Proceedings of the Standing Senate Committee on
National Finance
Issue 1 - Evidence - Meeting of March 10, 2010
OTTAWA, Wednesday, March 10, 2010
The Standing Senate Committee on National Finance met this day at 6:45 p.m., pursuant to rule 88 of the Rules of the Senate, to organize the activities of the committee.
[English]
Adam Thompson, Clerk of the Committee: Honourable senators, as clerk of your committee, it is my duty to preside over the election of a chair, and I am now prepared to receive motions to that effect.
Senator Gerstein: It is my great honour to nominate Senator Day as chair of the Standing Senate Committee on National Finance.
Mr. Thompson: Thank you, senator. Are there any other nominations?
[Translation]
Mr. Thompson: Are there any other nominations?
Senator Ringuette: I move that the nominations stop.
[English]
Mr. Thompson: If there are no other nominations, I will put the question before us. It is moved by Senator Gerstein:
That the Honourable Senator Day do take the chair of this committee.
Is it your pleasure, honourable senators, to adopt the motion?
Hon. Senators: Agreed.
Mr. Thompson: I declare the motion carried and invite Senator Day to take the chair.
The Chair: Thank you very much, colleagues. I would like to thank my campaign chair, Senator Gerstein.
We all have in front of us a proposed agenda, organizing committee. We just did the election of the chair, Item 1.
Item 2 is the election of deputy chair. Could I have a mover for the position of deputy chair?
Senator Neufeld: So moved, Senator Gerstein.
The Chair: I saw Senator Ringuette first, if you would not mind.
Senator Neufeld: No, that is fine.
The Chair: I do not need a seconder. Are there any other nominations? Hearing no other nominations, I ask the clerk to cast one ballot in favour of Senator Gerstein and declare him as deputy chair of this committee.
Welcome and congratulations and thank you.
Item 3 concerns the Subcommittee on Agenda and Procedure, which is normally referred to as the steering committee. It states:
That the Subcommittee on Agenda and Procedure be composed of the chair, the deputy chair, and one other member of the committee to be designated after the usual consultation; and
That the subcommittee be empowered to make decisions on behalf of the committee with respect to its agenda, to invite witnesses and to schedule hearings.
Senator Ringuette: What is "the usual consultation''?
The Chair: The usual consultation has taken place in this instance, as I understand it. Senator Gerstein, would you like to let us know who that other member of our steering committee might be?
Senator Gerstein: It is with great pleasure that the gentleman to my right, Senator Neufeld, will be the other member.
The Chair: Excellent. We look forward to working with you on the steering committee. We should have a formal motion moved that the subcommittee can do those various things and acknowledge that the usual consultation has taken place. Senator Ringuette, thank you.
All those in favour, say "yea.''
Hon. Senators: Agreed.
The Chair: Contrary minded if any? Thank you. Motion carried.
Item 4, motion to publish the committee's proceedings. Could I have a mover that we publish our proceedings?
Senator Callbeck: I so move.
The Chair: Thank you, Senator Callbeck.
All those in favour of the motion say "yea.''
Hon. Senators: Agreed.
The Chair: Contrary minded, if any? Motion carried. Thank you.
The next item is Item 5, which concerns authorization to hold meetings and to receive evidence when quorum is not present. This is important. Mr. Thompson, please explain this item to members. I think this should be explained.
Mr. Thompson: Senators, the quorum of the committee as set by the Rules of the Senate is four senators. There is a provision under rule 89 to allow the committee to authorize evidence to be taken when there is less than a quorum. As you can see in that proposed motion, it includes a specification that each side must be represented. What that would allow is were members to be late or were there an attendance issue, the committee could still proceed to hear that evidence, but no decisions could be taken without a full quorum being present. This only refers to the receiving and publishing of evidence.
The Chair: Is everyone comfortable with that motion? Senator Neufeld moves that it be accepted. All those in favour will please signify by saying "yea.''
Hon. Senators: Yea.
The Chair: Contrary minded, if any? Motion carried. Thank you.
Item 6 concerns the financial report. It states that the committee adopt the draft first report prepared in accordance with the rules. After each prorogation or dissolution when we first come back, we are required to do a report of everything we spent previously, as I understand it. We have that in front of us, do we? Are there any questions that the clerk can help you out with in that regard? You will note that we are not one of the big spending committees. We spent $7,800 in our last year or so.
This is a report of what has already happened. We have not looked at our proposed budget. Could I have a motion to accept this financial report?
Senator Finley: So moved.
The Chair: Thank you. All those in favour will please say "yea.''
Hon. Senators: Yea.
The Chair: Contrary minded, "nay.'' Motion carried. Thank you.
The next item concerns research staff. Now, we have three different paragraphs here that the committee ask the Library of Parliament to assign an analyst to the committee. I am very pleased to let you know that the Library of Parliament has assigned Lydia Scratch to be our primary person from the Library of Parliament, assisted by Sylvain Fleury. We are sad to see Jean-Francois Nadeau leave us. He has done a fine job in the past, but he has moved on to bigger and better things. We are pleased for him. With your permission, I think we will send him a note of congratulations and best wishes.
Senator Ringuette: Where has he gone?
The Chair: He has moved on to Finance.
Senator Ringuette: To the Department of Finance?
The Chair: Yes, from the Library of Parliament to the Department of Finance.
The second paragraph concerning research staff states:
That the Subcommittee on Agenda and Procedure be authorized to retain the services —
We do not need that, do we?
Mr. Thompson: Yes, we do.
The Chair: It continues:
— services of such experts as may be required by the work of the committee.
This is broader than the motion that was passed, but it is a usual motion that authorizes us to — please explain that to us, Mr. Thompson.
Mr. Thompson: Normally this motion includes an additional paragraph that authorizes the chair to seek the permission to engage experts as are required. However, this afternoon, Senator Comeau proposed a motion that was adopted that gave that authority to all committees. This motion delegates that authority to the steering committee. Of course, before they could engage any services, the committee would have to prepare and submit a budgetary application and receive a release of those funds from the Senate.
The Chair: Thank you. I know most of us were aware of that motion that Senator Comeau dealt with today.
The third paragraph of Item 7 states:
That the chair, on behalf of the committee, direct the research staff in the preparation of studies, analyses, summaries and draft reports.
Then, of course, all those reports must be brought back here before they become committee reports in any event.
Any question on that rather long resolution? Could I have a motion to accept? Thank you.
All those in favour will signify by saying "yea.''
Hon. Senators: Yea.
The Chair: Contrary minded, if any, "nay.'' Motion carried. Thank you.
The next item concerns the authority to commit funds and certify accounts. We have three paragraphs here as well. Is there anything in here, Mr. Thompson — whenever we talk about accounts and spending money, we get you involved.
Mr. Thompson: This is a standard motion that has been adopted each year. The third paragraph is not new this year but is relatively new, and it reflects some developing policies from Internal Economy. This is the standard accounting practice.
The Chair: In this motion it is noted that the chair and the deputy chair must both sign off on the commitment of any funds for hiring outside consultants. I do not think we will have any difficulty with that because we would not be hiring them without the authority of this body.
Could I have a motion to accept that authority to commit funds?
Senator Neufeld: So moved.
The Chair: Thank you. All those in favour will signify by saying "yea.''
Hon. Senators: Yea.
The Chair: Contrary minded, if any, "nay.'' Motion carried. Thank you.
The next item concerns travel. It is Item 9. It states:
That the committee empower the Subcommittee on Agenda and Procedure to designate, as required, one or more members of the committee and/or such staff as may be necessary to travel on assignment on behalf of the committee.
I do not know that we have ever needed to do that, but it is nice to have it there. Could I have a motion? Thank you. Senator Finley so moves.
All those in favour will please say "yea.''
Hon. Senators: Yea.
The Chair: Contrary minded, if any? Motion carried. Thank you. The next item concerns the designation of members travelling on committee business.
Mr. Thompson: The Senators' Attendance Policy includes a provision for a senator to be declared on "official business'' if travelling on behalf of the committee. This delegates the authority to the steering committee to make a determination if a senator is travelling on behalf of the committee for official business. It is just related to the attendance policy.
The Chair: If you are away and you do not have this and you do not have your whip's approval, then you are counted for attendance purposes. This helps for attendance purposes, even if you are not in the Senate.
Senator Callbeck: Is this new?
The Chair: Maybe we have never looked at it closely before, but it has been around for a while. Did Senator Callbeck move that item?
Senator Callbeck: Yes.
The Chair: Thank you. All those in favour will please say "yea.''
Hon. Senators: Yea.
The Chair: Contrary minded, if any? Motion carried. Thank you.
The next item is Item 11. It concerns travelling and living expenses of witnesses. It states:
That, pursuant to the Senate guidelines for witness expenses, the committee may reimburse reasonable travelling and living expenses for one witness from any one organization, and payment will take place upon application, but that the chair be authorized to approve expenses for a second witness should there be exceptional circumstances.
When we have witnesses before us, Mr. Thompson, could you explain where that money comes from in relation to our budget?
Mr. Thompson: Witness expenses are paid for out of a global budget administered by the committee's directorate. When Internal Economy allocates funds for committees, there is some money set aside for special expenses, which would be the budgetary application that we would make if we were to travel or for anything of that nature. There is an envelope that is allocated and administered by the Principal Clerk of Committees Directorate that deals solely with witness expenses and video conferences. It does not actually come out of our pool. However, as you will note in the rule 104 report that we discussed previously, we do report how much was incurred for those expenses. It does not come out of our budget.
Senator Gerstein: I would like to clarify. It is not automatic that a witness receives travel funds. In other words, when we have heads of banks or what have you, surely they are not getting compensated for travel.
Mr. Thompson: I have never been asked for reimbursement by those organizations.
Senator Gerstein: So there is a judgment brought to who receives and who does not?
Mr. Thompson: Yes.
The Chair: It would be very strange if the chairman of the Bank of Canada asked for reimbursement, but reimbursement for university professors and others is appropriate.
Senator Gerstein: Yes, where appropriate.
The Chair: We have in here somewhere, if they ask — travelling and living expenses for one or more witnesses. Upon application, will take place upon application.
Senator Gerstein: So it is not automatic. That is my point.
The Chair: Yes, but we do let them know. When Mr. Thompson contacts a potential witness, he lets them know there are some funds available to help defray some of their expenses. Is that correct?
Mr. Thompson: That is correct.
The Chair: Could I have a motion to accept this particular clause? Senator Marshall so moves. Thank you. All those in favour will please signify by saying "yea.''
Hon. Senators: Yea.
The Chair: Contrary minded, if any? Motion carried. Thank you.
The next item concerns communications. Mr. Thompson, could you explain the communications motion?
Mr. Thompson: This is the only significant change to the standard agenda and it has an added paragraph. For a number of years now we have been assisted by a communications officer assigned by the Senate Communications Directorate. This motion used to only deal with the power to broadcast. We have now expanded it to formalize the role and accountability of those officers and delegating to the steering committee the authority to direct them, as is done with most other things.
Again, normally we would be asking for permission from the Senate to have the power to broadcast. That was done by a global motion for all committees this afternoon. It just sets out how that determination is made.
The Chair: We are not asking for any power here that is not authorized by the Rules of the Senate.
Mr. Thompson: That is correct.
The Chair: We are not trying to go beyond the normal communications rules.
Mr. Thompson: Not at all.
The Chair: Could I have a motion then to accept this particular resolution? Senator Ringuette. Thank you. All those in favour signify by saying "yea''. Contrary minded, if any? Motion carried. Thank you.
I would like to point out that Francine Pressault was here and she is our communications person. If we, as a steering committee or as a group, feel that there is some point that we want to make sure that we get out to the public, Francine works for the Senate and is here to help us out.
Lydia Scratch has just joined us from the Library of Parliament. This able gentleman to my left is Adam Thompson, who works for the Senate as our clerk, and we are extremely lucky to have him as the clerk of the Standing Senate Committee on National Finance.
Here are some more items for your information. On time slots for the regular meetings, it says 9:30 a.m. to 11:30 a.m. That one has not changed; it is a two-hour time slot on Tuesday morning. Then on the Wednesday evening meeting — I guess this has been negotiated — there is a 15-minute delay over our regular time. It is now 6:45 p.m to 8:45 p.m. Is everyone comfortable with the time change? Is there a reason for that change?
Mr. Thompson: Yes. I understand that the rationale for that change was a shift in what was the 4 p.m. time slot that would traditionally start right at the adjournment of the Senate on Wednesday afternoons. That has been shifted to 4:15 p.m. to allow time for senators to get to those meetings, which, in turn, shifted us an additional 15 minutes later.
The Chair: Now we hopefully will not have to be standing outside the door waiting for another committee to get out on Wednesday nights, which sometimes happens.
Mr. Thompson: That is exactly it.
The Chair: Okay. They are our time slots. If you can make them, that is great. If you cannot, that is not good. Do your very best to try to be there and if not, have a substitute.
Is there any other business? I have a few items that I will talk about and maybe this is the appropriate time.
Mr. Deputy Chair, is there any other business that we should talk about at this stage? We have a little bit of time, but the organization meeting is basically finished.
I want to discuss where we are going from here and then maybe the steering committee could stay with Lydia and Adam afterwards for the steering committee to talk about timing.
Senators, you have received two books. They are on your desk and we do not have much time to deal with them. We have to prepare a report. We have to have hearings and then prepare a report and have the report debated and accepted in the Senate before the supply bill that comes along. There is a schedule included that will be on the supply bill. It is the same. We know how much the supply bill will be for.
Supplementary Estimates (C) have to be done by the end of March. This is the final supply for the government before the end of March. We have to get our work done and get a report in, which involves you and involves all of us in adopting the report, and filing it and having it adopted by the Senate.
In addition to that, we have Main Estimates for next year. Starting April 1, the government's appropriations will be based on them. We have to start our study on the Main Estimates — not finish it, because we can study it all year, but we have to start it — and produce a preliminary report that forms the basis for interim supply. We will do interim supply from April 1 to June 30.
That happens every year, but because of prorogation, we are really squeezed on these two things. It will take virtually all of our time between now and the end of March to complete that work. It is not a matter of "we will get it done when we get it done.'' Because of the fiscal year end and the beginning of the next fiscal year, this is something we will get done; and we will sit out of our normal time slots, if we have to, to get it done.
That is what we will talk about as a steering committee. We will attempt to do our planning so we can complete our hearings and produce a report with which all members are comfortable. We have to present that report and have it passed in the Senate. Anyone can speak on it, and hopefully you will speak on some of these reports so they do not just get a very quick passage, because that is what happens in the House of Commons. The reason we get the supply bills so late is because they deal with them at the very last minute. The House of Commons is a confidence house, and these are more important over there, but the government still has to have the money, whether we are a confidence house or not.
That is what is staring down on us. After that is complete, we can anticipate, between the end of March and summer recess, we will likely have the Supplementary Estimates (A). The problem with this is it was prepared before the Budget 2010, so it does not reflect any of the budget details.
Therefore, we will get a Supplementary Estimates (A). This is Supplementary Estimates (C); we did an (A) and (B) earlier this year. Supplementary Estimates (A) will have to be done; we will have to go through the same steps — hearing, report and then a supply bill that comes to match up to it.
It is likely that we will be getting a budget implementation bill that comes from the budget, which will take a lot of work, but we do not know yet. Inquiries have been made, but no one knows when it might be coming down. However, it will reflect obviously what was in the budget last week, so it will take a while to get that. In addition, we have to keep studying the Main Estimates and do a report so that final supply can be completed before the end of June.
You can see that this committee will be very active. We already know the work ahead of us. We know that all of this has to be completed and we are prepared to do it; but we are dealing with what is the essence of government, supply. If they do not have funds to meet the promises, the commitments and the infrastructure, then the whole thing falls apart. Our role here is to provide an overview of that supply cycle.
Our role was explained to some of you who were able to make the meeting that we arranged with all of the officers of Parliament. I am really glad you were able to be there, and I know several of you were.
The officers of Parliament are there to help parliamentarians understand the process in their particular area and help us be properly informed to ask the right questions of the government, the executive branch. We typically will bring in one or two officers of Parliament each year and often that is around the time they do their reports. Your steering committee will work on trying to determine who we should bring in at the appropriate time and who is available to come in at that time.
In addition to that, when there is time, we try to do some usually short, succinct studies on different matters. A final point that I would just like to make now before we adjourn is that if any of you have any ideas, either now or if you want to send in something to the steering committee, we would be pleased to consider those items. These are subject matter studies. They are not based on a bill or a supply or estimates, but they are subject matter studies that relate to finance and government finance.
One of the typical ones we have done over the last year is we have been following the stimulus package, where the money has been going, how it has been going out, what things have changed within Canada Mortgage and Housing, Business Development Canada and Export Development Canada. You will recall that was all stimulus spending. We probably should follow up on those departments to see how they are doing since there is a second phase.
There is much work of importance to us in the Treasury Board, the Prime Minister's Office and the Privy Council Office. There are often witnesses to tell us what is happening on certain subject matters that we decide we would like to follow up.
My theory in the past has generally been that hot political matters — the things we are reading about in the paper every day — should be dealt with by the House of Commons. That is their domain. We should try to look at longer- term matters, not those that are only the flavour of the day.
Senator Gerstein, I have spoken enough, but I know you have an item you want us to follow up. I found the initial meeting in relation to currency very interesting. We had one hearing on that in the last session. Would you like to explain a bit on that?
Senator Gerstein: I was not intending to do it tonight, but I would be happy to make an overview comment. One area the Department of Finance is interested in this committee pursuing is a review of the status or future status of the penny in our currency. Budget 2010 anticipates changing the metal content of both the loonie and the toonie. They are planning to change the nature of bills from paper to a new technique being explored. There is also great support for us looking at this issue.
I remember Senator Eggleton's kind comments about it at the time, regarding how it would save him money in terms of his pants not being ripped by the volume of coins that he carries on a regular basis. This is something that we might consider as we go forward.
The Chair: We had representatives from the Royal Canadian Mint appear. It was an interesting study. An area that I found fascinating in addition to the penny discussion was that no one seemed to have control over how many pennies, loonies or toonies they would produce. We could not get to the bottom of that discussion, which we may want to do one day.
Senator Eggleton: I would like to see the penny go, but that is not what I want to talk about now.
We had a couple of sessions in this committee last year on the pension system in Canada. It is becoming an increasingly bigger issue for many Canadians. Witnesses said there are approximately 5 million Canadians who do not have adequate pensions. That number represents one-third of our workforce. I am combining both private and public pension systems in that description. This is very timely and appropriate for this Senate committee to review.
If you do not want to go into a further discussion on that issue this evening, Mr. Chair, I would be happy to make a submission on it to the steering committee.
The Chair: Does anyone else have a favourite subject to tell us about now that you would like the steering committee to consider? Senator Eggleton, it would be helpful if you could prepare a brief.
Senator Eggleton: I would be happy to appear before the steering committee as well.
Senator Ringuette: As a past member of the steering committee, I certainly support Senator Eggleton's suggestion. We are not talking about a few million dollars of activity in the economy; pensions are billions of dollars and impact the long-term sustainability of CPP with regard to the aging population of Canada and health care. All of that affects the issue of pensions whether looking at public service pensions, private corporate pensions or private pension investments.
I have great fears. The Banking Committee discussed pensions and pension funds several years ago. The committee was reassured by financial institutions in Canada that their investments in regards to pension funds such as the Ontario Municipal Employees Retirement System, OMERS, or any group investing funds for pensioners were all secured. Everything was secure and there was no worry for the federal government.
Well, ladies and gentlemen, it is not the case. We have to be realistic about this pension issue. If pensions are in jeopardy from whatever source — public or private — the end result is that pensioners will have to rely either on provincial social transfer programs or other federal programs to sustain themselves.
I think this is an urgent issue also recognized by the provincial premiers. They acknowledge that these pension issues must be reviewed.
I hope we will provide more time to continue the research we started last fall. We were starting to get bits and pieces here and there, but not enough to have a clear picture. Was not it in January that provincial premiers met in Whitehorse to look at a report they had ordered? We should look at all of these issues because ultimately this committee has to agree in regards to transfers to the provinces with regard to supply that will have an impact. We also must agree to the amount of money put into the Public Service Pension Plan.
We need to look at all of those elements to have a broad picture to see if the pension issue for all Canadians is adequate in the future — that is the minimum necessary to survive. I do not think it is there now for anyone. It is a major concern. In some instances, the concern is immediate or even yesterday in the case of Nortel, CanWest and many forestry workers, et cetera.
However, the medium and long term issues relating to pensions need our attention.
[Translation]
The Chair: Thank you, Senator Ringuette. Are there any other comments regarding pensions or other studies that we can undertake? These studies will probably be done in the fall, as we will be very busy until the summer break.
[English]
Honourable senators, I passed two documents around for your leisurely reading. One is the Library of Parliament's A Guide to the Estimates. The other is simply An Introduction to the Standing Senate Committee on National Finance.
You should have found those two booklets.
I do not have anything further.
Senator Ringuette: Mr. Chair, I have a motion. In the last few sessions of this committee, there was a certain agreement that I would like to put into a formal agreement in the way of a motion.
I would like to move that any time that Senator Finley or I decide to go for a fresh air break that we pair in doing so.
Senator Finley: I smoke more than she does.
Senator Ringuette: Is that agreed?
Senator Finley: Absolutely.
The Chair: It is so nice that it works out that way. I wish the both of you and each of you the best.
Senator Finley: We will probably both catch pneumonia at the same time.
The Chair: As long as you are paired, that is what is important, right?
Is there anything else? Then I will call this meeting to an end. I thank you all very much and look forward to working with you. To the new senators who have joined us, welcome. I think you will find this to be the number one committee in all of the Senate in terms of the work we are doing and in terms of the jovial congeniality we have here.
(The committee adjourned.)