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THE STANDING SENATE COMMITTEE ON NATIONAL FINANCE

EVIDENCE


OTTAWA, Monday, June 15, 2020

The Standing Senate Committee on National Finance met by videoconference this day at 3:15 p.m. [ET] to study: a) certain elements of Bill C-13, An Act respecting certain measures in response to COVID-19; b) the provisions and operations of Bill C-14, A second Act respecting measures in response to COVID-19; and, c) the government’s response to the COVID-19 pandemic and its economic consequences.

Senator Percy Mockler (Chair) in the chair.

[English]

The Chair: Honourable senators, before we begin, I would like to remind senators and witnesses to please keep your microphones muted at all times unless recognized by name by the chair. We will now begin with the official portion of our meeting.

My name is Percy Mockler, a senator from New Brunswick and chair of the Finance Committee.

Honourable minister and Canadians, I would like to introduce the members of the committee who are participating in this meeting: Senator Forest, deputy chair; Senator Richards, steering committee member; Senator Boehm; Senator Dagenais; Senator M. Deacon (Ontario); Senator Duncan; Senator Galvez; Senator Harder; Senator Klyne; Senator Loffreda; Senator Marshall; Senator Smith and Senator Gagné. Also participating on Zoom today, we have Senator Dasko, Senator Lankin, Senator Pate and Senator Miville-Dechêne. Welcome.

[Translation]

I wish to welcome all of you and viewers across the country who may be watching. Today, our committee continues its study on certain elements of Bill C-13, on the provisions and operations of Bill C-14 and on the government’s response to the COVID-19 pandemic and its economic consequences, which were referred to this committee on April 11, 2020 by the Senate of Canada.

[English]

Our oversight committee has common denominators of transparency, accountability, predictability and also reliability.

Today, we welcome the Minister of Finance, Honourable Bill Morneau, who is accompanied by a group of senior officials from the Department of Finance and the Department of Social Development and Canada Revenue Agency.

Minister, thank you for accepting our invitation, and I might add that you have always been available for our committee. I know you have some comments, so the floor is yours.

Hon. Bill Morneau, P.C., M.P., Minister of Finance: Thank you very much, Mr. Chair. We’ve had the opportunity to come and see you on numerous occasions, and I’m very pleased to be with you here and with your committee today.

To start with some remarks, we know that we’ve all seen the impacts of COVID-19 abroad and at home. It has been three months since Canada launched an unprecedented economic response plan aimed at protecting Canadians’ health and mitigating the economic impacts of the pandemic. Facing a rapidly evolving global challenge, our government has worked and is continuing to work closely with local, provincial, territorial and Indigenous partners to minimize the health, economic and social impacts of COVID-19. My colleagues and I are also in constant contact with our G7 and G20 partners to ensure an effective and broad approach.

[Translation]

In these extraordinary times, Canadians should not have to choose between paying their rent or feeding their families. Our priority will always be to support Canadians and our economy. Our government’s rapid response, through Canada’s COVID-19 economic response plan, is putting $150 billion in direct financial support at the disposal of Canadians.

[English]

Canada has one of the most robust and comprehensive plans in the G7. We’ve rolled out measures for workers and businesses across all economic sectors for employers of all sizes. This has been a difficult time for many Canadians. Some have seen their income greatly reduced while others have lost all of their income and their jobs. To assist Canadians during this time, as you know, our government has put in place a number of supports. The Canada Emergency Response Benefit, or CERB, provides $2,000 a month taxable benefit for up to 16 weeks. Over 8 million people have applied to receive the CERB, resulting in more than $43 billion of support for those who most need it.

COVID-19 has placed significant demands on low-income workers in key sectors, including in hospitals and nursing homes, those ensuring the integrity of the food supply or those providing essential services to Canadians. We believe that these Canadians who have kept this country working deserve a raise. We’re providing up to $3 billion in federal support to increase the wages of low-income essential workers. Every province and territory will determine which workers would be eligible for support and how much support they will receive.

[Translation]

In May, we also provided support for families with a $300 payment from the Canada Child Benefit. In addition, in April, our government made a special GST credit payment to more than 12 million individuals and low- or middle-income individuals and families in Canada. This doubled the annual amounts of GST credit, giving an average of $600 more to couples and almost $400 more to adults living alone.

The government is also providing assistance to seniors by reducing the minimum mandatory withdrawal from Registered Retirement Income Funds by 25% for 2020. It is also providing a one-time non-taxable payment of $300 to seniors eligible for the Old Age Security benefit and $200 more to seniors eligible for the Guaranteed Income Supplement.

[English]

Through these measures and others, the government is providing our most vulnerable seniors with nearly $900 more in support on top of their already existing benefits to help with extra costs during the pandemic.

To support students and recent graduates, we placed a six‑month interest-free moratorium on Canada Student Loan repayments. To provide the financial support for this summer and beyond, we introduced the Canada Emergency Student Benefit, and to make sure they get the experience and the skills needed to succeed, we’re investing in 116,000 jobs and opportunities for this summer.

Indigenous communities are also seeing challenges, so we established the new distinctions-based Indigenous Community Support Fund to address immediate needs for First Nations, Inuit and Métis Nation communities. We’ve also provided funding for community public health needs to help First Nations prepare for and respond to the COVID-19 pandemic.

Our government is taking action to protect Canadian jobs and to help businesses retain and rehire their employees. We introduced the Canada Emergency Wage Subsidy to help affected companies retain and rehire their employees. This program provides employers with a 75% wage subsidy — up to $847 per week per employee. The program is supporting millions of workers across Canada, and more firms are signing up each week. We recently announced that we will extend this program until August 29.

I held several constructive meetings with business and labour representatives on potential adjustments to the wage subsidy program to ensure it continues to meet the immediate needs of businesses, that it promotes growth and that it continues to protect jobs and maximize employment.

[Translation]

We are well aware that small businesses are facing difficulties. They are key to our communities and they need assistance. That is why our government has launched the new Canada Emergency Business Account, provided by eligible financial institutions in collaboration with Export Development Canada. This program provides loans and interest-free grants that can go as high as $40,000 for small businesses and not-for-profit organizations to help them cover their expenses during this difficult period. Moreover, 25% of the loan is forgiven if the loan is repaid by the end of 2022.

[English]

So far, around 669,000 small businesses have been approved for the Canada Emergency Business Account loans, helping them pay employees, pay rent and stay strong through this crisis period.

The support our government has provided through Canada’s COVID-19 economic response plan represents over 10% of GDP. It’s a robust, comprehensive plan designed to keep Canadians safe and support them through this crisis.

[Translation]

We know that, all over Canada, workers and companies are facing uncertainty. Our government is offering support to the Canadian economy during this difficult time so that it can get back on its feet quickly when the time comes.

[English]

As economies across the country slowly and cautiously begin to restart, we are in discussions with our provincial and territorial counterparts to make sure Canadians can safely get back to work. We’re focused on the following areas: testing and tracing, making sure there is PPE so Canadians are safe on their job, support for child care, support for vulnerable people like those in long-term care facilities and further support for cities and municipalities. We are all in this together, and our government will be there with Canadians every step along the way.

Thank you, Mr. Chair, and I would be happy to answer questions at this time.

The Chair: Thank you, minister, for your statement and also your comments. We will now proceed to questions, and I would like to remind senators that you will have a maximum of three minutes each. Therefore, please ask your question directly. To the minister and witnesses, please respond concisely. I would ask that any official called upon to help answer a question first give their name and title for the record. The clerk will make a hand signal to show me when it’s time to move to the next senator.

Senator Marshall: Thank you, minister, for being here today.

Minister, last month when the Interim Auditor General testified before the House of Commons Finance Committee, he told the committee that the Auditor General used to conduct 27 performance audits per year, but this year, because of funding constraints and additional audit work, they had to reduce a significant portion of their audit work.

Within the past six months, the House of Commons has requested the Auditor General to conduct three special audits. First was an audit of the COVID-19 programs, which are spending billions of dollars, as evidenced in your sixth report last week. The second is the audit of the $180 billion infrastructure program, which is being delivered by 32 federal departments and agencies over 12 years. Finally, there is an audit of special warrants. So she has been given a lot of significant additional audit work but no additional money to carry out the audits.

Last week, just before your appearance at the House of Commons Finance Committee, that committee unanimously passed a motion — and that includes all Liberal members — to provide the Auditor General all the funding she needs to carry out the audits. The Public Accounts Committee also supported the Auditor General’s request for additional money. So there is support for additional funding for the Auditor General across party lines.

The supplementary supply bill will soon be before Parliament, most likely this week. Noticeably absent from the supplementary supply document is the funding required by our newly appointed Auditor General. As Minister of Finance, you’re in the prime position to correct this problem by ensuring that the supply bill includes the funding for the Auditor General. My question is: Will you ensure that the funding required by the Auditor General is included in the supplementary supply bill that will be tabled in the House of Commons this week?

Mr. Morneau: First of all, I’d like to thank the senator for the question and the support of the Auditor General. The Auditor General, of course, has been appointed in the last number of weeks. I want to first say that we’re obviously very pleased that we’ve appointed a new permanent Auditor General, and I’m looking forward to having the opportunity to work with her in this regard.

I think the best way to answer the question is to say that we look forward to working with the new Auditor General to make sure that she has the resources she needs to fulfill her mandate. That is, of course, our continuing goal. We have increased funds for the Auditor General over the course of our time in office. I believe those funds significantly enhance the amount of staff that the Auditor General’s office has now versus when we came into office, but we’ll continue to work with her to make sure that the resources are there appropriately so that she can complete her function, which we see as critically important.

Senator Marshall: Do I have any more time?

The Chair: No. Thank you, senator.

[Translation]

Senator Forest: Thank you for joining us, Mr. Minister, and for giving us this information.

My question is about municipalities. I would really like to know the status of the negotiations with the provinces in terms of assistance to municipalities. How big is the envelope of assistance that will be allocated to municipalities, in Quebec specifically? Will Quebec and the municipalities have the flexibility they need to make investments according to their [Technical difficulties]? When does the government anticipate that the money will be available? I am asking all my little questions at once, and I look forward to your answers, Mr. Minister.

Mr. Morneau: Thank you very much. Those are not little questions, they are actually big ones. As for our approach, we know that it is important to work with the provinces to do something for municipalities, because of the challenges that they have to face from the changes in their circumstances. That is why we have explained to the provinces and territories that we want to work with them to improve the situation for municipalities. However, at the same time, we know that there are other very important issues to ensure the safe reopening of our economy. To that end, we have identified a number of categories of necessary expenditures. For municipalities, this category of necessary expenditures includes public transit systems, for example. We have not yet defined the exact size of the envelope for municipalities. That will be done during the negotiations with the provinces and territories. In that way, I hope that we will be able to provide more to municipalities because, as you know, the municipalities are under provincial jurisdiction. If we provide funds to municipalities, in our opinion, they should be combined with funds from the provinces. The discussions have already begun. We have had discussions on a number of occasions with the premiers, of course, and will be able to say more about this in the coming days.

Senator Forest: Thank you.

[English]

The Chair: Thank you, minister.

Senator Richards: Thank you, Minister Morneau, for being here. These are uncertain times, and certainly for a Finance Minister it must be very difficult.

Thousands of people will run out of the CERB benefit in September, and the CEBA is not going to last beyond that too much, either, for many, and I’m wondering what will happen. How are we going to rectify that if this goes on into the fall or early winter or, if push comes to shove, there is a second wave of the pandemic? How many billions over the initial estimate do you think we will be faced with, and what kind of recovery time — or can you even predict a recovery time in all of this, sir?

Mr. Morneau: I think it’s important to make sure that we inform Canadians about the information that we have and are careful about making predictions based on information we don’t have. Our best understanding of how we’ll be able to recover is that the economy will follow the health situation, and that’s why we’ve been very focused on that.

With respect to the benefits, we’ve worked to provide a bridge for people. Potentially you might have heard the Prime Minister talk earlier this morning about the Canada Emergency Response Benefit and our intention to extend that past the original 16 weeks. A significant portion of the people who got on that benefit will have their first 16 weeks expire in early July, and obviously we’re concerned that in many cases would not necessarily be able to get back to work or that they would not necessarily have jobs there for them. So we will be extending that. We’re working on the details.

It gives you a sense of our approach to this pandemic. We’re trying to make decisions when we have information, so as we have more information, we’re trying to come to the right decisions for where we’re at at that particular time. It would be inappropriate for me to say I know where we will be in the fall or you asked even farther beyond that. What I can say is that we will continue to work to provide a bridge for people and for enterprises as they try and get through this time. We recognize that we really will need to work together with all levels of government in trying to achieve that goal.

Senator Richards: Thank you.

Senator Harder: Thank you, minister. I appreciate the work that you and your officials are doing in these extraordinary times.

In your statement, you referenced the work that you are doing on behalf of Canada internationally. Since this committee began its work, there has been significant growth in the infection rates and absolute numbers in the developing world. In fact, last week it was reported that seven of the eight countries with the highest infection rates are in the developing world. Can you report to this committee what you and Canada on behalf of Canadians are prepared to do in coordination with our G7 and G20 partners that you referenced, as well as the IMF?

Mr. Morneau: Senator Harder, that’s a particularly important question. We both have an interest obviously in helping people around the world, but we also have a self-interest in eradicating COVID-19 because, until we have it under control everywhere, we don’t really have it under control anywhere. That’s something we recognize.

What we’re doing right now at the forum that you’re talking about is trying to help countries to fend for themselves, knowing that each situation is different. One of the things we’ve done, together with the G20 and the G7, is to suspend interest payments on debt for some of the countries experiencing the particular challenge and that are heavily indebted. That’s been critically important. The debt service suspension initiative has been a critical one.

We’re working to coordinate with other countries, seeing if we can extend those efforts even farther, push the envelope on relieving people of their challenges in the face of this time. That is really not so dissimilar, theoretically, from what we’ve done in Canada where we’ve suspended people’s necessity to pay back debt during a time when they don’t have access to capital.

Additionally, as we’ve seen, we’ve tried to work together with other countries on ensuring that there’s continuing access to supply chains so that we keep the ability for places around the world that might have less economic advantage to get access to PPE and to testing and materials required for that.

I think we do need to acknowledge this is a significant challenge and one that will not be easily overcome, which means that your question around the International Monetary Fund is particularly important. There will be countries that find themselves in extreme stress. Working together with other countries, G7 and G20, we’re looking at how we can make sure the IMF is resourced to provide support to countries as they enter into distress. That similar approach is the approach we’re taking with the World Bank in trying to come up with ways that they can work together as well.

It’s complicated. It’s difficult to work together with other countries at a time when it’s hard to meet with them physically, but I would say that progress is being made. The initiatives that the Prime Minister has taken as well have been important in trying to get other countries on board for working with other countries that are more challenged. We’ll just have to continue to do this, including with financial support as we work together with other countries.

Senator Smith: Welcome, minister.

We spoke with the Parliamentary Budget Officer a short while ago about the ability to sustain the plan that the government has rolled out. We all recognize what a great job the government has done in protecting Canadians. I’m not going to ask you when you’re going to come up with an economic statement, because everybody else is, but I’d like to ask two questions. One, do you have a kind of SWAT team that’s working on modelling potential scenarios that you can look at and adjust? Two, have you had a chance with that same group of people to look at the actual economic position of Canadians and how Canadians can sustain whatever actions you take? I’m not talking about income tax increases, but I’m talking about getting yourself and your group prepared with options. And Canadians, how are they doing? Could you give us some background?

Mr. Morneau: I actually think, senator, those are the right questions. We absolutely do have a team working on our economic scenarios. We always do have that, but obviously the work is that much more intense during this time period.

The essential challenge in presenting an appropriate snapshot of our economic position is to understand the underlying state of the economy. We were clearly in free-fall with some significant challenges during the end of March and the beginning of April as we effectively closed down the economy. As it becomes somewhat more stable in what we’re calling the safe restart, there is more of an ability to understand the state of the underlying economy.

Of course, we’ve tried to be very clear on the investments we’ve put in place. That stability will allow us, over time, to have a little more clarity. We did not want to go out with some sense of false precision with numbers that we would not be sure about. We want to be careful, because confidence in our ability to understand our situation is critically important.

You will have seen even last week that the OECD came out with their forecasts. They couldn’t come out with a forecast. They actually came out with two different scenarios. That presents for people how fast-changing our situation is.

To the second part of your question, evaluating how Canadians are doing, both now and in the future, is critically important as we evaluate the rollout in our programs and the change in the programs. The Emergency Response Benefit and the wage subsidy together have done a very good job at supporting people during this time. We’ve largely replaced the wages for those with lower income in our society, cushioning them from a severe blow. We know COVID-19 has had a bigger impact on lower-income workers and those in more precarious work. That has been critically important. We see people are in a stronger position than expected, but we’ll continue to work on that as well.

[Translation]

Senator Dagenais: Good afternoon, Mr. Minister. I will be dealing with two subjects.

First, last Friday, the President of Air Transat stated, on the radio in Montreal, that he really had heard you and the Prime Minister announce on a number of occasions that you were going to provide assistance to airlines. Three months after the complete shutdown of activities, he still does not know what you are going to do: will the company have to declare bankruptcy? It seems like quite a long time to me.

My first question is simple: Are you really going to help the airlines? If so, when will the companies have news that is more specific than the announcements that have been made?

Let me move directly to my second subject, which is about the misappropriation of money from the assistance programs for businesses. For money to be skimmed off into other bank accounts, there has to be complicity on the inside. A yes or no answer is all I need: Are you going to investigate this?

Mr. Morneau: Thank you for asking those questions.

I can say at the outset that we have already done a lot for companies in all sectors of our economy and in all geographic regions of our country. We have established a program that provides credit to companies in difficulty. As you know, we have implemented special measures for small and medium-sized enterprises.

For the large companies, we have created a program that allows them to obtain funds through the Government of Canada if they are not able to access credit by other means. This is a very important measure for companies like Air Transat. The money will be there for those companies if they need it. We would really like to have an approach for each sector of the economy, but a number of them are facing enormous challenges and it will be very difficult to provide a specific, made-to-measure program for each.

For example, a number of sectors, including hotels, retail sales and restaurants, are facing huge difficulties. A number of them can see that they have access to credit; each company must evaluate the possibilities available to them.

In response to your second question, we want to establish programs for companies of different sizes. So we have emergency loans for small and medium-sized enterprises, we have the EDC-BDC alliance for larger companies, and finally, we are working with companies directly through the Large Employer Emergency Financing Facility.

[English]

Senator Galvez: Thank you very much, minister, for being here.

Thank you for the initial phase of facing COVID-19 and keeping the economy afloat and the workers working. As we approach the second stage, I want to talk about transparency. As you know, the National Action Plan on Open Government includes a specific commitment to make government spending information easier for Canadians to find and understand, notably through the proactive disclosure of grants and contributions above $25,000.

The guidance is applicable to all the departments but not specifically to EDC or the Canada Account. However, we have made important changes in that we have received testimony and submissions, and media have reported or disapproved or criticized the lack of transparency of transactions undertaken in EDC and the Canada Account. In fact, when we go to the website, we can see that the loans in the ranges of billions of dollars. Sometimes the exact amounts are not there. The amounts repaid or pending to be repaid are not there.

I wonder what steps your office is taking in order to ensure that Canadians know where their tax dollars are going and when this lacking information will be available to the public. Thank you.

Mr. Morneau: Let me start by saying we certainly continue to view transparency and information on the investments we’re making on behalf of Canadians to be critically important. I think what you will have seen over the course of this COVID-19 period is a high level of transparency around the announcements we’re making. Obviously, it’s unprecedented to be doing press conferences daily. But also, you will have seen that we’re putting out extensive reports to the Finance Committees of the House of Commons and of the Senate so that you can understand those investments. As the scale of the investments come out to be different, smaller or larger than our original estimates, we have come out to give people an understanding of where those estimates are based on the information that’s coming in. So we continue to see that as critically important. I would say that is broadly how we’re trying to approach all areas of government investments.

I can’t see the documents you’re looking at or those websites, but I would be happy to have my team respond to any specific questions around information that you feel is not available, because we’ll continue to try to make sure we’re presenting things in the way that gives you the best understanding of where we’re making investments.

Senator M. Deacon: Thank you very much for being here this afternoon.

Just before I ask one or maybe two questions, I want to invite you and your finance team, when you have a moment, to look at the model that New Zealand is using. It is interesting, and it’s something worth Canada learning from that they wish to use to jump-start their economy, albeit a different story. Their Minister of Finance is also their Minister of Sport, and he believes the happier and the healthier families are, the recovery and conditions around COVID-19 will be faster in their population, particularly the most vulnerable. They’re really focusing on it. It’s a model, my respected colleagues, that is worth reviewing.

My question specifically at this moment, however, is to do with internet access. Presently, in COVID-19, high-speed internet has become a lifeline for many Canadians at quite a rate each and every day. Particularly for our students, with their lack of access, the stories will break a heart. They’re very compelling. And for our small businesses.

In Budget 2019, your government committed to seeing that 95% of our Canadian homes with that goal were going to have access to the internet, and by 2030, 100%. Given this experience and the sudden increased reliance on internet access and all of its complexities, are there any plans to rethink this and to accelerate this last year’s commitment for this project that might help more Canadians sooner?

Mr. Morneau: Thank you, senator. I think it’s an appropriate consideration.

We are absolutely resolute in the goal that we laid out in Budget 2019 to get that internet access to people across Canada, even that very difficult last mile, which is presenting some challenges in some parts of our country. The funding we put there was in multiple envelopes, including direct funding by the federal government, some changes that are going to encourage more investment from the companies, as well as the Canada Infrastructure Bank and the CRTC. We will, of course, always have to look at whether that can be accelerated. It’s not something that we’ve looked at yet, not because it’s not important but because in this time obviously we’ve been focused on the emergency function. But I will tell you that my colleague Maryam Monsef, who is responsible for rural, is looking carefully at this issue as we speak. It will be something we’ll have to consider as we see the evidence of the challenges we face.

That said, I would also say that we have seen very positive results with the ability of people to work online. We’ll need to deal with the gaps at the same time as celebrate the successes.

The Chair: Minister, I know we had a scheduled time for you. I have four senators left to ask questions. I could ask the senators to go directly to the question. Minister, do you want to answer now after those questions are presented to you, or do you want to answer in writing? I want to respect what you’ve asked of us with the time frame that you have.

Mr. Morneau: Thank you, Mr. Chair. What I might suggest is you have all the questions asked, and I will do my best to answer them all at the end of those four questions.

Senator Klyne: Thank you for meeting with us, Minister Morneau. I want to thank you as well for all the work you and your colleagues have been doing on behalf of Canadians.

I want to ask you a question that relates to the government’s response to the pandemic. The former Governor of the Bank of Canada was confident that the monetary policies being employed are the right ones and that we have this in hand, and the Parliamentary Budget Officer feels we have some runway available to us but we can’t carry on with the current response measures of support and stimulus for too long, and certainly not permanently.

From varying perspectives, the measures support the stimulus is all rather unprecedented. In regard to fiscal policies, can you tell this committee what lessons have been learned along the way? Are there measures of support and stimulus that worked as intended? Are there things that could have been done differently and things that could have been done and are still under consideration? Thank you, minister.

Senator Boehm: Minister, good to see you. Thank you for your hard work and to your talented officials for all their efforts. I’m going to add to the fusillade with two questions.

We’ve talked a lot in our committee about the importance of data as we look ahead. As you gather the data for your economic statement, the question is whether we need, as the OECD has suggested, to go beyond strictly GDP figures and include other social and distributional indicators, especially in our country, which is so large, and that this might eventually help us look ahead if we are to look at a guaranteed livable income prospect.

The second one is whether you see the fin-tech lending sector in Canada doing more work. It seems to be rather disadvantaged with respect to small business. This is very different in the United States, for example, and in some other countries. Thank you.

Senator Duncan: Thank you, minister, for being here and to my colleagues for the questions and to the officials, I appreciate your attendance here this afternoon.

The Senate committee heard very clearly from the northern air carriers, especially Air North, Yukon’s airline, and Canadian North. I have two points with regard to these airlines. They include substantial First Nations and Inuit investment, and also they are essential services throughout the North and to Southern Canada, especially for medical treatment. There were two asks from the northern air carriers: an extension beyond June of the northern Essential Air Service program and the Canada Emergency Wage Subsidy. The minister addressed the Canada Emergency Wage Subsidy. Will the northern Essential Air Service program continue, or will the northern air carriers be directed to another program?

My second question is with regard to their second point in the presentation, access to gateway markets and beyond the regulatory issues before his colleague Minister Garneau. The mainline carriers seek financial assistance, and the minister has referred them to another program. The minister has also made comments that we’re all in this together. Will the minister use his good offices to encourage the mainline carriers to offer complementary services rather than competing services with the northern air carriers? As an incentive, I would just advise the minister that we’ve received written testimony that ensuring the maximum proportion of gateway routes revenue stays in the North will help ensure the viability of all routes, including the regional routes, and it will reduce and eliminate the requirement for a subsidy. There is a financial incentive there as well.

Senator Loffreda: Thank you, minister, for being here.

Our small business sector is so important to our economy, making up 42% of our GDP and 48% of new jobs. Do you have a SWAT team around the small business sector specifically, looking at tax holidays, greater forgiveness on the BCAP, for example, to help with recovery costs that will be necessary, such as social distancing, as we relaunch our economy? Investment tax credits for helping build digital networks and maybe creating virtual markets for our small businesses?

Last but not least, in expanding and modifying the CERB, are you looking at a greater incentive to work? Because a lot of small business people and businesses are saying that they’re having a difficult time rehiring and getting employees back.

Mr. Morneau: Thank you. Those are a number of questions I would like to get to.

To Senator Klyne, I think it’s an appropriate question that we consider the lessons we’ve learned in this extraordinary time. There will certainly be a time for reflection as we move through this. My initial response would be that we’ve really learned along the way that in putting out programs and policies at this unprecedented pace, we need to be willing to change and adapt as new information comes in. It’s a unique situation that we’ve obviously found ourselves in, one where we’ve tried to be flexible and make improvements as we’ve gone along. I’m sure there will be time for more reflections in front of your committee in the months to come.

Senator Boehm, I think you appropriately ask about data and what data we’ll be using in developing our next steps and eventually budgets. The answer is most certainly we will be looking at the typical data we look at, but we will also continue to try to look at other sources of data that are important. The good example, obviously, is we’ve taken an approach to looking at gender disaggregated data to come up with approaches that have an impact on women differentially, and that kind of approach will be something we’ll consider for other parts of our society.

On fin-tech, we will continue on the road towards open banking. We’ve obviously had some slowdowns during the course of COVID-19, and we still do expect that the fin-tech sector, which is providing such innovation in our country, will be something that will help us all, including giving us better services in that sector.

Senator Duncan, I appreciate the comments on northern air carriers. We’ve already announced that we would be extending the wage subsidy, and that would certainly include any companies or organizations that qualify. With respect to the northern air subsidy, we haven’t come to any conclusions yet, so I don’t have anything to announce in that regard. I will certainly pass along your comments to my colleague Minister Garneau about the challenges with mainline carriers working with northern carriers, as it’s not something I’ve directly spent time on.

The final question, senator, was around whether we have a SWAT team looking at small business issues, and the answer is we are very focused on this issue right now. Over the course of the weekend, we’ve been working on the Canada Emergency Business Account and how we can ensure that it is working for a broad cross-section of businesses. It has had a huge impact so far, with more than 660,000 businesses applying, but we did announce today that we will be looking to expand that even more.

As we look at the programs, the continuation of the CERB benefit, we’re certainly aware of the challenges that presents. We’re also aware of the fact that there will not be enough jobs for people at the end of the first 16-week period, so we’re trying to balance those two things in a way that makes sense. We think that is where the wage subsidy will have an important impact on people’s ability to manage at this time.

With respect to other ideas, we’re certainly looking at how the restart impacts businesses and trying to evaluate how all the programs we’ve put together are helping. Should there be additional things that we need to consider, of course we’re trying to be nimble and do that through the course of this time.

Mr. Chair, thank you for the time today. I look forward to continuing to be available to your committee. Obviously, I appreciate all the work that you are all doing to help keep Canadians informed during a particularly challenging time.

The Chair: Thank you, minister, for your time and your availability to this committee.

Honourable senators, thank you for your participation and your support. Our next meeting is scheduled for Monday, June 22, at 11:00 a.m. EST. We will have Minister Qualtrough appearing.

Before I declare the meeting adjourned, I will ask Senator Forest and Senator Richards to stay on Zoom for a short meeting with the steering committee.

(The committee continued in camera.)