You can give it whatever label you want, we'll take it.
Mr. Tim Madden (Director of Research, Borrowers' Action Society): On the subject of printing money, Statistics Canada reports that since 1975 the Bank of Canada has printed a net$15 billion in currency to bring the total in circulation to some $28 billion. Would you accept that as being an accurate figure?
Mr. Pillitteri: They're collecting money.
Mr. Madden: Okay, they're replacing money.
Over the same period, the chartered bank loans and assets of the big five have increased by approximately $700 billion. If the government printed a net $15 billion over that period, where did the other $685 billion come from?
Mr. Pillitteri: From the changes made to the act in 1991. Is that what you're referring to?
Mr. Madden: No, I'm referring to the fact that the private chartered banks have a right under the Bank Act to operate as the nation's pawnshop, in essence. You put up the asset, and they have a right to create the loan asset against it. The Bank of Canada could just as easily do the same thing with respect to provincial loans, municipal loans, and infrastructure projects.
Mr. Pillitteri: In 1991 the Bank of Canada was in the business of taking deposits and so on, but it no longer does it. Of course, the Bank of Canada's role at times is to buy or sell foreign currency in order to balance the dollar and the interest rates.
Mr. Madden: The essence of the Bank of Canada's policy is that it has a lawful right to purchase money wholesale through the Bank of Canada. It is choosing as a matter of policy to go and pay retail for it. That is an appallingly bad policy.
The Vice-Chair (Ms Whelan): Thank you, Mr. Madden.
Mr. Schmal, you wish to comment?
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Mr. Schmal: It is always very easy to criticize, but in my statement earlier I indicated how successful, for instance, the infrastructure program was, which created thousands of jobs in Canada at a time when things weren't going so well. Reviewing the proposal for a second phase, we now see the criticisms coming from people like the chambers of commerce, who are always ready to attack when government gets involved and who will say not to create another program because you get yourself in trouble.
I'd like to say on behalf of the Federation of Canadian Municipalities that it's been an extremely good program, and with the money that was spent in the city of Calgary, $145 million by three levels of government, 80% of those dollars was spent by the private sector.
Mr. Pillitteri: This supported the infrastructure wholly.
Mr. Schmal: I hope the effort to bring jobs to people who need them, the younger people, in construction and infrastructure efforts and the effort to bring back a plan created by three levels of government will have a lot of benefit for municipalities throughout Canada.
The Vice-Chair (Ms Whelan): Thank you very much, Mr. Schmal. Thank you, Mr. Pillitteri.
Mr. Fewchuk.
Mr. Fewchuk (Selkirk - Red River): I would just like to say on behalf of the people of Manitoba and myself, it's been a great pleasure to be here today and to listen to you all. I didn't come here to fight; I came to listen. I thank you very much and I hope to see you again sometime in the future.
The Vice-Chair (Ms Whelan): Thank you, Mr. Fewchuk.
I would like to ask a couple of questions. We are going to do things in reverse order.Mr. Duhamel has a final question for everyone, but before we go to that, I would like to talk...and maybe Mr. Skoreyko can help me with this. I see Mr. Hart had to leave the table for a few minutes.
With regard to fair organizations, I notice in Mr. Hart's brief he talked about the fact that there's a burden of maintaining, retrofitting or replacing facilities. We've had a number of discussions coming before this committee about a second infrastructure program. I'm just wondering whether you may or may not have a position on this, whether or not you would prefer to see a second infrastructure program limited solely to roads, sewers and water.
The reason I ask this is that I know that in my riding in the first phase of the infrastructure program there was a small community that chose to allocate some of their dollars because of one reason: they didn't have the tax dollars to match within the community to one of their local fair organizations to allow them to rebuild an outdated building. That was for one of the oldest fairs in Ontario, 137 years old.
If we were to enter a second infrastructure program, would you want to see the limitations that have been suggested by others who have come before us?
Mr. Skoreyko: First of all, my understanding of the original program is that the program was done through the municipalities and some of those restrictions were in place. However, in this municipality we ended up putting $14 million into two sports facilities to the benefit of a local entrepreneur.
The submission we provided is that if you're going to do it through the municipalities for roads and sewers, or whatever, then keep it there through your own rules and regulations, because the last time that isn't where it was used.
Again, part of the submission here is that whether you participate in the rodeo or you don't, we still do generate a huge economic benefit and we do employ 2,000 people who otherwise may not be employed in this municipality. We have been around a long time. We feel that we are a benefit to the community, perhaps misunderstood.
Something has to be done with that contribution for 800 organizations across the country. We would submit that maybe some portion of the infrastructure program, if it makes sense, might be made available to the fairs to help us move towards self-sufficiency. That seems to be a contradiction in terms.
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The Vice-Chair (Ms Whelan): I guess I'm a bit confused, because in the province of Ontario there was a possibility for municipalities to make their decisions on how their dollars were going to be spent. I realize every province operated somewhat differently because of the different provincial agreements, but in Ontario there was an allocation directly for education and an infrastructure program for infrastructure and education facilities. School boards, universities and colleges made their own decisions on how those dollars would be spent in partnership with the provincial government and the federal government. There was direct allocation.
The direct allocation in municipalities again was in most cases a municipal decision. I respected the priorities of my municipalities. One of my municipalities placed emphasis on restructuring a building because the fair was a major component of their community and economic activity. The building was over 100 years old and they felt that was a major benefit to the community.
I've heard from groups before us that we should limit how infrastructure dollars, if there were a second phase, could be spent through strictly roads, sewers and water. I'm going to ask again, do you agree they should be limited or not?
Maybe Mr. Hart wants to add to it now.
Mr. Skoreyko: I agree that if you're going to put the limitation on, then stick with it. If you're going to let it go freewheeling, then allow fairs and exhibitions and other groups to come in and make their own submissions.
The Vice-Chair (Ms Whelan): Okay. Mr. Hart, would you like to add to that at all?
Mr. Hart: Yes, this is the comment that I would support. If it's going to be open, allow fairs and exhibitions to enter. That doesn't apply just to the infrastructure program but to many government programs. Fairs and exhibitions are excluded for various reasons and terms. That's a problem that we've encountered and that really affects our ability to respond.
The Vice-Chair (Ms Whelan): Mr. Matousek, do you wish to comment?
Mr. Matousek: Yes, I'm very glad... [Technical Difficulties - Editor]
While hospital beds in Canmore were being closed, $7 million of infrastructure money was given to construct an overpass that benefited only one group of people, a consortium of people, including Bud McCuaig and Hal Walker. It went to their property. That was the only reason for that overpass.
The Vice-Chair (Ms Whelan): Thank you. I have one final brief question for Dr. Weiner.
I know I had to cut you off during your presentation, but with regards to basic research, I believe mention was made in your presentation - although maybe it was in another - about a $100 million endowment fund. Was that in your presentation? Could you expand on that briefly for us?
Dr. Weiner: Yes, it's the proposal that was made by Dr. Cal Stiller at the Innovation in Funding Health Research in the New Millennium conference. What he proposes is that the government create a fund of $100 million per year for 10 years that would be accessed by universities, which would then partner with the private sector, for example the Canadian medical discoveries fund and venture capital funds like that to commercialize, to develop, and to really make products from the massive amount of research that is going on in this country of which we haven't been taking advantage.
He has a number of economists who have worked on this with him, and his view is that after a 10-year period the amount of equity that the universities would have created in these spin-off companies by sale of those companies, by the recapitalization, by the products, royalties and so forth, would create an income stream that would allow the continuance of basic research to be funded at this level of $100 million to maybe even $250 million a year, depending on whose estimates you take, to get government out of some of this.
Government still has a role, but we can't rely totally on government. This is a way to really transfer it to the private sector over a long period of time. The private sector right now is not doing enough in basic research and this is a proposal. They have generated a lot of interest.
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I would just like to make one comment on the infrastructure program. Don't forget, in Alberta we couldn't use the money for higher education, schools, colleges or universities. In the next program it's crucial that there be some commitment, because we're crumbling. If there's going to be a program, we need to have a commitment that the money go in that direction.
The Vice-Chair (Ms Whelan): I agree. I think it's very important that Canadians understand the differences in how the infrastructure program worked last time. I know in my area the University of Windsor did benefit from it. It was allowed to replace some of that crumbling infrastructure and add to it.
Dr. Weiner: If you would like the full report of Dr. Stiller's proposal, I can send that to you.
The Vice-Chair (Ms Whelan): Yes, that would be fine.
Dr. Weiner: Okay, I'll send that to you.
The Vice-Chair (Ms Whelan): I am going to turn now to Ron Duhamel, who has a question for everyone.
Mr. Duhamel (Saint Boniface): A brief comment and a brief question.
First of all, I want to tell you how appreciative I am of these various exchanges. It really points out how interesting a job I have, and I say this with a great deal of sincerity.
For example, a major question has been raised here this morning. What is a useful government program? What is a necessary program? For example, some people would argue that this is a very useful program. That is, we go out on the road and we talk to Canadians. Some people would say, though, it's not absolutely necessary so why don't you save the money?
With respect to flags, in my riding there's been some criticism of the flag program, but by 10 to 1 it's been endorsed by people who've called and frankly we can't keep up. I wish, in a sense, that it would come to an end, because it's really taxing my resources.
Let me just make another point with respect to this. We talked about the optimum size of government this morning and there was a gentleman who raised the other side of the equation. What's the optimum size of the private sector businesses? Is there an optimum size? We've heard people talk about whether government should be larger or smaller.
These questions are extremely complex and they go back to the set of values that you represent. I'm not saying that as a cop-out. I'm just trying to point out that these are not simple questions. I think it's good that you should raise them; it pushes my colleagues and me to think more about them.
In 30 seconds or fewer, Madam Chair, I wonder if we could go around the table and ask each participant to give us a message that they would like us to bring back to Mr. Martin, the Minister of Finance, as we approach this budget.
The Vice-Chair (Ms Whelan): We'll start with Mr. Garber-Conrad, please. If you have one message for Mr. Martin, what would it be?
Mr. Garber-Conrad: I would ask to maintain a strong federal presence in direct funding of health and social services. If you need to go over the provinces in order to get the job done, then partner with municipalities or community organizations to do the priorities that you see needing to be done.
The Vice-Chair (Ms Whelan): Thank you. Mr. Kuiken.
Mr. Kuiken: I think we're an amazingly rich country. We're one of the best countries in the world. I think Mr. Martin has the responsibility of helping Canadians across the country learn to share their responsibilities... [Technical Difficulties - Editor]
The Vice-Chair (Ms Whelan): Thank you. Mr. Schmal.
Mr. Schmal: Madam Chair, I'm presently working with people in Corrections and National Parole.
[Technical Difficulty - Editor] ...like a co-op worker where the different levels of government provide funding towards a wage to bring back offenders in the community, because that's the crux of the whole matter. When the offender comes out of that big gate back into the community, our chief of police says if he isn't somehow accepted by the family or people he knows, within 72 hours he's back in the same situation.
How can we provide some kind of job for these people, even if we have to split it between different levels of government, so that they can actually come back into the community? That's where the problem lies.
I am hoping you will take that back.
The Vice-Chair (Ms Whelan): Thank you, Mr. Schmal. Ms Aizenman.
Ms Aizenman: I would like Mr. Martin and his colleagues on the finance committee and in conjunction with other departments, such as the departments of health and human resources, to take whatever action is necessary to restore faith in our country, in our future, in our youth. I want protection for our most vulnerable.
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I want Mr. Martin to remember the legacy of his father, the social programs that his father was so responsible for establishing. What Mr. Martin Sr. gave Mr. Martin Jr., please don't take it away. Protect it. Don't erode the social fabric of this country; have no further unravelling of the basic social values that are so important to us, as Canadians, as we see them in the programs that make this country the number one country in the world.
The Vice-Chair (Ms Whelan): Thank you, Ms Aizenman. Mr. Whaley is next.
Mr. Whaley: My message would be to ensure truth and justice in lending and enforce the existing laws in the lending area, and consumers will re-enter the marketplace and stimulate the economy to everyone's benefit.
The Vice-Chair (Ms Whelan): Thank you. Dr. Weiner.
Dr. Weiner: My message would be that Mr. Martin listen to the recommendations of this committee. In the past two years you've made a number of recommendations, particularly with the granting councils. They haven't been listened to and I think it's been a big mistake. If he would listen to what you have heard and what you recommend, I think we'd be all better off.
The Vice-Chair (Ms Whelan): Dr. Weiner, you should be aware that he does listen to some of our recommendations. We're hoping that this year he'll listen to all of them.
Ms Wilson.
Ms Wilson: My message to Mr. Martin really would be to continue and protect the vulnerable in society of all age groups and everywhere and to maintain a strong federal voice. We really need a voice that speaks loudly, that articulates our social values and other values, and we look to the federal government to do this.
The Vice-Chair (Ms Whelan): Thank you. Ms Matousek.
Ms Matousek: I echo just about everything that's been said up to now. There have to be strong federal standards to protect those of us who have to live in Alberta. I'm not saying this will go on forever, but we need to have a strong federal voice. I also think the government must understand that what you do to seniors today, you will be doing to the seniors of tomorrow. Once the young people, the boomers, figure that out, there may be stronger resistance to cuts to seniors.
The Vice-Chair (Ms Whelan): Thank you, Ms Matousek. Ms Shoush is next.
Ms Shoush: Thank you. I would say to Mr. Martin to continue his support for the National Cancer Institute and the Canadian Breast Cancer Research Initiative. His father, Paul Martin Sr., was a founding member of the National Cancer Institute and he certainly appreciated the importance of the treatment and research on cancer.
I'd also recommend that he consult and develop a consensus with the provinces on finances so that we can work at eliminating overlap and bringing down the deficit. I'd say to him to stay the course on deficit reduction and begin work right away on eliminating the debt. Thank you.
The Vice-Chair (Ms Whelan): Thank you. Mr. Opstad.
Mr. Opstad: My message to Mr. Martin is that he decided to tax the banks $100 million, as I understand it, and he's definitely hitting the great untouched area of our country that we need to touch. But he's just touched the tip of the iceberg.
He should get to it and look at some new ideas. I've given him two ideas, so he should look at them. We have to make some changes here. We can't go on the same way we've done year after year, because if you keep doing things the same way you've always done, you'll get all the same results. And look at what results we've got, up and down and God knows what.
So Mr. Martin has got my message. He should just read the proposals, mine plus all the others here too. Thank you.
The Vice-Chair (Ms Whelan): Thank you very much, Mr. Opstad. Your proposals were interesting and will definitely cause much discussion, I'm sure, around the finance table.
Mr. Skoreyko, please.
Mr. Skoreyko: I suppose my message to Mr. Martin is to not forget to fuel the fires of economic development, growth and job creation. If we forget about that in this country, we won't have anybody left to tax so that we can apply the money to all the other programs.
The Vice-Chair (Ms Whelan): Thank you. Mr. Hart.
Mr. Hart: While somewhat limited in scope, our message to Mr. Martin is to use the existing system in rural Canada of organizations to deliver programs and services, but focus on them as organizations, because their health and well-being is essential if they're going to be around to deliver those programs and services.
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The Vice-Chair (Ms Whelan): Thank you, Mr. Duhamel.
I want to thank all the witnesses for taking time out of their busy schedules to appear before us and file the briefs they have presented. If anyone hasn't presented a written brief, they can submit it within 10 days.
Again, it's a very interesting discussion we've had here in Edmonton. Your time is very much appreciated. We will take your messages back to the rest of the finance committee, and they will be part of our final report.
The meeting is adjourned.