Budget Implementation Act, 2023, No. 1

An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023

Sponsor

Status

This bill has received Royal Assent and is, or will soon become, law.

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

Part 1 implements certain measures in respect of the Income Tax Act and the Income Tax Regulations by
(a) enabling the Canada Revenue Agency (CRA) to use electronic certification of tax and information returns and requiring taxpayers to file electronically in certain circumstances;
(b) doubling the maximum deduction for tradespeople’s tools from $500 to $1,000;
(c) providing that any gain on the disposition of a right to acquire Canadian housing property within a one-year period of its acquisition is treated as business income;
(d) excluding from a taxpayer’s income certain benefits for Canadian Forces members, veterans and their spouses or common-law partners;
(e) exempting from taxation any income earned by the Band Class Settlement Trust in accordance with section 24.05 of the Settlement Agreement entered into on January 18, 2023 relating to the attendance of day scholars at residential schools;
(f) providing an additional payment of the Goods and Services Tax/Harmonized Sales Tax (GST/HST) credit equal to double the amount of the regular January 2023 payment;
(g) providing for automatic, quarterly advance payments of the Canada Workers Benefit;
(h) allowing divorced and separated spouses to open joint Registered Educational Savings Plans and increasing educational assistance amounts under those plans;
(i) extending, by ‚three years, the ability of a qualifying family member to be the plan holder of an individual’s Registered Disability Savings Plan and expanding the definition of “qualifying family member” to include a sister or a brother of the individual;
(j) allowing defined contribution registered pension plans to correct contribution errors and requiring that the contributions or refunds are reported to the CRA for the purpose of correcting the RRSP deduction limit;
(k) modifying reporting requirements in respect of reportable transactions, introducing reporting requirements for notifiable transactions and providing reporting requirements with respect to uncertain tax treatments, as well as extending the reassessment periods applicable to those transactions and creating or modifying penalties for non-compliance with those requirements;
(l) allowing the CRA to share taxpayer information for the purposes of the Canadian Dental Care Plan;
(m) expanding the definition of “dividend rental arrangement” to include “specified hedging transactions” carried out in whole or in part by registered securities dealers;
(n) implementing the Model Reporting Rules for Digital Platforms developed by the Organisation for Economic Co-operation and Development;
(o) requiring annual reporting by financial institutions of the fair market value of registered retirement savings plans and registered retirement income funds;
(p) expanding the permissible borrowing by defined benefit pension plans; and
(q) implementing a number of technical amendments to correct mistakes or inconsistencies and to better align the law with its intended policy objectives.
It also makes related and consequential amendments to the Excise Tax Act , the Tax Rebate Discounting Act , the Air Travellers Security Charge Act , the Excise Act, 2001 , Part 1 of the Greenhouse Gas Pollution Pricing Act and the Electronic Filing and Provision of Information (GST/HST) Regulations .
Part 2 implements certain measures in respect of the Excise Tax Act and a related text by
(a) clarifying that the international transportation of money benefits from Goods and Services Tax/Harmonized Sales Tax (GST/HST) relief and other special rules in the same manner as a service of internationally transporting other kinds of freight;
(b) permitting a pension entity, in specific circumstances, to claim the pension entity rebate or an input tax credit, or to make the pension entity rebate election, after the end of the two-year limitation period;
(c) specifying that cryptoasset mining is generally not considered a supply for GST/HST purposes; and
(d) ensuring that payment card clearing services are excluded from the definition “financial service” under the GST/HST legislation.
Part 3 amends the Excise Act , the Excise Act, 2001 and the Air Travellers Security Charge Act in order to implement two measures.
Division 1 of Part 3 amends the Excise Act and the Excise Act, 2001 in order to temporarily cap the inflation adjustment for excise duties on beer, spirits and wine at two per cent, for one year only, as of April 1, 2023.
Division 2 of Part 3 amends the Air Travellers Security Charge Act to increase the air travellers security charge that is applicable to air travel that includes a chargeable emplanement after April 2024 and for which any payment is made after April 2024.
Part 4 enacts and amends several Acts in order to implement various measures.
Division 1 of Part 4 amends the Bank Act to strengthen the regime for dealing with complaints against banks and authorized foreign banks by, among other things, providing for the designation of a not-for-profit body corporate to be the sole external complaints body. It also makes consequential amendments to the Financial Consumer Agency of Canada Act and related amendments to the Financial Consumer Protection Framework Regulations .
Division 2 of Part 4 amends the Pension Benefits Standards Act, 1985 to, among other things, provide for variable life benefits under a defined contribution provision of a pension plan and amends the Pooled Registered Pension Plans Act to, among other things, provide for variable life payments under pooled registered pension plans. It also makes a consequential amendment to the Canadian Human Rights Act .
Division 3 of Part 4 contains measures that are related to money laundering and to digital assets and other measures.
Subdivision A of Division 3 amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to, among other things,
(a) require persons or entities referred to in section 5 of that Act to report to the Financial Transactions and Reports Analysis Centre of Canada information that is related to a disclosure made under the Special Economic Measures Act or the Justice for Victims of Corrupt Foreign Officials Act (Sergei Magnitsky Law) ;
(b) strengthen the registration framework for persons or entities referred in paragraphs 5(h) and (h.1) of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act , which are often referred to as money services businesses;
(c) create two new offences relating to persons or entities who engage in activities for which they are not registered under that Act and the structuring of financial transactions undertaken to avoid reporting obligations under that Act, as well as a new offence relating to reprisals by employers against employees who fulfill obligations under that Act;
(d) facilitate the sharing, between the Minister of Finance, the Office of the Superintendent of Financial Institutions and the Financial Transactions and Reports Analysis Centre of Canada, of information that relates to their respective mandates; and
(e) authorize the Minister of Finance to issue directives to persons and entities referred in section 5 of that Act in respect of risks relating to the financing of threats to the security of Canada.
Subdivision A also amends the Budget Implementation Act, 2021, No. 1 in relation to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act .
Subdivision B of Division 3 amends the Criminal Code to provide for a new warrant authorizing a peace officer or other person named in the warrant to search for and seize digital assets, including virtual currency, as well as to expand the list of offences on the basis of which an examination of information obtained by the Minister of National Revenue under various tax statutes may be authorized. The subdivision also makes related amendments to other Acts.
Division 4 of Part 4 amends the Customs Tariff to extend the expiry date of the General Preferential Tariff and Least Developed Country Tariff to December 31, 2034 and to create a new General Preferential Tariff Plus tariff treatment that will expire on the same date. The Division also aligns direct shipment requirements for tariff treatments under that Act with those that apply to free trade agreements.
Division 5 of Part 4 amends the Customs Tariff to remove Belarus and Russia from the List of Countries entitled to Most-Favoured-Nation tariff treatment.
Division 6 of Part 4 allows the Bank of Canada to apply, despite sections 27 and 27.1 of the Bank of Canada Act , any of its ascertained surplus to its retained earnings until its retained earnings are equal to zero or the ascertained surplus applied to its retained earnings is equal to the losses it incurred from the purchase of securities as part of the Government of Canada Bond Purchase Program.
Division 7 of Part 4 enacts the Canada Innovation Corporation Act . That Act continues the Canada Innovation Corporation, which was established under another Act, as a parent Crown corporation, sets out the Corporation’s purpose to maximize business investment in research and development across all sectors of the economy and in all regions of Canada to promote innovation-driven economic growth and includes transitional provisions. The Division also makes consequential and related amendments to other Acts.
Division 8 of Part 4 amends the Federal-Provincial Fiscal Arrangements Act to authorize additional payments to the provinces and territories.
Division 9 of Part 4 amends the Federal-Provincial Fiscal Arrangements Act to renew the authority to make Equalization and Territorial Formula Financing payments for another five-year period beginning on April 1, 2024 and makes a technical change to improve the accuracy of the programs. It also makes a technical change to the calculation of fiscal stabilization payments. Finally, it provides for the publication of the details of all amounts authorized to be paid under that Act.
Division 10 of Part 4 amends the Special Economic Measures Act , the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and the Justice for Victims of Corrupt Foreign Officials Act (Sergei Magnitsky Law) to strengthen Canada’s ability to take economic measures against certain persons.
Division 11 of Part 4 amends the Privileges and Immunities (North Atlantic Treaty Organisation) Act to, among other things, enable the Paris Protocol to be implemented in Canada.
Division 12 of Part 4 amends the Service Fees Act to, among other things, clarify the definition “fee”, exempt certain fees from the application of that Act, make certain exceptions in that Act applicable only with the approval of the President of the Treasury Board, make certain changes to the annual adjustment provisions and provide authority for the President of the Treasury Board to amend the regulations made under section 22 of that Act by taking into account the factors established by regulations.
It also amends section 25.1 of the Canadian Food Inspection Agency Act to provide for the application of sections 16 to 18 of the Service Fees Act to low-materiality fees, within the meaning of the Service Fees Act , that are fixed under section 24 or 25 of the Canadian Food Inspection Agency Act .
Division 13 of Part 4 amends the Canada Pension Plan to allow the Minister of National Revenue to make available information to the Minister of Employment and Social Development that is necessary for the purpose of policy analysis, research or evaluation related to the administration of that Act.
Division 14 of Part 4 amends the Department of Employment and Social Development Act to grant the Minister of Employment and Social Development the authority to collect and use Social Insurance Numbers for the purposes of administering or enforcing any Act, program or activity in respect of which the administration or enforcement is the responsibility of the Minister.
Division 15 of Part 4 amends the Canada Labour Code in respect of leave related to the death or disappearance of a child to, among other things, increase the maximum length of that leave from 104 weeks to 156 weeks and to repeal paragraph 206.5(4)(b) of that Act.
Division 16 of Part 4 amends the Immigration and Refugee Protection Act to provide that a claim for refugee protection made by a person inside Canada must be made in person and, with regard to a claim made by the person other than at a port of entry, that the Minister of Citizenship and Immigration may specify the documents and information to be provided and the form and manner in which they are to be provided.
Division 17 of Part 4 amends the Immigration and Refugee Protection Act to clarify that the Minister of Citizenship and Immigration may give instructions in respect of an application to sponsor a person who applies for a visa as a Convention refugee, within the meaning of that Act, or as a person in similar circumstances.
Division 18 of Part 4 amends the College of Immigration and Citizenship Consultants Act to, among other things,
(a) provide that the College of Immigration and Citizenship Consultants may seek an order authorizing it to administer the property of any licensee of the College who is not able to perform their activities as an immigration and citizenship consultant;
(b) extend immunity against proceedings for damages to directors, employees and agents and mandataries of the College, among others;
(c) authorize the College to enter into information-sharing agreements or arrangements with any entity, including federal or provincial government institutions; and
(d) expand the areas in respect of which the Governor in Council may authorize the College to make by-laws.
The Division also makes related amendments to the Citizenship Act and the Immigration and Refugee Protection Act to clarify that any person who is the subject of a notice of violation issued under either of those Acts has the right to request a review of the notice or the administrative monetary penalty set out in the notice.
Division 19 of Part 4 amends the Citizenship Act to, among other things,
(a) grant the Minister responsible for the administration and enforcement of that Act the power to collect biometric information from persons who make an application under that Act — and to use, verify, retain and disclose that information — in accordance with the regulations;
(b) authorize that Minister to administer and enforce that Act using electronic means, including by using an automated system; and
(c) grant that Minister the power to make regulations requiring persons who make an application or who provide documents, information or evidence under that Act to do so using electronic means.
Division 20 of Part 4 amends the Yukon Act to authorize the Minister of Northern Affairs to take any measures on certain public real property that the Minister considers necessary to prevent, counteract, mitigate or remedy any adverse effect on persons, property or the environment.
Subdivision A of Division 21 of Part 4 amends the Marine Liability Act to, among other things,
(a) increase the maximum liability for certain claims involving a ship of less than 300 gross tonnage;
(b) establish the maximum liability for claims involving air cushion vehicles;
(c) remove all references to the Hamburg Rules;
(d) extend the application of the International Convention on Civil Liability for Bunker Oil Pollution Damage, 2001 to non-seagoing vessels;
(e) provide for public notice requirements relating to the constitution of limitation funds under that Act;
(f) clarify that the owner of a ship is liable for economic loss related to fishing, hunting, trapping or harvesting suffered by an Indigenous group, community or people or suffered by a member of such a group, community or people; and
(g) expand the compensation regime of the Ship-source Oil Pollution Fund to include certain future losses.
Subdivision B of Division 21 amends the Canada Shipping Act, 2001 to, among other things,
(a) expand the application of Part 1 of that Act in relation to certain pleasure craft;
(b) expand the exemption powers of the Minister of Transport and the Minister of Fisheries and Oceans;
(c) allow the owner of a Canadian vessel to enter into an arrangement with a qualified person under which that person is the authorized representative of the vessel;
(d) give the Marine Technical Review Board jurisdiction to make decisions on applications for exemptions from interim orders;
(e) authorize the Governor in Council to incorporate by reference in certain regulations material that the Minister of Transport produces;
(f) broaden the Governor in Council’s power respecting fees, charges, costs or expenses to be paid in relation to the administration and enforcement of matters under that Act for which the Minister of Transport is responsible;
(g) increase the maximum amount of fines for certain offences;
(h) provide authority, in certain circumstances, for the Chief Registrar to refuse to issue a certificate of registry and for the Minister of Transport to refuse to issue a pleasure craft licence;
(i) authorize the Governor in Council to make regulations respecting emergency services;
(j) authorize the Minister of Transport to, among other things,
(i) direct a master or crew member to cease operations,
(ii) authorize the Deputy Minister of Transport to make interim orders in response to risks to marine safety or to the marine environment, and
(iii) direct a port authority or a person in charge of a port authority or place to authorize vessels to proceed to a place selected by the Minister; and
(k) permit designating as violations the contravention of certain provisions of Parts 5 and 10 of that Act and the regulations made under those Parts.
The Subdivision also makes a related amendment to the Oil Tanker Moratorium Act .
Subdivision C of Division 21 amends the Wrecked, Abandoned or Hazardous Vessels Act to, among other things, establish the Vessel Remediation Fund in the accounts of Canada and provide the Minister of Fisheries and Oceans with certain powers in relation to the detention of vessels.
Division 22 of Part 4 amends the Canada Transportation Act to, among other things,
(a) allow the Governor in Council to require air carriers to publish information respecting their performance on their Internet site;
(b) permit the sharing of information to ensure the proper functioning of the national transportation system or to increase its efficiency, while ensuring the confidentiality of that information;
(c) allow the Minister of Transport to require certain persons to provide certain information to the Minister if the Minister is of the opinion that there exists an unusual and significant disruption to the effective continued operation of the national transportation system;
(d) establish a new zone in Manitoba, Saskatchewan and Alberta, in which any interswitching that occurs is subject to the rate determined by the Canadian Transportation Agency, for a period of 18 months; and
(e) broaden the scope of the administrative monetary penalties scheme.
Division 23 of Part 4 amends the Canada Transportation Act to, among other things,
(a) broaden the authority of the Canadian Transportation Agency to set fees and charges to recover its costs;
(b) replace the current process for resolving air travel complaints with a more streamlined process designed to result in more timely decisions;
(c) impose a greater burden of proof on air carriers where it is presumed that compensation is payable to a complainant unless the air carrier proves the contrary;
(d) require air carriers to establish an internal process for dealing with air travel claims;
(e) modify the Agency’s regulation-making powers with respect to air carriers’ obligations towards passengers; and
(f) enhance the Agency’s enforcement powers with respect to the air transportation sector.
Division 24 of Part 4 amends the Customs Act to, among other things,
(a) allow a person arriving in Canada to present themselves to the Canada Border Services Agency by a means of telecommunication, if that manner of presenting is made available at the customs office at which they are presenting themselves; and
(b) subject to the regulations, require that the operator of a commercial aircraft arriving in Canada ensure that baggage on board the aircraft is transported without delay to the nearest international baggage area.
The Division also makes a related amendment to the Quarantine Act .
Division 25 of Part 4 amends the National Research Council Act to, among other things, provide that the National Research Council of Canada may procure goods and services, including goods and services relating to construction and to research-related digital and information technology. It also establishes a new Procurement Oversight Board.
Division 26 of Part 4 amends the Patent Act to, among other things,
(a) authorize the Commissioner of Patents to grant an additional term for a patent if certain conditions are met;
(b) authorize the Governor in Council to make regulations respecting the number of days that is to be subtracted in determining the duration of an additional term; and
(c) authorize the Commissioner of Patents and the Federal Court to shorten the duration of an additional term if the duration as previously determined is longer than is authorized.
Division 27 of Part 4 amends the Food and Drugs Act to extend measures regarding therapeutic products to natural health products in order to, among other things,
(a) strengthen the safety oversight of natural health products throughout their life cycle; and
(b) promote greater confidence in the oversight of natural health products by increasing transparency.
Division 28 of Part 4 amends the Food and Drugs Act to, among other things, prohibit
(a) the sale of a cosmetic unless its safety can be established without relying on data derived from a test conducted on an animal that could cause pain, suffering or injury, whether physical or mental, to the animal, subject to certain exceptions;
(b) the conduct of a test on an animal that could cause pain, suffering or injury, whether physical or mental, to the animal if the purpose of the test is to meet a legislative requirement that relates to cosmetics; and
(c) deceptive or misleading claims, on the label of or in an advertisement for a cosmetic, with respect to testing on animals.
Division 29 of Part 4 enacts the Dental Care Measures Act .
Division 30 of Part 4 amends subsection 41(1) of the Canada Post Corporation Act , in response to the decision in R. v. Gorman , to limit the Canada Post Corporation’s authority to open mail other than letters.
Division 31 of Part 4 expresses the assent of the Parliament of Canada to the issuing by His Majesty of a Royal Proclamation under the Great Seal of Canada establishing for Canada the applicable Royal Style and Titles.
Division 32 of Part 4 amends the Public Sector Pension Investment Board Act to provide that the Public Sector Pension Investment Board may incorporate a subsidiary for the purpose of providing investment management services to the Canada Growth Fund Inc. It also amends the Fall Economic Statement Implementation Act, 2022 to increase the amount that may be paid out of the Consolidated Revenue Fund on the requisition of the Minister of Finance for the acquisition of shares of the Canada Growth Fund Inc. and to provide that the Canada Growth Fund Inc. is not an agent of His Majesty in right of Canada.
Division 33 of Part 4 amends the Office of the Superintendent of Financial Institutions Act , the Trust and Loan Companies Act , the Bank Act and the Insurance Companies Act to, among other things,
(a) expand the mandate of the Office of the Superintendent of Financial Institutions to include the supervision of federal financial institutions in order to determine whether they have adequate policies and procedures to protect themselves against threats to their integrity or security; and
(b) expand the Superintendent of Financial Institutions’ powers to issue directions to, and to take control of, a federal financial institution in certain circumstances.
It also makes a consequential amendment to the Winding-up and Restructuring Act .
Division 34 of Part 4 amends the Criminal Code to, among other things, lower the criminal rate of interest calculated in respect of an agreement or arrangement and to express that rate as an annual percentage rate. It also authorizes the Governor in Council, by regulation, to fix a limit on the total cost of borrowing under a payday loan agreement. Finally, it provides for transitional provisions.
Division 35 of Part 4 amends the Employment Insurance Act to extend, until October 26, 2024, the increase in the maximum number of weeks for which benefits may be paid in a benefit period to certain seasonal workers.
Division 36 of Part 4 amends the Canadian Environmental Protection Act, 1999 to, among other things,
(a) establish an account in the accounts of Canada to be called the Environmental Economic Instruments Fund, for the purpose of administering amounts received as contributions to certain funding programs under the responsibility of the Minister of the Environment; and
(b) replace references to “tradeable units” with references to “compliance units”.
It also makes consequential amendments to the Canada Emission Reduction Incentives Agency Act .
Division 37 of Part 4 amends the Canada Deposit Insurance Corporation Act to clarify that the Canada Deposit Insurance Corporation may administer any contract related to deposit insurance entered into by the Minister of Finance and to allow the Minister to increase the deposit insurance coverage limit until April 30, 2024.
Division 38 of Part 4 amends the Department of Employment and Social Development Act to, among other things,
(a) establish the Employment Insurance Board of Appeal to hear appeals of decisions made under the Employment Insurance Act instead of the Employment Insurance Section of the General Division of the Social Security Tribunal; and
(b) eliminate the requirement for leave to appeal decisions relating to the Employment Insurance Act to the Appeal Division of the Tribunal.
It also makes consequential amendments to other Acts.
Division 39 of Part 4 amends the Canada Elections Act to provide for a national, uniform, exclusive and complete regime applicable to registered parties and eligible parties respecting their collection, use, disclosure, retention and disposal of personal information.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, an excellent resource from the Library of Parliament. You can also read the full text of the bill.

Votes

June 8, 2023 Passed 3rd reading and adoption of Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023
June 7, 2023 Passed Concurrence at report stage of Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023
June 7, 2023 Failed Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023 (report stage amendment) (Motion 730)
June 7, 2023 Failed Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023 (report stage amendment) (Motion 441)
June 7, 2023 Failed Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023 (report stage amendment) (Motion 233)
June 7, 2023 Failed Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023 (report stage amendment) (Motion 126)
June 7, 2023 Failed Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023 (report stage amendment) (Motion 122)
June 7, 2023 Failed Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023 (report stage amendment) (Motion 112)
June 7, 2023 Failed Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023 (report stage amendment) (Motion 15)
June 7, 2023 Failed Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023 (report stage amendment) (Motion 3)
June 7, 2023 Failed Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023 (report stage amendment) (Motion 1)
June 6, 2023 Passed Time allocation for Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023
May 2, 2023 Passed 2nd reading of Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023
May 2, 2023 Failed 2nd reading of Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023 (reasoned amendment)
May 1, 2023 Passed Time allocation for Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, 2023

May 26th, 2023 / 10:05 a.m.
See context

Conservative

Marty Morantz Conservative Charleswood—St. James—Assiniboia—Headingley, MB

I think Mr. Chambers could wear this as a badge of honour and that he has probably been called worse things by better people. In any event, that's not productive.

I really think that what would be productive is that we have witnesses come to talk about a half a trillion dollars in government spending. That's what we're arguing for here, Mr. Chair, and it's very important.

I want to get into some of the substance, though, of what we need these witnesses here for. For example, the department actually provided a document. There is one thing I want to mention, by the way. When we had Ms. Gwyer here a while ago, I asked her what the issue was with CRA not accepting cheques over $10,000. I'm paraphrasing, but she essentially said that, if someone can't do it, and if they can't figure out how to transfer electronically, CRA will try to help them. I just saw a news report that she testified in front of the Senate committee about how CRA is going to be accepting these cheques. That's just one example of something we need to get clarification on.

The overview report the department provided is close to 90 pages long. It's massive. There is electronic filing and certification of tax information and electronic payments. We need more time to discuss those types of things.

We did get to speak about the doubling of the expense credit for tools of the trades, although it would actually have been nice to get testimony from my colleague Mr. Lewis about his bill on this matter.

We have not heard from the real estate industry, when housing—affordable housing and housing in general—is a major crisis in this country. This country is growing and it's going to be much bigger over the next 10 years. We have a massive shortage of housing and housing starts have gone down, yet at this committee we have not heard from experts on housing and what government can do to create the environment that home builders need to get houses built in this country. That's a major hole in witness testimony, and those voices are not being heard.

We have new rules on house flipping, on which we have not heard external witness testimony to find out how those might affect the market. I'm not saying that maybe this isn't a good thing. I just don't know, because we haven't had a chance to hear from people representing co-ops, people in the real estate industry or people in the banking industry what this type of change to the rules of our real estate markets might mean. It's a huge gap in our witness testimony.

Regarding taxation of veterans' and active members' benefits, again, we all have great respect for our veterans yet we haven't heard from any veterans. They haven't appeared before committee on this budget, yet their benefits are being directly affected by this budget. Why haven't we heard from veterans organizations?

All we've said is that we want another 10 hours of testimony—which could really have been done by now—before we get to clause-by-clause. It's not as though we're asking for the moon. It wasn't as though we were asking the finance minister to do a lot either, other than to come to the committee for two hours.

At every step of the way, this government seems to want to cut off debate on the budget in the House and to cut off witness testimony. Maybe it's because they didn't like the 10 hours of witness testimony we had. It was pretty bad for the government. There weren't a lot of good things—or any that I can recall—said about this budget.

Maybe they wanted to stop the bleeding. It's really hard to say. I can't get into their minds. I can really only speculate. Nevertheless, that's the point of having these meetings, of having an opposition to the government that can point out flaws. We know that having an effective opposition is fundamental to good governance. We know that because all we have to do is look around the world and look at countries that don't have an effective opposition.

Do you know what happens in those countries? Bad things happen. We can see that right now in Russia, in China, in Sudan and in many other places around the world.

Getting back to the issue of witness testimony, there's a provision here, in part 1, dealing with technical changes to the Gottfriedson class settlement agreement, a class action proceeding on behalf of 325 Indian Act bands. We haven't heard from those bands about what this settlement means. We've heard no indigenous testimony, in fact, about this budget. If I were a member of the indigenous communities across this country, I would be aghast at the short shrift this government is giving to indigenous communities, especially when their legal status has been affected by this budget, yet there's been no indigenous testimony.

We talked about the grocery rebate already, so I'll move on from that one.

There's also the automatic advance for the Canada workers benefit. It might be a good thing, but, again, we haven't heard from workers. We haven't had unions speak to what this means for their members.

Registered education savings plans is another area that we have not had witnesses on. There have been no witnesses on the RESPs. This is a very important program. I had those for my kids. I'm sure many members of this committee had them. Millions of Canadians have these RESPs, and there are changes being made to the RESPs. We haven't been able to hear from parent groups. We haven't been able to hear from schools. There's been just a complete absence of testimony on a policy that will affect millions and millions of Canadians. There's been zero testimony.

There's the registered disability savings plan. This one is actually near and dear to my heart. Probably many committee members don't know but my son Nathan was born in 1999. When he was two, he was diagnosed with autism. He was actually among the most severe. When Mr. Flaherty brought in this particular program, we were among the first to sign up for it. The registered disability savings plan is an extremely important program for families in this country who have a loved one with a disability. We have not heard from disability groups. I would love to hear from disability groups about what we could do to improve the effectiveness of the registered disability savings plan. For Mr. Flaherty, may he rest in peace, this was a signature accomplishment of his career. He was an excellent finance minister for this country. I can guarantee he would never do what this government is doing now in terms of their spending.

Where are the special needs groups? Why isn't the St.Amant centre in Winnipeg here testifying about the importance of the registered disability savings plan? There are so many. The Autism Society of Manitoba, my home province, could be here testifying about the registered disability savings plan. In fact, there's been no testimony from any family, group or individual on special needs issues even though there are major changes being made in this budget that will affect millions of Canadians who have children.

It's just appalling that the dearth of witness testimony being enforced by the costly coalition of the Liberals and the NDP on this committee is really doing a massive disservice to Canadians.

On fixing contribution errors in defined contribution plans, there's no witness testimony on that.

There are technical tax changes to the dental program and taxpayer information sharing for the Canada dental care program. These are very important things. We're talking about having CRA share confidential information. We've seen problems. There's a bill before the House right now to try to deal with privacy issues around leaking personal data. CRA has been hacked already. There are a lot of issues around protection of personal data. Again, it would be interesting to hear, for example, from the dental profession about this issue, but, no, we haven't had those witnesses either.

For hedging and short selling by financial institutions, we haven't had testimony on that one. That sounds like a very important subject that we should really be talking about at the finance committee, which is where we talk about the finances of this country, yet major changes to banking laws are being made without any testimony.

I'm not going to go through every single one of these, but there are a few more that I want to touch on. Just bear with me here.

There's treatment of mining of crypto assets. That's in terms of the GST/HST. We did have some testimony on that. I'm no expert on that, but that strikes me as an area that needs to be further examined. We did hear testimony from, I think, a couple of lawyers here from Toronto, who said that this is of serious concern, this particular change, and that it needs further examination. Other countries are going to eat our lunch on this type of technology in the future if we don't start treating entrepreneurs in this area with a little bit of respect.

The credit card services we heard.... I have to say in my testimony, Mr. Chair, that I've never seen a government actually make a promise and break that promise in the same budget. That was a new one. They've broken many promises. I won't go through the whole list here. I'm sure my colleagues would like to speak about those later, but we have a situation in which the government has said they want to bring down credit card fees and that they've made agreements with the banks now to bring down the charges that people pay when they go shopping and use their credit cards, but at the same time they change the GST rules to make it more expensive. They giveth and they taketh away, not a few months apart or years apart but actually in the same moment, in the same document. It's quite stunning.

We have the pension limitation period rebate fix. We've had no testimony on that.

For freight transportation of money, we've had no testimony on that one either.

On alcohol excise duties, we have had some testimony. I suppose it was good to see the government at least freeze the excise tax increase at 2% instead of inflation. I know I had asked the Minister of Finance to freeze this back when the fall economic statement was released, when she was actually in committee that one time. She said something about this advice being akin to crypto or something. It was a weird response. I didn't expect the government to actually move on this, but I guess the finance minister must have thought about it, thought about my question and my arguments, and agreed with me. I suppose that's one good thing, because when the budget came out, I would have liked instead to see zero.

Frankly, the undemocratic nature of the escalator tax is clear. Taxes should not be increased unless Parliament actually votes for them, not by order in council or any other way, but that's not what the excise tax does.

On a fair external complaints handling system for banking, again, we have not had the banks in to talk about what this means. It may be a good thing. I'm not arguing for or against it, but the point of this motion isn't to argue for or against these measures. The point of this motion is to argue for the fact that 10 hours of witness testimony for a half-trillion dollar budget is simply not sufficient. That's painfully obvious.

On strengthening the pension and federal pension framework and the Pension Benefits Standards Act, 1985, again there was no testimony.

By the way, I just want to spend a few moments talking about the Canada growth fund. I think this is very important. This is a $12-billion project the government wants to stand up really quickly. My experience in my prior life as a lawyer has been that, when clients rush to do things, often mistakes are made.

They want to stand it up really quickly, so instead of doing what they did with the Canada Infrastructure Bank—which is a whole other issue that I will get to later—and going out and hiring people to run the Canada Infrastructure Bank, what did they do? They decided to approach an independent pension fund management firm, the PSPIB, the Public Sector Pension Investment Board, and ask them to stand up the Canada growth fund as soon as possible. In fact, the departmental briefing notes say that a team has been seconded to stand up the growth fund.

We did have officials here on this in the prestudy of the budget, and one of the things I asked the officials was whether or not a request for proposals was made and how the PSPIB was selected. They are independent. They are not a branch of the government. They stand alone. How is it that all of a sudden the PSPIB is managing the Canada growth fund?

When I asked whether or not there was an RFP, the official said she would have to get back to me, which is fine, Mr. Chair, but the problem is that this is now approaching the end of May and I've not heard back. I don't know why the PSPIB was selected without having to go through a request for proposals. In fact, the Government of Canada's own website on procurement says that for the public service to retain services of any company for over $100,000, it must go to an RFP. I would like an answer to that question. I asked the clerk to follow up on that for me last week. He did, and I still do not have an answer. That is fundamental, and we need to have an answer as to how the PSPIB was selected. Who made that decision? Was that a cabinet decision?

We've seen so many things happen with this government and how these decisions are made. People get appointed because of their connections. I'm not saying that the PSPIB isn't a worthy organization or a qualified organization. I just don't know, because no RFP was conducted. We haven't heard from witnesses. We could call other witnesses who might be able to testify and who might be able to do that as well, but somehow, out of the blue, the PSPIB gets to manage $12 billion, with no request for proposals. This is terrible practice, Mr. Chair. We saw what happened with the WE Charity when this happened. It's like this government has never seen a conflict it didn't want to embrace.

I look at the intergovernmental affairs minister's sister-in-law being tapped to be the interim director of ethics and members of the Trudeau society being appointed to provide reports that are supposed to be independent and potentially critical of the government.

Of course we've seen what happens when this government appoints people—its friends—and says they're independent. It's just a farce. This government seems to have a blind spot frankly when it comes to these types of conflicts. It is a huge concern. Why don't we have witnesses? It's a $12-billion project. Certainly you would think a request to hear from witnesses on the $12-billion Canada growth fund would be reasonable, yet, no, we're stymied. This committee wants only 10 hours of witnesses. We're not going hear about the RDSP. We're not going to hear about RRSPs. We're not going to hear about CRA sharing private information. We're not going to hear about the Canada growth fund. It's appalling, but again I do hope...and I want to relay to the clerk that perhaps he could follow up again to get me that answer. I would very much appreciate having answers as to why on a $12-billion project—$12 billion of taxpayers' money that is being rushed out the door—no request for proposals was done to find absolutely the best management for this project, this program, in the country.

Who decided it should be the PSPIB? Was it someone in the public service? Was it a minister? Was it the Prime Minister? It's a mystery, and I don't like mysteries, especially when it comes to taxpayers' dollars, especially from a government that said it would be open by default, from a government that pretended to be the most transparent government in Canadian history. That was another important promise that was broken.

We have not heard from any witnesses about the important issue of money laundering in this country. Canada has become a safe haven for money launderers. In fact we have our own nickname now for it in Canada. It's called snow washing. It's not a badge of honour, yet there's been not a single witness on money laundering, which is a major issue. I know my colleague Mr. Chambers cares very much about this issue. In fact he presented an important bill, a very simple bill that would have helped get this situation under control, and the government rejected it. They rejected a common-sense bill that would reduce money laundering in this country. Why? Is that responsible government? No, it's not responsible government. That's why we should be hearing witnesses on why Canada has the nickname “snow washing” of all things. Again, it's not a badge of honour.

There's supporting the economic growth of developing countries and preferential tariff programs for developing countries. This is division 4 of Bill C-47. This may also be a very laudable goal, but we have no explanation on this. We have no witness testimony. It would be interesting to hear from developing countries, in fact, as witnesses on this matter. I know that in my time on the foreign affairs committee, we spent a lot of time talking about how we could help civil society organizations around the world improve the standards of living of people living in poverty around the world. Canada is in many respects a leader in that type of thinking. Again that's another very important part of this budget, but there's been nothing, no witnesses and no testimony.

There's the indefinite withdrawal of most-favoured-nation status from Russia and Belarus. By the way, this is in the budget bill. The indefinite withdrawal of most-favoured-nation status from Russia and Belarus—I ask all the people who are watching this committee meeting now what that has to do with a budget. Send me your emails. It has nothing to do with the budget. It again gets back to this issue of the dangers of omnibus bills.

I may get back to some of these provisions in a few minutes, Mr. Chair, but I want to say that I think we also need to have witnesses on omnibus bills. This practice has gotten out of control.

I have an academic article written by Louis Massicotte. I won't read the whole thing, but there is one passage here that I think needs to be read into the record. It's not a recent document. It refers to an older bill, Bill C-38.

Bill C-38 has been widely condemned, and criticisms came from unexpected sources. Why are so many people concerned about omnibus bills? The reasons are in many ways the exact reverse of the previous ones. From the point of view of the opposition, omnibus bills are as attractive as the closure, time allocation, supply guillotines and so on. They create quandaries for opposition parties and oblige them to object to some popular measures delicately hidden in a less attractive package.

The real question, however, beyond the convenience of the government or of the opposition parties, may well be: is the public interest well served by omnibus bills? Take for example the clause-by-clause study in committee. When a bill deals with topics as varied as fisheries, unemployment insurance and environment, it is unlikely to be examined properly if the whole bill goes to the Standing Committee on Finance. The opposition parties complain legitimately that their critics on many topics covered by an omnibus bill have already been assigned to other committees. The public has every interest in a legislation being examined by the appropriate bodies.

We know that Speakers have consistently refused to act as referees on such issues, while at times hinting that the House might provide for some special procedures. One of them, Lucien Lamoureux, came up with what is probably the best question: is there any end?

This is the point of this article: Where does this go?

Could a government wrap up half of its legislative programme into a single measure dealing with the improvement of the life of Canadians or ensuring prosperity for all?

We often hear that omnibus bills are like closure and time allocation: “all governments do it”, which.... This is why some of the most eloquent pleas against the practice of omnibus bills have been made in the past by the present Prime Minister, and were no less eloquently refuted by then Cabinet ministers now sitting in opposition. But in recent years, the logic behind omnibus bills has been pushed to extremes never seen before. It has been computed that between 1994 and 2005, budget implementation bills averaged 73.6 pages, while since 2006 they averaged 308.9—four times longer. But the increase is even more huge than it looks. While during the first period a single budget implementation bill was presented each year (there were none in 2002 and two in 2004), bills of that nature have since then been presented twice a year except in 2008, when there was a single one. The yearly average of budget implementation legislation in recent years is therefore closer to 550 pages—this is seven times longer! Another contrast is that during the first period, budget implementation bills tended to be slimmed down markedly between first reading and Royal Assent, while in recent years they kept their initial size throughout.

The debate on Bill C-38 reminds us that omnibus bills have become a slippery slope now generating high controversy. In my view, they do little to improve the already low esteem in which legislators are held by the Canadian public. My colleague Ned Franks wrote three years ago that omnibus budget implementation bills “subvert and evade the normal principles of parliamentary review of legislation”. I fully concur with his assessment.

I couldn't have put it better, Mr. Chair.

With that, I think I am going to give up the floor for the moment. I would ask the clerk to put me back on the list, though.

I do hope that some of the things I've said have some influence on the other members of this committee.

It is vitally important. The Liberals need to put their partisanship aside and look out for the best interests of all Canadians. With a half-trillion dollar budget, reaching almost 25% of this country's GDP, Canadians deserve no less.

Thank you, Mr. Chair.

May 26th, 2023 / 9:30 a.m.
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Liberal

The Chair Liberal Peter Fonseca

I call this meeting to order.

Welcome to meeting number 93 of the House of Commons Standing Committee on Finance. Pursuant to the order of reference of Tuesday, May 2, 2023, and the motion adopted on May 16, 2023, the committee is meeting to discuss Bill C-47, an act to implement certain provisions of the budget tabled in Parliament on March 28, 2023.

Today's meeting is taking place in a hybrid format, pursuant to the House order of June 23, 2022. Members are attending in person in the room and remotely using the Zoom application.

I would like to make a few comments for the benefit of the witnesses and members.

Please wait until I recognize you by name before speaking. For those participating by video conference, click on the microphone icon to activate your mike. Please mute yourself when you are not speaking.

With regard to interpretation for those on Zoom, you have the choice, at the bottom of your screen, of either floor, English or French audio. Those in the room can use the earpiece and select the desired channel.

I will remind you that all comments should be addressed through the chair.

Members in the room, if you wish to speak, please raise your hand. Members on Zoom, please use the “raise hand” function. The clerk and I will manage the speaking order as best we can. We appreciate your patience and understanding in this regard.

Members, before we begin, for the benefit of our members and of Canadians who are joining us and watching us today in the committee's proceedings, I'd like to inform you that, as per the motion adopted on May 16, 2023, through unanimous consent from all parties, we scheduled a clause-by-clause meeting yesterday that went for five and half hours, completing a total of two clauses out of 681 clauses total. Now, that's very unusual.

At the finance committee, we've worked on many report considerations in the past. Last year, clause-by-clause took a total of five hours to complete. Again, yesterday we could complete only two clauses in five and half hours. We scheduled this meeting to begin clause-by-clause consideration, as per part (b) of the motion adopted, again, by unanimous consent from all parties. It reads, “(b) Moving to clause-by-clause review of Bill C-47 no later than Thursday, May 25, 2023 at 11:00 a.m.”, which is what we did.

As of yesterday, we've completed a total of 46 hours, equivalent to at least 23 meetings, for the subject matter of Bill C-47. A few members mentioned yesterday that they had assumed there would be more witness meetings scheduled for this week. I reminded those members and all others that, as per the motion adopted with their unanimous consent—meaning all members were in agreement—there were no objections to that and to what was being agreed to at that time. There were no objections. We met with the requirements of the motion before we moved to clause-by-clause, again, as per the motion's part (b) that I read out a little earlier.

After consulting with our clerks, I also reminded them that, during our last witness meeting, during the late evening of May 18, 2023, I stated the following during my remarks: “You will be the last set of witnesses the committee will hear on this piece of legislation”. All party members in this room wholeheartedly thanked our witnesses, as well as our clerks, who had diligently arranged the witness testimonies in such short order.

To reiterate what I mentioned yesterday, as chair, I must interpret the motion as written. Given that there's still some confusion over part (d) of the motion and how the phrase “goal of accomplishing at least 20 hours of study prior to the beginning of clause-by-clause consideration of the bill” interfaces with the rest of the motion, I want to specifically read out the start of the motion and part (a):

That the committee continue its pre-study of Bill C-47, An Act to implement certain provisions of the budget tabled in Parliament on March 28, by:

a) Inviting witnesses to appear on the contents of Bill C-47 during meetings scheduled the weeks of May 1, May 8 and May 15, 2023

Our meeting 87, which was scheduled with the clear intent of proceeding with witnesses as per the motion, ran for approximately 27 hours—at least equivalent to 13 meetings—starting on Tuesday, May 2 at 11:00 a.m. and ending on Tuesday, May 16 at 4:24 p.m.

The members who spoke at length during meeting 87 were already fully aware that we had to cancel all scheduled witnesses in order to allow them to keep speaking for hours.

Canadians would have preferred instead to listen to testimony from witnesses, including the many individuals and organizations that were eager to appear in front of our committee to answer many questions from our members. I know all our members work hard to prepare thoughtful and intelligent questions for our expert witnesses.

We adjourned that meeting with unanimous consent from all parties to add, “and that the whips of the recognized parties, and the clerks, be empowered to seek as many meetings as possible, with the goal of meeting for 10 hours before the end of this week”. That was for the week of May 15, which was last week.

Thanks to our extremely hard-working clerks—I thank them—we were able to achieve the 10 hours of witness testimony last week, as required, with a full house of witnesses for every hour of those meetings. Everything was done in good faith and collaboration, as evidenced by it being carried with unanimous consent from all parties.

All parties submitted amendments in the same good faith, within the required deadline of 12:00 noon last Friday. This was an indication that everyone interpreted the adopted motion the same way that the clerk and I understood it. Also, this timely submission helped our legislative clerk and his team work towards the next step, to ensure that they prepared the required documents and package for clause-by-clause.

I understand that members who brought this up in the late afternoon on Wednesday had plenty of time to bring it up ahead of submitting their amendments. In spite of having my personal contact information, none of these members called, texted or emailed me to discuss or to clarify. You had an opportunity to reach out to me last week or all of this week, but you decided not to.

Again, I am happy to make myself available to all members, and I am glad that a number of you sent me messages yesterday. I have sent MP Morantz.... I apologized yesterday that MP Morantz did not have my personal information. I believe he has it now.

Marty, feel free to contact me any time.

Again, I hope what I mentioned has brought better clarity to the motion that was adopted on unanimous consent, and we can move on.

I would again like to take this opportunity to thank our clerks, our legislative clerk and their team of analysts, interpreters and technicians, who have made these 46-plus hours possible and still keep on working really hard.

Thank you.

Members, if this is good, let's try this again. We will go ahead with what's in front of us. Please refer to the package received from our clerk.

With us today, again, are a multitude of senior officials from various departments per division discussed. If you have any questions for them, you'll have an opportunity to ask those.

At this time, we'll get to our annotated agenda here. I'll look to the legislative clerk, but we were at clause 4. Is that correct? Yes.

We have some hands up. I see MP Morantz—his hand is up—and then MP Blaikie and PS Beech.

May 25th, 2023 / 3:20 p.m.
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Liberal

The Chair Liberal Peter Fonseca

I will respond to that, MP Lawrence. What is disingenuous is what you've just said.

I'll read it into the record, because I'd like to do that. This is what I said today at the start of this meeting as we were going to get into clause-by-clause. This will give me an opportunity. All those who may be watching can hear this, which may be limited to the members of this committee.

Knowing that we have spent a considerable number of hours on the subject matter and Bill C-47, I'd like to provide a recap for the benefit of our members, as well as for anyone watching this committee.

To be precise, as of last week, we have completed a total of 40.5 hours, which is the equivalent to at least 20 meetings, thanks to our wonderful clerks right here to my left. As chair, I must interpret the motion as written, given there seems to be some confusion—and that may be your confusion—over part (d) of the motion and how the phrase “goal of accomplishing at least 20 hours of study prior to the beginning of clause-by-clause consideration of the bill” interfaces with the rest of the motion.

I want to specifically read out the start of the motion and section (a). It reads:

That the committee continue its pre-study of Bill C-47, an Act to implement certain provisions of the budget tabled in Parliament on March 28, by:

(a) Inviting witnesses to appear on the contents of Bill C-47 during meetings scheduled the weeks of May 1, May 8, and May 15, 2023....

I hope you have a calendar in front of you, MP Lawrence. You could look at when those weeks were.

In keeping up with specific requirements, our clerks had diligently worked hard to schedule witnesses. Our members may already be aware that we had to cancel all those scheduled witnesses ahead of the meetings. We had to cancel those, MP Lawrence. In fact, thanks to the kind intervention of our Bloc member, MP Ste-Marie, we were able to break a marathon meeting, number 87, which ran for approximately 27 hours or at least equivalent to 13 meetings. It started on Tuesday, May 2, at 11 a.m., and ended on Tuesday, May 16, at 4:24 p.m. I just want to make sure that you get that correctly. We adjourned that meeting through unanimous consent.

For all those watching, and for members, who I'm sure are aware, unanimous consent means that all members, including yourself, MP Lawrence, from all parties agreed to add the following:

(e) and that the whips of the recognized parties, and the clerks, be empowered to seek as many meetings as possible, with the goal of meeting for 10 hours before the end of this week.

That's what you agreed to—for 10 hours before the end of the week—for the week of May 15, which was, again, last week, MP Lawrence, if you pull out your calendar. Thanks to our extremely hard-working clerks again, we were able to miraculously achieve the 10 hours of witness testimony last week as required with a full house of witnesses for every hour of those meetings.

Unfortunately, due to the late passage of this motion, members are fully aware that we are under constraints, and our clerks did their best to work around the timelines required for last week. We had a number of committees that had to be cancelled, etc., to be able to pull those hours together and to have the resources to have those witnesses come before us. Everything was done in good faith and in collaboration.

I know that because, MP Lawrence, you never reached out to me. You had my number. You had my text. For MP Chambers and MP Hallan, it was the same. Actually, you spoke to me about a number of things but never was this ever brought up. I just want to let you know. Everything was done...as evidenced by being carried, again, with unanimous consent from you and from all the members, from all the parties here.

All parties submitted amendments in the same good faith within the required deadline of 12 noon last Friday, including the Conservatives. This was a very clear indication, MP Lawrence, that everyone interpreted the adopted motion the same way that I understood. Also, this timely submission helped our legislative clerk and his team—who are with us here right now, and we have heard them read some of the clauses into the record—work towards the next step to ensure they prepared the required documents and package for clause-by-clause.

I understand that the members brought that letter that came to us late in the afternoon yesterday. Yesterday is when you sent it—the first time I heard from you from our last meeting when we were here, hearing from witnesses. You had plenty of time to bring this up earlier, submitting whatever amendments you had.

All members on this committee have my personal contact information. I know, because you text me regularly. Adam Chambers texts me regularly. Jas Hallan does the same. I don't know if Marty has ever texted me.

Marty, I'd love to get a text from you. Please text me, Marty. I feel lonely when you're not doing that.

Everybody, including the Liberals, including the Bloc, including the NDP, regularly communicates with me. None of you reached out to me. None of you ever reached out. I just want to make that very clear, MP Lawrence.

Again, let me thank MP Ste-Marie here for his quick thinking. He was really quick on his feet. He was able to think of how we could efficiently get in as many witnesses as possible, which we did. Thanks to the hard work of our clerks and everybody else, we heard from those witnesses.

That's where we are today, MP Lawrence. You know, we have officials who have been brought in. They are here to answer questions, etc., and to help us as we go through clause-by-clause. Many Canadians are waiting for their benefits. You've spoken to some of them. They've come up, actually, in the first couple of clauses, where we talked about tradespeople, etc., who need this to happen.

MP Lawrence, I'm going to give the floor back to you, but that's where we're at and that's how we got to this place.

Just to do a full recap for you, if there's something that you feel was not right in what I just spelled out for you.... Did you not vote for that motion? Through unanimous consent, did you not say “yes” to what we wanted to do here today? Now it sounds like amnesia, like you've never heard of this before.

MP Lawrence, go ahead—

May 25th, 2023 / 1:25 p.m.
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Liberal

Terry Beech Liberal Burnaby North—Seymour, BC

It's just in terms of relevance. I'm reading the motion that was circulated by the clerk. It has to do with whether or not we'll go back to hearing witness testimony on Bill C-47, not hearing the testimony itself from Mr. Lawrence. I would ask that he stay relevant to the motion on the floor so that we can have a vote on it and decide how this committee is going to proceed.

May 25th, 2023 / 1:20 p.m.
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Conservative

Philip Lawrence Conservative Northumberland—Peterborough South, ON

Thank you, Mr. Chair.

I'll start from the top because of the interference. I move: C-47

That given the committee has yet to achieve its objective of obtaining 20 hours of witness testimony on Bill C-47, notwithstanding the motion adopted by this committee on May 16th, the committee allocate an additional 10 hours for witness testimony and that clause by clause begin immediately following the 20th hour of witness testimony.

I'd like to continue with that motion if it is found to be in good order, Mr. Chair.

May 25th, 2023 / 1:20 p.m.
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Conservative

Philip Lawrence Conservative Northumberland—Peterborough South, ON

Mr. Chair, I would like, at this point, to bring a motion to the floor: That given the committee has yet to achieve its objective of obtaining 20 hours of witness testimony on Bill C-47, notwithstanding the motion....

I'm getting some feedback, Mr. Chair.

May 25th, 2023 / 11:35 a.m.
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Liberal

The Chair Liberal Peter Fonseca

We're moving on.

Members, we are now back to meeting number 92. Pursuant to the order of reference of Tuesday, May 2, 2023, we are here for clause-by-clause consideration of Bill C-47, an act to implement certain provisions of the budget tabled in Parliament on March 28, 2023.

Pursuant to Standing Order 75(1), consideration of clause 1, the short title, is postponed.

We are now at part 1, “Amendments to the Income Tax Act and Other Legislation”. There are no amendments to clauses 2 to 70. I don't know if members would like to group those, but we would need unanimous consent to be able to do that.

Did I hear a “no”?

May 25th, 2023 / 11:20 a.m.
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Conservative

Philip Lawrence Conservative Northumberland—Peterborough South, ON

Thank you. I'd like to read into the record the following letter with respect to our members at this committee:

We are writing to express our profound disappointment regarding the insufficient witness testimony on Bill C-47 the Budget Implementation Act. The motion passed on May 16th, which was the result of collaborative efforts by Conservatives, clearly outlined the committee's objective of conducting a minimum of 20 hours of study before commencing clause-by-clause consideration of the Bill. However, as the scheduled time for the clause-by-clause review approaches...May 25th at 11 am, we have only received 10 hours of witness testimony....

Conservatives were fully prepared and available to work diligently over the weekend, as well as on Tuesday and Wednesday of this week, to ensure ample witness meetings took place. Regrettably, no such meetings were scheduled, which undermines the goodwill with which [the motion was passed on May 16th]. Furthermore, it is disheartening for all Canadians who are eager to testify on the budget.

Canadians need to have their say as they are struggling with the cost-of-living crisis. Budget 2023 proposes $60 billion in new spending and since it was introduced, inflation in Canada has increased. Groceries are inflated [by] 10% [per month], food bank use is at record highs—

I might add, from the testimony of this very committee, that food bank experts, CEOs and leaders were saying that the situation on the ground was “terrifying”.

—1 in 5 Canadians are skipping meals and it is getting harder and harder for many to get by. On housing, rent and mortgage payments have doubled over the past eight years, and 9 out of 10 young people believe that they will never...own a home. These are the issues concerning Canadians and this is the testimony that committee needs to hear.

Considering that we are...10 hours short of the testimony required to fulfill the minimum goal specified within the motion, Conservatives will introduce a motion tomorrow....

It has been introduced.

Let me put some background behind this. I had numerous discussions in good faith with my counterparts across the way and made it clear that Conservatives wanted 20 hours of testimony and that we were willing to sit whether it be Saturday, Sunday, Monday, Tuesday, Wednesday, Thursday or Friday, to get this done. We were absolutely clear on this, and there can be no doubt. I would put my honour on it. Any type of comment otherwise is the height of disingenuity. That's perhaps not surprising, given that with this government's record of corruption, with the SNC-Lavalin affair, with WE and with foreign interference, we have seen that this is a government we cannot trust.

Maybe it was because of the testimony, which was absolutely damning for the 10 hours. We heard that this was the slowest economic growth since the 1930s. Since the Great Depression, Canada has never experienced such economically challenging times with record-low growth.

Yes, there was some time before the committee, during which absolutely Conservatives engaged in a lengthy discussion or debate, and that was in order to get Minister Freeland here. This is a minister who has now presided over the worst economy since that during the Great Depression, and she wouldn't come to talk for two hours.

That was the outrageous demand of Conservatives: to have her come and testify for two hours. Then she came to committee and she wouldn't answer the most basic of simple questions. My colleague Mr. Chambers asked the simplest question, a question she was well equipped to answer off the top of her head, but she would not answer. She would not answer the simple question of how much interest was being paid on the debt.

These were simple questions. All that we asked was for the Minister of Finance, who is presiding over the biggest national debt, some of the highest inflation and the worst housing situation in a generation, to come for two hours and answer simple questions. That was the only precondition to going forward. Acting collaboratively and in good faith, I personally worked with members at this committee and told them to work more to move the process forward. I personally had discussions with them and counted on them to act as honourable members of this House, and they committed to me that they would do everything possible to get 20 hours of testimony. That was a personal discussion. It's the spirit of this act, and it's the spirit of this motion.

If this chair is unwilling to do the right thing and have testimony put on the record...and it's completely possible, because do you know what, Mr. Chair? When it came to you trying to grind or punish Conservatives, you had all the time in the day. We could go until midnight any night we wanted to. Now, suddenly, there's a lack of resources. This is the height of hypocrisy and a biased chair.

All Conservatives want is to hear from Canadians. Canadians deserve the right to hear why $60 billion of their money is being spent and why this government—why this Minister of Finance—is blowing past the debt-to-GDP ratio. All we want is the right for Canadians to testify. This is not outrageous. We are not trying to do anything that is beyond the pale. We're asking for an additional 10 hours of testimony.

Conservatives are committed to democracy. Conservatives are committed to putting on the record the important issues and, Mr. Chair, one of the most important issues with respect to the current economy. Philip Cross, a noted academic, a noted former employee of Statistics Canada, used Statistics Canada information to demonstrate that we have the worst economy since the 1930s, and one of the issues is this government's war on work.

If this chair is unwilling to put forward witness testimony, I will simply start reading it into the record, as is my right. The C.D. Howe Institute has a report: “Softening the Bite: The Impact of Benefit Clawbacks on Low-Income Families and How to Reduce It.” This would have been an important witness to hear.

It would have been great to hear from some of the great think tanks across the country, not just on the right but on the right, the left and in the centre. I would have loved to hear from the Fraser Institute and many other institutes...the Broadbent Institute.... I would have loved to hear all of this important information.

As we start here, we'll start with the summary, just to give our viewers an idea of what I'm going to talk about:

As families earn more taxable income, government benefit entitlements are reduced...at various phase-out rates, which reduces their overall cost for government and ensures that they remain targeted to the [low]-income families. However, benefit reductions act like hidden tax rates: They reduce the effective gain from working to generate...income. To determine the tax system's full impact on a family's financial gain from work, one must take into account the combined effect of both taxes paid and cash...reductions.

What this means, Mr. Chair, fellow members and all of our viewers out there, is that Canadians are increasingly being disincentivized to work. Their incentive to work is being reduced. There are many low-income Canadians who are giving back to the government more than 50¢ on the dollar of every dollar they earn. The government is the greatest thief of the means that low-income families need to provide housing, to provide food and to take care of their children.

It continues:

This Commentary presents various estimates of effective tax rates on personal earnings for families with children. These effective rates play a key role in family work decisions by reducing the monetary reward of earned income. The “marginal” effective tax rate...conveys the loss, through additional taxes and diminished benefits, associated with an extra dollar of earnings. For a working parent, it represents the financial penalty that must be paid from any small addition to their income. The “participation” tax rate (PTR) is the cumulative effect of all...taxes, other contributions, payroll deductions and loss of...benefits on the entire prospective earnings from work.

That means that if a mom or dad wants to go back into the workforce, they face substantial headwinds. Many times, they're greater than the child care cost, because of the taxes they are paying. If this government were serious about allowing women to return to work—as they are still the disproportionate caregivers to children—they would reduce these barriers. Quite frankly, however, they are not serious about enabling women to return to work. If they were, they would remove these barriers, these high levels of clawbacks and taxation, that make it difficult for women with children to return to the workforce.

Marginal effective tax rates, or METRs, as they are sometimes colloquially referred to, “have generally been higher for lower-income families than those of higher-income families.” Let me reread that, because I think it's important for people to understand: “[Marginal effective tax rates] have generally been higher for lower-income families than those of higher-income”. That means that the poor are paying more and the rich are paying less.

It continues, “In some cases, the lower-earning parent in a dual-earner family with three children might lose more than 80 cents of an extra dollar of earnings.” Yes, you heard that right. If, for example, you are a mom and dad, and you have three kids, with the next dollar that you earn, you might be giving 80¢ of that back to the government. That's a substantial disincentive.

As Mr. Cross so eloquently said when he was at this committee, when we allowed witness testimony, it's not necessarily the calculation that occurs. It's more the global social impact that happens. It's like death by a thousand cuts. As Canadians work harder and harder, and earn less and less and keep less of their paycheques, it is a disincentive. You feel that the more you work....

You're working so hard, but you're just spinning your wheels. You're not getting ahead. That has to have a negative impact on Canadians' desire, on Canadians feeling that they are rewarded for their work. This is an issue not only for their economic well-being but also for their mental health.

It says, “Nationally, 15 percent of working lone parents or the lower-earning parents in dual-income families face a [marginal effective tax rate] above 50 percent, and 14 percent of stay-at-home parents face a PTR”, which is a participation tax rate, “above 50 percent.” This means that if you are a stay-at-home parent and you wish to rejoin the workforce, for every dollar you earn, you're only going to be able to keep less than 50% of it. Finally, it says, “And these proportions have risen substantially since the mid-1980s and early 1990s when very few families faced a [marginal effective tax rate] or [participation tax rate] greater than 50 percent.”

There are a number of ideas that I could carry on with in this discussion, but I think I'd like some of my colleagues to make a couple of comments, if they wish. Please do put me back on the speaking list, Mr. Chair.

May 25th, 2023 / 11:15 a.m.
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Liberal

Terry Beech Liberal Burnaby North—Seymour, BC

Thank you.

I'd also like to note that part (a) of the motion clearly states—again, this is the motion that was passed by unanimous consent—that we are able to hear from witnesses the weeks of May 1, May 8 and May 15. I'm happy to read that quote:

(a) Inviting witnesses to appear on the contents of Bill C-47 during meetings scheduled the weeks of May 1, May 8, and May 15 2023

In fact, we did have those meetings. The Conservatives chose to use that time not to hear from witnesses but to instead talk to themselves about almost anything that didn't have to do with the BIA. Given the limited time we have, the many officials who are present here to support us in this important work in studying this bill, and all the work that has been done by all members and staff and the clerk and everyone else—

May 25th, 2023 / 11:10 a.m.
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Conservative

Philip Lawrence Conservative Northumberland—Peterborough South, ON

Mr. Chair, thank you very much for your opening remarks. I disagree with nearly all of them.

I would like to put the following motion on the table for discussion and debate. I move:

That the committee reiterate its desire to hear a total of 20 hours of testimony in relation to Bill C-47, Budget Implementation Act No. 1, as agreed to on May 16, 2023, and notwithstanding that motion, the committee not proceed with clause-by-clause consideration of the bill until the committee hears 20 hours of witness testimony.

I think you'll find that it's in good order. I'd like to at this point start my discussion of the motion if I could, Mr. Chair.

May 25th, 2023 / 11:05 a.m.
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Liberal

The Chair Liberal Peter Fonseca

I'll call the meeting to order.

Welcome to meeting number 92 of the House of Commons Standing Committee on Finance.

Pursuant to the order of reference on Tuesday, May 2, 2023, and a motion adopted on May 16, 2023, the committee is meeting to discuss Bill C-47, an act to implement certain provisions of the budget tabled in Parliament on March 28, 2023.

Members, if you can put yourselves on mute, I will complete my opening remarks.

Today's meeting is taking place in a hybrid format pursuant to the House order of June 23, 2022. Members are attending in person in the room and remotely using the Zoom application.

I'd like to make a few comments for the benefit of the witnesses and members.

Please wait until I recognize you by name before speaking. For those participating by video conference, click on the microphone icon to activate your mike, and please mute yourself when you are not speaking. For interpretation for those on Zoom, you have the choice at the bottom of your screen of floor, English or French. For those in the room, you can use the earpiece and select the desired channel.

I will remind you that all comments should be addressed through the chair. For members in the room, if you wish to speak, please raise your hand. For members on Zoom, please use the “raise hand” function. The clerk and I will manage the speaking order as best we can, and we appreciate your patience and understanding in this regard.

Members, before we begin, I understand that there have been some questions on the interpretation of the motion adopted. Knowing that we have spent a considerable number of hours on the subject matter and Bill C-47, I'd like to provide a recap for the benefit of our members as well as anyone watching this committee.

To be precise, as of last week, we have completed a total of 40.5 hours, equivalent to at least 20 meetings, thanks to our wonderful clerks here.

Thank you, Clerks.

As chair, I must interpret the motion as written. Given that there seems to be some confusion over part (d) of the motion and how the phrase “goal of accomplishing at least 20 hours of study prior to the beginning of clause-by-clause consideration of the bill” interfaces with the rest of the motion, I want to specifically read out the start of the motion and section (a). It reads:

That the committee continue its pre-study of Bill C-47, an Act to implement certain provisions of the budget tabled in Parliament on March 28, by:

(a) Inviting witnesses to appear on the contents of Bill C-47 during meetings scheduled the weeks of May 1, May 8, and May 15, 2023....

In keeping up with specific requirements, our clerks have diligently worked hard to schedule witnesses. Our members may already be aware that we had to cancel all those scheduled witnesses ahead of the meetings. In fact, thanks to the kind intervention of our Bloc member MP Ste-Marie—and thank you very much, MP Ste-Marie—we were able to break a marathon meeting, number 87, which ran for approximately 27 hours or at least equivalent to 13 meetings. It started on Tuesday, May 2 at 11 a.m. and ended on Tuesday, May 16 at 4:24 p.m.

We adjourned that meeting through unanimous consent from all members here on this committee, which represent all parties on this committee. Again, it was by unanimous consent. Those watching may not know that all members voted unanimously and that all parties were represented by those members. It read:

(e) and that the whips of the recognized parties, and the clerks, be empowered to seek as many meetings as possible, with the goal of meeting for 10 hours before the end of this week.

That week was the week of May 15, which was last week. Thanks to our extremely hard-working clerks again, we were able to miraculously achieve the 10 hours of witness testimony last week as required, with a full house of witnesses for every hour of those meetings.

Unfortunately, due to the late passage of this motion, members are fully aware that we are under constraints, and our clerks did their best to work around the timelines required for last week. Everything was done in good faith and in collaboration, as evidenced by being carried with unanimous consent from all of the members of committee, who represent all parties.

All parties submitted amendments in the same good faith within the required deadline of 12 noon last Friday. This was a clear indication that everyone interpreted the adopted motion the same way that the clerk or I understood. Also, this timely submission helped our legislative clerk and his team—Philippe Méla, thank you—work towards the next step to ensure they prepared the required documents and package for clause-by-clause.

I understand that the members who brought this up late afternoon yesterday had plenty of time to bring this up ahead of submitting their amendments. All members on this committee have my personal contact information: my cellphone, email, etc. You can call me, text me and email me. You've done it during weekdays, weekends, workday hours and after work hours. It doesn't matter. I'm open to hearing from the members.

The members who have put this letter together have also reached out to me many times in the past, and I always try to get back to you within a reasonable time. Sometimes within minutes I get back to you. You had the opportunity to reach out to me last week or all of this week, but I did not hear from any of you.

I hope what I've mentioned has brought better clarity to the letter that was received and the motion that was adopted by—again, I'll repeat—the unanimous consent of all the members.

Again, I would like to thank MP Ste-Marie for quickly thinking of an efficient way to bring in the witnesses who were cancelled a couple of weeks ago. I really believe that our finance committee works well with this kind of collective team effort.

I would again like to take this opportunity to thank our clerks, our legislative clerk and team of analysts, and our interpreters and technicians, who have really made these 40-plus hours possible and are still working. Thank you very much.

Thank you to all of you.

Members, if good, we will go ahead with what's in front of us. You have received the package from our clerk. With us today are a multitude of senior officials from various departments, per division as discussed, if you have any questions for them.

I see a hand up. I see MP Lawrence.

May 18th, 2023 / 7:55 p.m.
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Bloc

Gabriel Ste-Marie Bloc Joliette, QC

Thank you.

Obviously, the EI system needs reforming, as I said, to make sure it meets the demand and covers the people who need it. That was promised for last summer. Then last summer, the government said it would happen in the fall. Last fall, the government said it would happen eventually.

My understanding is that the consultations have happened. Meanwhile, what we find in Bill C-47—the one-year extension—doesn't solve anything. It is indeed a temporary measure to address the gap in the targeted regions. The board of appeal is fine, but it could be better, given the points you raised.

May 18th, 2023 / 7:55 p.m.
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Bloc

Gabriel Ste-Marie Bloc Joliette, QC

Thank you, Mr. Chair.

Mr. Bissonnette, in your opening remarks, you talked about the Employment Insurance Board of Appeal. My understanding is that Bill C-47 basically replicates what was in Bill C-37 with respect to the appeal board. We know that a real appeal mechanism is needed.

I gather that you support the same proposal, but you think the details need improving. You feel that the hearings should take place in person and that the chairperson shouldn't be involved.

Would you mind explaining that again?

May 18th, 2023 / 7:35 p.m.
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Bloc

Gabriel Ste-Marie Bloc Joliette, QC

All right. I have time left.

All the government is doing in Bill C-47 is extending, for one year, a temporary measure to address the gap in the targeted regions. Is that enough?

May 18th, 2023 / 7:05 p.m.
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Marc Brazeau President and Chief Executive Officer, Railway Association of Canada

Thank you, Mr. Chair.

Thank you for the invitation to appear before the committee.

Former member of the CTA and Liberal candidate in Manitoba Mary-Jane Bennett said that interswitching was inefficient—that it wouldn’t correct problems with the supply chain, but amplify them.

Each switch adds to transit time. The more switches you do, the bigger the slowdown. The more you handle a car, the longer it takes to get moving. This measure undermines the capacity, the efficiency and the fluidity of Canada’s supply chains and will harm all shippers.

In fact, that measure was tried between 2014 and 2017, and it failed. Extended interswitching adds, on average, one to two days to rail transit times. It was abandoned by this government after an independent statutory review of the Canada Transportation Act. This government’s transport minister at the time, Marc Garneau, acknowledged that the policy was always meant to be temporary. Nothing has changed that would justify going back to extended interswitching.

Let’s review why extended interswitching was sunset. First, is the lack of reciprocity in the U.S. Regulated interswitching does not exist in the United States. Under the government’s proposal, U.S. railways will be able to solicit Canadian traffic at cost-based rates, without any reciprocity for CPKC and CN to do the same in the U.S. That means fewer available car loads for Canadian railroaders to move across Canada.

It may also mean less available work for port workers if shipments end up in Seattle rather than Vancouver, for example. These are good-paying, overwhelmingly union jobs. The combined network of CN and CPKC exceeds 60,000 kilometres of track. CN and CPKC have 27,000 employees based in Canada. U.S. railways’ Canadian presence is mainly incidental, with just a few hundred kilometres of track.

Why should Parliament intentionally disadvantage Canadian railways to directly benefit U.S. railways?

Helena Borges, former associate deputy minister of Transport Canada, told Parliament in 2017 that extended regulated interswitching was “having unintended consequences on the competitiveness of our railways vis-à-vis the U.S. railways.” Long-haul interswitching was the government’s much-consulted response. Now the government wants to resurrect a policy it already recognized as a failure.

The second reason for sunsetting was the non-compensatory rate. Bill C-47 will force Canadian railways to move traffic, sometimes in the wrong direction and always at below-market rates. The 2016 review found that below-market rates were inappropriate because they hurt railways’ ability to reinvest in their networks. Everything we purchase is at market rates, from buying steel to paying salaries. Railways cannot be the only parts of our supply chains that are not operating at market rates.

The transport minister’s office, in the National Post this morning, acknowledged that extended interswitching creates congestion. It admitted that's why they’re not doing it in Ontario, Quebec or British Columbia. The fact that this measure will apply only in the three prairie provinces proves that this is not evidence-based supply chain policy.

The national supply chain task force never consulted railways on interswitching before its final recommendation. Canadian grain shippers already pay some of the lowest freight rates in the world. To move one ton of grain one mile in Canada, it costs on average just 2.97¢ U.S.

Our class I railways both set historical records for grain movements this past year. This was made possible by a combined $1-billion investment in new grain hopper cars, built in Hamilton, Ontario, and by tens of billions of dollars of investment in capacity and technology over the last decade. An independent study conducted this past January by CPCS found that Canadian freight rates are the lowest among market economies. In fact, they are 11% lower than in the U.S. These rates support the competitiveness of Canadian railway shippers.

Extended regulator interswitching is a cure in search of a disease. There is no justification for market intervention, particularly through a policy as egregious and ill-advised as extended regulated interswitching.

The government's decision to eliminate this policy was the right one. It was based on facts and evidence.

Long-haul interswitching was the government's solution to the problems with extended regulated interswitching. The former is based on market rates for comparable traffic, and the latter is the below market regulated rate. Those asking for this policy want a cheaper rate. It is not about improving service, nor is it about improving competitiveness.

Extended interswitching will do the exact opposite. The only winners of extended regulated interswitching are U.S. railways. To limit the harm to Canadians, division 22 must be amended or deleted entirely.

We're asking, at a minimum, that rates be market based and applicable to Canadian origins and destinations. You'll find more details in our brief.

Mr. Chair, it is collaboration and not more economic regulations that move supply chains.

My colleagues and I will be happy to take questions.