Proceedings of the Standing Senate Committee on
Agriculture and Forestry

Issue 10 - Evidence - Meeting of April 29, 2014

OTTAWA, Tuesday, April 29, 2014

The Standing Senate Committee on Agriculture and Forestry met this day at 5:03 p.m. to study the Canadian Food Inspection Agency's User Fee Proposal respecting overtime fees, pursuant to the User Fees Act, S.C. 2004, c. 6, sbs. 4(2).

Senator Percy Mockler (Chair) in the chair.


The Chair: Honourable senators, I welcome you to this meeting of the Standing Senate Committee on Agriculture and Forestry. To the witnesses from the department, thank you for accepting our invitation.

At this point, I will introduce myself. I am Percy Mockler, a senator from New Brunswick and chair of the committee. I would ask senators to introduce themselves, starting with the deputy chair.

Senator Mercer: Senator Terry Mercer from Nova Scotia.


Senator Robichaud: Fernand Robichaud, Saint-Louis-de-Kent, New Brunswick.


Senator Oh: Victor Oh, Ontario.


Senator Maltais: Senator Maltais, Quebec.

Senator Dagenais: Jean-Guy Dagenais, Quebec.


Senator Johnson: Janis Johnson, Manitoba.

Senator Ogilvie: Kelvin Ogilvie, Nova Scotia.

The Chair: Thank you.

Today the committee will consider the Canadian Food Inspection Agency's User Fee Proposal respecting overtime fees. We welcome today, from the Canadian Food Inspection Agency, or the CFIA, Tony Ritchie, Executive Director, Strategic Policy and International Affairs; and Linda Webster, Director of Strategic Partnerships Division.

Thank you for accepting our invitation to appear and share your comments. We will hear from Mr. Ritchie, who will make his presentation, followed by questions from the senators. Please proceed.

Tony Ritchie, Executive Director, Strategic Policy and International Affairs, Canadian Food Inspection Agency: Thank you, Mr. Chairman. I appreciate this opportunity to provide some context to the Canadian Food Inspection Agency's overtime user fees proposal and why action on this is so important to the agency right now.

This proposal is about bringing overtime fees being charged by the CFIA up to date to reflect the actual costs of services that we provide. This is in line with the modernization agenda that is currently underway at the agency to bring legislation and regulations up to date. This proposal is about cost recovery and about fair compensation for services rendered.


I would like to speak to three important points today. First, overtime fees would be collected from service recipients who request CFIA services outside regular working hours.

The second point concerns overtime requests made to the agency by service recipients on a completely voluntary basis.

The third will be overtime incurred by the agency that is not due to a service request but instead to a response to a specific issue, such as avian influenza, in which case no overtime fees would be charged.

The agency is mandated to serve Canadians by safeguarding food, animals and plants, which enhances the health and well-being of Canada's people, environment and economy. We have been doing this since 1997, when the agency was first created.


I want to make it clear that it has always been a shared responsibility. Industry is responsible for producing safe food and assuming the health of the plants and animals they produce. The agency's job is to verify industry compliance with the regulations. These services benefit the industry in that they contribute to marketplace confidence. However, these services come at a cost, especially when they are delivered outside of regular working hours.

The agency's overtime fees are currently set out in the Canadian Food Inspection Agency Fees Notice. Right now, Mr. Chair, the agency's overtime fees are based on the rates of pay and other benefits described in the respective collective agreements as they existed in 1995.


The current rates recover approximately 54 per cent of the cost to the agency to provide overtime service.

This brings me to point one. Overtime fees would be collected from service recipients who request agency services outside regular working hours.

Where possible, the agency delivers our quality services during regular working hours. The agency tries to be flexible in defining regular working hours for any given company. We often negotiate those hours with the service recipient. The agency's employees who typically deliver overtime services to service recipients are for the most part inspectors and veterinarians. They work day and night, including overtime when requested.


Overtime requests are made to the CFIA by service recipients on a completely voluntary basis. The majority of such requests from industry are for ``same-day'' overtime service to accommodate business needs.

A common example is that the service recipient may add an extra shift for their workers to meet a particular delivery deadline. In such a case, the service recipient may request that the CFIA employee work overtime because of that extra shift. The majority of overtime requests are for this kind of ``same-day'' service to accommodate business needs.

The agency deserves to recover these costs. Service recipients who get direct benefits from the services delivered outside of regular, negotiated working hours should pay for those services.

Mr. Chairman, it is not fair to expect taxpayers in general to subsidize services that provide direct benefits to individual service recipients.


In the event the overtime incurred by the agency is not due to a service request but instead to a response to a specific issue, such as to avian influenza, for example, no overtime fees would be charged. The agency has been providing and will be continue to provide its much needed services during regular working hours and beyond.

We take special circumstances into consideration. The agency is sensitive to the needs of all stakeholders, including industry. It consulted on this proposal. It held a 75-day public consultation from October 25, 2012 to January 11, 2013. The results are posted on the agency's website. The agency also followed up on stakeholder concerns. In response to stakeholder feedback, the agency rounded down its proposed user fees to the nearest dollar.


The agency also recommended that if the proposal is adopted, implementation of the revised fees would be delayed until fall 2014.

The fees being proposed now would be the first increase of overtime fees for the agency in two decades. To keep overtime fees aligned with costs and to reduce the need for large adjustments, the agency plans to review them every five years.

I trust that as this proposal is studied you will see how we need to update these cost-recovery fees so that the agency is fairly compensated for the services it delivers for Canadians every day and so that taxpayers in general no longer have to subsidize the services that provide direct benefits to individual service recipients.

Thank you.

The Chair: Thank you, Mr. Ritchie.

Senator Mercer: Thank you for being here, both of you. I appreciate that.

What is the projected new revenue for the agency if these price increases come into effect?

Mr. Ritchie: We only expect to recover the costs that it takes to undertake the service during out-of-hours service, so the overtime. On page 13, you will see the costs that we expect to incur in overtime based on average calculations, moving forward over the next three years. We would expect, through the proposal, to recover those particular costs. For year 2014-15, it indicates a partial cost recovery, and that is because, as we have indicated, we don't expect to implement this proposal until sometime later in the fall.

Senator Mercer: We are talking about $9 million or almost $10 million per year in costs and the cost recovery of the same amount. I am assuming that the people who are paying the fees, this $10 million, which is not chicken feed, will pass along the costs of that $10 million to their customers. Their customers may be a processor or may be a supermarket chain. The supermarket chain, when it has a price increase, will pass it on to whom? To the consumer. It seems to me that while some of this makes logical sense, in the end, the same old guy is going to get it, and that is the consumer.

You said in your presentation that you held 75 days of public consultations, from October 25, 2012 to January 11, 2013. How many people did you consult with in that time period?

Mr. Ritchie: During that time period, we have a ``Listserv,'' and we sent out information on that Listserv, which includes over 12,000 CFIA subscribers, email shared through existing business channels. We responded to stakeholder complaints both through written responses and follow-up meetings. As per the User Fee Act, individuals who are reviewing a proposal do have the opportunity to ask the minister to strike an independent advisory committee, and that request was not received. We have a summary of all of the comments we received — I believe they are in your package — and we have responded to those.

Linda Webster, Director, Strategic Partnerships Division, Canadian Food Inspection Agency: In addition, we had a series of engagements with our meat hygiene sector, which represents 90 per cent of the overtime costs incurred by our stakeholders. We are confident that within that consultation period we heard from the majority of those who are paying our overtime fees.

Senator Mercer: I am a little confused. I want to clarify that not only for myself but also for the public watching this broadcast today. You talked about 75 days of public consultations and 12,000 people on your Listserv. The consultation was done via email as opposed to face-to-face or having meetings in various parts of the country?

Ms. Webster: Yes.

Senator Mercer: It was all done by email?

Mr. Ritchie: That is correct.

Senator Mercer: So people who receive hundreds of emails every day get another email and are asked to comment on the cost of overtime. Am I interpreting that correctly?

Mr. Ritchie: You are right. The Listserv is extensive. However, as Linda has indicated, we went through the comments received. We did get comments back from two of our largest stakeholders, which represent, from an association basis, the largest percentage of those that would be impacted by the user fee proposal. We felt very comfortable at that point in time that we had connected to the right parties. Their comments were taken into consideration, and they were very good comments. At that point, we did feel that we were successful. It was a large electronic Listserv, but we did manage to get to those associations that represent a good proportion of members that would be affected by the user fee proposal.

Senator Mercer: Of the 12,000 people on your Listserv, what percentage responded?

Ms. Webster: There were five formal respondents.

Senator Mercer: Five out of 12,000?

Mr. Ritchie: Five formal respondents, but, as Ms. Webster indicated as well, there were two associations, the Canadian Meat Council and the Canadian poultry industry, who represent a good proportion of those individuals who would be impacted directly by the user fee.

Senator Mercer: I appreciate that two of the bigger players responded, but five entities out of 12,000 responded. In my old job as a fundraiser, if I got five people responding to my 12,000 requests, my boss would be throwing me out the door.

Did you not think that you should have been a little more proactive in finding another method of consulting with the stakeholders? I don't feel comfortable with five out of 12,000. I can't do the math to get that many zeroes out there; I have to rely on my good friend Senator Ogilvie to do that. However, I am concerned about that issue.

Senator Ogilvie: To follow up on that last point, it would be normal, in your roles, to deal with associations on behalf of large numbers of participants in a normal fashion, would it not, as opposed to dealing with each individual member?

Mr. Ritchie: In certain cases, we would take a balanced approach. In some cases, it would be a broader group of individuals, and in some cases we would undertake consultations with those particular entities that we feel are most implicated by the activity.

Senator Ogilvie: My questions relate to getting a sense of what this involves. You undertake investigations at your own initiative in the majority of cases; is that correct or is that not correct?

Mr. Ritchie: What do you mean by ``investigations?''

Senator Ogilvie: Well, whatever you do. You are talking about your agency going out and inspecting plants.

Mr. Ritchie: That's correct.

Senator Ogilvie: I should have used the term ``inspection'' perhaps. I am referring to what you do.

Mr. Ritchie: We do inspections in a variety of ways. They are basically risk-based, so we would identify, in a sense, those high-risk entities that perhaps, in the past, have either not complied with the regulations or undertake high risk activities. That is our basis for doing it.

Senator Ogilvie: But you initiate them?

Mr. Ritchie: Yes, we do initiate them, but in this case I would like to make the point that we are responding to the private sector entity that requests us to do inspections related to an activity that they need to have done for their benefit outside of our normal hours of operation. In that case, it is generated by the recipient. They are the ones coming to us and saying, ``I need you, agency, to do this inspection because I need to access a particular foreign market or the domestic market, and I need your clearance.''

Senator Ogilvie: That is why I asked the question, to get a clarification on how you normally operate. So the bulk of your work is dealing with compliance at your initiative.

The reason I am asking the question is the term on page 3 of your document, where you said, ``by service recipients on a completely voluntary basis.'' I had difficulty interpreting that in normal language, but I think I understand it now. You are referring there to exactly what you just indicated, that is, where they come forward to you and request that you visit.

Mr. Ritchie: Yes, that is correct.

Senator Ogilvie: In that regard, do these inspections normally involve some travel? During normal working hours, would it be normal for these to take more than one working day? Is there travel, and do they often take more than one working day?

Mr. Ritchie: There is travel involved, certainly. I can't respond to whether they would take more than one day or not. Some of the inspections are lengthy, depending on the size of the plant. For instance, we may find ourselves involved in a fairly large meat operation or processing plant, and the actual inspection could take a number of hours. I cannot answer whether, in fact, it takes one day or two.

Senator Ogilvie: Where I was going with this question was to determine the degree of actual out-of-pocket costs that the agency is incurring that you are actually recovering by this salary option. Clearly, salary is the largest portion of your operational cost to respond to a voluntary request. As I understood the language of your document, you are recovering actual dollars, rounded down to the nearest even dollar, but you don't include per diems and travel in your billing to the organizations that request you to come on their own.

Mr. Ritchie: What we do include in the overtime fee is the salary, as you rightly indicated, along with employee benefits. In certain cases, if it is a callback, there would be travel that we would include as well.

Senator Ogilvie: So the $9 million that you anticipate down the road is roughly the total cost of the expense.

I will say that I think it is appropriate in terms of the general issue of cost recovery under the nature of this, and I was just trying to get a sense of what it involves. Thank you very much.


Senator Robichaud: Further to what Senator Ogilvie said, in the table on page 13, where you say that costs are $9,796,073, the title of that table simply reads, ``Projected Overtime Costs and Revenues.'' That does not take into account other expenses, which does not seem to corroborate the answer you gave Senator Ogilvie.


Mr. Ritchie: I will see if I can answer that. If you look at the table above overtime, there are three types of overtime.

Senator Robichaud: I am not questioning that. I am just questioning your answer to Senator Ogilvie where he was asking about other incurred expenses and how you were collecting them. In the previous answer, you said that the total collected was $9 million, and it only says:


``Projected Overtime Costs and Revenues.'' To my mind, that differs from the answer you gave. There are no doubt reasons for that, but, as the saying goes, this does not click. If I give you the time, could you perhaps send a letter to the clerk of the committee and provide us with an answer?

I have other questions because the introduction to the paper I have before me, ``User Fee Proposal: Overtime Fees'', states the following: ``The CFIA is dedicated to safeguarding food, animals and plants, and contributing to a safe and accessible food supply and plant and animal resource base, thereby enhancing the health and well-being of Canada's people, environment and economy'' and, in fact, protection in general.

That is the agency's role, is it not?

Mr. Ritchie: Yes.

Senator Robichaud: So you protect the public — us — but, on the other hand, you bill people for costs because you protect us. On page 6 of your speech, which I have before me, you say:

It is not fair to expect taxpayers in general to subsidize services that provide direct benefits to individual service recipients.

Explain the difference to me because your purpose is to protect the public, and you are going to make someone pay for the work you are going to do to protect the public since you refer to ``individual service recipients.'' I find this hard to understand. That often happens to me.


Mr. Ritchie: You're absolutely right; the agency's mandate is to protect the safety of the food supply, our animal and plant resource bases. Those resource bases are, as well, used for industry and export purposes. To access foreign markets, we export tremendous volumes of our plant resources and animal or animal by-products. Those generate revenues directly to the exporter or the company that's exporting. In that case, we would still have a role to play in those services. In order for an exporter to access a foreign market, that foreign market will sometimes require the agency to validate that that export is free of certain pests and diseases because the importing country doesn't want to receive those. In that case, those services are directly beneficial to the exporter. The exporter needs assurances that they can access that market. In that case, we would deem that to be primarily a private benefit, so we would charge a fee to recover the costs that we would incur to generate that export certificate.

Senator Robichaud: I could agree with that, but when you are protecting the public, you're also protecting industry, aren't you?

Senator Mercer: To follow up on Senator Robichaud's line of questioning, other than your argument on exports, which I buy, are not the public/taxpayers beneficiaries of the work of the CFIA as well as industry?

Mr. Ritchie: Absolutely, they are. You could take that export argument and reverse it. We would receive imports from foreign countries. We import a tremendous amount of food, animal and animal by-products, as well as plant products. On imports, we work with industry to ensure we have an import framework that says those products coming into Canada need to be free from certain pests or diseases that we no longer want to see in Canada. That is purely a public safety activity, and we would do that without charging for those particular fees. That's a service we do to protect Canadians.

Senator Mercer: That's on imports, but on domestic use of products that are produced in the country, Canadians feel confident because of the good work of the CFIA that the food products we consume here are safe because of the inspections of the CFIA, so it is a direct benefit to the public.

Mr. Ritchie: Yes.


Senator Maltais: The Canadian Food Inspection Agency is very important for Canadians, the protection of Canadians' food and what is exported. Do you check all export products?


Mr. Ritchie: On export, for the most part, we would be engaged in anything that is exported where a foreign country requires validation from the agency that that product is free of certain pests or diseases. We would be involved in that.


Senator Maltais: We are currently studying bees. Do you inspect exported honey?


Mr. Ritchie: I can't answer that question directly. We can get back to you. I would believe we do. The product itself, the honey, is exported, and if certain countries require certification that the product is free of certain conditions, the CFIA would be engaged in doing that.


Senator Maltais: Boston is the biggest fish market in America. All the Maritime provinces and Quebec sell a lot of fish in that market. Do you inspect that fish? Do the Americans require a health certificate for that fish?


Mr. Ritchie: I can get back to you with those particulars, if you wish. The proposal in front of us is about user fees as they pertain to overtime services.


Senator Maltais: As regards costs, first we need to know what you do. When I hire a carpenter at home to repair my deck, he obviously has to repair the deck. So I am asking you what you do and you will answer me. I am sure you are very good at your job, but do you think you are sending your funding requests to the right place? It seems to me they should be sent to the Minister of Finance. Where does most of the agency's funding come from?


Mr. Ritchie: A large part of our funding does come from the federal government. It's A-base. When it was established in 1997, the agency was established as a special operating agency of government and therefore retained cost recovery approaches.


Senator Maltais: I understand that, but I would like to know how much you get from the federal government.


Mr. Ritchie: At this point in time, user fees would represent about 8 per cent of our revenues, so 92 per cent of the agency's revenue is allocated by government funding.


Senator Maltais: How much is that in dollars?


Mr. Ritchie: The actual budget itself for the agency? I would have to get back to you with that. I don't have that figure off the top of my head.


Senator Maltais: So we do not know how much money you receive. Do you claim overtime from the government or the agency? Or is it simply a matter of getting permission to bill more to those you inspect? Who do you claim your overtime costs from?


Mr. Ritchie: We would cost recover from the recipient of that service, so from the private entity that is asking us to undertake services beyond our normal hours for their benefit.

On the funding, I can get you details on this if I'm incorrect, but the funding would go back to consolidated revenue. When we get our budget the following year, an adjustment would be made vis-à-vis how much A-base we would get versus how much funding we would have gotten through our cost recovery.


Senator Maltais: I want to get a clear understanding and to help the agency so that inspectors are well paid and so on, but I do not understand why you come and ask us for permission to increase the rates that will be paid by users. Is that what this is about?

Mr. Ritchie: Yes.

The Chair: Mr. Ritchie, if you believe you must inform us on questions that have been asked and that are directly related to the fee plan, please send that information to the secretary.

Mr. Ritchie: Yes.

The Chair: Thank you.

Senator Dagenais: Thank you, Mr. Chair. Correct me if I am wrong, but planned expenditures in dollars are $621,575,735 for 2014-15. That is what I have found. I see that this should decline, year over year, to approximately $582,500,000 in 2016-2017. You can check that.

I find it very surprising that were are here on the Standing Senate Committee on Agriculture and Forestry and are talking about overtime. For your information, I was president of the Syndicat des policiers de la Sûreté du Québec for eight years and we negotiated overtime and evening and night shift premiums. I would like you to explain something to me. You say in your presentation that some people are on duty 24 hours a day at the request of service recipients, but do people work on various shifts? I imagine some work days, evenings and nights, but perhaps a little less during the nights because there is less demand.

Do employees who work evenings and nights receive a premium? If they do, I am expressing myself poorly. If they are already on duty, why should they work overtime as well?

Since they are already on duty and are being paid an evening and night shift premium, I imagine that had to be negotiated. We used to say that, in the first two years, that was for temporary workers who were going to become permanent at the agency, and then they would cost a little less. That was based on what are called orphan clauses. Those people acquired seniority; they were temporary employees and were less costly and that therefore lowered costs somewhat.

Can you explain all that to me?


Mr. Ritchie: To begin with, the agency has a tremendous amount of stakeholders out there and we work with those clients closely. As you can well imagine, there are operations that run 24/7, such as large processing plants, slaughter plants and those kinds of things. In working with those particular clients, we do try to come to an arrangement whereby we use our inspectors as efficiently as we can to accommodate their service and their hours of operation without incurring overtime costs. We would organize our shifts accordingly so that we may have inspectors present there, as required, to be able to work within the parameters of that industry's needs.

What we're talking here about here, though, is activities for which the industry itself makes a requirement over and beyond what has been organized and arranged collectively with them for additional services. We do try to limit the overtime by working with these large industries. We have arrangements in place and everything is negotiated and understood with that particular industry, but there are certain cases where we would get requests to have to undertake additional activity over and beyond what we might call normal hours of operation. That is what we're talking about here, namely those requests that come in and say, ``Agency, I know we had an arrangement, but I need you right now to do something for me in order for me to be able to access a foreign market or to ship my product somewhere. I need the services of the agency over and beyond normal operating hours.'' That's what we're talking about here.

Senator Oh: How big is your workforce of inspectors?

Mr. Ritchie: I don't have accurate numbers, but we are somewhere around 6,000 full-time equivalents across the country.

Senator Oh: What is the average earning for these inspectors on top of overtime? What is their salary in addition to overtime?

Mr. Ritchie: If you look at page 12 of your proposal as it pertains to overtime services, the majority of those overtime services are provided by two classifications of individuals: veterinarians and what we call engineering and scientific individuals. Those are the government classifications for those types of individuals who perform inspection- related services for us.

The qualified level in both those areas for veterinarians would be levels 1 and 2 where we feel they have the competency necessary to undertake those activities. On engineering scientific support, it's level 2 or level 4. The table on pages 11 and 12 gives you the average salary for those individuals. Page 11 is for veterinarians; page 12 is for engineering and scientific support.

If we take veterinarian level 1 and level 2, for example, that's the minimum level we require to do an appropriate inspection service. The average salary for that individual is about $81,813. There is an employee benefit package on top of that. That's approximately another 23 per cent or so. That equates to $20,756 for a total of $102,756. That's the average salary cost we're using in this case with respect to overtime fees.

Senator Oh: You charge overtime fees to the client. What is the split between the staff and how much goes back to the coffers?

Mr. Ritchie: Again, the overtime fee charged is for a service that has been requested for us to do outside of our normal hours. Depending on the type of overtime fee — there are three types — if it's an overtime fee requested within the same day we're operating, it would be time and a half. That would be the typical rate we would charge. It would be our average salary multiplied by time and a half.

That fee would be collected and, as I have indicated, it would go back to the Consolidated Revenue Fund. When we get our budget the following year, the government will then give us the public funds. Our allocation for the following year is comprised of public funding, plus whatever we collect from user fees.

Senator Oh: Part will go to the staff and part will go back to the government coffers; is that correct?

Mr. Ritchie: All the fees we collect would go back to the Consolidated Revenue Fund, so back to the government's central funding. The government would then use that and go back to the agency and say, ``Agency, your budget next year, since you did collect fees, would reduce the amount of funding the government actually has to provide to you.'' So the government would provide a little less to us and the fees that we collected, which are in the central bank, would be reallocated back to the agency.

Senator Oh: What is the split? Part would have gone to the inspectors and the staff, right?

Senator Tkachuk: I think Senator Oh is asking if you bill $50, what percentage of that goes to the actual employer and how much goes to the agency?

Ms. Webster: If I understand the question correctly, we pay our staff the overtime. Staff is paid one and a half times their regular salary. So if an employee goes out and does two hours of overtime, we pay them time and a half for those two hours. We collect that cost back and that is invoiced to the company.

Senator Oh: Thank you.

Senator Johnson: I've come across a question here and I think would be interesting to find out this information. You did a comparative analysis about how certain foreign countries calculate overtime hours and bill for services. You looked at Australia, New Zealand the U.K. and the U.S. First, can you tell us something about the outcome of your analysis? Second, do Australia, New Zealand and the U.K. charge user fees in addition to overtime fees and are they comparable to those of the CFIA?

Ms. Webster: In terms of our comparison, we were in line with the fees charged for overtime services in various countries — sometimes a little bit over; sometimes a little bit under. In terms of a comparison of other fees such as regular time fees, that is part of the process that we undertake as we are revising all of our other fees. We do the same kind of comparison. That is factored into how and where we set our fees.

If we were to look at animal health export certification, to use Tony's example, we would look at what similar countries charge for those export certification tests, and we would do a similar comparison here.

Senator Johnson: Does the United States do this? I work a lot with U.S. issues, and I'm wondering about them in that respect.

Ms. Webster: The United States does charge for overtime services in a similar fashion to the way we do.

Senator Johnson: How do you think we stand in terms of these other countries? Are we all on the same page here?

Ms. Webster: Yes.

Senator Johnson: Thank you.

The Chair: Now we will go to the second round.

Senator Mercer: I guess my question is: Why are we here? You said in your presentation that CFIA's overtime fees are based on the rates of pay and other benefits described in the respective collective agreements as they existed in 1995. It would seem to me that the way you would manage things is say if that's what the fee was in 1995, that the agreement would be that the rate would follow whatever the collective agreement has been as we move along. I don't understand why, in 19 years, it hasn't moved any. Through various collective agreements that the public service has negotiated, I'm sure they have had a raise in 19 years. I hope they have, because they deserve it.

The second question is related to that as well. Will you be back here next year? Do we have to keep bringing this back to Parliament? It seems to me that this is something that should be handled simply by tying it to whatever the collective agreement dictates, which is done in an open fashion and is in the public domain already.

Mr. Ritchie: That's correct. The original intent from Parliament was for the agency to be partially dependent on revenue generated by user fees for its operation. However, the minister made a commitment at the time to introduce no new user fees or increases to existing fees before the year 2000. In 2002, there was a continued moratorium on new or increased user fees that was extended to June 2009. It's only since June 2009 that we have actually been able to begin to modernize our user fees, which were still, by and large, reflective of the 1997 collective agreements.

The agency has undertaken a large exercise to modernize our user fees, and we're here today on the overtime fees because it's an easier exercise to undertake at this point. We are now going back to the latest collective agreements, and that's the overtime fee that we talked about in terms of the average salaries. It's based on the most recent collective agreement.

Moving forward, we don't want to have to do this all the time, so in the proposal we built in that there would be a regular review every five years. At that point in five years, we would look at the collective agreements and the costs at that point in time and decide whether in fact an increase is required or not.

Senator Mercer: No one has a five-year contract. It would seem to me that it should be tied to the collective agreement that is in place as of the day you were charging user fees, as opposed to every five years. It seems to me that it should be automatic. I know that the public service is not going to allow any government to get away with negotiating a five-year contract.

Thank you, chair.


Senator Robichaud: You note in your proposal on user fees and overtime fees that you received a total of five formal comments: three on-line questionnaire responses and two letters, including a joint submission from two well- established industry associations collectively representing more than 220 firms. What industry sector responded? In fact, whom did that affect?


Ms. Webster: We heard from the Canadian Meat Council and the Canadian poultry industry in terms of responding by letter. We also heard from Maple Leaf Canada directly by letter. We had conversations via conference call with all those interested parties.


Senator Robichaud: I see from the comments that some people complained about the higher fee schedule. Were they successful? Do you not think the industry should be allowed an adjustment period so it can include these new fees in its production costs?


Mr. Ritchie: That's correct. Since we have not been able to consistently review our fees, there will be a considerable jump in some fees. When we had undertaken those consultations, the consultations were undertaken two years ago, I believe, almost.

Ms. Webster: They finished in January 2013.

Mr. Ritchie: At that time, we indicated that we would not be imposing the fees until sometime later in 2014.


Senator Robichaud: On April 1, 2014, from what I see here.


Mr. Ritchie: At the time when we had undertaken those consultations, we had predicted that we would be through the system by April. At this point in time, we've revised that and most likely we won't be imposing the fees until sometime probably in the fall.

The Chair: Honourable senators, are there any other questions? If not, you mentioned, Ms. Webster and Mr. Ritchie, the meat council and the poultry producers. How many producers would that represent if you look at the meat council and the poultry producers of Canada?

Mr. Ritchie: That is information, Mr. Chair, that we would gladly be able to provide you. We don't have that data on hand at this point.

The Chair: If you could provide that through the clerk?

Mr. Ritchie: Yes.

The Chair: Thank you very much.

Do you have any other comments to add, Mr. Ritchie or Ms. Webster?

Mr. Ritchie: No, we do not.

The Chair: On behalf of the Standing Senate Committee on Agriculture and Forestry, I want to say thank you very much on behalf of all the senators for being here and sharing your comments and being informative on the user fee proposal respecting overtime fees.

Honourable senators, we will take a short break to permit our witnesses to leave. Before I adjourn the meeting, I propose that the committee continue in camera to discuss and consider a draft report concerning the user fee.

(The committee continued in camera.)