THE STANDING SENATE COMMITTEE ON NATIONAL FINANCE
EVIDENCE
OTTAWA, Tuesday, May 3, 2022
The Standing Senate Committee on National Finance met with videoconference this day at 9:31 a.m. [ET] to study the Main Estimates for the fiscal year ending March 31, 2023.
Senator Percy Mockler (Chair) in the chair.
[English]
The Chair: Honourable senators, I wish to welcome all the senators here in the room with me, as well as all the viewers across Canada who are watching us on the Senate of Canada website, sencanada.ca.
[Translation]
My name is Percy Mockler, Senator from New Brunswick, and Chair of the Senate Committee of National Finance.
Now, I would like to introduce the members of the National Finance Committee who are participating in this meeting: Senator Boehm, Senator Dagenais, Senator Duncan, Senator Forest, Senator Galvez, Senator Gerba, Senator Gignac, Senator Marshall, Senator Moncion, and Senator Pate.
[English]
Honourable senators, this morning we are continuing our study on the Main Estimates for the fiscal year ending March 31, 2023, which was referred to this committee on March 3, 2022, by the Senate of Canada.
Today we are pleased to welcome officials from three departments, namely, VIA Rail Canada, Natural Resources Canada and Veterans Affairs Canada.
[Translation]
Welcome to all of you and thank you for accepting our invitation to appear in front of the National Finance Senate Committee.
[English]
I understand that three officials will deliver opening remarks on behalf of their respective departments. We have Steven Harris, Assistant Deputy Minister, Service Delivery Branch, Veterans Affairs Canada; and Shirley Carruthers, Assistant Deputy Minister, Natural Resources Canada.
[Translation]
We also have Marie-Claude Cardin, Chief Financial Officer, VIA Rail Canada.
[English]
Mr. Harris, the floor is yours.
Steven Harris, Assistant Deputy Minister, Service Delivery Branch, Veterans Affairs Canada: Mr. Chair and honourable senators, thank you for this opportunity to address the committee for the first time. As the assistant deputy minister for service delivery, I can tell you I’m fully aware of the significance of being a senior official for the department that serves Canada’s veterans. It is an honour and a privilege.
There are currently about 630,000 veterans in Canada. For us at Veterans Affairs, our priority is to make sure that every one of them who comes to us for support receives a response as quickly and efficiently as possible.
[Translation]
In the context of the global pandemic, that means that we are taking a close look at how our programs and services are offered, paying particular attention to the impact of this public health crisis on our clients.
Many public health regulations that we followed for two years had the unfortunate secondary effect of eliminating opportunities for socializing. Since we have talked about this directly with veterans, we know that many of them still feel vulnerable and isolated.
Although there are a number of disadvantages with the virtual world we created to replace a portion of the human contacts we lost, that world at least enabled us to continue communicating with veterans as best we can.
We may not have been able to meet our clients in person very often during the last two years, but we spent time face to face, even if it was virtually. That has always been very important.
[English]
As always, our goal is to provide the highest quality service to our veterans and to ensure that every individual receives the same positive and respectful service experience every time. From everything I’ve heard, people are appreciative, on balance, of the kind of direct and personal service that Veterans Affairs provides, and we want this to continue.
Our 2022-23 Main Estimates provide Veterans Affairs with funding of $5.5 billion, over 94% of which represents payments to veterans, their families and other program recipients. Compared to last year, this is a net decrease of $784 million or about 12.5%. To note, these estimates represent the funding available at a point in time.
The government has demonstrated its support for veterans and their families by increasing capacity to address backlog and turnaround times related to disability decisions for the next two years. This support was announced through Budget 2022 and will be reflected through future estimates adjustments.
This funding is critical to support our mission of reducing wait times for disability benefits. The $784 million decrease, in comparing the variance of this year’s Main Estimates to previous years, is largely impacted by the timing of the announcement for additional operational capacity. The decrease reflects the lower level of operational capacity and, in turn, impacts the amount of benefits that can be processed and paid to veterans and their families.
Veterans Affairs continues to work with our partners, including the Canadian Armed Forces and the Royal Canadian Mounted Police to determine veteran and RCMP veteran demands for each individual program and to ensure that every veteran who comes forward and is entitled to support will receive what they need. This is reflected annually through the quasi-statutory program adjustments that occur later in this fiscal year.
[Translation]
I’m going to close by noting that our department is achieving progress in its efforts to make decisions faster and reduce wait times.
I can assure you that we are on the right track, that these are people who interact on a daily basis with veterans, or people working in the background to make sure our programs and services are provided as quickly and efficiently as possible. We are all going in the same direction.
The department relies on strong fundamental principles. Our focus on care, compassion and respect lays a good foundation for providing good service and doing our job.
Thank you, and I look forward to your questions.
The Chair: Thank you, Mr. Harris.
Now, we are going to hear from Shirley Carruthers, Assistant Deputy Minister, Natural Resources Canada. The floor is yours.
Shirley Carruthers, Assistant Deputy Minister, Natural Resources Canada: Honourable senators and colleagues, I am very pleased to be with you this morning to discuss the 2022‑23 Main Estimates for the Department of Natural Resources Canada.
[English]
In these Main Estimates, Natural Resources Canada is requesting total authorities of $3,609.4 million. This funding consists of $722.4 million in operating expenditures, $36.6 million in capital expenditures, $2,245.3 million in grants and contributions, and $604.9 million in statutory authorities. This funding will ensure that our natural resources are developed sustainably for Canadians, providing a source of jobs, prosperity and opportunity, supported by innovative science in facilities across the country all while preserving our environment and respecting our communities and Indigenous peoples.
[Translation]
Further, this funding will support the department in delivering on five strategic priorities.
[English]
These include accelerating development and adoption of clean technology to build a more resilient economy and transition to a net zero by 2050; create and maintain market access while improving competitiveness for Canada’s resource sectors; advance reconciliation, strengthen relationships, increase engagements and share economic benefits with Indigenous peoples; promote, build and foster equity, diversity and inclusion while supporting resource communities to thrive in a net-zero carbon economy; and protecting Canadians from the impacts of natural and human-induced hazards while supporting and advancing climate change adaptation.
Notably, these Main Estimates include a net increase of $1,371.1 million, or 61% over our 2021-22 Main Estimates. This increase is primarily due to new funding to address the department’s ambition to support a prosperous energy transition that benefits every region.
[Translation]
This funding will allow the department to take advantage of Canadians’ tremendous capacity to innovate and seize opportunities.
[English]
Specifically, this year’s Main Estimates request $362.4 million for the Clean Fuels Fund. This fund was announced in Budget 2021, includes $1.56 billion over five years and will allow NRCan to work with other departments to advance the development of clean fuels, including low- or zero-carbon hydrogen.
The department is also requesting $292.5 million for the Smart Renewables and Electrification Pathways Program, which will advance smart renewables and energy and grid modernization projects. As Canada’s remaining coal-fired electricity generation units are phased out by 2030 due to regulatory requirements, this initiative will incentivize increased deployment of and access to renewable energy sources to encourage coal-reliant provinces to rely on renewables over natural gas. It will also support the transformation of the Canadian electricity grid by allowing it to accommodate a higher level of renewables and provide energy to other economic sectors such as transportation, buildings and industry, leading to a significant emissions reduction across all sectors by 2050.
The department is also requesting an increase of $247.3 million to fund our Greener Homes program. This initiative helps Canadians save money by offering them a grant of up to $600 for the cost of an EnerGuide home energy evaluation as well as offering 700,000 grants of up to $5,000 each to help homeowners undergo resiliency and energy‑efficiency home retrofits.
To help us continue our work in the areas of affordability of zero-emissions vehicles and the increased accessibility of charging stations, the department is also seeking an additional $66.3 million. This funding will help get us closer to our goal of 50,000 new charging stations and is in addition to the $1 billion that has already been invested since 2015. Finally, these Main Estimates also include an increase of $209.9 million to operationalize our commitment to plant 2 billion additional trees, just over $51 million to advance carbon capture technology, $27.4 million to establish a critical mineral centre of excellence and $41.6 million to expand the Investments in Forest Industry Transformation Program.
[Translation]
I hope this summary provides the committee with the insight they are seeking on the 2022-23 Main Estimates for the Department of Natural Resources Canada. I look forward to your questions.
Marie-Claude Cardin, Chief Financial Officer, VIA Rail Canada: Good morning to everyone on the committee. My name is Marie-Claude Cardin, Chief Financial Officer at VIA Rail Canada. I am pleased to appear today with my colleague Philippe Cannon, Director of Public Affairs and Government Relations. We are pleased to have this opportunity to discuss the Main Estimates.
VIA Rail is a non-agent Crown corporation that operates the national passenger rail service on behalf of the Government of Canada, and as such meets its customers’ needs for intercity and regional travel and travel to remote communities. As an independent Crown corporation created in 1977, VIA Rail Canada provides safe, secure, accessible, environmentally sustainable, efficient, and reliable passenger service from coast to coast, in both official languages.
In normal times, we offer over 450 departures a week and we serve approximately 400 Canadian communities.
[English]
In 2019, we offered more than 450 weekly departures. Our ridership reached a 30-year record high of more than 5 million passengers, and we surpassed the $400 million revenue mark for the first time in our history. Our overall performance in 2019 came after five consecutive years of ridership growth with an overall increase of 32%. That meant less reliance on federal support.
However, in the last two years, our services were severely impacted by the COVID-19 pandemic, which resulted in an important decrease in demand, a reduction of our services and even the suspension of some of our routes for months.
[Translation]
Despite that context, VIA Rail Canada was able to expand its activities in 2021-22, as the capacity deployed attests, having increased by 31.6% over the previous year. Performance improved over 2020, but suffered the impact of the COVID-19 pandemic: We had 1.5 million passenger trips during that period, compared to 1.1 million the previous year.
During the last two fiscal periods, we were very careful to find a balance between maintaining services that are essential to Canadians and our rigorous management of the budgetary impact of this crisis on our finances. We adopted a number of measures to minimize lost earnings, in a context in which VIA Rail Canada experienced an historic decline in its ridership, on the order of 95% at the peak of the public health crisis.
The expenses primarily affected therefore related to a substantial reduction in our services and even suspension of certain frequencies, with the exception of our service between Winnipeg and Churchill, and the resulting temporary layoffs represented nearly one third of our workforce, or over 1,500 employees at the peak of the crisis.
In 2022-23, VIA Rail Canada plans to expand its activities to meet the sustained demand in recent months and will reintroduce all its routes over this period. As well, despite the impact of the pandemic on our operations, we have stayed the course on the planned major modernization projects such as our new fleet.
[English]
As a result, VIA Rail Canada is seeking access to $980.5 million in planned spending authorities.
[Translation]
The funds will help VIA Rail Canada to operate a safe, efficient and reliable rail service for travellers throughout Canada.
[English]
Operating funding is for VIA’s general provision of national passenger rail travel and to implement and manage infrastructure investments that will improve fluidity. Capital funding includes funds to keep VIA’s asset base in a state of good repair as well as investments in modernization and improved connectivity such as fleet renewal in the Quebec City-Windsor corridor.
We have always closely monitored the evolution of the pandemic in order to fulfill our mandate during these unique times while contributing to national efforts against COVID-19, and we will continue to do so for as long as necessary. It goes without saying that the resumption of our operation in 2022-23 will take place with the objective of answering to growing demand and contributing to the government effort to protect the environment while minimizing any rise in the deficit that would have the effect of increasing VIA Rail’s dependence on the government.
[Translation]
There will be no shortage of challenges associated with our ambitious vision, but VIA Rail Canada’s present and future service is synonymous with solution, at a time when we are trying to embody a greener and more accessible national intercity transportation mode in Canada.
We thank the committee for its invitation and we look forward to your questions.
[English]
The Chair: To the presenters, thank you for your statements. We will now proceed to questions. Senators will have a maximum of six minutes each for the first round and a maximum of three minutes each for the second round. Therefore, please ask questions directly. To the witnesses, please respond concisely. The clerk will inform me when the time is up. As for the officials, please introduce yourself the first time you answer a question for the record of the committee.
Senator Marshall: Thank you to the witnesses for being here today. My first question is to Mr. Harris, or one of his officials, regarding Veterans Affairs and some information that you provided to us at the end of your statement.
The volume and the age of the outstanding claims have always been problematic. It has taken the department quite a while to process them. Could you give us some current information on the number of outstanding claims and also some idea as to the age of them? I think 16 weeks is your targeted time frame for dealing with the claims. Could you provide us with an update on that part of your department, please?
Mr. Harris: Sure, and thank you very much for the question. Mr. Chair, quite simply, it’s correct that we’ve seen a significant rise in the number of incoming applications for disability benefits from veterans over the course of the last five or six years; and, in fact, as was pointed out in the question, there are substantial delays for veterans who are making those kinds of applications.
Just two years ago we were above 23,000, in terms of applications that were beyond our 16-week service standard. I’m pleased to share with the committee here that as a result of additional funding, human resources, extra capacity that has been put in by the government, we’re now down to about 11,500. So those applications that are beyond our 16-week service standard have been cut in half over the course of the last two years.
With the additional funding I noted in my introductory remarks, we expect to bring that down even more substantially over the course of the next two years, now that we have this additional funding as well. We want to get back to achieving our service standard of processing these disability applications within a 16-week period, and we do expect to do that over the course of the next two years.
Senator Marshall: Could you clarify a couple points? The 11,500 is as of what date?
Mr. Harris: It is as of the end of the last fiscal year, so March 31, 2022.
Senator Marshall: Is the 11,500 in total or just the number that exceeds the 16-week time frame?
Mr. Harris: We have a pending backlog, a total number of applications with the department, of just over 30,000 at this point in time, of which 11,500 would be beyond the existing 16-week service standard.
Senator Marshall: What’s the plan going forward? I realize that you did hire some temporary staff in the past. What is the plan to deal with those outstanding or those that exceed the 16‑week time frame?
Mr. Harris: We’ve invested in additional human resources, as noted. We’ve extended another 518 staff for an additional two years, through the end of next fiscal year, which we expect will make a significant difference in the number of pending applications that we have.
At the same time, I would be happy to share details around additional undertakings that have been made by the department to be able to streamline the process, reduce the amount of bureaucracy that it takes sometimes to make decisions, so we’re trying to make the decisions easier, automate the process, as well as the additional human resources we have to make sure we have stability for this for the longer term.
Senator Marshall: My last question on that topic is that the 11,500 is as of March 31 of this year. Do you have a lower target for March 31 of next year?
Mr. Harris: We’re looking to try to get to about a 5,000 range in terms of the backlog for the end of this current fiscal year. The 16-week standard is 80% of the time, so not every application can be treated as quickly as the service standard as a result of the complexity, delays in obtaining information and others, so it is an 80% standard for the files, and that’s our target for this current fiscal year.
Senator Marshall: Thank you very much. My next question is for the Department of Natural Resources, and it’s on one of the statutory items, budgetary, and that’s the funding for the Canada–Newfoundland and Labrador Atlantic Accord Implementation, the revenue fund, the $526 million; and then there’s another $11 million. It has increased significantly and I’m not complaining about that. I’d just like to have an explanation from the officials.
Ms. Carruthers: These amounts vary from year to year, due to production levels of oil and gas and also operation cost. The amounts are collected and there’s actually no material difference to the Government of Canada because the same amount that’s actually collected is sent to the provinces, so it acts as a bit of a flow-through. In 2022-23, as you noted, it is forecasted to increase quite significantly, and I would note that this forecast was actually prepared in 2021. It was based at that time on the exchange rate and commodity prices and the increase in oil and gas production.
As you know, based on what we know today, we do expect this amount will go even higher, but we won’t know that for a little while yet. As I mentioned, there is no material impact in terms of the overall impact on the Government of Canada’s budget.
Senator Marshall: Where would I go to find out the details of the assumptions to arrive at the $526 million? That’s my first question. Second, have you completed a reassessment at this point in time?
Ms. Carruthers: In terms of your first question, I have seen some details just in terms of how those are calculated. I’m not sure where you’d be able to find them, but I can certainly send that information to you following the committee appearance. What was your second question again?
Senator Marshall: You said in your explanation that you were expecting that number to go higher, and I’m wondering if you’ve done an assessment to indicate how much higher it would be.
Ms. Carruthers: At this time, we don’t know how much higher that will actually go.
Senator Marshall: I’d like to see those numbers, thank you very much.
[Translation]
Senator Forest: To begin, I would like to say it’s nice to finally see one another in person. Let’s hope we can keep it up.
My first question is for Ms. Carruthers and relates to the energy transition. The environment commissioner recently criticized the lack of a government strategy for the energy transition. He said:
The audit found that there was no federal implementation plan, formal governance structure, or monitoring and reporting system in place to support a just transition and that supporting legislation has been delayed.
Those comments are from the Commissioner of the Environment and Sustainable Development, Mr. DeMarco. How can your department explain the absence of a transition plan to help communities and workers move toward green energy, to ensure a somewhat more planned and softer energy transition?
[English]
Ms. Carruthers: Thank you for the question. I’ll ask my colleague Mollie Johnson, Assistant Deputy Minister, Energy Systems Sector to step in and answer that question.
Mollie Johnson, Assistant Deputy Minister, Energy Systems Sector, Natural Resources Canada: Thank you very much for the question. As my colleague said, I’m Mollie Johnson, Assistant Deputy Minister for Energy Systems Sector at Natural Resources Canada. We received the report and the recommendations from the CESD last week. The scope of the audit that the commissioner reviewed was from January 2018 to September 2021, and you will see that we did agree with the recommendations that CESD provided, but I would also note that owing to the finishing time of September 2021, it didn’t cover a lot of the actions that are under way. We have active consultations under way on a proposed legislation framework, on proposed principles that would guide that legislation. Those formally ended on April 30, and we are moving forward with alacrity in order to put this into place and move forward.
We’re also very focused on what the jobs of the future will be, recognizing that a place-based approach is important. If we want to be considering what we’re transitioning to, we need to have a strong sense of what those industries are going to be in the different parts of our country. It is very important to know where we’re going to be able to figure out where the jobs are.
With respect to governance, we do have governance within the federal system that has been used to support this approach. Of course, building on the recommendations of the CESD, we look forward to continuing to build that and making that stronger.
[Translation]
Senator Forest: Do you have a more precise timeline for defining the plan, which is vital, in my opinion, given the scope of the challenge and the number of partners that will have to be involved?
[English]
Ms. Johnson: Indeed. In Budget 2022 there was an announcement of the regional strategic initiatives, which is about how we give life to this place-based approach. I expect that will be moving out in the near future and will pull all of these pieces together. I look forward to sharing that information with the committee as soon as it is announced.
[Translation]
Senator Forest: I’d like to make a suggestion regarding a partnership with the municipalities. Your initiative, whose purpose is to encourage homeowners to do an energy assessment, is a very useful strategy. I’d like to tell you about an experience we had in Quebec at the time when I was the mayor of a city. Hydro-Québec involved the cities in doing energy assessments on homes, and it worked really well. Each household that agreed to do an energy assessment was compensated, and the cities that participated also received a small amount. It created a real dynamic.
That is a project worth considering, because municipalities are essential partners in the energy transition and in sustainable development. As I said earlier, that’s a suggestion.
Do I still have any time, Mr. Chair?
The Chair: You have two minutes left.
Senator Forest: My next question is for VIA Rail. When I look at the high-speed train project, the estimate is that it might take up close to 75% of VIA Rail’s revenue. I come from Rimouski, and at that time, there was a train that left Mont-Joli every morning. It went to Quebec City and it came back in the evening. Today, in the regions, particularly in eastern Quebec, there are three trains a week that go through in the middle of the night.
Those are not optimal conditions for using this mode of public transportation, which is both extremely useful and very ecological. But the stations are virtually never open. I’m concerned when I hear that the rapid train project might take up close to 75% of your revenue.
What will be left for the regions of Canada? Canada is a big country, an unoccupied land. How are you going to provide service that will encourage people to take the train? At a time when there is a real need for public transit, how can we encourage people to use your excellent services, which are becoming too rare outside major centres?
Philippe Cannon, Director, Public Affairs and Government Relations, VIA Rail Canada: Thank you for your question, senator. In fact, the percentage you’re talking about is the result of the service used at present. You probably know that we operate only on a small percentage of lines that belong to us. As a result, high frequency rail is a project that was developed in 2016 at VIA Rail.
The purpose of the project is to offer more reliability in terms of arrival and departure times and to have better control of our schedules and the number of trains we can operate. The project is actually targeted where there is the highest demand. It’s not in the plans to reduce the services offered elsewhere in Canada. You’re talking about Rimouski and the lower St. Lawrence, and also the train that goes from Montreal toward the Atlantic, as far as Halifax, called the Ocean.
In fact, I’m glad you asked the question. It gives me a chance to point out that we have announced a return to service. Obviously, there was a reduction in service throughout the pandemic, but on April 14, we announced a plan to return to service across the country in June. I would stress that we have to deal with the fact that we don’t own the rail infrastructure and that this creates additional obstacles.
It is definitely not in VIA Rail’s plans to reduce the nature of the services we offer anywhere, to all Canadians, in any way.
Senator Gignac: My first question is for the representatives of VIA Rail. You are actually asking for nearly a billion dollars in expenditures, which represents a 27% increase over the previous year.
I’d like to come back to the impact of the pandemic on ridership. I understand that you took measures to restrict spending, to be more efficient. Can you give us an overview? In terms of ridership, is it below what it was during the pandemic? Mainly, do you have comparable statistics for Amtrak, in the United States, given that the public health restrictions were much more stringent in Canada, and continue to be? Is Canada at a level comparable to the United States, when it comes to ridership?
Ms. Cardin: On the question of ridership, in 2019, before the pandemic, we had almost 5 million passengers. In 2020, at the peak of the pandemic, the number of passengers was 1.1 million. In 2021, at December 31, we ended the year with about 1.5 million passengers.
Of course, we won’t be returning to the 2019 level for several years. Passengers have to be comfortable enough to start taking public transportation, rail transportation, again. However, we are seeing a major increase in demand. The most recent statistics for 2022 show that we are at almost 85% of 2019 levels, which were historic levels for VIA Rail.
The increased spending is an excellent question. It is actually 27%, if we compare 2021-22 with 2022-23. One of the reasons for that is that the increase in frequencies means that our operating expenses are going up significantly. As well, as I said in my presentation, we have substantial transformation projects. Certain funds had to be incurred earlier, in particular for the acquisition of our new fleet of trains. Those funds were not incurred in the previous years, but they will be this year. That is a budget allocation that dates from 2018 and it is still the same funds. The trains will continue to be delivered in 2022, 2023 and 2024. In 2022-23, the increase will really be connected with the fact that there is more activity in connection with the delivery of new cars for the new fleet.
Senator Gignac: For the United States, do you have statistics for comparison with Amtrak? Have we almost got back to pre‑pandemic levels, or are we still far from the American figures?
Ms. Cardin: Given the fact that we prioritized passenger health, our trains were not as dense as Amtrak’s, which adopted fewer public health measures throughout the pandemic. In terms of ridership, I couldn’t give you precise statistics, but the Americans are certainly ahead of us.
Senator Gignac: In the past, VIA Rail was heavily criticised in terms of the quality of service, and that was in the headlines. Can you tell us whether you have performance indicators for the management of funds, and especially for customer service?
Ms. Cardin: Absolutely. If I’m not mistaken, we have just completed a survey. I think we had one of the best results when it comes to passenger transportation. I don’t know whether Philippe has the document in question.
Senator Gignac: You can send us the answer in writing.
Ms. Cardin: We’re going to send it to you, we’ll be happy to do that. There was certainly an improvement.
[English]
Senator Gignac: My question is for Natural Resources Canada. Last week we heard from the Commissioner of the Environment and Sustainable Development, who gave a negative report regarding the assessment of the government’s hydrogen strategy. He said that it was overly optimistic. More disturbing was the fact that there is a significant inconsistency between Environment and Climate Change Canada and Natural Resources Canada. In fact, one predicts a reduction in emissions of 15 megatonnes and the other predicts 45 megatonnes.
Could you explain to us how it is possible that two departments in the federal government have two different assumptions, please?
Ms. Carruthers: Thank you for the question. I will hand it over to my colleague Sébastien Labelle, Director General, Clean Fuels Branch.
Sébastien Labelle, Director General, Clean Fuels Branch, Natural Resources Canada: Thank you very much, Senator Gignac. That’s a great question. Just last week we spent time with the commissioner and with parliamentarians to talk about that.
When you think about the two documents and the two approaches to modelling, the Hydrogen Strategy for Canada is a call for action. It is meant to show the opportunity and what could be done with hydrogen. It is meant, as well, to reflect the input we had over three years of consultations with the private sector, provinces and academics. It reflects an ambition to move forward with hydrogen as a fuel source.
On the other hand, I am happy to comment briefly on ECCC’s work. They are looking at the Strengthened Climate Plan and, more recently, the Emissions Reduction Plan, which looks at actual measures that are in place and what they will do. By definition, their job is to be more conservative and to think about what is funded. That is the main difference.
Senator Gignac: I do not want to take too much time from my colleagues, so if you could send this to me in writing. Thank you.
Mr. Labelle: Of course.
[Translation]
Senator Gerba: Canada is the second largest country in the world. It crosses several time zones. And yet it is the only G7 country that doesn’t have high-speed trains. My question is for the VIA Rail representatives. Can you explain why the government opted for high-frequency trains rather than high‑speed trains? Is it because of a lack of financial support? There are people who would like to visit Canada, starting with me. I’d do a trip all around Canada before I’d do a trip around the world. From a financial point of view, what is the justification for the government’s choice?
Mr. Cannon: Thank you for your question. I can answer for VIA Rail as to why we proposed a high-frequency train project. When I joined VIA Rail, someone told me: “You know, Philippe, you have to learn to walk before you run.”
In the Quebec City-Windsor corridor, the most densely populated area, VIA Rail carries several million Canadians every year. As I said earlier in answer to a question from Senator Forest, we own fewer than 5% of the lines we operate on. As a result, we have to be able to control the frequency of departures every day. We also have to control the hours and the reliability of the timetables that enable us to get passengers to their destination. And we have to control the length of trains, that is, the number of cars we put on the train, in order to serve the public better. That is what the high-frequency train project grew out of.
I should also point out that we have train itineraries that can take Canadians from coast to coast. The Ocean, which covers the Halifax to Montreal route, can easily take the HFT. And then, between Toronto and Vancouver, we have the Canadian, which can also connect with it.
We need a reliable, safe, comfortable means of transportation. There’s no need to repeat that we offer internet access and we are recognized for our customer service and the quality of our onboard passenger service. The services offered for passenger transportation need to be expanded, taking the environment into consideration, and that transportation has to be reliable and safe.
For people who want to visit Canada, which we invite you to do, senator, you can take the Canadian, which gives you the chance, through our rail experience, to travel from Toronto to Vancouver while admiring the Canadian landscape.
Senator Gerba: Clearly, taking the time to visit because you’re on vacation is a very attractive ideal. However, some of us come from very far away and it takes forever. This is 2022, and the plan is for the project to be operational in 2025, if memory serves?
Mr. Cannon: That’s a good question. I’m going from memory. A document was published by the minister, Mr. Alghabra, and you can consult that. It’s a reference document for a call for interest. The document contains the sequence in which things are to proceed, for example.
You know, this is a big project. We are the first to say that if we could have this kind of method of transportation, we would be extremely happy. But we have to follow the process and there is a lot to be done. Creating this kind of infrastructure for the country, one that is of crucial importance, is a very big project. You can’t cut corners when you’re carrying out a project like that. There is a process to follow and you have to take the necessary time. The Department of Transport has a team that is dedicated to moving the project forward very surgically and methodically, to ensure that Canadians are able to properly benefit from this train service within the time allocated for a project like this.
Senator Gerba: Going back to the question of time, my colleague has just told me that the project will start in 2030. It’s now 2022. Is there not a risk that the needs of Canadians and visitors to Canada will change by 2030? Was it not possible to consider that this demand will be growing in 2030? Today’s calculations are based on frequency, because that’s an immediate need. Was planning done based on long-term needs, doing a comparison from the financial point of view? If so, I’d like to get that calculation in writing, if possible.
The Chair: Can you provide the answer in writing, please? We’ll give you the deadline.
Senator Dagenais: My first questions are for Ms. Cardin.
Ms. Cardin, we know that Unifor, the union that represents 2,000 employees of VIA Rail, has decided to strongly oppose the involvement of the private sector in the Quebec City-Toronto corridor.
How much money have you obtained from Ottawa to negotiate or to fight the union’s demands? Do you plan to go ahead, even if the dispute hasn’t been resolved?
Ms. Cardin: As my colleague explained, Transport Canada is taking a surgical approach to planning the next steps. In terms of the union, Mr. Alghabra is negotiating with the VIA Rail employees to affirm the importance of keeping the various unions at VIA Rail. For the moment, Transport Canada is continuing with its plan for the high-frequency train. If funds are needed, I don’t think that is part of our short-term horizon; I assume we will have the necessary discussions with Transport Canada.
Senator Dagenais: There is talk of a budget of $42.8 million allocated for building or renovating stations in the Quebec City-Toronto corridor project. Can you tell us how much, and how and when those funds will be spent in Quebec?
Ms. Cardin: That’s an excellent question. For 2022-23, there will in fact be investments. If we’re talking about Quebec, it’s mainly the Palais station that will be getting major renovations. If it’s not in the current fiscal year, it will be in 2023-24. Being completely transparent, it will be happening very fast.
Senator Dagenais: Mr. Harris, to follow up on your discussion with Senator Marshall, I’m going to dig a bit deeper into the matter of response times, particularly for veterans with mental health problems. We know there are a lot of them. I’m not going to get involved in proving how urgent it is for them and their families that they get care quickly, but when you talked about your results, I was a bit concerned by the answer you gave. Do you think you have the necessary capacity to do faster follow-up in mental health cases?
Mr. Harris: Thank you for your question. There are two things I can say about that. Last year, we saw improvements in wait times for disability claims, including for mental health care. We improved by six to ten weeks in each category of disability benefit claims last year.
Second, a new mental health program was created and implemented on April 1. When a veteran submits a claim relating to a mental health problem, they get immediate access to treatment programs. They don’t have to wait for a decision to be made, and access to a mental health program is available as soon as the claim is filed. That allows us to respond to challenges associated with wait times or delays in processing their claim and it gives them access to treatment immediately.
Senator Dagenais: Mr. Harris, out of a budget of $5.5 billion, an envelope of about $3.7 billion has been dedicated to veterans’ benefits. That may leave $1.8 billion to be managed. If we add up the figures, we see that it costs about $100 million to manage operations, in the performance table, which may need to be discussed in some cases. Would there be ways of making changes so that these funds are better used and the overall effectiveness for veterans is definitely better?
Mr. Harris: Thank you for your question. I’m going to ask my colleague, the Chief Financial Officer, to answer this question.
[English]
Sara Lantz, Acting Assistant Deputy Minister, Chief Financial Officer and Corporate Services Branch, Veterans Affairs Canada: Thank you for the question. In fact, the $1.3 billion that you see for the operating expenditures includes just over $300,000 for our regular operating budget. In fact, the other $1 billion is for support services for veterans and their families, mostly consisting of health care cost coverage for the services that are provided.
As Mr. Harris stated in his opening remarks, Veterans Affairs Canada’s operating budget is consistently less than 10% of our overall budget and this year comprises approximately 6% of our Main Estimates.
Senator Galvez: Ms. Carruthers, in your opening remarks, you spoke about attaining net-zero emissions by 2050 and building a resilient low-carbon economy through increasing competitiveness and innovation. However, the government approved the North Bay project while still not having recuperated the benefits of the Muskrat Falls hydroelectric project.
In 2016, the Canadian government announced that it would take equity from the Muskrat Falls project and provide a guarantee as a part of a $5.2 billion structured agreement with the Atlantic provinces, which included $2 billion in government finance. In these Main Estimates, you are listing $125 million as statutory authorities for payments to the Newfoundland Offshore Petroleum Resource Revenue Fund.
How do you reconcile the goals of your minister with the actions of your department? With the approval of the Bay du Nord development project, did you expect the payments to continue to increase?
Ms. Carruthers: I’m sorry, I’m not familiar with the project that you are raising. I’m not sure if any of my colleagues are aware of that project, but I can certainly get back to you on that.
Senator Galvez: You are not familiar with the North Bay project or the Muskrat Falls hydroelectric project?
Ms. Carruthers: I’m sorry, I do not have any details on those with me.
Ms. Johnson: I’m happy to jump in.
Senator Galvez: Mr. Chair, it’s unbelievable.
The Chair: Madam, is there someone here who could speak to it?
Ms. Carruthers: Yes. Ms. Johnson is going to jump in here.
The Chair: Thank you.
Ms. Johnson: These are not items that are in the Main Estimates, so from a financial perspective, they would not have been identified. The Bay du Nord project is not something that goes through Natural Resources Canada. That would have been a project that was approved recently. With respect to Lower Churchill, obviously, the process went through this year.
If I am correct, senator, the question that you are asking is related to the alignment of the government’s transformation to a low-carbon economy, and I’m happy to speak to that if I have the question correct. Is that fair?
Senator Galvez: Yes. You can answer that too, but the Library of Parliament provided us with a document, and it says here that in the Main Estimates 2022-23, NRCan is listing $526 million in statutory authorities for payment to the Newfoundland Offshore Petroleum Resource Revenue Fund, which is a 160% increase compared to the 2021-22 Main Estimates. Are you saying that the Library of Parliament is wrong?
Ms. Johnson: No, but I believe — and Ms. Carruthers can correct me if I’m wrong — that is the flow-through that Ms. Carruthers spoke to off the top, which is related to the offshore. I am happy to come back to that through her if we want to clarify that piece.
Did you want to jump in on that one, and then we can talk about the broader low-carbon transformation?
Ms. Carruthers: Yes, definitely. The piece that’s actually listed in the estimates is exactly as you mentioned. It’s the item that I spoke about a little bit earlier, which is the flow-through.
Senator Galvez: Perhaps the previous witness can explain the reconciliation?
Ms. Johnson: Perfect. I’m very happy to do that. When we look at the modelling from the International Energy Agency, and we look at the transformation to a low-carbon economy by 2050, there are a number of pathways that we will have to move through. We talk about electrification; we talk about low-carbon fuels; we talk about energy efficiency, and we will have to move through all of these things together.
With respect to the Bay du Nord project, I believe it’s looking at .02 megatonnes. I don’t have the number off the top of my head, but maybe one of my colleagues would. It’s really the lowest emitting per-barrel type of project that we would need going forward, and that’s really what we need to be thinking about as we move through the transformation.
We do know the world will continue to need oil and gas as we move forward. At the same time, we are working quite aggressively to achieve targets to drive electrification. As we look across the country, we have an ambitious target for 2035 to electrify the economy. We’re also working aggressively to implement a hydrogen strategy that enables clean fuels to be working across the country as well. As I spoke about earlier, we’re looking at a place-based approach so that we can really seize and support the economic opportunities in each region of Canada to drive this transformation.
At the end of the day, I’m saying that we need to ensure that we have access to all of the tools to support decarbonization of our system while, at the same time, ensuring that we’re able to do this in a way that is affordable, ensures reliable energy that Canadians require so we’re not freezing in the middle of the night, and that we have a clean energy source as we move through the transformation.
Senator Galvez: Maybe you can provide the answer to this question in writing. Does the government consider updating the Canada-Newfoundland Atlantic Accord to incorporate and specify the responsibility for the royalty payments under Article 82 of the United Nations Convention on the Law of the Sea, particularly in the wake of the approval of the Bay du Nord Development Project? Thank you.
Ms. Johnson: Perfect. That would be something that we would follow up on. I appreciate the question.
The Chair: Thank you, Ms. Johnson and Ms. Carruthers. Could you go back to the original question posed by Senator Galvez? If you want to add additional information, you could do that in writing. We have a timeline for receiving the response of our questions in writing. It would be by May 10, through the clerk. Do we have an agreement, Ms. Carruthers, that you will follow up, after taking notice of the statement and the first question that was posed by Senator Galvez?
Ms. Carruthers: Yes, absolutely. We’ll follow up.
Senator Pate: Thank you to the witnesses for appearing. I have two questions, one for Veterans Affairs and one for Natural Resources Canada.
For Veterans Affairs, you’ve talked about the decrease. You’ve responded to Senator Marshall about the wait times and some of the concerns. I note that some of the most significant spending is on benefits such as pain and suffering compensation, income replacement benefits and pensions for people with disabilities. The fact that there are significant numbers of veterans who are homeless is, of course, a concern for your department, as well as for many of us.
The data seems to indicate that the current programs and services are not succeeding in supporting veterans to find pathways out of economic need and crisis. I speak in particular of the research done about 10 years ago by Dr. Ray. The department needs to emphasize some ways to actually assist veterans going forward.
I’m curious as to whether the department has looked at initiatives — particularly in light of the Guaranteed Income Supplement and its relative success overall with those kinds of approaches — whether they’ve looked at a guaranteed basic income in terms of a way to complement the services and programs that are provided, and to allow for more flexibility and responsiveness to the needs of marginalized veterans, in particular, to support them as they try to achieve longer-term economic stability.
Mr. Harris: Thank you for the question. The question does cover lots of ground, so I’ll do my best to respond to the elements that you brought forward. It is important to recognize that a large number of payments are made with respect to compensation for those military members who have suffered illness or injury as a result of their service. Some of those are compensation elements, compensating them for an illness or injury that they’ve received.
Other payments that we make are financial benefits, which are involved perhaps in working to allow veterans to rehabilitate from their illness or injury and to re-establish themselves into normal lives. So while there’s a compensation payment, there are significant elements that are financial benefits to support veterans who may not be able to necessarily re-enter a workforce or who may need to rehabilitate before they go into a workforce environment.
We have a number of programs, such as the Income Replacement Benefit, which provides what I think you’re getting at in terms of a living wage, to veterans who are either in the middle of a rehabilitation program or who may not be able to earn the same level of salary that they would have had while they were in the military as a result of the illness or injury that they suffered during their service. That income replacement is up to 90% of their pre-release salary while they are going through the rehabilitation program or if, ultimately, it’s determined that they will not be able to rehabilitate to a successful enough level to be able to earn that.
I think there are programs in place that look like a universal wage, or something to that effect, to help veterans who may find themselves in that area of need.
With respect to homelessness and veterans — and I’ll try to keep it quick — we also have a number of programs in place. The government has recently announced additional funding to support purpose-built housing for our veterans through our colleague departments in terms of infrastructure, like Canadian Mortgage and Housing and others. We provide wraparound services. In other words, we provide case management services and others to help veterans who may find themselves in or at risk of homelessness and supports to allow them to get programs from Veterans Affairs, whether that’s treatment benefits they might need for drugs, medication or other things like physiotherapy, things of that nature. We provide all those kinds of wraparound supports for the re-establishment too.
I do think there are a few of those elements in place already, and that has worked successfully. That being said, we need to make sure we’re continuing to provide as much support as we can for at-risk veterans, both in terms of income security but also to avoid them coming into a situation of homelessness.
Senator Pate: Could Veterans Affairs provide me any assessments of the various types of economic or income support programs that they have examined? It would be fantastic if we could get that in writing, please.
For Natural Resources, I notice there are quite significant increases, as you’ve identified and others have talked about, in terms of this year’s Main Estimates. In your departmental plan, 18 out of 25 of the aspects suggested by your department for funding are areas that target Indigenous peoples and community groups. Yet, there’s nothing that I could find with respect to drinking water and clean water, and the costs and the allocations that are a result of the class-action lawsuits that have been brought. I also noticed there’s a lack of anything in the departmental plan in light of this reality.
I’d like to know if there’s any plan for your department regarding the use of Natural Resources going forward, especially when the use of these is so severely impacting Indigenous communities, in addition, of course, to the issues that Senator Galvez raised.
Ms. Carruthers: Thank you for the question. You’re correct. There’s no funding within Natural Resources Canada to address that issue. That issue would actually be addressed by the Department of Indigenous Services. You would be able to find some information on that in their departmental plan.
Senator Pate: I have a supplementary if there’s time.
The Chair: On the second round, Senator Pate.
Senator Boehm: My first question is for Natural Resources Canada.
Ms. Carruthers, it’s good to see you again. You mentioned there were going to be 50,000 new charging stations. I’m assuming that will be coming out of the $96 million in the estimates for contributions in support of zero-emission vehicle infrastructure.
On this committee — current and former members, and in the previous Parliament — we have expressed a lot of concern about the lack of existing infrastructure in Canada, so that Canadians would have the ability to purchase, shall we say, an electric vehicle even in rural areas. Colleagues have indicated that in smaller centres, rural, remote, Northern and Indigenous communities, this is really not going to happen. Until charging stations are as ubiquitous across Canada as gas stations are, it really will not be seen.
Could you comment on that? How much of this $96 million is earmarked for charging stations and that supporting infrastructure specifically? My concern here too is that we might be exacerbating the urban/rural divide that exists. We’ve seen demonstrations certainly in this city on that subject. Where are these stations going to go, and what is the plan for more remote areas of the country?
Ms. Carruthers: Thank you very much for the question. I’m going to turn it to my colleague, Sébastien Labelle, who has some information that you’re requesting.
Mr. Labelle: Thank you very much, Senator Boehm. I’m happy to take the question. The Zero Emission Vehicle Infrastructure Program — and you see the $100 million in this particular exercise, the great majority of which is going directly to two recipients. We’ve got a split of $96 million for contributions and $4.3 million to operate the program.
When it comes to urban and rural, we run a competitive process. We launched the last one for the existing funding just this week to see where the opportunities are and where the demand is. In terms of the specific rural and urban, we will have to get back to you with a written response on that. We can certainly do that.
I also want to answer the second part of your question, what’s next. The Emissions Reduction Plan allocated $400 million for NRCan to continue that funding and another $500 million to the Canada Infrastructure Bank to also get into the space and look at alternative delivery mechanisms to deliver that. We’re working very closely with the CIB, so that $900 million is what is next in terms of recent announcements. On the urban/rural, I will have to get back to you.
Senator Boehm: Thank you, Mr. Labelle. Thanks to your cat as well for brightening up our morning.
My next question, if I may, chair, would be for Mr. Harris and it follows on the question made by my colleague Senator Dagenais. This is with respect to mental health supports for veterans. This is Mental Health Week, after all. We want to draw more attention to the needs for mental health supports.
Here in Ottawa, we’ve seen various demonstrations that have involved veterans, those concerned about their freedoms and those who were anti-protestors actually protesting against those who were expressing their concerns. I’m wondering whether during all of this you have seen any increase in requests from veterans for mental health supports and their families who might have been having a hard time recently as part of these events? How much money is being requested in these estimates and is specifically earmarked for mental health supports for veterans in general?
Mr. Harris: Thanks again. We’ve been reaching out regularly to our veteran clientele and more broadly to the veteran population over the course of the pandemic, and then all the way through the events as you’ve noted just recently, to see whether they’ve been impacted by changes in Afghanistan, impacted by news and events in places like Ukraine as well.
We’ve seen a general increase in the number of people seeking mental health support over the course of the last number of years as new initiatives have come forward both from Veterans Affairs to support mental health issues, but also just the recognition in the general population about the importance of addressing mental health as quickly and early as possible. I noted the mental health benefit that has come into effect as of April 1, which means on applications for disability benefits, we are granting immediate entitlement to treatment for mental health challenges or illnesses that a veteran may suffer. They can go and get treatment immediately while they may be waiting for a decision to be made.
We’ve not seen a specific increase in the last little while as a result of the events in Ottawa and perhaps elsewhere, but we are checking in regularly with our veteran clientele to make sure that they have access to the things that they need to ensure that they’re being treated effectively.
We also operate operational stress clinics across the country that we fund through provincial associations, as they’re responsible for health, and we have 11 OSI clinics across the country and a number of satellites that allow veterans to be able to get access to mental health supports and treatments on that.
With respect to specific spending on mental health, I would ask my Chief Financial Officer colleague Sara Lantz if she has that figure; if not, we can get that for you as a follow-up.
Ms. Lantz: I can add that we previously had a similar question from the Senate. Attributed to our mental health spending from our operating budget was approximately $84 million earmarked for mental health programs in 2019-20. Since then, as my colleague mentioned, we do have the new mental health benefit for those applying for disability benefits. Since 2019, we have continued to implement our Centre of Excellence on Post-Traumatic Stress Disorder and Related Mental Health Conditions. I can safely say we’ve earmarked approximately $90 million annually for mental health services and supports for our veterans and their families.
Senator Boehm: Thank you. Second round, please.
Senator Duncan: Thank you very much to the witnesses that are appearing. I would like to address my first question to NRCan and I’d like to address the item of the cleanup of the Gunnar uranium mining facility. I note there was not expenditures in 2021, limited expenditures in 2021-22 in the estimates and we have a substantial increase in the Main Estimates for 2022-23. I believe that is likely due to COVID that the funding was not spent previously.
My point is that elsewhere in Budget 2022-23 Indigenous Services and Crown-Indigenous Relations, both of them have funding for the cleanup of contaminated sites. In the Yukon, the cleanup of the Faro Mine site, there’s been a substantial amount of cleanup to date, and there has also been a very clear and tangible effort to provide employment and to work closely with the First Nation in the area, the Ross River Dena Council.
Could the department explain if there is any sort of effort or opportunity for Indigenous individuals and businesses in Saskatchewan to work on the Gunnar mine site, Gunnar uranium mining cleanup facility? Is there any effort to work with Indigenous people in Saskatchewan on that cleanup?
Ms. Carruthers: Thank you, senator. Maybe before I hand it over to my colleague Mollie Johnson, I’ll mention the funding that you do see in these Main Estimates has actually been reprofiled or carried forward every year since 2008-09. So there’s no new funding allocated from the fiscal framework. Mollie, would you like to go ahead and maybe answer the specific question from the senator?
Ms. Johnson: Senator, I will get back to you on the proposed engagement opportunities for Indigenous people, but what you’re seeing in terms of the carry-forward is a reflection of an allocation of funding, but there’s ongoing legal engagement with the province. So that money is being carried forward until we’re able to come to a resolution of that point.
Completely agree with you in terms of opportunities for the cleanup, and particularly the opportunities for Indigenous peoples to be engaged in those processes. In this particular case, there is a legal piece outstanding and we’re going to need to tackle that. I am happy to provide some additional information for you.
Senator Duncan: Thank you for that. I’m also curious if there is an all-of-government, all-of-Canada approach to these contaminated sites cleanup, if there is a working group on best practices that involves NRCan as well as the Indigenous relations and CIRNAC. Perhaps I could have that answer in writing.
My final question is for NRC. There’s a substantial listing of grants and a substantial listing of contributions. Grants may be application based. Similar to Senator Boehm’s question regarding an all-of-Canada approach and whether or not electrification is a rural and urban divide, could we have in writing an overlay for Canada of where all this money is going in each specific area in terms of contributions for, let’s say, support-critical minerals? Could we have from the department in writing — by May 10, as the chair suggested — an overview of where that money is being spent in the country?
Ms. Johnson: Perhaps on the other projects, like the Smart Renewables and Electrification Pathways Program and the Smart Grid Program, and when we’re talking about off-diesel projects, which is our Clean Energy for Rural and Remote Communities Program, you’ll see a fairly extensive breakdown across the country and in different jurisdictions. A number of those are focused on supporting communities that don’t have access or grid connectivity. I’d be happy to provide that breakdown to you.
For the rural, urban and Indigenous communities, we’re finding that, in particular, the breakdowns we’re getting for some of our electrification programs are very much incentivizing Indigenous people’s participation at a much higher threshold than we had initially thought. I’d be pleased to share that with you. I think you’ll see quite positive results owing to the work that’s been happening.
Senator Duncan: Thank you.
If I could address VIA Rail for a moment, the Main Estimates say that “VIA Rail also provides passenger rail transportation to regional and remote communities, some without alternative year‑round transportation access.”
I note that in 2019, Destination Canada began a tourism marketing campaign that would help Canadians to discover lesser-known areas, hidden national gems and new experiences across the country.
Could VIA Rail please provide in writing an indication of how they participate with Destination Canada in building Canada’s tourism economy, particularly in the more rural and remote areas of the country?
Ms. Cardin: I will do so.
[Translation]
Senator Moncion: I would like to put my question to Natural Resources Canada.
Once again, you’re talking about retrofitting projects. These projects have been in place for years and the value is still the same: $5,000. The programs have not changed in years.
Today, if we take the example of a house, if you want to change your heating system and not use natural gas or oil heating any longer, you have to get a heat pump. The cost of a heat pump is far more than what an ordinary furnace costs. When you look at the $5,000, it is certainly not enough to encourage people to choose another heating source, for example. That is one point.
The other point relating to the $5,000 figure is that we’re still talking about the energy efficiency of houses and not looking at the other extremely polluting little machines. We’re not urging people to change their habits. I’m talking about gas leaf blowers and gas lawn mowers, which are very polluting.
Could the department take a look at expanding and modernizing the programs offered for retrofitting?
[English]
Ms. Carruthers: Thank you very much for the question. In terms of whether the department should start to think about different ways in which to administer the program, I can mention that Budget 2022 allocated an additional $200 million to accelerate the pace of deep retrofits in Canada. This would include a focus on low-income and affordable housing. I would ask if my colleague Drew Leyburne would like to add some information to your question.
Drew Leyburne, Assistant Deputy Minister, Energy Technology Sector, Natural Resources Canada: Thank you for the question. With regard to the retrofits program, you are right that many retrofits will cost more than $5,000. But when we designed the program, we wanted to ensure we were getting the right balance of scope across the country so that up to 700,000 homeowners could use the program.
In addition to the grant amount of $5,000, there are many other incentives for people to think about shifting to heat pumps. In Atlantic Canada, for example, if you are paying for heating oil, the payback period for a heat pump, regardless of what kind of subsidy or grant you get from the government, is very attractive. We’re trying to find the right balance. We evaluate the scope of the program on an annual basis to make sure we’re including the right kinds of equipment that can be used within the program.
On the broader question about other types of equipment or energy-using devices, Natural Resources Canada is also responsible for an ever-improving process of developing equipment standards for energy efficiency. We routinely bring forward regulations that have the effect of eliminating the least efficient pieces of equipment across the Canadian economy.
For the specific equipment you mentioned, leaf blowers, I’m not sure whether that would be under the scope of the Energy Efficiency Act to be managed.
Senator Moncion: No, it’s not.
Mr. Leyburne: It’s a fair question. Certainly for equipment within houses, we have an active routine of eliminating the least efficient products.
Senator Moncion: It becomes a conscious decision that is made by the owner. I’m sure you’re aware of this. We always look at the larger polluters, but we’re not looking at the mass polluters. Anyone who owns a gas lawnmower is a large polluter, if you put all the gas lawnmower owners together.
We’ve always focused on the larger groups, but I think there’s an argument that can be made for all Canadians. Because the amounts and the retrofits are the same year over year, it’s a preoccupation that I have.
[Translation]
Second, regarding charging stations, we’re talking about adding 50,000 all over Canada. I have been driving the Ottawa‑North Bay-Sudbury corridor for 25 years. In that corridor, Tesla has installed lovely machines that can be used only by Teslas, and it’s hard to find charging stations for ordinary vehicles. You plug in your Tesla, and 20 minutes later, it’s done, but nobody else can use those charging stations. Tesla also has a loyalty program with Canadian Tire.
What kind of initiatives are you going to propose for getting higher capacity charging stations that are more accessible, over a larger area, particularly in regions where people have to travel long distances or populations are far apart? My question is along the same line as Senator Boehm’s.
[English]
Ms. Carruthers: Thank you very much for the question. Before I hand it over to my colleague Sébastien Labelle to respond to your specific question, I’ll note that as of March 31, 2022, NRCan had approved projects that, if successfully completed, will result in the installation of more than 2,500 new charging stations and 19 hydrogen stations.
Sébastien, I’m wondering if you can add some details.
[Translation]
Mr. Labelle: Thank you for that question.
That is exactly the question we ask ourselves when we work on imagining the design of the program. I mentioned $900 million that has just been allocated. We can ask ourselves what the role of the federal government is and what the role of the private sector is. How can the two interests be aligned? For Tesla customers, it’s fantastic, but if you don’t have a Tesla, what do you do? That is exactly what we are thinking about. For the $900 million, these are the fundamental questions we are thinking about now.
I don’t have an exact answer for the future, but until future announcements are made and until the program with the Canada Infrastructure Bank is launched... The Infrastructure Bank will certainly bring a valuable perspective, given its experience with the private sector.
We know that charging stations are getting more profitable. We hold a lot of discussions with the Bank of Canada to get a better understanding of how to benefit from them. That is a very good question and we are working on it.
Senator Moncion: If I can give you an example: In Deep River, if you stop at Canadian Tire, there are five Tesla stations; if you stop at Tim Hortons, which is less than 30 metres away, you have only two. There is one that is super efficient, but not the other. How is it different about Tesla’s way of thinking, from the ones who install two stations at Tim Hortons, and five at Canadian Tire? It’s sometimes a very narrow way of thinking.
The Chair: I’d like to tell you that last October, I bought a good EGO leaf blower.
[English]
It works very well, the EGO snow blower. It is a two-phase operation. Plus, I was surprised that the two batteries will last at least two and a half hours. I also have an Oregon chainsaw, which is battery.
Senator Moncion: We have to publicize it.
The Chair: But with the indulgence of the senators, please, I have a question for Veterans Affairs.
[Translation]
The question is about the Juno Beach Centre.
[English]
The vote that is being looked at is half a million dollars.
But I want to bring it back, and I will also use some comments by Minister MacAulay.
[Translation]
Canadians are very worried, sensitive and concerned about the Juno Beach Centre, which is a private museum in Normandy owned by the Juno Beach Centre Association, a Canadian not‑for-profit organization that manages it.
In the Government of Canada’s 2021 to 2025 strategic plan, the JBCA receives a $500,000 grant to manage and administer it.
[English]
I also agree with Minister MacAulay when he says that the Government of Canada is committed to ensuring that the outstanding contributions of our veterans and the fallen are never forgotten. D-Day and the Battle of Normandy are considered some of Canada’s most important military engagements of the Second World War. I have had the honour and pleasure in my other life to visit it.
There is no question of the immense historical significance of D-Day landing sites and certainly of Juno Beach, the 10‑kilometre stretch of shore along the Normandy coast where the Canadians landed on June 6, 1944, where so many Canadians made the ultimate sacrifice in the defence of France.
I have two questions in respect to the vote that is being requested.
[Translation]
What options are available to the federal government, given that the museum is in jeopardy because of the intention to propose building two apartment buildings on a very historic site that means a lot to Canadians and affected the whole world in the Second World War?
What options are available to the federal government to resolve this dispute and make sure that the memory of Canadians is honoured?
Does the government plan to request more money to support the Juno Beach Centre if the museum’s activities are disrupted by the construction work?
Could the representatives of Veterans Canada inform the committee about this situation, one that Canadians are worried about? Over the last two months, I had the opportunity to speak with Atlantic veterans, and everybody is worried.
Mr. Harris: I’m going to ask my colleague Amy Meunier, Assistant Deputy Minister, Strategic Policy and Commemoration, to answer your question.
[English]
Amy Meunier, Assistant Deputy Minister, Strategic Policy and Commemoration, Veterans Affairs Canada: Thank you very much for the opportunity to speak on this issue. I just recently returned from visiting the Juno Beach Centre with the minister. As you mentioned, senator, Canada and France have a long history of recognizing and commemorating the contribution of Canadian soldiers over the last 100 years. As you noted, we’re certainly well aware of the proposed condominium development adjacent to the Juno Beach Centre. Currently, this is a private dispute between the Juno Beach Centre and a real estate developer. It is before the courts currently. The Government of Canada has made clear and brought attention to this issue.
I mentioned that I was just at the Juno Beach Centre with the minister, who convened a meeting with key stakeholders involved, including the Juno Beach Centre Association, local mayors, Les amis du Centre Juno Beach and representatives from the Canadian embassy in Paris as well as Veterans Affairs Canada stakeholders. Minister MacAulay also had the opportunity to meet with the Minister Delegate for Remembrance and Veterans from France. Following that meeting, there have been subsequent meetings with key stakeholders. All parties feel a sense of urgency and importance towards finding a positive resolution.
It’s important that we let the court process proceed. There is currently confidential mediation under way. The Government of Canada and the minister have been very clear that this is really important, and the Government of France has also indicated and shared a common sense of importance to preserve this area and work with all involved to ensure a positive outcome for those involved.
In terms of funding and supporting the Juno Beach Centre, we’re very happy to be able to provide assistance to the Juno Beach Centre on an annual basis to assist with their operating costs. We do work with them on a regular basis to help determine what is a sufficient amount and what they require to ensure ongoing continuity of services that they provide to Canadians who are visiting, to local citizens and the many youth who attend the Juno Beach Centre.
The Chair: Thank you very much for your professionalism and also to the veterans.
Honourable senators, we will now move to the second round.
Senator Marshall: My question is for Natural Resources Canada.
Your budget this year is a substantial increase over last year. It was $1.4 billion in 2020-21. Then it doubled to $2.8 billion in the following year, which was last year. Now in these Main Estimates, you are requesting $3.6 billion. There is a substantial amount of money there for incentives and subsidies, which I don’t expect that the government will be able to afford to continue in the future, especially at the rate at which it has been accelerating.
What I am hearing now is that people are starting to be concerned about energy security. I think they are observing what’s happening in Europe and the ongoing situation in Ukraine. Does the department do any work or are they looking forward, looking into the future and making sure that Canada is left in a position whereby we have energy security, or are we going to be surprised one of these days?
Right now, the price of gas is going up. Everything is escalating in cost. People are saying, “Okay, what do I do? Do I put gas in my car, do I heat my home or do I buy groceries?”
What are you doing in the area of energy security? Is it on your radar?
Ms. Carruthers: Thank you, senator. Yes, it is on our radar. I will ask my colleague Molly Johnson to provide you with an answer.
Ms. Johnson: Thank you very much.
It’s a very complex question that you have asked but one that is certainly on our radar. As we think of energy and energy transformation, we have a number of things in mind. Front and centre for us are these questions: Is it affordable as we’re looking forward through the transformation? Is our system reliable? Is our system clean? We want to make sure that “triangle” is always properly calibrated. If any part of that triangle gets too much out of whack, we know we are going in the wrong direction.
That is why we need to make sure as we are moving forward with regulatory measures, which is our colleagues at ECCC, and moving forward with pricing mechanisms, we need to make sure that the carrots and the sticks are all moving together to create the proper investment climate so that Canadians are able to continue to have access to reliable power.
That also gets to how quickly we move through the transformation to different sorts of energy and also to ensure that we have a reliable supply chain available to Canadians.
Senator Marshall: I have a quick follow-up question. Are there energy experts within the department; are there employee who are energy experts?
Ms. Johnson: Yes. We have economic analysts and people who have been on different parts of the energy systems. Within my team, we have the electricity system and we have folks who are experts in clean fuels and hydrogen across the different pathways in the office of energy efficiency.
[Translation]
Senator Forest: Planning an energy transition plan is particularly crucial. My question is for VIA Rail. If I understood correctly, high-frequency trains were chosen instead of high‑speed trains because of costs. The department is taking a surgical approach to transportation planning.
What surprises me is that very recently, when the minister was questioned on this subject, he said that the price of the high‑frequency train project might vary between $6 and $12 billion dollars. That is actually a pretty big margin. Do we currently have any guarantees, in this surgical planning, that the workforce will be retained? Do we have some guarantee of Canadian content in this very important project that has this elastic a budget?
Ms. Cardin: I’m going to ask Mr. Cannon to answer the question.
Mr. Cannon: Thank you for your question, Senator Forest. There are several components to it, that I will try to cover. You started out by saying that the choice of the HFT was made on a budgetary basis. That is not really the case; actually, it was made on a service to the public basis. The idea was to set up a more reliable service in the area where we have the most current and potential customers.
Once again, we own a very small percentage of the infrastructure we travel on. With the HFT, we will have better control over departures, timetables and [Technical difficulties]. We will therefore be better able to serve the public.
As my colleague said in her opening remarks, 2019 was a record year. There is obviously an appetite for this in Canada. We see it in recent years in VIA Rail’s numbers before the pandemic years, obviously. Fundamentally, we need this kind of service to be able to build later.
I don’t have a crystal ball to know whether or not that future development will take place. Obviously, we are a company that operates trains. We can’t argue that developments in the future aren’t a good thing, but I think projects of this size have to be taken one bite at a time, to come back to what I was saying earlier: offering a reliable, regular service before thinking about developing a high-speed train.
That doesn’t mean that one is going to completely squeeze the other out. Remember, if this is a subject you are following, that the high-frequency train is a project that will be electrified. It will be capable of achieving that quality of infrastructure. I imagine that we can go about it step by step after that, but the first step is really to give Canadians a reliable system.
Senator Gignac: My question is for Mr. Labelle from Natural Resources Canada, and is a follow-up to the questions asked by my colleagues Senator Boehm and Senator Moncion on the deployment of charging stations in rural and remote areas. As you know, Canada is a big country. It is thirty-ninth in the world in terms of population density. We’re talking about four people per square kilometre.
I’d like to know whether there is a business plan to determine now many millions or billions of dollars it will cost in infrastructure to install charging stations to serve everybody. Second, there are charging stations that won’t be profitable. What recurring costs is that going to cause? Is there a business plan at Natural Resources Canada, and can you share it with us? If necessary, you can send the answer in writing.
Mr. Labelle: Thank you for the question, senator. First, we certainly need more charging stations. The government has promised to have at least 50,000 installed.
Obviously, the government isn’t the only one that will be doing it. Tesla and other private sponsors are also going to do it. On the question of recurring costs, that isn’t something that is covered by our program. It is really the responsibility of users to pay for the operation and maintenance of charging stations.
I think your question is what the ideal amount is that should be invested in charging stations, to get a continuous electrical network everywhere in Canada. There are several estimates and they vary, depending on who is proposing them. We can certainly answer that question in writing.
Senator Gignac: Thank you for getting back to us on that. With the promise that the federal government made yesterday, that 100% of vehicles in the country will be electric starting in 2035, I was curious about whether Canada had done any mapping of charging stations.
Senator Gerba: My question is for anyone at Natural Resources Canada.
Budget 2022 proposes to provide $40.9 million over five years to support researchers from black communities. Is Natural Resources Canada connected with that initiative? If not, are measures being taken in the department to help ensure better integration and greater representation of black Canadians?
[English]
Ms. Carruthers: Thank you very much for your question.
To my knowledge, no, we are not a part of the $40.9 million. But in terms of other initiatives, I know the department is quite seized with looking at different ways in which we can increase equity, diversity and inclusion, specifically among Black Canadians. But I could likely get back to you with a more substantive answer in writing if that is okay.
Senator Gerba: Yes, thank you.
[Translation]
Senator Dagenais: My question is for Ms. Cardin.
Ms. Cardin, I’d like to come back to the subject of high‑frequency trains, particularly as it relates to the Unifor member employees. If I understood your answer correctly, it’s the Minister of Transport who is addressing VIA Rail Canada employees directly to sell his idea of bringing the private sector into the Quebec City-Toronto project.
Does this seem normal to you? Could you give us more information about this dynamic, which I would describe as hardly ordinary, in labour relations? Because, in fact, VIA Rail Canada is the real employer, not the minister, in my opinion.
Ms. Cardin: Absolutely. We are working with the Department of Transportation and when we made the announcement, I think it was more in order to reassure our union representatives and our workforce and say that this was excellent news for Canadian passenger rail, but no more than that. It was perceived positively and that was really the objective of that letter.
Senator Dagenais: You understand that it puzzled me a little, but that’s your answer.
[English]
Senator Galvez: I would like to ask a question concerning the electrical grids. They are aging, and they need to be modernized. I want to know if there is collaboration between provinces to export and import electricity between the provinces.
I’m asking this because Quebec is exporting hydroelectricity to New Hampshire and Vermont while there are Canadian provinces that may also need this clean energy. Is there a plan that will look at this in a holistic way, where on the one hand we deliver the electricity that is needed to Canadians in all parts of Canada in a cleaner way but also modernize the grids? As my colleagues are explaining, if you have an electric car, it is difficult to charge it. Also, I want to put solar panels on my house in Quebec. Quebec is a very modernized province, but we are not capable of doing it because the building codes are not following with the modernization of this clean energy distribution. Thank you.
Ms. Carruthers: Thank you very much for your question. I am going to turn it to my colleague Mollie Johnson to respond.
Ms. Johnson: Thank you. Your question is really about collaboration with the provinces. I think that is the right question because, as you well know, the jurisdiction around electricity and our electricity systems sits with our provincial counterparts.
There are a number of examples across Canada right now where provinces are working together and where the federal government is using the tools they have in the kit to support collaboration so that we can move more clean power between jurisdictions. We know that getting back to that affordable, reliable, clean and secure triangle that we were talking about can really improve when the jurisdictions work together.
There are a lot of conversations in the Atlantic. You might have heard of the Atlantic loop, which really is about moving clean power between Quebec, Nova Scotia, New Brunswick and Newfoundland and trying to move more clean power and connect those grids between that region. That will really help.
In terms of the tools that the federal government has, we have the regulatory levers that can talk about what power is used in those pieces and we have programmatic incentives, which are some of the measures that you have seen in these Main Estimates, like the Smart Renewables program that helps the electrons move around in a smarter way so that it is more efficient. That will help ensure that when you are charging and plugging in your car or using a solar panel, you are using it at off-peak times so that the system moves more efficiently, and then we’re better able to use grids.
At the end of the day, the decisions around what power is onboarded onto those systems ultimately sit with our provincial partners.
The Chair: Thank you. When you mention the Atlantic provinces, don’t forget Prince Edward Island also.
Ms. Johnson: We never do.
Senator Pate: Thank you to the witnesses. I suspect you’ll need to get back to us in writing about my first question.
I’m curious about the categories that you listed at Natural Resources Canada in terms of funding that will go to benefit Indigenous communities and Indigenous people. What are the actual contributions? How much? Which communities? What is the purpose in terms of whether it is for economic development or other issues? If you could provide that in writing, that would be great.
For Veteran Affairs Canada, I understand there is ongoing work on LGBTQ2S purge survivors and also that there are consultations going on. I’m curious as to what the status of that is and what barriers you are seeing to supporting the survivors of the LGBTQ2+ purge. When do you think the consultations will be done and a final report available? Thank you.
Mr. Harris: Thank you. I will ask Amy Meunier to provide an answer to that question.
Ms. Meunier: Thank you very much. In terms of supporting the LGBTQ2 community and purge survivors, there are a number of consultation avenues.
First and foremost, in 2019 we stood up the Office of Women and LGBTQ2 Veterans. One of their mandates is to work closely with individuals who have lived experiences in order to identify and address challenges facing these groups with, in our case, a particular emphasis on barriers or obstacles to accessing benefits and services from the department. We did glean some first-hand experience in working with survivors as we implemented the purge class action. That taught us a lot about how to approach working with survivors or victims in a very trauma-informed manner and about the time and barriers that have to be overcome in order to have the courage to reach out and access support that is available to them.
In terms of consultation, I would also add that on an annual basis, we do host a forum for women veterans and LGBTQ2+ individuals. Unfortunately, with COVID, we have not been able to do that face to face, but we are in the midst of planning for a fall forum to continue that dialogue.
I also want to add that through our Veteran and Family Well‑Being Fund, we do work with a number of community organizations, and we contribute funds to those organizations who are working directly with individuals in these vulnerable populations. We are always looking to expand our reach and contact these organizations to create relationships of trust. Moreover, it is important that we’re also connecting at a community level and supporting organizations that are on the ground and working directly with this vulnerable population.
The Chair: Thank you. To conclude the second round, we have Senator Boehm.
Senator Boehm: Thank you, chair. I’m always happy to conclude. It seems to be my role at times.
I have a very quick question for VIA Rail, either for Ms. Cardin or Mr. Cannon. It’s good to see you again, Mr. Cannon.
I’m asking this as an Ontario senator. The new High Frequency Rail, or HFR, project will go as far as Toronto. I receive a lot of mail from people in Southern Ontario — communities west of Toronto like Mississauga, Guelph, Kitchener-Waterloo, Stratford and St. Marys-London. There is concern about the lack of frequent connection from Toronto to these large and, in some cases, very much growing communities.
GO Train provides some service that is both collaborative and competitive. I know that. I am just wondering if there are plans to up the level of service going west from Toronto. Thank you.
Mr. Cannon: Nice to see you again as well, Senator Boehm.
As far as the HFR project is concerned, there is a document with call letters that are sometimes hard to say, an RFEOI, which is a public document. Some of the answers to your questions are in there in terms of communities served.
As far as our services are concerned, of course, we do inner‑city rail, not commuter service. We announced at the beginning of April a plan to return to service gradually, as we’ve been managing both the pandemic and budget, and our colleagues here are just happy and eager to go out and meet with the passengers again and be able to serve those more than 400 communities we serve across the country.
The Chair: As we conclude, to the officials of VIA Rail, Natural Resources and Veterans Affairs, there is a deadline for written answers. We will do our due diligence, because written responses have to go through the clerk by the end of the day on Tuesday, May 10, 2022, so officials, if you can please agree to do your due diligence on the questions and answers you’ll be providing.
Honourable senators, I would like to inform you the next meeting is May 10, 2022, at 9:30 a.m. ET to continue our study on the Main Estimates. The meeting is now adjourned.
(The committee adjourned.)