Proceedings of the Standing Senate Committee on
Banking, Trade and Commerce
Issue 19 - Evidence - Meeting of May 14, 2008
OTTAWA, Wednesday, May 14, 2008
The Standing Senate Committee on Banking, Trade and Commerce, to which was referred Bill C-10, An Act to amend the Income Tax Act, including amendments in relation to foreign investment entities and non-resident trusts, and to provide for the bijural expression of the provisions of that act, met this day at 4:12 p.m. to give consideration to the bill.
Senator W. David Angus (Chair) in the chair.
[English]
The Chair: I am calling to order this meeting of the Standing Senate Committee on Banking, Trade and Commerce. Good afternoon to all those present in the room as well as to our viewers on the CPAC television network and the World Wide Web. We are here to continue our study of Bill C-10.
Mr. Cronenberg, I would like to welcome you to this hearing. I know you have come a distance to be with us. I gather you could not be here earlier and we are delighted you could be with us now.
My name is Senator Angus and I am the chair of the committee. To my right is our deputy chair, from Quebec, Senator Goldstein. We also have Senator Fox, from Quebec; Senator Eyton, from Toronto; Senator Massicotte, from Quebec; Senator Corbin, from New Brunswick; Senator Tkachuk, from Saskatchewan; and Senator Gustafson, from Saskatchewan. With us as well are June Dewetering, from the Library of Parliament, and our clerk, Dr. Line Gravel. We have also Senator Harb, from Ontario; Senator Biron, from Quebec; Senator Moore, from Nova Scotia; Senator Ringuette, from New Brunswick; and Senator Spivak, from Manitoba.
We have had already some 44 witnesses and we have done a fairly extensive study on various tax and related matters. I understand, Mr. Cronenberg, you are here to talk about the sections of the act that would purport to affect the film and video industry. We are very interested to hear what you have to say.
Senator Goldstein: I have a point of order to raise. It takes precedence for the moment. I attempted to raise this question during Question Period in the chamber earlier this afternoon, but the Speaker ruled that it should be raised in committee. I am doing so now.
I understand that this morning the CBC broadcast the news that the chair of this committee had arranged the situation so that there would not be television coverage of our hearings this afternoon. Later this morning, we, the Liberal members of the committee, forced the re-establishment of the coverage as soon as we discovered that it had been countermanded.
Colleagues, this witness, Mr. Cronenberg, will be addressing the issue of government censorship. What I just described is a further manifestation of censorship by this government, attempting to prevent the press and the people of Canada from hearing opinions and ideas that do not reflect the opinions of the government.
Now the government is attempting to censor a public hearing that deals with the attempts of the government to censor the arts in Canada. So much for transparency and honesty. Arranging for not having television coverage of these hearings was never disclosed by the chair to members of the steering committee, whose decision would have been necessary to break with the long-established tradition and the requirement pursuant to a motion passed in our organization meetings: the long-established tradition of televising the public hearings of this committee.
All of the public proceedings of the Standing Senate Committee on Banking, Trade and Commerce have been televised for years. I think the people of Canada are entitled to know who was responsible for this attempted additional imposition of censorship and secrecy and the flouting of the rights of the Canadian public by this so-called "transparent government."
This is a point of order and a point of personal privilege, and it directly affects the chair of this committee, who should, with respect, therefore, not chair this segment of the proceedings. I am deputy chair of the committee but I will not assume the chair because I may propose a motion in connection with what occurred. I therefore suggest that Senator Moore, the third member of the steering committee, should chair this segment of the meeting.
Senator Tkachuk: Are you moving a question of privilege or a point of order?
Senator Goldstein: I have not decided whether it is a point of order or privilege.
The Chair: It is totally out of order.
Senator Tkachuk: Senator Goldstein, you have said your peace. I asked you the question and you did not know.
Senator Goldstein: I did not say I did not know.
Senator Tkachuk: What is it?
Senator Goldstein: It is either or both.
Senator Tkachuk: Senator Goldstein, by exaggerating the whole idea of censorship, you demean the act itself. Not having television does not mean there is no press here. We always have press. Our meetings are open to the public and our meetings are open to the press.
The chair of the committee, or whoever made the decision — I have no idea who made the decision not to have television here; for all I know it was a room problem — that would not affect the fact that we all, Mr. Cronenberg included, have the freedom to say whatever we wish and ask whatever questions we wish and to deal with this matter in a free and democratic way like we always do.
By exaggerating this whole issue of the fact that you did not have a TV camera in here makes your argument moot. You are acting for the TV cameras. That is exactly what you are doing. This is not a question of freedom of speech, Senator Goldstein, and you know that. You are a lawyer. This is a question of you acting for the TV cameras at this time.
I take particular offence that we are wasting Mr. Cronenberg's time when we could be discussing this matter right now and dealing with it later. You are playing to the cameras.
The Chair: Senator Massicotte, you wanted to say something.
Senator Goldstein: I made a motion. There is a motion on the floor to name Senator Moore as chair of this segment.
Senator Tkachuk: You cannot have a motion when you have a point of order. Let us discuss that, and I do not think you even can.
The Chair: Since I had not planned to do this, and since senators made a number of very false and outrageous comments about me, I would like to say these accusations are totally false. Our regular room is 505. This committee has been in effect for 140-odd years. It only televises meetings by exception. As soon as a request came forward for Mr. Cronenberg to appear, I made the arrangements to have this hearing televised. As you can see, that is happening. The statements made are not true at all.
Having said that, when I saw Senator Goldstein shaking and getting ready to make his point of order or question of privilege, I would have suggested this is a matter that we would be better discussed in camera, later on, after the witness gives his testimony. I think it would be more dignified and more in keeping with the heretofore collegial and non-partisan nature of this committee. I am in your hands in that regard, colleagues.
Senator Massicotte, I would recognize you.
Senator Massicotte: I am not sure whether it will be a point of order, but I want to know more about the facts. Did you or did you not ask for cancellation of TV cameras as was reported earlier?
The Chair: No. It is totally false. As soon as I heard that television broadcasters were interested in this hearing, I made arrangements through the clerk to start a process. At 3:01 p.m. yesterday afternoon we received an email from the clerk that she had received a call from CTV News asking to televise. She said we do not have the national networks in. We need to have the feed. We were booked for room 505 in the Victoria Building, which does not have the feed. We discussed it for the next hour or so, and I said, "Put in a process so that we can have the hearings televised." Unlike what Senator Goldstein said in the house this afternoon, no pressure from anyone caused these things. It was my instruction that this hearing be televised. I would have wanted it to be televised, it is being televised, and I do not see what the problem is. I do not like these false statements being made about me; I very much resent them.
Senator Massicotte: You intended, requested and ensured that this proceeding would be televised, and you never suggested otherwise.
The Chair: Exactly. As a matter of fact, it was only this morning that we learned, when the clerk called me around nine o'clock, that we needed the whips to discuss this because there are two facilities for televising committee hearings, apparently, and they were already assigned to other committees. I asked whether there was any way we could make it happen. She said that we needed the permission of the whips, and I said, "Go ahead and do it."
Next, I received a call from our whips asking if that was what we wanted. I said yes, and it was done. Other arrangements had already been made. It is a gross misrepresentation to make these comments about me, but I am a big boy and I can deal with them. I had planned to deal with them in the proper way ad hominem, and I have written a letter to Senator Goldstein, which I will hand to him at the appropriate time.
Senator Goldstein: May I respond, by your leave, senator?
You have asserted that what I said was false. You have asserted that you never suggested otherwise. You asserted that this is a gross misrepresentation. The only person who can tell us whether you said not to arrange for television would be the clerk. I would like to know what she has to say about that.
The Chair: It is completely out of order to bring the clerk into it. Last week we had to apologize to her. Again, there are many issues you seem troubled by. Let us have them out, but do you think we need to have them out in front of the Canadian public? Again, senators are here in their official capacity, and I would like to have this matter deferred and have a full discussion of it later on.
Senator Goldstein: Do you not think the Canadian public is entitled to know what you are doing?
Senator Eyton: Certainly, the Canadian public can know and should know. I am embarrassed to be a member of this committee and to have this going on with our witness before us. He has come here to give his testimony and we want to hear it. It will be televised. Certainly, it is public and there is no muzzling going on whatsoever. As to the facts, we can sort them out later. It seems that we should proceed as we always do in a courteous and non-partisan way to achieve the best result.
Senator Goldstein: I would like to have an answer to my question to the clerk.
The Chair: You will not get one. I am telling you the truth. If you want to call me a liar, you can do so.
Senator Ringuette: I have been part of this committee for a year and a half. We have always had our committee meetings here and they were always televised except when we were looking at reports that we wanted to table in the Senate. With regard to the facts, there is a question of ethics, and I regret what is happening right now. If we want to put an end to this, we can defer the matter to the end of today's meeting or tomorrow's meeting in respect of the motion that both senators leave the chair to Senator Moore, and we will deal with the issue at hand after we have heard from the witnesses today.
Senator Tkachuk: Mr. Chair, call the meeting to order and let us conduct this meeting.
The Chair: Is that the wish of the committee? Is anyone opposed?
Senator Moore: I have a question. I would like to put on record the process for having television coverage available. How does that happen?
The Chair: What was the question?
Senator Moore: What is the process for having television coverage available to the committee?
The Chair: The way it has been happening since I became the chair, which was last September, is for the clerk and I to have a chat about it.
It is quite incorrect, by the way, Senator Ringuette. Our regular room is 505, Victoria Building. That is where we had our hearings in December, when you were present. If you cannot remember, I do not impugn that. You are in good faith and I hope you think that I am in good faith. I have bent over backwards to be an even-handed chair, and I find this a deplorable and embarrassing situation. There seems to be a vote of non-confidence in me, and I am quite taken aback by it.
I normally speak with the clerk about televising the meetings and I make a value judgment. That is how it has been happening to date. A motion was made some time ago, as the clerk showed me, that the chair's prerogative had been voted in terms of deciding whether to televise. That is why the minute I heard, at 3:01 yesterday — and I have emails to prove it — I asked the gentleman from Senate communications to come up. He had received the request from CTV, and I said I would have to find out what was involved to change the room, and we gave instructions. That is how it works. That is the answer to your question.
Senator Goldstein: That is absolutely incorrect. It is important for you to know what the resolution is. We decided at the first meeting of this committee, and I quote:
That the chair be authorized to seek permission from the Senate to permit coverage by electronic media of its public proceedings with the least possible disruption of its hearings.
That took place on the floor the Senate. The resolution continues: "That the Subcommittee on Agenda and Procedure," — which is the steering committee — "be empowered to allow such coverage at its discretion."
We were never consulted as to whether coverage should not take place for these hearings.
Senator Moore: I know that. As a member of the steering committee —
The Chair: There is another document.
Senator Moore: I want to know who contacts the technicians or the Senate staff to let them know we are televising.
The Chair: The clerk.
Senator Moore: Ms. Gravel, from whom do you receive instructions? Is it normally from the steering committee or from the chair?
Line Gravel, Clerk of the Committee: From the chair. It has always been like that.
Senator Massicotte: All of this has much merit and deserves much discussion, and I am not trying to cause closure, but we should hear the witness and agree to have the discussion afterward, not in camera. Out of courtesy, let us hear our witness and get on with the business of the committee and resolve these issues of order later. That would be best for everyone.
The Chair: Is everyone comfortable with that?
Hon. Senators: Agreed.
The Chair: Thank you.
Welcome to the Senate, Mr. Cronenberg, please proceed.
David Cronenberg, Director, as an individual: I know that the committee has had quite a few hearings and I have seen some transcripts and reports of them. Some have been articulate and well-structured. I do not think I will be saying anything that you have not heard before, but it will come from my personal perspective and experience. That is what I have to offer, which, perhaps, the presentation by the Directors Guild of Canada did not have.
I went to Telefilm Canada 40 years ago, when it was the Canadian Film Development Corporation initiated by Judy Lamarche, I believe, to see about obtaining funds for an underground film I was making.
In the 40 years since then, there has never been a pornographic film made with government money. There has never been a criminal film made with government money. There has never been a hate film made with government money. Therefore, why is this happening now? I do not understand it.
The mechanisms that were always there in the Criminal Code and in the mandate of bodies like Telefilm are in place now as they were then. They work. They filter out all of those possibilities. Those bodies are not allowed to fund projects that contravene the Criminal Code. Therefore, what is this really all about? I do not get it. I do not think we need it and I do not understand it.
Having said that, if it did not do anything negative or cause any problems, then you might say okay, let it go through. Let it become law; it will not change anything. Unfortunately, it has significant repercussions that perhaps the original framers of this clause were not aware of and that we are now all aware of.
I am on the advisory committee of PEN Canada. PEN is an international organization that protects writers and journalists. They are very upset and disturbed by the implications of this clause. It is not a bunch of hysterical, overly sensitive artists who are running around overreacting. This is a real issue, and it matters not only in terms of the theory of democracy and freedom of expression, but also in dollars and cents.
Those of us who work in the film industry have to be tough. We have to have our feet on the ground because it is a business as well as an art form. A lot of money is involved in movie making. You have to balance your artistic aspirations with the realities of international finance, distribution, artistic awareness, and so on.
The people who are upset by this are telling you something that is real. It is not a hypothetical thing that does not matter. It is something quite substantial. I will assume these implications were not properly understood by the original framers of this clause. That is the way I prefer to think about it.
Having said how tough and down-to-earth artists are, I also like to think of us as the frogs of the ecosystem. Biologists are always looking at frogs because they breathe through their skin. They are the first to absorb any toxic elements that exist in the environment, and they react by becoming quite deformed and dying.
Artists are like that. That is our job. We have these antenna and we have this thin skin. Therefore, in certain circumstances, we are the first to become aware of dangerous toxic elements in the environment that other people may not be aware of as quickly.
I have read letters to editors saying these artists go to the government for handouts and now they are complaining that the handouts they should not get anyway will be cut off.
The film industry is a business. I have had the experience of being censored, first by the Ontario Censor Board. That was at a time when you could go to jail for five years for putting the pieces of your film that the censor board had cut out back in your film and showing it. The projectionist could lose his licence and also be put in jail.
One of the implications of this clause is that it is not easy to censor in a democracy. It is not easy at all. The mechanism of censorship is quite complex and difficult because, basically, you want to filter out the subjective. You want to filter out the idea that one person or three people in a closed room will look at your film and say, "I just don't like it, so let's suppress it."
That is anti-democratic. It is not anything that I think anybody really wants. However, it is what would result from this clause's coming into law.
My first film that was censored was called The Brood. A man named Mr. Belcher generously phoned me because the film was censored. It was cut. I was shown the version they had re-cut and I was appalled. I also thought they actually made some things nastier and more violent by the cuts they made to the film.
I do not know who made those cuts. There were editors who did not tell you they worked for the censor board because they were ashamed of it within the industry, but they did it.
Mr. Belcher agreed to talk to me on the phone. Normally none of the censors would talk to you about why they were cutting anything. They would simply do it behind closed doors.
He said he would talk to me because he was retiring. It was a science fiction, fantasy, horror film. There was a scene where Samantha Eggar played a woman who had an external womb. It was like a sack attached to her and she would bite it like an animal biting open a placenta to deliver this baby. They censored that shot and this external organ I had invented. It was not sex; it was not violence. In those days we were not talking about things being racist or hate propaganda, but it was not those either. I asked him why they cut that. He said it was because they thought it was repulsive. That was it.
I do not think that what Mr. Belcher finds repulsive was encoded in the Criminal Code of Canada. However, he did not feel the slightest impulse to apologize for imposing a personal, subjective response to a moment in a film.
I am afraid that is what always happens. It can be as hypothetical, and you could have all the guidelines you want, but you can never cover every possibility of artistic expression or invention. Whoever potentially frames the guidelines that would be involved in this clause of Bill C-10, how will they ever have part of it covering external organs? There is no way that can be put into guidelines that are acceptable and understood beforehand.
Therefore, what you end up with is subjectivity. We have all gone to movies with people we love or are close to. When we come out of the movie, we have a big argument because someone hated it and thought it was despicable while someone else thought it was a masterpiece. That is fine normally, but if the end result is that a film is suppressed, that is not fine in a democracy.
When you think of the mechanics behind this kind of judgment, what will happen? I do not want to say censorship, because you can argue the word. Will Ms. Verner watch every film and television production made in Canada and pass judgment on them? If not, why not? Why choose some and not others? That is not democratic; that is not fair. Will there be a huge, cumbersome, rotating committee of people who view these films after the fact?
The problem with this clause is that it all happens after the film has been made. We are not talking about people looking at a script, which would be even more bizarre. We are talking about people watching a film after it has been made and deciding to withdraw funds based on a subjective feeling that it is not in accord with public policy or that it is not acceptable to the Canadian public.
I do not know who really has the key to that. What person can say exactly what is acceptable to the Canadian public? In fact, in a democracy, that does not have to exist. You can have a minority opinion and a minority appreciation of art. No one else needs to have that. You should still not be suppressed, and that piece of art should not be suppressed, because only one person in the entire country likes it.
These are the problems I have with the implications of the bill, which I think have not really been thought through. That is what the problem is. The people who have been coming here have had the time, the motivation and the analytical capacity to consider what the implications are. They all have come up feeling that this is very bad legislation. I am not talking about the whole of Bill C-10, I am talking only about this clause.
The tax refund was designed to be based on labour costs. It is meant to be quite neutral. Certainly, I am far from being a tax expert — you can talk to my accountant about that — but it is almost as though there is a tax refund on lumber under certain circumstances, but it only happens if they know what you will do with the lumber. If you will make a baseball bat that can be used to kill someone, you do not get that tax refund. It seems that strange to me that there should be this content judgment element of what was designed to be a quite neutral tax refund on labour and services in an industry, the film industry. It seems quite strange to me.
The question is loss of revenue. I could be wrong but I believe that you have heard from the Royal Bank of Canada, perhaps not directly. These are not artists — whatever one might think an artist is. They are very down-to-earth business people. They have said that this bill will mean that they will probably withdraw from funding Canadian productions. That must tell you something. It is really a nickel-and-dime or dollars-and-cents level.
The issue is this: The government investment in most films is the foundation. All filmmaking in Canada is independent filmmaking. I do not mean student filmmaking; I mean independent filmmaking. By that I mean you do not have major Hollywood or Canadian studios that have their own sources of financing. All Canadian films are independent films and government funding is the platform; it is the solid, secure platform upon which all of those productions are built. I cannot think of one that was not built that way.
This clause would make that platform very earthquake-prone. It would take away the solidity of it. That is why the bank has said that it could not accept that. They have loaned money to you based on the tax credit that they expect. Knowing that it could be pulled after the fact, why should they take that risk? As I said, there are no guidelines that can make that risk reasonable enough that a bank would take it. The film business is risky enough as it is. It is like a house of cards with the tax credit as the base. You pull that out and the whole thing falls apart.
Therefore, this makes it very difficult for any producer. The whole structure that has been in place and has worked, as I said, for at least the 40 years that I have known and benefited from it will be destroyed. In essence, this clause negates the existence of Telefilm Canada and the existence of the Canadian Television Fund. They might as well not exist. There will be nothing for them to invest in because everything will be seen as too risky.
A lot of money is involved. You have heard from producers of all kinds: television and movie producers. This is not a hypothetical thing. This is much more real than the threat that I think is quite imaginary. The imaginary threat is that there will be the embarrassment of government funds somehow put into a film that is pornographic and contravenes the Criminal Code. That threat has not existed for 40 years. However, the threat I am talking about is very real.
Ms. Verner was quoted in the press as saying that mainstream movies like my movie, Eastern Promises, would of course not be affected by this. I am happy to hear that I am mainstream. I have not ever heard that before. I guess that is a step up; I am not sure. I wonder if she would say the same thing about my film Crash. I am not referring to the Paul Haggis film of recent years but my film of 1996. It was very controversial but also won the Special Jury Prize at the Cannes International Film Festival and was the number 1 film in Canada and in France when it opened.
You have to remember that someone can say nice things about Eastern Promises once it has been lauded by the critics — which it was — once it has gotten the Golden Globe nominations, Oscar nominations — which it did get — as well as Genie Award nominations; it is very safe now to say this movie is okay. However, imagine none of those things had happened yet. The film has not been released and you are sitting in a room watching a movie in which, in the first scene, a man's throat is cut in a very violent scene on camera. There is a completely naked fight scene with knives in a steam bath. There is a scene of a man having sex with a prostitute while another man watches. What would various people think, sitting in that room watching this, having no context of critical appraisal and so on to balance their own subjective response?
I am not confident at all that the Telefilm money that was invested in Eastern Promises and helped to make it happen would not have been withdrawn by the Minister of Canadian Heritage or whatever committee. I am not that confident in it. It is that very lack of confidence that I, producers and the Royal Bank of Canada would have that makes this a very perilous piece of legislation.
Finally, the rationale for this legislation now seems to be that someone noted — and once again I am quoting Ms. Verner — it is a logical inconsistency that exists and must be corrected that there is no way for the Minister of Canadian Heritage to deny funds to a pornographic film. However, for some strange reason this does not apply to American films that would receive Canadian funding.
I find that much more bizarre than the logical loophole that seems to be distressing everyone so much. An American film could come to Canada, get Telefilm funding and not be subject to this ex post facto examination. I do not understand the mentality involved there. If it will apply to Canadian films, surely it will apply to every other film that receives the same taxpayers' money. I cannot understand how that division can exist.
Ms. Verner was quoted as saying that it is because American films are usually bigger budget so they would not be pornographic. I can tell you that many American films that come here for financing are not big budget at all. They are not as big budget as Eastern Promises, and many of the American television pilots and shows that shoot here are not big budget. It is also quite strange to think that big budget should equal moral correctness. I do not get that at all. That is much more bizarre than any hypothetical tax loophole problem that was suggested.
That is pretty much it. I am happy to take your questions.
The Chair: That is very interesting, sir. Are you suggesting to the committee that the provision be removed?
Mr. Cronenberg: Yes. I know that there have been suggestions about ways that it could be amended. All of the solutions to that problem seem to generate other problems. Since the Criminal Code is in place and the funding bodies are bound to not transgress the Criminal Code, I do not see that there is a problem. I suggest that the clause be removed.
The Chair: Thank you.
Senator Tkachuk: Mr. Cronenberg, we are not embarking on new ground here. Despite your scenario, in this case the artists were not like frogs but more like turtles.
Mr. Cronenberg: Turtles are endangered, too.
Senator Tkachuk: This clause existed previously through regulation. The government notified the industry through a discussion paper on March 8, 2001, and announced on at least four separate occasions that the legal status of the public interest test would be written into the Income Tax Act. These dates were December 20, 2002; November 14, 2003; February 27, 2004; and July 18, 2005. It is also the second time this bill has been before Parliament. Do you not think it is a little strange that we are debating a change that nobody had any problems with until it was the subject of a newspaper story in January? I cannot find it credible that no one in the industry noticed this provision until now.
Mr. Cronenberg: Yes; so what? My answer to that is, so what? It is here now. It was never passed into law. I never heard about it before, for whatever reason, so to me all of that is completely irrelevant. That might have political significance for you, but it does not have any significance for me whatsoever.
Senator Tkachuk: It does have significance because this law existed as regulations since 1995.
Mr. Cronenberg: Would you explain it to me?
Senator Tkachuk: The regulation, which has the same effect as law, gave the minister the power to have a public policy test on film credits, just as this bill proposes. It has existed since 1995. The movie that you were talking about earlier was made under that provision.
Mr. Cronenberg: Which movie was that? Do you mean Crash?
Senator Tkachuk: No.
Mr. Cronenberg: Eastern Promises?
Senator Tkachuk: Yes.
Mr. Cronenberg: That was only a year and a half ago. I see the difference, I suppose.
Senator Tkachuk: Crash was 1996, was it?
Mr. Cronenberg: Yes. The difference is that the Minister of Canadian Heritage has said she will act on it. If it is a latent possibility and no one acts on it, then there are many ways it can just slip by. I understand that many people did not catch this clause in the 500-page document this time around.
You see, I can only tell you what it is from my point of view. I did not know about it. What it is becoming now is a different frog or turtle. If it will be passed into law, that is a different level. The Minister of Canadian Heritage says that she would expect to reject a handful of films every year. This is new. This is not old. No one has ever said that before. I have not ever heard anyone talk about it that way. Let us not talk theory. The reality is that you have not had this reaction before from so many people in so many parts of the industry, and there is a reason for that. What do you think the reason is? It is because it is only now come to light. It has been buried up to now in the way that these things can get buried.
I did not mean to be rude by saying that it is insignificant. What I meant was exactly that: it has been buried up to this point and no one knew it existed. It has been a skeleton in the closet and no one opened the door to the closet before. Now, the door has been opened and the skeleton is there and now people are reacting to it.
Senator Tkachuk: When Ms. Polley testified, I pointed out to the industry associations that accompanied her the letters that showed they were notified about this in 2001. The tax credit system has been operating under these provisions of public policy tests since 1995.
Mr. Cronenberg: Why is it only now that the Royal Bank of Canada is suddenly considering withdrawing its support?
Senator Tkachuk: I have no idea, Mr. Cronenberg.
Mr. Cronenberg: I do have an idea. It is only now that people realize what the impact of it is. It is a straightforward, functional thing that I am talking about. It might have existed in another form, and I do not know the niceties or differences between its being regulation and its being legislated into the law. I do not know the implications of that.
Senator Eyton: If I may, we can probably round up this historical discussion, but to put it in context, the regime was in place legally. This committee has been told that only two films in all that time were contrary to public policy and therefore were not funded in the usual way. That is our understanding of the regime in place. It was known at least by some, and it was only effective with respect to two productions.
Mr. Cronenberg: My understanding was that those two films were rejected at the level of Telefilm looking at proposed projects.
Senator Fox: We are discussing around something —
The Chair: Let us finish the other one.
Senator Fox: The regulations were in place in 1995 and they do not say what Senator Tkachuk says.
[Translation]
i. news, [. . .];
ii. a talk show;
iii. a production in respect of a game [. . .];
iv. a sports event or activity;
v. a gala presentation [. . .];
vi. a production that solicits funds;
vii. reality television;
viii. pornography;
ix. advertising;
x. a production produced primarily for industrial, corporate or institutional purposes.
[English]
Let us not invent what it was. Maybe we should read into the record exactly what the situation was. Now the witness is being asked to comment on a regulation that did not exist, and that is a rather difficult thing to do.
The Chair: Thank you, Senator Fox. You have made your point well.
Senator Tkachuk: Thanks for that testimony, Senator Fox. Our minister did offer a year with the advice of the industry to place guidelines on the public policy test, similar to the guidelines that you have read on the question of the regulation that was already in the books.
I have one more question. Mr. Cronenberg, no one here on either side wants to damage the film industry, which has been quite successful not only in this country but also internationally. I do not know anyone in the entire Senate who wants that to happen.
A business case could be made, and I am looking for a business case. It has been confused with freedom of expression. I do not believe that the only way to have freedom of expression is with subsidies or tax credits. Freedom of expression exists in this country because we operate under the rule of law, and it has nothing to do with tax credits. A business case can perhaps be made to change it so that we do not damage the industry in some way. However, as politicians, we have a business case to make for ensuring that taxpayers' money is spent wisely, and that is why we are having this debate here. You may not agree with the debate, but we are having an important debate.
Mr. Cronenberg: When you say "taxpayers' money is spent wisely," that really is sidestepping the issue. You could make a business case for "wisely" being a pornographic film because it can make a lot of money. That sidesteps the question of morality and criminality and so on.
I think the business case has already been made by the Royal Bank of Canada. What more do you want? Again, that is why I am insisting on the reality now. To me that is old political history and, as I say, it may have significance, but right now, the Royal Bank of Canada is saying that they will have to seriously consider not funding Canadian productions, period, because of this clause. That is quite straightforward and quite businesslike.
[Translation]
Senator Biron: Mr. Cronenberg, the film industry generates around $5 billion in economic activity and creates 30,000 jobs. What does this economic activity mean to you and how will industry jobs be affected by this legislation?
You have outlined very clearly the position of the Royal Bank of Canada. However, to what extent will the adoption of Bill C-10 move screenwriters to censor their own work? Is there not a risk that they will conform to the guidelines if the act is adopted to ensure that they receive the tax credits? How might the legislation affect the way they draft their scripts?
[English]
Mr. Cronenberg: At that point, you are talking about the effects of censorship in general. Anyone who has seen films from the old Soviet bloc countries can read about the effects of the censorship that occurred. What happens is that censorship becomes internalized, and artists begin to censor themselves out of fear.
I do not want to be incendiary or extreme, but I think in this scenario the Royal Bank could say that obviously the bankers will not be reading scripts and judging their content. They have no way of doing that. Therefore, they could say they still might finance some children's films or some children's cartoons. Maybe they would still do that. However, for anything beyond that you would not find funds in this country. What do you do as a filmmaker?
You do not have to be an extreme filmmaker, one who pushes the edges or the boundaries, in order to find yourself being censored. I have had films distributed in a hundred countries. Some countries censor and some do not. However, it is the most bizarre things, things you would never think would be offensive, that are somehow offensive and are censored. Latin American countries are very sensitive to anything that has to do with Catholicism and religion. Other countries are sensitive to sexuality but not violence.
You really are stymied. I think you would see the exodus of many artists from Canada.
I have to tell you my story. It was the Canada Council and Telefilm, as the Canadian Film Development Corporation, that kept me in Canada. My friend Ivan Reitman had already gone to Los Angeles. There was a time when Norman Jewison could not make a film in Canada because there was no film industry. He went to Hollywood. Ted Kotcheff went to London.
It was when the Canadian Film Development Corporation appeared and invested in my first film that I decided I could make films in Canada. I had gone to Los Angeles and talked to Roger Corman. My first film was a low-budget horror film. It is now considered a classic, but then it was controversial. I was thinking that I might have to join Lorne Michaels, producer of Saturday Night Live, who ended up going to America and living there. I thought I would have to go to Los Angeles and move there to make movies.
First, it was the Canada Council for the Arts that supported me when I was writing my scripts. Then, second, what became Telefilm Canada came to the rescue when they said they would invest in Shivers. That is why I am still here. I am still here because of government funding. If it had not been for that, I would not be here. I would be an American filmmaker and I would not be making the films I have made. I would be making other things.
The gravitational pull of Hollywood is extremely heavy, and when you are there it distorts you. When I am in Hollywood, I start reading the trade magazines, Variety and The Hollywood Reporter and think about who got what deal. I think it would have been disastrous creatively for me to have had to leave the country.
Shivers was a controversial film and there were questions raised in the House of Commons about the film and about taxpayers' money being put into a horror film that shocked a lot of people, thought it did not contravene the Criminal Code. I was not arrested and no one was put in jail, but it did shock a lot of people.
It turned out to be the first film that ever made its money back for the Canadian Film Development Corporation. That changed the understanding of its function for a lot of people. At that point, the funding body was trying to decide what films it could invest in: Where should Canadian film go and how can we guide that process? Should we only fund movies that look like Hollywood movies or should we fund only small European-type movies? Is there some other essentially Canadian movie that we could nurture?
Strangely enough, the kind of Canadian film represented perhaps most obviously by me and by the films of Atom Egoyan has shown itself to be a strange creature — a strange turtle or frog — that is neither European nor American but combines pieces of both. I often say to people that in Toronto I feel like I am living halfway between Europe and Hollywood and that my films somehow represent that.
These are not easy films. These are controversial films. I was at the Cannes International Film Festival with Crash, and Atom Egoyan is taking his movie to Cannes this year. These were controversial films, but the Cannes festival was delighted. Canada was in the forefront and people were very excited talking about it. We received tons of press and there was a lot of respect for Canadian filmmaking.
However, I can imagine that any one of those films could be denied funding by a specific person; we do not know who. It is not only one minister, because eventually there will be another minister or another committee.
That has a damaging effect on the creative process, as we can all see from any films like The Lives of Others, the film about life in East Germany among artists who are being monitored and censored in a heavy, totalitarian way.
I do not pretend this bill is like that. However, it does have a negative effect. It means there will be fewer films made in Canada and fewer people will have jobs. Less money will be generated for everyone.
Senator Harb: Thank you for your presentation. You asked a question earlier about the difference between legislation and regulation, or a law and regulation, and the fact that regulations come after the law becomes law. Then the regulations are drafted.
I do not think my colleague did it on purpose when he told you there is regulation. What he meant to say, I suppose, is that there are draft regulations in anticipation of a bill's passing.
In any event, you are an adviser to PEN Canada. In that capacity, would it be your view that if this proposed legislation were to become law with this clause, it would infringe upon your rights under the Charter of Rights and Freedoms? Do you think that could be a case for someone to take the government to court?
Mr. Cronenberg: I think it could be, yes. I see these letters written to the editors by people who say, "We are not really censoring you. You can make your film, but not on our dime; not with public money."
That is true as far as it goes. However, if there is no other money — if you cannot actually make your film without public money — then it is a form of censorship. There are many forms of censorship, some of which are definitely allowed in Canada, such as certain libel laws and so on. I am not sure saying it is possible to have a society where there is no kind of censorship of anyone under any circumstances. I am not arguing that.
I am arguing the pragmatics of this situation. Canadian films — and every national cinema in the world — define themselves against Hollywood. Hollywood is a monster; it is huge. There would be no national cinemas anywhere without government support in every country. They simply could not exist, because we cannot make movies like the Americans. We cannot make a movie that costs $180 million like Iron Man, which was just released. It is impossible. No other country in the world can do that. Therefore we need to do it another way. The other way always involves public or government funding. It has to. It is not just in Canada but in Norway, Finland, France, England, everywhere.
Senator Harb: Do you consider this clause to be a bad public policy approach?
Mr. Cronenberg: I do.
Senator Harb: The minister has made a proposal to the industry saying, "Trust me. Pass the law, and in one year's time we will develop some sort of policy guideline."
Is it your view, and do you think it would be the view of the vast majority of the people in the industry, that we should figure out what those policy guidelines will be first and not pass the law until we understand what those policy guidelines will be; or would it be your view that we should remove that component from this particular clause totally and leave it up to the Criminal Code, as was the case before?
Mr. Cronenberg: I think you have to remove the clause. As I have said before, you cannot accurately create guidelines that would work in the real world with real people. When it comes to an actual, specific movie with specific scenes and specific actors, it is impossible to have guidelines that can anticipate that. It is not reasonable to expect someone to come up with those kinds of guidelines.
Though the Minister of Canadian Heritage has said that she would be happy to have, for example, the Directors Guild of Canada involved in developing the guidelines, the directors guild has quite correctly said, "We cannot think of any guidelines that would actually work."
The clause cannot work. I say that from people who have been through it and know.
Senator Fox: I really hit on something you said, Mr. Cronenberg: the implications of this bill had not been thought through. I could not agree with you more. I do not care where the origins of the bill are, whether Liberal or Conservative. The fact is we have a bill in front of us today that we are supposed to look at and see whether it works. That so many people are coming forward and making their point of view known on the bill should impress on the government that this has not, as you said, been thought through.
I read Mr. Flaherty's comments in front of this committee. I quote him and I have with me a copy of the press release issued November 14, 2003, by the previous government, referencing the amendments that they were proposing at that time.
That is fine. That was the leader at the time, but they never came to a parliamentary committee of any kind. They were never examined in depth, in public as these are being examined in depth today. As a matter of fact, if Senator Tkachuk was right, why would we be here if all of these regulations were already in place? They would simply be applied.
The fact of the matter is that the regulations do not cover the type of situation the minister is talking about. The minister before us has said that what is contained in the Criminal Code is not enough, that effectively if the government is involved in making funds available to film producers, then it should have what I would translate as a droit de regard on the content.
I have trouble accepting that. That is a very pernicious principle that is being introduced into the funding of the arts in Canada.
Mr. Cronenberg: I agree with you.
Senator Fox: I will move on to my second point. You said there were three issues: democracy, freedom of expression and dollars. The Minister of Finance here said the case had not been made that there would be financial consequences to the Canadian film industry. That is why it is important that we continue with these hearings to put enough evidence in front of the Minister of Finance to convince him that there are indeed consequences to this.
You have testified to that from your own personal experience today. I do not know if anything can be added to that.
Mr. Cronenberg: I think I can add a bit. Normally, when I take a credit as a producer on a movie it is more a creative element rather than my putting the money together behind the scenes. When you produce a movie, you basically borrow the entire budget of the film from a bank based on the various deals that you have with European distributors, with American distributors and with, let us say, Telefilm Canada. Because you do not get that money right away, you have to borrow it. If that borrowing were subverted and made impossible, you could not be a producer anymore; you literally could not produce a movie.
You cannot put a bank in the position of judging a project in terms of the Criminal Code, morality, ethics or public policy. That is not their business. It is much easier and safer for them, and it makes sense for them, to simply gracefully withdraw from the entire process. That would be a disaster for the Canadian film industry.
Senator Fox: You have testified that you thought the best solution was simply to delete the clause that mentions the words "public policy." I suppose I am concerned by the words "public policy" because, to my mind, a film that contravenes public policy is a film that contravenes the ministerial will, the ministerial statement, a white paper or what have you.
When the Canadian Film and Television Production Association, CFTPA, and their French-speaking equivalent came before us, their position was endorsed in general by the Canadian Civil Liberties Association and, I believe, by PEN. They suggested that the term "public policy" be further defined to say something to the effect that offending public policy essentially means contravening a provision of the Criminal Code.
Would that type of amendment be acceptable to you?
Mr. Cronenberg: It would. I say this off the top of my head because, once again, I have not really thought through what the implications of that might be. However, that would certainly make more sense.
Nonetheless, you still have to ask why you need it. All of the funding bodies that are government funding bodies are already required to do that. Why do you need this additional layer of the same thing, other than to satisfy the sense of control that the Minister of Canadian Heritage has? Is that the only reason? There seems to be no other reason. I have not heard anything that would imply otherwise.
Senator Massicotte: I would summarize your concerns as being, one, that the lack of certainty for the Royal Bank would affect financing and, obviously, the feasibility of doing films; and the other, that the Minister of Canadian Heritage could have the power to condemn or qualify certain films.
Could you comment on the latter? As you know, Minister Verner has suggested that she would work with the industry to develop the criteria. I believe I know the answer to my question, but I want to play devil's advocate. Why do you have concerns if the first issue is resolved?
Mr. Cronenberg: Human beings are tricky creatures. I am always willing to believe that someone who has censorial power over someone else, as in the circumstances in this country, has the best will in the world and is meaning only to do good and to be honourable. Even with that, the problem is the subjectivity. If sit in a room with someone and I have the responsibility to possibly censor something, I start looking for things to censor. As I said, there are no guidelines that can cover the external organ I created. Is that image contrary to public policy? Does it disturb people? How can you possibly anticipate that?
Mr. Belcher, my censor of long ago, was honest. He said, "I found it repulsive, so I cut it." That shocked me then and it shocks me now. He said, "If you put that image back in your film, you will go to jail for five years, and I am retiring tomorrow."
That can happen, despite the best intentions and will in the world. Censorship is so vague, and it is always subjective. You cannot pretend that it is not subjective. That is why there are courts — so that people can make their case. If having it in guideline form or in Criminal Code form were sufficient, we would not need courts; guilt would always be obvious. However, it does not work that way.
Senator Massicotte: You recognize that much of the funding for films comes from other government agencies, usually provincial, and often with significant discretion and pre-approval of films. There is a scarcity of funds, so one must qualify and seek the film that has the greatest merit. That has immense discretion, and yet the industry largely accepts that discretion.
Mr. Cronenberg: It is true that decisions have to be made. I am sure you could ask Wayne Clarkson, the executive director of Telefilm Canada to talk about their process. They try to make it as neutral as possible. Let us say that an experienced producer comes with solid financial backing and a script, which is judged by script readers as to the film's viability.
In art, there is always subjectivity; there is no doubt about that. Primarily, it is like the lumber tax. If you have the wood, the nails and the shingles, you can build a house. They try hard to filter out the subjective elements, because they are depending on the voices of the people in the industry. For example, if you have Metropolitan Films of France investing in it and you have Fuji in Japan wanting to buy the rights to the film based on the screenplay, the star and the director, and you have Focus Features in the U.S. willing to do that, then it makes industry sense because these people think it is a viable project. A consortium of people all over the world are involved in what becomes a green light.
Senator Massicotte: I understand fully your point about discretion and what it leads to. However, I observe that the industry has become accustomed to the fact that the provincial agents are using significant artistic and factual discretion, but there is always discretion in the definition of the word. You seem to accept provincial discretion. If the federal government somehow reached the same point of certainty of non-discretionary agencies, would that be acceptable? If the criteria were set to be as certain as the provincial criteria, would that be acceptable?
Mr. Cronenberg: No, not really, because it is the difference between people who are government ministers and people who are part of the community of filmmakers and film financiers. It is a different sphere and a different sensibility. Their approach is quite different.
Again, you could talk to people from Telefilm Canada to give you the lowdown on exactly how this happens. In that way, you could know whether you thought it would be the same as what would happen with the Ministry of Canadian Heritage. Although once again, I ask, why do you need another level?
There is what they call an envelope in Telefilm, which is to say, if Robert Lantos, producer, has produced a movie successfully, he receives an envelope containing a certain number of millions of dollars at Telefilm. He can use that money at his discretion for anything. No one works in a vacuum. We are all part of the society. If at any level you contravene the Criminal Code, you are liable to criminal charges and everything else. Everyone, every filmmaker, is aware of this.
I believe that what is being suggested is quite different in quality and in the kind of people involved because film is not their main job. In contrast, the people at Telefilm Canada are very experienced film people and it is their job — that is all they do.
Senator Massicotte: I hear you saying that because government officials are not sensitive to the industry, you have significant concern about them using discretion. However, if it were industry people, like Telefilm Canada, then you would have no concerns. If the minister is prepared to delegate or to organize a system at Telefilm Canada, you seem to say that would be okay.
Mr. Cronenberg: No, not really. Why do you need another duplication of legal layers? That does not make any sense to me. There are theories of government and law that suggest that that kind of duplication is very inefficient and not necessary.
The Chair: Mr. Cronenberg, I understand that you have a plane to catch and that you can stay with us only ten more minutes. Is that correct?
Mr. Cronenberg: That is probably correct.
Senator Eyton: One way or another, including this mechanism, the federal government helps to fund about 1,000 films a year. Perhaps one or two per year might contravene some sort of policy. That is one tenth of 1 per cent. In the business world, materiality counts. If it is only one tenth of 1 per cent, most business people would say forget it, let us not do anything. The other approach is to say it is not that important so why do we not fix it. The issue is clearly defined.
We have a provision that has engendered a great deal of debate. One position is that we take it out and not have any standard except the Criminal Code. I am sure many Canadians would say there should be some standard beyond the Criminal Code. Maybe it is the Criminal Code plus 5 per cent.
I will ask you a hypothetical question. Assume the minister could meet with concerned stakeholders to deal with standards, the process of obtaining the certificate and getting funded. Assume that it happens within the 12 months that she has volunteered and that they come out with binding guidelines to which the parties could agree. Assume those guidelines have the support of 90 per cent of Canadians, which is very hypothetical. Could you personally support that result?
Mr. Cronenberg: I cannot say I would because we do not know what the guidelines would be. I think the guidelines would ultimately devolve into the Criminal Code again. Those are the only guidelines that matter. Anything else is too vague, too slippery and too subjective to be acceptable. If you happen to be one of the 5 per cent of persons whose film have been rejected, it could be quite disastrous for your career and your life. Ultimately, this issue is not the lumber dispute.
Senator Eyton: I hear you, but I want to correct you. I was talking about stakeholders coming to some precise standard that was binding. That was the question.
Mr. Cronenberg: You mean standards in the sense of the guidelines?
Senator Eyton: That is right.
Mr. Cronenberg: I still have the same problem. We accept that the Criminal Code itself is something that can be discussed. You can go to court and discuss whether this person really did something contrary to the code. There are many instances where it is not clear that the Criminal Code has been transgressed in a certain case. In some cases, it is clear; in others, it is not. You never know which is which.
Once again, I think due process and the Criminal Code are really the only guidelines we need. The proof is in the pudding. We have had forty years without there ever being an issue. Why do we need to change that?
Senator Goldstein: Would the wait of one year that the minister has discussed and Senator Eyton has referenced have a destabilizing effect on your industry?
Mr. Cronenberg: Absolutely, it would. That proposal chills the heart of every filmmaker. I know it was meant to be reasonable and to comfort, and I accept and understand that. However, its effect is completely the reverse. It is like Damocles' sword hanging over everyone's head for a year. That is not very conducive to risk taking.
Senator Ringuette: We have heard from the film and television industry that we are talking about 125,000 jobs in Canada, and the industry is contributing over $2 billion to our economy yearly.
I have listened carefully to your comments that we should remove this clause from Bill C-10. My concern is that we now know the direction this government wants to go. If we remove this clause and put nothing clear-cut in this bill, then we leave the window open for this government to create guidelines and regulations that do not have to come before a parliamentary committee and that do not require laws to be changed. We would be leaving the doors and all of the windows open for guidelines and regulations to be changed that could create all kinds of censorship issues.
Mr. Cronenberg: I must confess I do not understand that logic. I do not understand why that would be the case. I am not sure whether it is only my political naïveté or something else, but I do not see it.
I do not think you have to include something that says that, by the way, the government will not invest in anything that is pornographic or contravenes the Criminal Code. Is not that obvious? It is already there in all government-created funding bodies. The film industry cannot go to the heritage minister with criminal projects. That is quite straightforward.
This bill contains some good things that I think the Directors Guild of Canada and the Writers Guild of Canada have supported. Therefore, we are not saying the whole bill is bad, only this clause. I do not think taking this clause out would do a thing. What is the harm feared? What bad thing will happen if this clause is not there? The answer is nothing.
Senator Goldstein: The minister testified a couple weeks ago that opinion was divided in the industry about this particular provision. I understood that to mean that some people in the industry are in favour of the proposed legislation and some are against it. I have a simple question: Do you know anyone at all in your industry who is in favour of this proposed legislation?
Mr. Cronenberg: No.
Senator Moore: Mr. Cronenberg, thank you for being here. Thank you for your work and thank you for the work you do for Canadian filmmaking.
There is one clause I think we have been talking about here today. This was overlooked by the members opposite, but it is important. It is clause 120(12):
The Minister of Canadian Heritage shall issue guidelines respecting the circumstances under which the conditions in paragraphs (a) and (b) of the definition of "Canadian film or video production certificate" in subsection (1) are satisfied. For greater certainty, these guidelines are not statutory instruments as defined in the Statutory Instruments Act.
That last bit is the key phrase. It means they are not subject to review by the House of Commons or the Senate of Canada. It also means that the minister of whatever political stripe can change them, delete them, amend them, or do whatever he or she wants.
I think I know the answer, but I want to hear your response to that. It is a key part of this whole proposed piece of legislation.
Mr. Cronenberg: To me, that is totalitarian. It is what we would expect in Beijing, perhaps, but not in Canada. It is completely undemocratic.
Senator Banks: We have been talking about Telefilm Canada, the Canadian Television Fund and others. We agreed that those agencies make choices about how many films they fund, because they receive this many applications and they have this much money. They adjudicate on some basis, and there is a certain subjectivity in those choices, I think we have to agree, because they are human.
I want to be sure that I understand correctly. The Canadian Film or Video Production Tax Credit is not based on any of those subjective views. In fact, it is devised purely on the basis of labour and is not a content issue. As I read them, the present regulations do not include the phrase "public policy"; rather, they specify that the tax credits do not apply to news programs, sports programs, real life programs, quiz programs and the like because they are not intended to.
You are Canada's most successful filmmaker or certainly among the most successful. We have heard that the Canadian Film or Video Production Tax Credit is important to Canadian filmmakers. Is it important even to you? Do you still rely on it to some degree in order to stay in business?
Mr. Cronenberg: Yes, I do. Eastern Promises might have been able to be financed without Telefilm investment. However, the film I made before that, A History of Violence, had no Canadian investment at all; it was entirely funded by New Line Cinema, in America. The film before that, Spider, was a very difficult film to get made. It was an art film. It would have not existed without Telefilm financing and the tax credit.
I am saying that, for me, it depends on the production. I am at a point now, for better or worse, where I could do an American film, even if it was shot here, because they like the wage scale and whatever. In that instance, I would not need to take advantage of the tax credit. However, even then, if they are shooting here, American productions will take advantage of the tax credits. Probably 80 per cent of the films I have made could not have been made without the tax credit investment structure here.
The Chair: Senator Spivak we are delighted to welcome to you the committee.
Senator Spivak: I have only one question but I have a short preamble. It seems to me this falls into the category of "What were they thinking?" It is a solution to no problem. We would still have a lot of repulsiveness from video games, American films, et cetera, not to mention near-pornography, even if this were passed.
The argument about taxpayers' money being spent wisely is spurious. We supported the oil sands and we supported the CANDU reactor. Not everyone would think those investments were wise. The business case has been made, but here is my question to you: If this were passed, given that Canada is a culture with some fragility living next to an elephant, how would you see the cultural impact on Canada when, if Canadian films cannot be made, we would still have auto theft videos or whatever it is called.
Mr. Cronenberg: Grand Theft Auto.
Senator Spivak: What is your view as to the cultural case?
Mr. Cronenberg: In a sense I have discussed that. People like Atom Egoyan and me would be making American movies. They would not be the movies that we have made. They would not be considered Canadian movies. We would be like Norman Jewison when he was in his American phase, and I mean that as no insult. He made some wonderful Hollywood movies, but they were totally Hollywood movies.
The answer is that it would have a disastrous impact.
Senator Spivak: The short answer is it would be dangerous to the cause of Canadian culture.
Mr. Cronenberg: That is right.
The Chair: You have brought renowned testimony to our committee today. You have clearly expressed your views with passion and rationality. Thank you for coming.
Mr. Cronenberg: Thank you very much for inviting me. I appreciate it.
The Chair: Our next witness is Mr. Conrad Winn, President of COMPAS Inc. We look forward to hearing your comments on these issues that you are familiar with on Bill C-10 and in particular those provisions relating to guidelines or issues in respect of tax credits for the film and video industry.
Conrad Winn, President, COMPAS Inc.: Thank you for fitting me into your day on a quiet and boring note. I do not have any opinions on legislation and, if I did, my firm would not be happy with me for expressing them. I understand that my job here is to explain the little public opinion research poll that COMPAS did, and I am happy to answer any questions about the poll or the interpretations.
It is neither complicated nor enormously surprising that the public would be sensitive to this matter. The straightforward view is that the public, by an immense majority, is not comfortable with the idea that public money would be used for X-rated films.
The Chair: Thank you. Let me refer to this document, which has been made available to the committee in French and English, The Film Subsidy Controversy — National Poll Shows Public Polarized with Large, Female-Led Majority Opposed to Continued Subsidies. COMPAS Inc., the company Mr. Winn represents, is a public opinion organization. We will go to questions.
Senator Goldstein: I have two technical questions, which I thought would be useful for the next questioners.
I do not understand what you mean by "computer-assisted telephone interviewing technology," which is how you conducted the poll. Could you explain to us exactly how that works? I am accustomed to receiving a phone call from a person who says that he or she is doing a survey for X, Y and Z, and would I be prepared to answer questions.
Mr. Winn: Hidden in the background is a computer of one of the better known firms. The computer screen guides the interviewer through the questions.
Senator Goldstein: Do I understand correctly that your interviewer personally asked all of the questions?
Mr. Winn: Yes.
Senator Goldstein: Was the interviewer trained to do so?
Mr. Winn: Yes.
Senator Goldstein: Is this a full-time occupation of yours? I thought you taught political science as well.
Mr. Winn: I am a Carleton University professor. I have used provisions of the collective agreement to seek leave to do this.
Senator Goldstein: I am not being critical.
Mr. Winn: I have had a constrained load at the university, and I love the job, but much of my focus, and of course the focus of COMPAS Inc. employees, has to be COMPAS Inc.
Senator Goldstein: You said in your introduction a few moments ago that your conclusions, which are reflected in your very good report, were that the Canadian public, especially women by and large, do not want X-rated films funded. I take it from that that your survey was limited to X-rated films and that you did not deal with violence or anything else. It dealt with pornographic films only.
Mr. Winn: Those were the terms. The question is on the bottom of page 3 in a footnote. All polls have their limitations because words can mean different things to different people. In fairness, I would think that some people would think that gratuitous violence qualifies as pornographic too.
Senator Banks: The question reads: "There's controversy today about government subsidies for films considered X-rated or pornographic."
Senator Goldstein: I do not see anything about excessive violence.
Mr. Winn: I did not say anything about excessive violence in the question at all. In polling, you may ask about a rainy day and some people will think that you are asking about snow. Asking people questions is not like using a keyboard with a computer where if you push a certain button normally it produces a certain letter or action. There is a human aspect.
Senator Goldstein: Your survey questions dealt solely with pornography.
Mr. Winn: Exactly.
Senator Goldstein: Are you aware that the criteria for the issuance of a certificate of authorization for films and video productions in Canada already excludes pornography, as does Telefilm Canada exclude pornography from its assistance. Are you aware of that?
Mr. Winn: I do not want to answer the question because I do not feel I am here as an expert on public policy or cultural policy.
Senator Goldstein: I am asking you not as an expert but as a citizen. Are you aware of that?
Mr. Winn: I would doubt that the average citizen is aware of that.
Senator Moore: Thank you, Mr. Winn, for being here. Your client for the poll was the Institute for Canadian Values. Could you tell us about your client?
Mr. Winn: There are several people. A member of the Institute for Canadian Values was a witness before the committee, Mr. Charles McVety, if I am not mistaken.
Senator Moore: Is this a religious group?
Mr. Winn: You would have to ask them. If it were a religious group in terms of Charles McVety's religion, I would not qualify.
Senator Moore: I am looking at the question that Senator Goldstein asked you about the controversy over films considered X-rated or pornographic. I do not know who is doing the considering. We have been told by the evidence that only two films have been deemed pornographic, and they did not get funding. That is out of all the records of filmmaking and government contributions to it.
There is another question at the bottom of page 4: "Suppose that the government continued to subsidize X-rated, pornographic films." The government does not continue to subsidize films that are deemed to be pornographic. There have been only two such films, and they were not funded. Do you want to comment on that? Is it misleading? Are you aware of the evidence we heard before the committee?
Mr. Winn: I have not read the minutes of this committee. When a term or subject matter is controversial, there will be different perceptions. Here, there are different perceptions of what is pornographic and what is X-rated. Your previous witness was quite correct in saying that there are different perceptions of what would qualify.
Senator Moore: I understand that.
Mr. Winn: What else would you like me to say?
Senator Moore: Are you caught on your word "continued" because there has not been a continuation? There has not been a starter. It did not happen. Two films were deemed to be pornographic and they were not funded. Therefore, there has not been an experience of "continued."
Mr. Winn: The essence of anything as controversial as this is that you will get some people feeling that many films that are pornographic receive funds. Others will say that even the films you deem pornographic are not pornographic in their view. It is the essence of a subject like this that you will have differences of opinion.
Senator Goldstein: You say polling is a science and statistics is a science. Is it not a fact that the phrasing of the question is as important as the answer?
Mr. Winn: Sometimes it is and other times it is not.
Senator Goldstein: If you were to ask a question that contained a false premise, would that be acceptable procedure under your science?
Mr. Winn: Not if it were universally viewed as a false premise. If it were not universally viewed as a false premise, that is only another dividing issue.
There are two questions here. The more important of the two questions is the first one. I do not think anyone, however they word the question, will get a much different answer to the first question. That is really not shocking. People are very tax-averse and sensitive about how their funds are used.
In truth, you have some misgivings about giving money to the arts in general. That is not my view, but that is a view.
You are asking about the second question. Could it have been worded in a different way? Absolutely. Would it have made much difference to the answer? Maybe not.
Senator Goldstein: You do not know that, do you? That is hypothesis on your part, is it not?
Mr. Winn: Yes and no. I do not know it, because I did not test it. On the other hand, we do a lot of testing, often only for the fun of science.
Often we find that the way a question is phrased has an impact; other times, we are shocked to find it has no impact. It may have no impact when views are very firm. Respondents hear only one or two words and then they are not hearing the rest of the sentence. They are deciding how they will answer before you finish the sentence.
Senator Goldstein: You and I will agree on an etymological basis that asking a question that says, "Shall you continue such behaviour," is different from asking the question, "Shall we commence such behaviour."
Mr. Winn: Yes. If you are going to get technical about it, saying that something is taking place, or continues to take place, generally arouses less opposition than if we had said "commence." Had we said "commence," the opinion would have been much more, let us say, in the spirit of Charles McVety than David Cronenberg. By saying "continue," we are implying continuation, and people tend to say whatever has been happening, leave it be.
Senator Goldstein: Is that not the same as asking when did you stop beating your wife?
Mr. Winn: No, it has nothing to do with that.
Senator Eyton: We are going in bits and pieces looking at the survey. Would it not be useful for our witness to read the largest part of the first page, which is his finding, and then go on? It would put it in context, not for us but so that the people watching on television will understand what we are doing.
The Chair: Are senators comfortable with that?
Some Hon. Senators: Yes.
Some Hon. Senators: No.
Mr. Winn: The key question, which I think Senator Banks read, is this:
There is controversy today about government subsidies for films considered X-rated or pornographic. One such film has a 3 word title; the first 2 words are "Young People" while the third word starts with the letter F. Which of the following opinions is closest to your own?
These opinions are randomized, so there is no question order effect. The first respondent hears it in one order, and the second respondent hears it in another order, and so on.
The were different options that respondents could choose. Those films should be banned and made illegal in Canada. About a quarter of Canadians say that is the case, with a higher percentage being women than men. They should be allowed but should receive no government subsidies. Slightly less than half took that position, 46 per cent. The total against subsidies, including those who would ban them, was 72 per cent. They should be entitled to receive government subsidies as much as any other Canadian film. That was supported by 24 per cent, slightly more among men than women. Unprompted, a few people volunteered that governments should not be subsidizing film production in general. However, that was not one of the presented options. Four per cent said they do not know.
Senator Tkachuk: I am not surprised by what is said. There is a division of opinion in the country, and it is expressed in the political debate that is taking place. What is a surprise to me is that 24 per cent actually favour subsidies for pornographic films. I thought that was a little high.
Mr. Winn: I was much more surprised by the 26 per cent who would ban them and make them illegal.
Senator Tkachuk: I am not surprised by that. It makes sense to me that there would be that many people who would say we should not have any at all.
Could you spend a minute on two issues. First, a greater number of women are more concerned by this. Second, could you explain and report on the question on page 4 regarding withholding. I think it is important for whoever is watching this that the survey is explained while we are asking the questions.
Mr. Winn: Singling out the roughly one quarter who favour continued subsidies — treatment of this category of film like all other Canadian film — they were asked a follow-up question. We have already talked about that question, but I will read it out.
Some people say that film subsidies put the principle of freedom of speech for the film-maker in conflict with the principle of freedom of conscience for the taxpayer. Suppose that the government continued to subsidize X-rated, pornographic films. In that situation, do you think that individual taxpayers should be allowed to refuse to pay their personal contributions to these subsidies if doing so was against their conscience?
Should taxpayers definitely be allowed to withhold their share of the subsidies as a matter of conscience? Eighteen per cent of those who favour the subsidies say that should be the case. Twenty-one per cent of those who favour the subsidies think the taxpayers probably have a right to withhold their tax contributions for that purpose. Sixteen per cent said they probably have no such right, and 40 per cent said they definitely have no such right.
In summary, among those who favour treatment of this category of film like all other Canadian film, 56 per cent say, on balance, the taxpayers should have no right to withhold their taxes for that purpose. Thirty-nine per cent say they probably or definitely should have such a right.
Senator Fox: I have two questions. First, you told us who your client was. What is the size of your sample?
Mr. Winn: It was 500 people.
Senator Fox: How many people were there by region in the West, in Central Canada, in Quebec and in the East?
Mr. Winn: It is totally stratified. Every region and sub-region is represented in this sample in proportion to their share of the population according to Statistics Canada.
Senator Fox: Could you give me the numbers? How many people were interviewed in the West? How many in Ontario?
Mr. Winn: It would be roughly Ontario's share of the population, which is under two fifths. Then, within Ontario it would be further stratified among the regions of Ontario in proportion to their share of the population. Quebec's share would be under a quarter, corresponding to Quebec's share.
Senator Fox: Is that about 125 people, mostly in Montreal?
Mr. Winn: Roughly.
Senator Fox: Mostly in Montreal; is it not stratified across the province?
Mr. Winn: No, it would be stratified across the province.
Senator Fox: Therefore it would be 50 in Montreal and 25 across the rest of the province.
Mr. Winn: That is roughly correct.
Senator Fox: I wanted to ask you a question based on your own question. There is an assumption in your question. You are saying there is controversy about government subsidies for films considered X-rated or pornographic. Your assumption is that the government is, indeed, subsidizing films considered X-rated or pornographic, correct? Is that the assumption in your question? Did your client approve the question?
Mr. Winn: All clients approved the question.
Senator Fox: Did your client contribute to making the question?
Mr. Winn: Not at all.
Senator Fox: He approved the question, though. Thank you. You then mention the film with the three-word title, YPF. To my knowledge, this film has not been released yet. However, you refer to it as X-rated or pornographic, and you assume it has received funding from the government.
First, who decided that YPF is or should be X-rated? It is in your question; you are saying it is X-rated. You are stating that it is X-rated or pornographic. Who are you to decide that a film is X-rated or pornographic? Do you have expertise in that area?
Mr. Winn: I do, actually.
Senator Fox: Are you on a censorship board?
Mr. Winn: No, but I do public opinion research, and I have zero doubt that anyone conducting a poll asking people if they thought a film with this title was definitely, probably, probably not, or definitely not pornographic —
Senator Fox: Therefore you are judging it on the basis of a title. The title could be a marketing ploy. I am not trying to defend the film. I am simply trying to find out the type of methodology that you have followed.
You decided in advance — before any censorship board has seen it — that is X-rated or pornographic?
Mr. Winn: No, I have not decided that it is X-rated or pornographic.
Senator Fox: It is in your question.
Mr. Winn: No, you are wrong.
Senator Fox: I am wrong that it is in the question?
Mr. Winn: Exactly. It does not say that Conrad Winn considers it X-rated. It does not say it is X-rated. It says "films considered X-rated."
Senator Fox: "One such film has a 3 word title." The question says there is concern about "films considered X-rated or pornographic." Then you mentioned —
Mr. Winn: You have every right to ask me questions and I have a right to answer. It says "for films considered." Any casual reader of the mass media would see there are people who consider a film with this title to qualify for the category.
Senator Fox: Would you not agree that anyone being asked the question would assume there are government subsidies for films considered X-rated or pornographic? Can you name one film that is pornography that has received government subsidies, since you formulated the question?
You are a university professor and you teach political science, as well. I assume there are ethical standards that one must have in deciding to ask a question and to predetermine that a film is X-rated or pornographic. I do not understand it. Your assumption is that it is. Why are you asking a question where the assumption is stated?
Mr. Winn: I am not making any such assumptions at all.
Senator Fox: Then I do not how to read English.
Mr. Winn: Possibly. "There's controversy today about government subsidies for films considered" —
Senator Fox: Therefore you are saying there are government subsidies "for films considered."
Mr. Winn: Correct. I will address your question in a spirit of open-heartedness. There is nothing wrong with this question, but in fairness, no one question or one poll should ever be the only gauge of where the public stands.
If I were in your position, I would not feel the need to attack this question. I would ask a simpler question: Could there be other ways of phrasing it and would it be useful to have other ways of phrasing it? Having asked that, I would agree with you.
Senator Fox: You are saying that not one question determines the validity. The second question goes on: "Suppose the government continued to subsidize . . . ." In my mind, "continued to subsidize" indicates that the government is already doing so. You say ". . . continued to subsidize X-rated, pornographic films. In that situation, do you think . . . ."
That is an assumption. You are telling the person who is answering — you are not only assuming, you are telling them — that the Government of Canada is subsidizing pornographic and X-rated films. That is not the case.
Mr. Winn: That is your judgment and may even be my judgment. However, if you presented these films to a cross-section of the public, an amazing share of the public would deem some of the films that you and I may think innocent enough as pornographic.
Senator Fox: List the ones subsidized by the government that you are talking about. Which ones subsidized by the government are pornographic? Which ones are subsidized by today's government, which is not prone to subsidizing pornographic films?
Mr. Winn: I am here on public opinion measurement. I am not here to discuss what our film policy should be.
Senator Fox: I am challenging the way you have conducted this poll. It presumes many things. There are numerous assumptions in here. I would not want to run an election campaign based on the types of questions asked here.
I am angry because the types of questions asked have assumptions and are being presented as a scientific poll. That is why I am upset.
Mr. Winn: Apart from feeling that the senator's comments were outrageous, I have nothing more to say.
Senator Tkachuk: Is this committee past its time? To go further from our time, do we need whips' agreement? Am I right on this or not?
I have another appointment at 6:30 p.m. and I think others here may as well. I was thinking that perhaps we have run the route.
The Chair: There are others who wish to ask questions.
Mr. Winn: It is quite legitimate to calmly state — without impugning motives and casting aspersions on confidence — that there are several legitimate ways of asking a question. Lots of different questions should be asked to gauge the full sense of what the public thinks. However, I think that it would be wrong for anyone to think that there is not controversy among the public. It would also be wrong to think, however the question is worded, that there are not a lot of misgivings among the public.
Senator Harb: I am in conflict. I happen to know Mr. Winn from his days as a university professor and as a leader in the community who has done a tremendous amount of excellent work in his field. I do not think for a moment that he would ever have done anything outside of the perfection of his profession.
Knowing how the industry works — all of the public opinion polls and the companies that do public opinions — it is all a function of the question. I do not think Mr. Winn is denying that. He is telling us, in essence, it depends how he asks the question. Sometimes he can get a certain answer.
The way this question is asked is absolutely brilliant, considering the sponsor is the Institute for Canadian Values. I think they were brilliant in asking it the way they did.
In fairness, the subject matter is not before us as it is now. Pornographic movies do not qualify in any shape or form. It is a legitimate question to ask. However, if I want to validate the question of whether the government is in fact giving money to X-rated movies, the answer is no.
I also had an issue with the second question, which is a little more complicated, asking a constituent or taxpayer to create the balance between the freedom of conscience and the freedom of expression. I have no problem with the first question as it is, and I agree with you. I do not know how I would answer it. I think many of my colleagues on the committee would not know how to answer such a question. The Institute for Canadian Values has raised an interesting aspect in their questions. It is not on the agenda of the committee, so we are not discussing the issue. Therefore, I do not think it is fair for us to take issue with you. You have done a marvellous job for your client and your client is lucky to have had you conduct the survey on his or her behalf.
Mr. Winn: Thank you very much.
Senator Ringuette: I have never experienced contracting a polling firm, even though I have been in politics for 20 years. The dynamic that exists between Mr. McVety, your client, and you is interesting. You said that your client approved the questions. Was the client the supplier of the questions?
[Translation]
Mr. Winn: No, and that is easily understandable. Someone like Mr. McVety really believes that people view the world of film in the same light as him. Thus, it would be virtually impossible for him to find anyone within the film industry who does not share his opinion.
[English]
Given that he sees the average Canadian as thinking the same way that he thinks, it would never occur to him that it would not matter what the question asked is or that he would have a say. However, as in all polls, ultimately those who pay have to approve.
Senator Ringuette: You said that the survey total was 506 people. How long does it take to poll 506 people?
Mr. Winn: It depends on how many people you have on the telephone. You have to consider that a huge number of phone numbers dialled are dead because they are not assigned to a household. A huge proportion of the households that you reach have no one at home. A huge proportion of the households with people at home are too busy to participate in a poll. Thus, you phone an awful lot of people to complete interviews with only 500 people.
Senator Ringuette: Would it take a week?
Mr. Winn: It depends upon how many interviews you assign. It might take one to three evenings at most.
Senator Ringuette: I am looking at the time frame that you have specified. The survey was completed on April 11, 2008. You put forth your report to Mr. McVety on April 14. By coincidence, Mr. McVety was before this committee on April 16. I guess this poll was designed specifically for Mr. McVety to come before this committee.
Mr. Winn: You would have to ask him that question.
Senator Ringuette: I wish I could do that. Thank you.
Senator Goldstein: Mr. Winn, we do not want to keep you here any longer. Thank you for coming.
Could I ask that you send us in the next day or so the questions that were asked in French? Would you do that for us, please?
Mr. Winn: Certainly.
Senator Goldstein: Thank you.
Mr. Winn: I will ensure that you have them.
Senator Tkachuk: For clarification, when Mr. McVety testified before the committee, he referred to this poll. We asked to see it. He was kind enough to leave with us something that belonged to him and to produce the pollster. We were the ones who asked to see the pollster.
The Chair: Are there any other questions for Mr. Winn?
Thank you for coming, Mr. Winn.
Senators, we have a free hour in addition to the one witness tomorrow. I think you want to discuss issues of procedure. We can do it tomorrow or do it now.
Senator Goldstein: I am respectful of Senator Tkachuk's concern about being at his next meeting. I respect that, sir. I am perfectly ready to wait until tomorrow morning.
The Chair: We will adjourn the meeting until 10:45 a.m. tomorrow, as scheduled.
The committee adjourned.