THE STANDING SENATE COMMITTEE ON NATIONAL FINANCE
EVIDENCE
OTTAWA, Tuesday, June 7, 2022
The Standing Senate Committee on National Finance met with videoconference this day at 9:30 a.m. [ET] to study Supplementary Estimates (A) for the fiscal year ending March 31, 2023; and Bill C-8, An Act to implement certain provisions of the economic and fiscal update tabled in Parliament on December 14, 2021, and other measures.
Senator Percy Mockler (Chair) in the chair.
[English]
The Chair: Before we begin, I’d like to remind senators and witnesses to please keep your microphones muted at all times unless recognized by name by the chair.
[Translation]
Should any technical challenges arise, particularly in relation to interpretation, please advise the chair or the clerk and we will work to resolve the issue. If you experience other technical challenges, please contact the ISD Service Desk with the technical assistance number provided.
[English]
Honourable senators, the use of online platforms does not guarantee speech privacy or that eavesdropping won’t be conducted. As such, while conducting committee meetings, all participants should be aware of such limitations and restrict the possible disclosure of sensitive, private and privileged Senate information. Participants should know to do so in a private area and to be mindful of their surroundings.
[Translation]
We will now begin the official part of our meeting. I wish to welcome all of the senators as well as the viewers across the country who are watching us on sencanada.ca.
[English]
My name is Percy Mockler, a senator from New Brunswick and Chair of the Standing Senate Committee on National Finance. Now I would like to introduce the members participating in this meeting. We have Senator Boehm, Senator Dagenais, Senator Forest, Senator Moncion, Senator Gerba, Senator Gignac, Senator Loffreda, Senator Marshall, Senator Pate and Senator Richards.
Honourable senators, we begin this morning our study of expenditures set out in Supplementary Estimates (A) for the fiscal year ending March 31, 2023, which was referred to this committee on June 1, 2022, by the Senate of Canada.
[Translation]
Today, we have the pleasure of welcoming Mr. Yves Giroux, Parliamentary Budget Officer. He is accompanied by Ms. Kaitlyn Vanderwees, analyst. Thanks to you both for accepting our invitation to appear before the Standing Senate Committee on National Finance.
Thank you for your availability, Mr. Giroux. I understand that you have a few opening remarks. The floor is yours. Thanks again to you and your team.
Yves Giroux, Parliamentary Budget Officer, Office of the Parliamentary Budget Officer: Thank you. Honourable senators, thank you for the invitation to appear before you today. We are pleased to be here to discuss our report on the Supplementary Estimates (A) 2022-23, which was published on May 31, 2022. With me today I have our lead analyst on the report, Kaitlyn Vanderwees.
The government’s Supplementary Estimates (A), tabled on May 20, 2022, outline an additional $9.7 billion in spending. Parliament’s approval is required for $8.8 billion, which pertains to $2 billion for initiatives identified in previous budgets, $1.7 billion for the pandemic response, and $5.1 billion required for ongoing government operations.
The last category contains $330 million sought to provide adequate funding for airport passenger security screening.
Including these Supplementary Estimates, the total proposed year-to-date budgetary authorities are $407.2 billion, which represents a $6.6 billion, or 1.6%, decrease compared with the estimates-to-date for the 2021-22 fiscal year.
[English]
In accordance with the PBO’s legislative mandate to provide impartial, independent analysis to help parliamentarians fulfill their constitutional role, which consists of holding government accountable, my office will continue to prepare reports and analyses of the government’s estimates and the budget, in addition to other pertinent federal government documents relating to the nation’s finances or the economy.
My office recently released a stochastic debt sustainability analysis of the medium-term outlook presented in Budget 2022. The report provides a stress test of the government’s financial position.
Based on past experience, our results suggest that the government could maintain debt sustainability over the medium term. However, our results also suggest that, on balance, there is upside risk to the Budget 2022 projection of gross debt as a share of GDP. This morning we also released our Inflation Monitor report, which provides current analysis of recent consumer price inflation data.
Kaitlyn and I will be pleased to respond to any questions you may have regarding our analysis of the government’s estimates or other PBO work. Thank you.
The Chair: Thank you, Mr. Giroux. We will now proceed to questions. You will have a maximum of three and a half minutes each for one round. We have a second panel scheduled with the officials from the Treasury Board, so we will only be able to have one round of questions per panel. Therefore, please ask your questions directly to the witnesses, please respond concisely, and the clerk will inform me when the time is up by raising her hand.
Senator Marshall: Thank you to Mr. Giroux and Kaitlyn for being here today. Thank you for the excellent report on Supplementary Estimates (A). I have to compliment you on your new initiative where you are tracking the implementation of the Budget 2022 initiatives. You mentioned in your report that there is $1 billion in Supplementary Estimates (A) for six Budget 2021 initiatives. Would you know how many Budget 2021 initiatives are left unfunded?
Kaitlyn Vanderwees, Analyst, Office of the Parliamentary Budget Officer: Thank you for your question. As this is our first time tracking the budget measures since 2017, we did not do this for Budget 2021, but I can get back to you in writing.
Senator Marshall: Thank you very much. You indicated in the report they are off to a slow start. Do you have any insight as to why they are off to a slow start compared to last year?
Mr. Giroux: I have no definitive information on that. The only thing I could say is suppositions as to why that can be. And based on my experience drafting budgets, it is usually because budget proposals that ended up being in the budget were not as well developed as in previous years, but I don’t know that for a fact.
Senator Marshall: Thank you very much. You also mentioned the debt servicing costs in your report. Have you carried out any additional work in that area? I’m asking because I was looking at the debt servicing costs starting back in the 2020 fiscal update. As you go from the fiscal update to the budget for the next fiscal update to the budget, the number keeps increasing. Have you done any additional work that would give any insight into whether the $26.9 billion budgeted for this year looks to be in the vicinity or will move higher?
Mr. Giroux: We have not done work specifically related to the debt-servicing costs for this year. However, with the increase in interest rates, it is likely to go up slightly at the very least, because the debt-servicing costs are not immediately responding to increases in interest rates, given that the government finances itself through a variety of maturities, short term and long term. But in a report we released last week called A Stochastic Debt Sustainability Analysis of Budget 2022, we estimated the probability or likelihood of the debt-servicing costs in 2026-27 being at or below the level the government indicated in the 2022 budget. We estimate that it is very unlikely that the debt‑servicing costs will be at that level; they are very likely to be higher than what the government is budgeting for.
Senator Marshall: So you think that is still on an upward climb.
My other question relates to a $19-billion loss that the government recorded in the 2020-21 Public Accounts. It shows up as a negative revenue item.
In your review of financial information, have you seen any additional items like that? It shows up as negative revenue, which, in my opinion, should be a debt-servicing cost, so I was surprised when I saw it there in the Public Accounts. Have you seen anything else unusual like that with regard to debt-servicing costs?
Mr. Giroux: No, I don’t recall seeing anything that would be that unusual or strange with debt-servicing costs, except for the fact that they are rising and will continue to rise as interest rates continue to go up.
Senator Marshall: So you have not seen anything in 2021-22?
Mr. Giroux: Not that I can recall.
The Chair: Thank you, senator. You are out of time.
[Translation]
Senator Forest: Thank you, Parliamentary Budget Officer, for being with us. My questions relate to the $824 million appropriation under the Disaster Financial Assistance Arrangements. You correctly point out that since its inception in 1970, the program has provided over $6 billion to the provinces and that this amount has been growing rapidly. Catastrophic events and natural disasters have increased in frequency and over shorter periods of time.
Have you studied the estimated federal liability for payments under this Disaster Financial Assistance Arrangement?
[English]
Ms. Vanderwees: In one of our charts, we included the liabilities and expenses. The blue bar would represent the liabilities, year over year, and the additional expenses would be listed under the gold bar.
[Translation]
Senator Forest: Is the federal government’s strategy for dealing with these future obligations clear, reasonable and prudent? Is it a two-pronged strategy? I am concerned. The federal government owns several important infrastructures across the country. I’m thinking of fishing harbours and shoreline protection piers. There seems to be a response only when there is a disaster.
Does the federal government have a strategy for keeping its infrastructure in working order and in good repair, which is an important responsibility and which could reduce the impact of, for example, erosion and other natural factors?
Is there a financial or infrastructure strategy for this? Have you been able to verify this?
Mr. Giroux: Thank you, senator. This is not an issue that I have looked at in detail, but I know that there are federal infrastructure investment programs that are important.
A portion of those investments should logically be allocated to natural disaster preparedness and mitigation. However, beyond that statement, this is not an issue that this office or I have looked at in detail recently.
I cannot tell you that there is indeed a coherent integrated overall strategy across the federal government to protect infrastructure from natural disasters. That’s not to say that it doesn’t exist. It is just that I am not aware that there is such a strategy.
Senator Forest: Given the speed and frequency of these climate-related disasters, and given the expertise developed by the research chairs, a strategic reflection is necessary.
Is there a way to compare this financial assistance and the federal government’s strategy with those of other jurisdictions, such as the provinces or other countries? Are there any benchmarks to assess our strategy for dealing with natural disasters?
Mr. Giroux: The natural disaster program is really a last‑resort program. It only provides federal financial assistance as a last resort, which means that the provinces must be the first to pay when a disaster occurs. That is why the first $3.38 of per capita spending is entirely borne by the provinces. Once that threshold is crossed, the federal government contributes between 50% and 75%, and up to 90% for truly catastrophic cases.
Senator Forest: Thank you, Mr. Giroux.
Senator Gignac: Welcome, Mr. Giroux. Congratulations to you and your team for your good work.
You and Senator Forest just spoke about the Disaster Financial Assistance Arrangements. We are talking about $824 million in funding that was planned and announced in Budget 2021. Why is this in Supplementary Estimates (A) and not in the Main Estimates, since it was already announced in Budget 2021? Maybe there is an accounting element that I am missing.
Mr. Giroux: That is an excellent question to which I don’t have an answer, unfortunately. I don’t see why it wasn’t included in the Main Estimates, since it was announced several months ago. This is a question that Treasury Board Secretariat officials should be able to answer. In my opinion, if they can’t, it is probably that there is no good reason.
Senator Gignac: You have to dig deep. I am fairly familiar with how accounting works in Quebec, but I am still learning how Supplementary Estimates (A), (B) and (C) work.
In your opinion, is it unusual for an amount included in the previous budget to appear in supplementary estimates? You have substantial experience in reviewing various budgets, documents and estimates. Is this the first time you’ve seen this, or is it something that happens regularly?
Mr. Giroux: It does happen, not regularly, but quite frequently when officials want to refine estimates announced in previous budgets or when they haven’t had the time or the inclination to bring a particular initiative to Treasury Board or cabinet. There’s a cabinet committee that deals with those issues.
It may be a matter of time or it may be a number of other priorities that seem to have taken over. Basically, it’s a question of priorities. It is not common, but it is not extremely rare either.
Senator Gignac: Perfect. Do I have time for another question?
The Chair: Yes.
Senator Gignac: I notice a large gap between liabilities and expenses. Could you tell us a little more about those differences? There seems to be an increase in liabilities compared to the current year’s expenditures.
[English]
Ms. Vanderwees: To reference my previous comment on this, what we have here is the liabilities and expenses accrued of that year. As the government pays out these liabilities, you will see a fall in the blue chart in the graph, which represents the government paying out liability.
Senator Richards: I have two quick questions. The payments for Immigration and Citizenship, because of the crisis in Ukraine, is up by half a billion dollars in the supplementals of $451 million. And I don’t begrudge that at all. But I am wondering, is there any indication as to how high this will go over the next couple of years? My second question — and I’ve asked this, I know, quite a few times of you — is with the ongoing world crisis, how close is Canada to sinking into its own economic crisis or recession?
Mr. Giroux: Thank you, senator, for the question. With respect to the payments for the situation in Ukraine, it is very difficult to have any idea as to how high that could go. It is dependent on the war itself but also on government decisions and priorities. It could go as high as the government determines it is ready or willing to provide assistance to Ukraine, and obviously it will depend on how long the war is and how the war unfolds.
With respect to how close we are to recession or economic downturn, I do not think we are that close to an economic downturn, because despite the situation in Europe, what Canada provides in terms of commodities is usually quite similar or very often substitutes for what Russia and Ukraine provide the world. And with the price of these commodities going up, it benefits Canada. However, with the increase in the CPI and increase in interest rates, consumer spending will slow down. But the probability of a recession is not very high in Canada right now.
Senator Richards: I have one follow-up question, if I may. Is that $451 million, or half billion, is it allotted to be spent or has it already been spent on the Ukrainian crisis?
Mr. Giroux: I don’t know for a fact about that, senator.
Senator Richards: Thank you.
Senator Boehm: It is good to see you again, Mr. Giroux and Ms. Vanderwees. I am building on Senator Richards’ question. The government stated its intention when it tabled Budget 2022 to rein in spending after two extraordinary years. Treasury Board is undertaking a strategic policy review in an effort to save $6 billion over five years and then $3 billion annually by 2026‑27. Of course, when the government prepared the budget, it did not have any indication that Russia was going to invade Ukraine and throw any previous economic gains out the window, to say nothing of the global food security issue, gas prices, inflation, supply chain issues and increasing environmental disasters. So it is hard to see how less spending is really possible.
Does the PBO have any estimates or opinions on the government’s intention to rein in spending after two years of extraordinary, if necessary, pandemic spending? Second, on the strategic policy review specifically, as a result of increased spending that was not anticipated — on Ukraine, for example, as you just said — are these planned savings and in this time frame still feasible?
Mr. Giroux: That’s an interesting question. The premise of your question mentioned that when the government tabled its budget they didn’t know about the war in Ukraine, but they did, as the budget was tabled in early April, and the war in Ukraine had, unfortunately, already started.
So the spending review that the government mentioned should take into account additional spending for defence as laid out in the budget, as well as assistance to Ukraine. However, when we look at the government’s intention to rein in spending through a spending review — and if we were to believe the government’s numbers — that would mean that in 2024 to 2027, operating and capital spending would grow by 0.3% per year, which is a level of growth that we have not seen in a long time. That would probably be fiscal tightening or expenditure restraint more severe than what we have seen under the Conservative years in the early 2000s and 2010s. That’s one point.
Also, that’s not taking into account government priorities that have been announced in the electoral platform last year. Several of these items remain to be implemented.
We have mentioned that in our supplementary estimates note, and what we mean by that is that I personally don’t believe it is credible that there will be that level of spending restraint from the period 2024 to 2027, given all the expenditures that remain to be implemented by the government over that period of time.
Senator Boehm: Thank you very much.
Senator Loffreda: Thank you, Mr. Giroux, for being here and thank you, Kaitlyn, for joining him. Your reports are always insightful.
You did mention in your opening remarks that the debt is sustainable despite the higher interest costs, but you mentioned upside risk. What is your main concern on the upside risk? And how could we mitigate that risk, if there is a way of mitigating it? Is it uncertainty? Maybe you could elaborate on where you see the most important upside risk and what we can do to mitigate that risk.
Mr. Giroux: There are many aspects that come into play when I talk about upside risk when it comes to debt. One element is the increase in interest rates, which will very likely result in debt servicing costs that are higher than what the government is predicting. Another element is the yet-to-be-fulfilled electoral commitments, for which it is difficult to have a clear estimate because the government is amending some of the parameters of its platform commitments when it implements them, but they probably amount to a couple of dozen billion dollars for the five‑year period ahead of us. There are also a tremendous amount of pressures that the government is faced with, spending pressures, I mean. For example, demands from provinces to increase transfers when it comes to health care spending, as well as commitments by the government to deliver on the NATO commitment of spending 2% of GDP on defence. That’s just to name a few.
The demands on the public purse are numerous and they account for significant amounts of money, which is not factored into the budget that was tabled in April.
So those are two aspects that weigh heavily on the upside risks that you mentioned and that I mentioned in my opening remarks, as well as uncertainty related to the economic future, as we talked about with the war in Ukraine. There are uncertainties in the world, now more than we have seen in the last 10 or 15 years, except for COVID, of course. These are all elements of uncertainty.
For example, when it comes to interest rates, that could dampen consumer spending and slow down the housing market in Canada significantly, especially with high levels of debt from households and from certain other actors in the private sector.
Senator Loffreda: I will just stay on that topic, because it is important, on the macroeconomic side, and with your reports, you really take deep dives into the state of the economy in Canada. I hear more and more that the Canadian consumer — the consumer is the vehicle of every economy and I hear the consumer is in great shape. Are you concerned that with the spending that’s foreseen — we see in the budget there are many elements you have not mentioned — we might be facing higher debt that may not be sustainable in the future? And would maybe holding back a little, given the consumer being in such great shape, be a wise thing to do at this point in time? What is your opinion on all of that?
Mr. Giroux: Those are fair points. It all boils down to policy choices.
I mentioned that there are lots of demands on the public purse that may or may not be met, depending on the government decides to do. The government could decide to meet most, if not all, of them. It doesn’t have to mean that there will be increased levels of debt if, for example, the government were to increase taxes to finance these multiple demands it’s faced with, or the government could decide to meet some or all of its pressures by reducing spending in other areas.
It’s a matter of choice. So far, based on the past, what the government has chosen to do, usually, is to finance these additional expenses by increasing the level of the deficit or the level of debt, by extension, and offsetting some of these additional expenditures by creating targeted tax increases, for example, the luxury sales tax and a tax on financial institutions.
[Translation]
Senator Gerba: Thank you to our witnesses. I’m glad to see you here in person.
Inflation hit a record high in April of this year. Its impact on Canadians, but especially on the most disadvantaged, is very significant and tangible. The price of basic foodstuffs has risen significantly. We are talking about increases of 20% on pasta, 14% on cereal products and over 12% on bread. One in five Canadians reported going hungry at least once in March 2020. That month, one in four Canadians reported eating less because they did not have enough money for food.
Mr. Giroux, are there any specific measures in the supplementary estimates that would help ease the burden of inflation on people who are in a precarious situation?
Mr. Giroux: The impact of inflation that you are talking about is one of the main reasons why economists and central banks tend to want to keep inflation low — around 2%. Unfortunately, I did not see any specific measures in the supplementary estimates to contain or reduce inflation. As far as I know — and Ms. Vanderwees can correct me — these measures are only intended to fund government operations. To my knowledge, there are no specific measures to combat inflation.
Senator Gerba: Do you have any suggestions for measures that would serve that purpose?
Mr. Giroux: This is a very broad issue that could be the subject of a full committee meeting. For example, reducing the government’s economic stimulus in a high-inflation environment is one way to lower inflation. Another is offering ad hoc aid, such as the assistance that some provinces have provided to reduce the impact of inflation on the most vulnerable households. Both of these measures can mitigate the impacts of inflation. The central bank also has an important role to play, for instance, by gradually increasing interest rates and limiting its intervention in capital markets. This is known as quantitative easing, which consists in making a gradual reduction. It is a set of measures to reduce inflation and mitigate its impact on the most disadvantaged people, who are disproportionately affected by this situation.
Senator Dagenais: Good morning, Mr. Giroux. The price of oil is rising and could choke many consumers. Buying electric vehicles is popular, but many people are unable to do so in a reasonable time frame.
The supplementary estimates show an additional $323 million for the zero-emission vehicle program. Can you tell us if this money is being used in the form of subsidies on vehicles?
Mr. Giroux: As far as I know, that money in the supplementary estimates aims to complement the envelope for providing subsidies to those who are lucky enough to get an electric vehicle, since, as you mentioned, it is very difficult to get one.
Senator Dagenais: My next question is about Canada’s overall spending as a member of organizations such as the UN, NATO and NORAD, in addition to the G7 and G20. Can you tell us whether these expenses are kept under control, depending on travel and budgets? Canada is a member of several organizations. However, are these expenses under control?
Mr. Giroux: Are you talking about the government’s overall expenses or those related to being a member of these organizations?
Senator Dagenais: I am talking about the expenses related to being a member of these organizations.
Mr. Giroux: I have not looked into that, because the costs of being a member of the G7 or the OECD are generally not very well defined. They are often quite low. The costs of membership in these institutions are not very high. However, the costs of attendance, meetings and travel are spread throughout the government. As such, they are difficult to assess accurately.
Senator Dagenais: I would like to follow up on Senator Richards’ question about the $500 million that was given to the Department of Defence to help Ukraine. Obviously, there is additional spending, but is each commitment made with new money, or are existing items used for international affairs?
Mr. Giroux: The $500 million is new money, at least as I understand it. In general, the government can use new money. It can also use existing envelopes. For example, there is an envelope for international assistance that the government can use, obviously, if the spending meets the criteria for international assistance. This can be a mixture of new money or of recycling or reallocation of existing funds. The international assistance envelope is an example. There may be an allocation of existing resources. Since it is a priority, the government may, for example, decide to do fewer activities in this sector to reallocate the funds towards aid to Ukraine. This mechanism is always available to the government. It is a matter of choice and flexibility within the government apparatus, and a decision must be made as to whether the option is realistic and feasible.
Senator Dagenais: Thank you very much.
[English]
Senator Pate: Thank you, Mr. Giroux and Ms. Vanderwees, for appearing today and for this excellent documentation. It is incredibly helpful to us.
The supplementary estimates do not include, however, costs related to children’s benefits and Employment Insurance benefits. I’m wondering if you can speak to that amount and what those figures will likely be in light of the fact that, obviously, they’ve been included in the budget but are not available in terms of the additional costs.
Mr. Giroux: Thank you, senator. I think you’re referring to provisions in the Budget Implementation Act, and indeed, I don’t think they’re in the supplements because it’s statutory spending. That’s why it’s in the Budget Implementation Act. I don’t know off the top of my head how much that will be, but it’s something we can get back to you on with specific details or with more information, if available.
Senator Pate: That would be well appreciated. Thank you very much.
[Translation]
Senator Moncion: Good morning, Mr. Giroux. It is always a pleasure to see you.
My question doesn’t necessarily relate to the supplementary estimates, but rather to the links between the different bills.
In Division 7 of Part 5 of the 2022 Budget Implementation Bill No. 1, the government is proposing that extraordinary borrowing in the spring of 2021 be treated as ordinary borrowing, in order to ensure greater transparency on the government’s debt and accountability to Parliament for the total amount borrowed.
On the second part of my question, with respect to the budget, on page 205, chapter 9, there is a reference to a temporary recovery dividend to be imposed on banks and life insurers. It mentions a one-time 15% tax on taxable income over $1 billion; this one-time tax will be in effect for five years. Then there is the increase in the tax rate on taxable income of 1.5% on income over $100 million.
Could you explain how you are going to monitor the evolution of these revenues so that we can observe the decrease in the debt associated with COVID-19?
Mr. Giroux: That is a very good question. I must admit that I did not expect such a broad question this morning. Thank you, senator.
With respect to Division 7 of Part 5 of the Budget Implementation Act, this is something that we will follow, because we follow the debt assessment as a whole, whether it is in two separate divisions, with the general debt and the debt strictly related to COVID-19, or in a consolidated way. We will follow the evolution of the government’s debt, whether the government reports it separately or in combination.
With regard to dividends and the temporary tax for banks, if the National Finance Committee expresses an interest in monitoring the evolution of the additional revenues generated by this temporary tax, this is certainly something that can be considered. The impact that this will have on the debt will be difficult to determine, as it will depend on other factors, including how much money the government will actually make from these revenues, but also, and more importantly, what the government will do with these funds. Will they be used to generate other spending, or will they be used specifically for debt reduction anyway? I don’t think that it’ll be the case. So it will be difficult to determine the impact of specific taxes on banks and financial institutions in terms of debt reduction, since that will be in the consolidated fund. However, the Office of the Parliamentary Budget Officer is happy to look at that, if that is the wish of the committee.
Senator Moncion: Thank you.
The reason I ask this question is the following. When the goods and services tax was imposed in the 1990s, it was supposed to be a temporary measure to pay down the federal government’s debt. It has now become a source of additional revenue, the debt is growing, and there is no end in sight.
I notice that the same thing seems to be happening with this tax on banks and financial institutions. It’s always worrisome to see additional taxes coming in and not see any change in the debt.
Thank you. If you are in a position to look into this, I would be very happy to read your comments.
Mr. Giroux: Thank you, senator. With respect to temporary taxes, I remember when I worked at the Canada Revenue Agency, there was a frame in the commissioner’s office that talked about the Income War Tax Act of 1917; temporary things sometimes have a permanent effect.
The Chair: Thank you, Mr. Giroux.
[English]
Senator Duncan: Thank you, Mr. Giroux and Ms. Vanderwees, for being here today. I’d also like to express my thanks for your very excellent report. I’m going to use it in my first question. I have two questions.
You noted that the supplementary estimates reflect additional spending requirements that may have subsequently been refined to account for developments in particular programs and services. That’s taken from your report.
Are departments also required or does your office examine to see if the performance indicators for those same departments have been similarly refined to reflect the achievements anticipated as a result of the increased funding?
For example, Indigenous Services, which is appearing before us later, have significant additional funding. Have the department’s performance indicators been similarly refined?
Mr. Giroux: There are two types of answers I could give to that. There is the answer from the Parliamentary Budget Officer perspective from someone who has never worked in the public service, and then there’s the PBO perspective from a guy who has also worked in the public service for more than two decades. I’ll give you the second answer, as you can imagine.
Performance indicators, in an ideal world, would be considered by ministers and by departments when they ask for money and when they decide how and where to allocate money. But in practice, it’s decided mostly based on the needs of departments and also the policy decisions. Performance indicators could be useful when determining the effectiveness of specific initiatives and programs, but in practice, they’re not determining factors in decisions as to where and how to allocate additional funding. In response to some of your colleagues, we released a report on Indigenous Services and the Crown-Indigenous Relations departments where we found that performance indicators are regularly amended and adjusted for various reasons. But they’re not very glowing commendations of the departments most of the time.
Senator Duncan: Thank you. There’s also $323 million in funding for the Transport Canada to extend and expand the incentive for the zero-emission vehicle program. I believe Senator Dagenais mentioned this.
This is part of Canada’s overall 2050 net-zero goals. Electricity Canada has identified for all parliamentarians and Canadians that Canada will need two to three times as much electricity to meet its 2050 net-zero goals, and this requires a significant build-out of generation and electricity infrastructure.
How does this expenditure of $323 million meet with a whole‑of-government approach to the need for electrical infrastructure and discussions at the federal-provincial-territorial tables? It seems out of sync with one part of the story rather than an entire sector plan, a whole-of-Canada approach. Has your office examined this?
Mr. Giroux: We have not looked at the zero-emission vehicle subsidies, per se. That’s probably as much as I can say on that, so we have not looked at that.
As to how it fits with a whole-of-government approach, it’s one piece of the puzzle, and I think Ministers of Transport or Environment and Climate Change would be in a better position to explain how that fits with the overall strategy for net zero.
The Chair: Thank you, Mr. Giroux. Your office has always kept in mind transparency, accountability, predictability and reliability, and you’ve always kept in mind the deadline that we have to receive the written answer information from your office. We’re very appreciative of this. As chair, I would like to bring to your attention that a few questions asked by senators were for written answers. This being the set goal — and with the deadline — you have until the end of day on Monday, June 13, to send the written responses, or earlier. Thank you very much for your availability, as I said at the outset.
Honourable senators, we will move on to the second panel. We have officials from Treasury Board of Canada.
We welcome Annie Boudreau, Assistant Secretary of the Treasury Board. She will be making opening remarks. She is joined by other senior officials from Treasury Board who will help answer questions. I will ask those officials, every time you come to answer a question, to identify yourself with your responsibilities for clarity as we process questions.
[Translation]
Ms. Boudreau, thank you for your availability. The floor is yours.
Annie Boudreau, Assistant Secretary, Expenditure Management Sector, Treasury Board of Canada Secretariat: Thank you, Mr. Chair. As I’m in Ottawa, I’d like to start by saying that I’m joining you from the unceded traditional territory of the Algonquin Anishinaabe people. The Algonquins have lived on this territory since time immemorial. I am grateful to be on this land.
[English]
I am delighted to be here today and look forward to the discussion on Supplementary Estimates (A) for 2022-23. I am pleased to be joined by my colleagues: Karen Cahill, Assistant Secretary and Chief Financial Officer; Monia Lahaie, Assistant Comptroller General, Financial Management Sector; Samantha Tattersall, Assistant Comptroller General, Acquired Services and Assets Sector; Paul Wagner, Assistant Deputy Minister, Strategy and Transformation; Marie-Chantal Girard, Senior Assistant Deputy Minister, Pension and Benefits; and Rod Greenough, Executive Director, Expenditure Management Sector.
[Translation]
Mr. Chair and honourable senators, let me begin by telling you about the estimates process. As you know, the government prepares the estimates to seek Parliament’s authority to spend public funds.
The estimates ensure that parliamentarians and Canadians are sufficiently informed about the government’s spending plans and resources so that the government can be held accountable for the allocation and management of public funds.
The Main Estimates must be tabled in the House of Commons by March 1 of each year. Over the year, there are normally three supplementary estimates that serve to present information on additional expenditure requirements that were not sufficiently developed at the time of tabling of the Main Estimates or that have been subsequently refined to reflect recent changes.
[English]
The voted amounts represent a maximum up to ceilings, or estimates, and may be not fully spent during the course of the year. Actual expenditures will be included in the Public Accounts after the end of the fiscal year.
[Translation]
Mr. Chair, the Supplementary Estimates (A) for 2022-23 were tabled on May 20, 2022. This is the first of three supplementary estimates planned for this year. As a whole, it provides information on $8.8 billion in new voted spending for 26 federal organizations. It also provides information on an additional $860 million in planned statutory budgetary expenditures.
[English]
With Supplementary Estimates (A), the estimates to date for 2022-23 amount to $407.2 billion, including $199.1 billion in planned voted expenditures and $208.1 billion in forecasted statutory expenditures. This represents a 4.6% increase to planned budgetary voted spending over the 2022-23 Main Estimates.
Regarding major items that we have in Supplementary Estimates (A), those estimates seek additional parliamentary approval for the following major items: $3.6 billion to support priorities for Indigenous communities; $1.4 billion for existing and emerging COVID-19 treatments; $853 million to support Canada’s response to the invasion of Ukraine; and $323 million to support the use of zero-emission vehicles.
Notably, five organizations are each seeking $500 million or more. These include the Department of Indigenous Services, $2.2 billion; the Public Health Agency of Canada, $1.5 billion; the Department of Crown-Indigenous Relations and Northern Affairs, $1.4 billion; the Department of Public Safety and Emergency Preparedness, $823.6 million; and finally, the Department of National Defence, $500 million.
[Translation]
Approximately $1 billion in spending announced in the 2022 federal budget is included in the Supplementary Estimates (A) for 2022-23. Additional authorities to implement the programs announced in the 2022 federal budget will be sought in the upcoming 2022-23 estimates.
[English]
In conclusion, I will remind members of this committee of a fantastic tool available to parliamentarians to assist in their review and scrutiny of spending plans. GC InfoBase is an interactive online tool that presents a multitude of federal data in a visual way. It provides accurate, timely and understandable information about government spending. It contains the Main Estimates and supplementary estimates, along with other data related to government finances, people and results.
[Translation]
On that note, I conclude my remarks and thank you for your time.
The Chair: Thank you, Ms. Boudreau.
[English]
I would like to inform senators that you will have a maximum of three and half minutes, the same as the first panel. Therefore, please ask you questions directly and, to the witnesses, please respond concisely.
Senator Marshall: Thank you to the witnesses, and welcome back. I’m interested in the cost of servicing the public debt. I notice in the Department of Finance, it indicates about $24.7 billion so far this year.
Who decides on the accounting policies of government in the preparation of the Public Accounts? I’m asking because the $19‑billion-dollar loss that was incurred in 2021 by the Bank of Canada showed up on the government’s books, but it showed up as negative revenue rather than the cost of servicing the public debt. Is that something decided on by Finance or by Treasury Board?
Ms. Boudreau: Thank you, Senator Marshall. I will turn over your question to my colleague Monia Lahaie to give you an answer.
Monia Lahaie, Assistant Comptroller General, Financial Management Sector, Office of the Comptroller General, Treasury Board of Canada Secretariat: Thank you for the question. As a government business enterprise, investments in the Bank of Canada are accounted for in the Public Accounts using the modified equity method of accounting, whereby the cost of the government’s investment is reduced by dividends and adjusted to include the annual profits and losses for these corporations. Therefore, this adjustment is done every year to eliminate unrealized inter-organizational gains and losses.
The increase this year primarily relates to the $18.4 billion equity adjustment for the quantitative easing undertaken by the Bank of Canada. In response to the quantitative easing, an adjustment was required to record the upfront expensing of premiums paid by the bank on secondary market purchases of the Government of Canada. Effectively we are purchasing our own bonds, which means we eliminate any gains and losses incurred as a result of this market transaction.
Senator Marshall: But why does it show up as negative interest as opposed to an expenditure item, the cost of servicing the public debt? When I looked at the Public Accounts, it looked like you were burying a $19 billion loss rather than showing it up front. Who decides to record it as negative revenue? Is it Treasury Board or Department of Finance? This is what I want to know.
Ms. Lahaie: This is following accounting standards, and we are preparing a written answer. I will make sure that’s very clear and I will forward that to you.
The Chair: That would be very much appreciated. When I look at the Department of Finance, you’ve broken the interest between the $19 billion and the $5 billion. Is the $5 billion the interest on the unfunded liability? Is that why it is split out? Is it split out so it can be comparable to what’s in the Public Accounts? I’m trying to keep track of the cost of the public debt.
Ms. Boudreau: Thank you for your question. That’s exactly it. It is breaking down, because the second amount relates to pension costs, as an example, and that’s why we want to keep those two elements clean from a transparency perspective.
Senator Marshall: My next question is more of a general one. When we look at the funding being requested by the various departments, the departments that are asking for significant amounts of money would be Indigenous Services Canada, I notice Environment during the Main Estimates, Infrastructure Canada, very significant increases yet those departments performed very poorly in their performance reports.
With respect to Infrastructure Canada, they received a very poor audit report from the Auditor General on their Investing in Canada fund. Do you attach conditions to those departments? Because it seems like the ones who are performing poorly are the ones getting the biggest increase in funding.
Ms. Boudreau: Thank you for the question. The increase in funding will be related to what was announced in Budget 2022. For example, for all announcements after Budget 2022, those organizations come to Treasury Board when they are ready with their implementation plan in order to get the approval necessary to put an item into the estimates. That’s the extent of my answer to this. It is really based on when they are ready to implement and also when they need the money to do so.
Senator Marshall: But significant amounts of money are going out, and we can’t get a handle on where the money is being spent and whether it is achieving desired results because the departments are not providing the information. And with Infrastructure Canada, for example, we can’t even figure out the projects. Their map is four or five years old. You just can’t follow the money. I find it surprising as the Treasury Board, the overseer of the money for the government, that are you not imposing conditions on these departments. But based on what Infrastructure Canada told us that neither you nor the Privy Council Office is requiring any improvement in their performance.
The Chair: Ms. Boudreau, you’ve heard the question. Can you do the follow-up as a written response or do you have a 30‑second comment?
Ms. Boudreau: That question would be better addressed by the department, but we can come back with a written response. What is the due date, Mr. Chair?
The Chair: The due date is Monday, June 13 at the end of the day through the clerk.
[Translation]
You can also do so in the next few days. The deadline is Monday, June 13. Thank you very much.
[English]
We will wait for your answer.
Ms. Boudreau: Thank you.
[Translation]
Senator Forest: Thank you to the witnesses for being here today to answer our questions.
My first question has to do with the spending review. In Budget 2022, the government announced that it would be undertaking a program review in an effort to save at least $6 billion over five years government-wide. Are the departments setting those targets? How are they determined, and has the review process begun? What’s the approach?
Ms. Boudreau: Thank you for your question. The $6 billion in savings over five years was set out in the budget, and the decision was made by those in charge of implementing the measures in the budget.
We are still in the analysis and planning phase. We are examining which elements will be assessed, and as per Budget 2022, Budget 2023 will provide a progress update on the review.
Senator Forest: My next question flows from the first. In the news right now, we are seeing how much trouble the Canadian government is having delivering services to Canadians. For example, workers calling about employment insurance benefits have to wait hours to speak to an agent. On top of that, 15% of employment insurance claims are not processed within the standard 28-day time frame.
Passport Canada has a huge backlog; it’s all over the media. People have to line up for hours to apply for a Canadian passport. In some cases, if people aren’t travelling within 24 hours, they are told to come back the next day because their application isn’t considered a priority.
How do you square that effort to streamline and save $6 billion over five years with the government’s current difficulty serving Canadians?
Ms. Boudreau: That’s an excellent question. Obviously, the impending review will take into account programs that are the most important or that require more direction or funding. The idea is to ensure that the programs that serve Canadians are meaningful. Clearly, Passport Canada and the employment insurance program, which you mentioned, will be part of our review.
Senator Forest: As the central agency in charge of human resources, can you tell us what the staffing situation is? With workers in short supply across the board, is it hard to attract new employees? Faced with such a labour market, what is the federal public service doing to keep workers?
Ms. Boudreau: Thank you for your question. I’m going to ask Marie-Chantal Girard to answer that.
Marie-Chantal Girard, Senior Assistant Deputy Minister, Employee Relations and Total Compensation, Treasury Board of Canada Secretariat: Thank you for your question. My name is Marie-Chantal Girard, and I am the Senior Assistant Deputy Minister of Employee Relations and Total Compensation at the Treasury Board of Canada Secretariat.
You’re right, we are experiencing a labour shortage all over the country, but it’s more acute in some sectors. Through the Office of the Chief Human Resources Officer, the government is developing an approach to help it address the future of the labour market. The approach includes a skills strategy to ensure that newly hired government employees have the skills needed for the future.
We are updating our terms and conditions of employment. We are working with bargaining agents, including through the collective bargaining process, to make sure we stay competitive, not just compensation-wise, but also benefit-wise.
We also want to offer the types of jobs and arrangements that enable our employees to serve Canadians, which is a huge value added.
Senator Forest: Thank you.
Senator Gignac: My question is about the transfers to the provinces for child care. In Budget 2022, the government proposed a $625-million increase over four years for a Canada‑wide early learning and child care infrastructure fund, but according to the budget, the plan will not be in place until fiscal 2023-24.
I see that, in Supplementary Estimates (C), Employment and Social Development Canada is seeking an additional $176 million this year.
Can you give us an explanation regarding the transfer to the provinces? I thought there was a fixed amount of funding for this year. Does it have to do with inflation? Why does Employment and Social Development Canada need $176 million in additional funding for provincial transfers for the purpose of early learning and child care?
Ms. Boudreau: Thank you for your question. I heard you say Supplementary Estimates (C). Did you mean Supplementary Estimates (A)?
Senator Gignac: Yes, sorry about that. We haven’t gotten to Supplementary Estimates (C) yet.
Ms. Boudreau: The $176 million is funding that was deferred. It was allocated last year but lapsed. The department received authorization to carry it forward to this year in support of the initiative you mentioned.
Senator Gignac: The funding isn’t necessarily fixed, then? If it lapses, it can be carried forward to the following year. Is that right?
Ms. Boudreau: Yes, that’s right. It is possible to carry forward lapsed funding so that it is used for the intended purpose and isn’t lost.
Senator Gignac: My next question is about an altogether different topic. I asked the Parliamentary Budget Officer this question, but he didn’t have an answer. He suggested I ask you.
My question is about a measure in last year’s budget. I’m talking about the $824 million in Budget 2021 for the Disaster Financial Assistance Arrangements program. I’m trying to make sense of it all and figure out why the funding sometimes appears in the Main Estimates, and other times, it’s in Supplementary Estimates (A), (B) or (C).
Since the funding was in last year’s budget, why doesn’t it appear in the Main Estimates? Why does it all of a sudden show up here, in Supplementary Estimates (A)?
Ms. Boudreau: Thank you. That’s an excellent question.
Actually, it really depends on departments’ needs. It’s a two-part answer.
Number one, if their implementation plan is ready to go, they will ask Treasury Board for the necessary approvals. After that, the measure can be included in the supplementary estimates.
Number two, it also has to do with cash flow requirements, and that depends on whether they really need the money to spend it on the actual program.
This program, however, is a bit different. Federal assistance is paid out when provinces and territories submit their invoices. Once the federal government receives the documentation, auditors review the information to make sure all the supporting documents are there. Once that is done, the payments are made to provinces and territories. We don’t necessarily control that cycle. We are still waiting for supporting documentation from the provinces and territories. Once that is received, the payments can go out.
Senator Gignac: Thank you.
[English]
Senator Richards: The written answer on accountability to Senator Marshall will be sufficient if it is concise, so I will yield the rest of my time. Thank you.
Senator Loffreda: I want to continue on scarce resources and employee retention, which are major issues for many today. The Treasury Board of Canada Secretariat is responsible for negotiating collective bargaining agreements in the core public service. Can you give us an update on the collective agreements and inflationary pressures thereon? How many are expiring or are currently being negotiated? And how challenging is it at this point in time for you, with respect to employee satisfaction, employee retention, inflationary pressure and control over the collective agreements being negotiated?
Ms. Girard: Thank you for the question, senator. We are currently in negotiations for the 2021 round of collective bargaining. A majority of employees now fall under units that have tabled notice to bargain. We are currently in negotiations.
The conversations and discussions are ongoing. For those that had tabled notices to bargain in 2021, we started financial discussions and tabled initial economic offers to those groups. As the cycle evolves, those conversations are ongoing.
We establish and ask for a mandate based on four criteria. First, we look at external comparability. Second, we look at internal relativity between the different classifications and groups of employees. Third, we look at performance and, fourth, available affordability. That’s affordability for the Government of Canada and taxpayers, but it also includes a number of variables, such as inflation and cost of living. That’s where, for example, inflation is factored into the overall assessment and the global mandate provided to my sector to begin negotiations.
So far, conversations are under way. We do monitor the situation closely and provide regular updates. We have four tables, at this point, for which discussions have been interrupted, but the others are ongoing.
Senator Loffreda: I’ve raised the issue of the real estate portfolio numerous times. I raised it with Minister Fortier when she was here before us at committee. Given the possibility of holding or owning excess real estate and optimizing this real estate — and you do say in your departmental plan for 2022-23 that you are committed to giving sound advice and providing hands-on support and advice to improve the management of the government’s real property — can you provide us with an update on this review? Has an advisory panel been struck? Have guiding principles been established? And what’s the latest on this issue, particularly with respect to the government’s multi-billion-dollar real estate portfolio?
Ms. Boudreau: Thank you very much for the question. As indicated in Budget 2022, under stream 2 of the Strategic Policy Review, real property will be one element of the review. We are looking into it as we speak. As I indicated earlier, it is part of our plan, and we’ll be able to come back in Budget 2023 with an update on this specific topic. Thank you.
[Translation]
Senator Gerba: Thank you to the witnesses. My question is for both witnesses, not one specifically.
One of the largest items in the estimates is the additional $330 million for the Canadian Air Transport Security Authority, CATSA. However, according to the Parliamentary Budget Officer, CATSA’s overall budget remains close to historical levels. With health restrictions being lifted and summer holidays around the corner, the number of travellers is almost back to pre‑pandemic levels. Airports across the country are already experiencing a major shortage of screening officers. As a result, officers from Montreal are being mobilized to cover shifts in Quebec City.
Here’s my question. Why is CATSA’s budget essentially the same as it always is? Why hasn’t more funding been allocated to hire more screening officers?
Ms. Boudreau: Thank you for your question. As you mentioned, CATSA will receive approximately $330 million in additional funding, bringing the organization’s total spending to $885 million. That is in line with the average for the past four years. You pointed out the challenges airports are experiencing right now because of a staffing shortage, and other sectors all over the country are dealing with a labour shortage as well. However, CATSA is working closely with Transport Canada to hire more staff and provide the job training they need to deliver the level of security we have come to expect in airports.
In addition, Transport Canada has set up a working group, in conjunction with the country’s three largest airports as well as Air Canada and WestJet. The working group will examine all options that can help improve airport efficiency. One of the problems is the fact that airports have numerous incoming and outgoing flights at the same time, which increases the passenger volume. All factors will be examined closely to ensure passenger safety.
Senator Dagenais: My question is for Ms. Girard. A few weeks ago, your negotiations with the Public Service Alliance deadlocked because of the wage offer put forward by Treasury Board, which proposed an annual increase of 1.75%. It’s easy to see why employees, who are dealing with a 6.8% inflation rate, are asking for more. I would even go as far as to say that they were insulted by the offer.
The Public Service Alliance walked away from the bargaining table and filed for arbitration. I know you’re not going to share your negotiating strategies with us, but can you tell us whether there is any flexibility in the current estimates or whether we’ll have to wait for another set of supplementary estimates?
Ms. Girard: Thank you for the question. I can switch languages and repeat it if necessary.
[English]
The senator asked about the status update on the PSAC negotiation.
[Translation]
Yes, the bargaining tables were in full swing. We are disappointed with the outcome because we had discussed various options over the past few months. In late March, we began discussing the wage offer. The Public Service Alliance decided to declare impasse. We hope to be able to resume the negotiations, since the employer had the opportunity to propose only an initial offer. The usual negotiations were under way, but the union chose to declare impasse. Consequently, we are waiting for the response of the Federal Public Sector Labour Relations and Employment Board.
Senator Dagenais: They filed for arbitration. I imagine that the arbitrator’s decision will be binding?
Ms. Girard: That is what they asked the Federal Public Sector Labour Relations and Employment Board for. In its letter, the Public Service Alliance declared impasse and requested that a public interest commission be established. When bargaining agents submit their notice to bargain, they choose either arbitration, conciliation or strike. Arbitration is binding; conciliation is not. The Public Service Alliance asked for a public interest commission to be established, and we are waiting for the committee’s decision.
Senator Dagenais: And what about the supplementary estimates?
[English]
The Chair: Honourable senators, when I look at the time frame that we have for the final panel, I have four senators to ask questions. Ms. Boudreau, I will ask the four senators to each ask a question. Do we agree that you will meet the deadline that we have to send us written responses to those four questions?
Ms. Boudreau: Yes, sure.
[Translation]
Will I have a chance to answer the questions, or will we get them all in writing, in which case we are to get back to the committee with written answers?
The Chair: We’ll listen to the four questions, and then we’ll come back to them.
[English]
Senator Pate: My question has to do with the role of the Treasury Board in terms of monitoring organizations. In particular, of the 42 performance targets set by Indigenous Services Canada, only a quarter of those have been set. Similar findings are coming out from the Auditor General’s report for Infrastructure Canada. Given your role in providing oversight of the operations of the federal government as a whole and the financial management of departments and agencies, I am curious as to what you are doing in light of these reports to help ensure that they meet their targets.
I did have some questions about the COVID vaccination policies, how many public servants have been put on administrative leave with pay as a result of the policy, and what accommodation measures have been provided and on what grounds. Thank you very much.
Senator Duncan: Thank you to the witnesses who are appearing before us today. My questions are along the same lines as Senator Pate’s and Senator Marshall’s, so I will await that information in written form.
Could I just add that when we are receiving that information, could we also have a regional breakdown? For example, if performance indicators are indicating that funding is allocated more in one part of Canada than elsewhere, if we could receive that information? Thank you.
Senator Boehm: My question is in the same direction as earlier questions by Senators Forest and Loffreda, and that is with respect to stream 2 in the Strategic Policy Review. So I would have asked Ms. Girard this question. It is with respect to increased virtual or remote work arrangements. I see that many of you are back in your office, unless you have elaborate backgrounds that are office-like. I am wondering if there is a uniform standard or expectation across the different departments and agencies in terms of how this is going to work. Is OCHRO is taking a leading role in this or whether there are departments that are being used as pilot projects?
Some of my anecdotal evidence — and I will conclude on this at this point — is that a lot of people are used to working in a hybridized manner and don’t want to come back to work. How is this being handled? And perhaps this also flows into the bargaining unit negotiations as well.
[Translation]
The Chair: Ms. Boudreau, you have two minutes, in addition to the written answers.
[English]
Ms. Boudreau: I will start with performance indicators very quickly. We will come back to you, but my understanding is that ISC is appearing before your committee this afternoon. That will be a great opportunity to ask the question about performance indicators.
We do not have the regional breakdown, but I am sure ISC and CIRNAC will be able to provide that information. I will come back to you with an overview of monitoring of performance indicators when departments come to the board. This I will do.
I will turn it over now to Marie-Chantal Girard for the vaccination policy, as well as the return to the workplace. Thank you.
Ms. Girard: As of May 30, there were 2,108 employees put on administrative leave without pay. Currently 1,899 employees have been granted an accommodation measure.
Telework, Senator Boehm, is under the authority of the employer. Therefore, it is not negotiated at the bargaining table. You are absolutely right that the deputy minister can now bring back their employees as per their mandate and operational requirements and assessments.
The update of the health and safety guidance allows us now to bring back employees, implementing, of course, all of the preventive measures for COVID-19 — masks, hand sanitizing and distancing by 2 metres if that is possible without the mask; if not, with the mask.
Deputy heads are now undertaking testing of various models based on the mandates of their departments and their requirements. We are ensuring there is no one-size-fits-all solution but that there will be coherence, and OCHRO is providing guidance to that effect. Thank you.
The Chair: Thank you very much. This brings the panel to an end.
[Translation]
Ms. Boudreau, as discussed, you have agreed to get back to the committee with written answers. You have until Monday to get back to us, but you are of course welcome to provide the answers in the next few days, if you can. We appreciate it. You’ve shared a lot of information today, which is in line with the committee’s motto:
[English]
It is all about transparency, accountability, predictability and reliability. That is what Canadians want.
Honourable senators, as we bid farewell to the Treasury Board officials, we will now move into clause-by-clause consideration of Bill C-8.
The last agenda item for today is clause-by-clause consideration of Bill C-8. I would like to bring to your attention that we’ve had three meetings on Bill C-8. We’ve had 35 witnesses in 3 hours and 48 minutes. We also have the sponsor of the bill, Senator Gignac, who is a member of our National Finance Committee.
I need, as chair, to bring the process to your attention.
Is it agreed, honourable senators, that the committee proceed to clause-by-clause consideration of Bill C-8, An Act to implement certain provisions of the economic and fiscal update tabled in Parliament on December 14, 2021, and other measures?
Hon. Senators: Agreed.
The Chair: Thank you.
With leave, is it agreed that the committee be allowed to group clauses by the seven parts that are identified in the bill, when appropriate?
Hon. Senators: Agreed.
The Chair: Thank you. Shall the title stand postponed, honourable senators?
Hon. Senators: Agreed.
The Chair: Thank you. Shall clause 1, which contains the short title, stand postponed? Is that agreed, honourable senators?
Hon. Senators: Agreed.
The Chair: Thank you.
[Translation]
Shall Part 1, amending the Income Tax Act and containing clauses 2 to 9, on pages 1 to 16, carry?
Hon. Senators: Agreed.
[English]
The Chair: We will move to Part 2, honourable senators. Part 2 is Underused Housing Tax Act, clauses 10 to 40, pages 17 to 108. Shall Part 2, entitled Underused Housing Tax Act, containing clauses 10 to 40, carry?
Senator Marshall: On division.
Senator Gignac: On division.
The Chair: Thank you, honourable senators. We will now look at Part 3, entitled Canada Emergency Business Account, clauses 41 to 43, pages 108 to 110. Shall Part 3, entitled Canada Emergency Business Account, containing clauses 41 to 43, carry?
Hon. Senators: Agreed.
The Chair: Thank you. Part 4, honourable senators, is entitled “school ventilation improvement,” clause 44, pages 110 and 111. Is that agreed upon, honourable senators?
Hon. Senators: Agreed.
The Chair: Thank you.
[Translation]
That brings us to Part 5, Proof of Vaccination, in clause 45, on page 111. Shall Part 5, entitled Proof of Vaccination, containing clause 45, carry?
Hon. Senators: Agreed.
The Chair: We are on Part 6, entitled COVID-19 Tests, containing clause 46, on pages 111 and 112.
[English]
Shall it carry, honourable senators?
Senator Marshall: On division.
Some Hon. Senators: Agreed.
The Chair: On division. Thank you.
Part 7, honourable senators, entitled Employment Insurance Act, clauses 47 and 48, pages 112 and 113. Shall Part 7, honourable senators, entitled Employment Insurance Act, containing clauses 47 and 48, carry?
Is it agreed, honourable senators?
Hon. Senators: Agreed.
The Chair: We will move to clause 1, the short title. Shall clause 1, which contains the short title, carry?
Hon. Senators: Agreed.
The Chair: Thank you. Shall the title carry, honourable senators?
Hon. Senators: Agreed.
[Translation]
The Chair: Shall the bill before us carry without amendment, honourable senators?
[English]
Senator Marshall: On division.
[Translation]
The Chair: Does the committee wish to consider appending observations to the report? I have not had any indication that senators wished to prepare and submit observations.
[English]
Does the committee wish to consider appending observations to the report? Yes or no, honourable senators?
Senator Gignac: No.
The Chair: Did I hear a “no?” Yes. Thank you, honourable senators.
As we proceed with clause-by-clause consideration on the bill, is it agreed that I report this bill, as adopted and agreed upon, some sections on division? Are you giving me the authority, the agreement, to table the report as early as possible?
Hon. Senators: Agreed.
The Chair: With this, honourable senators, I would like to inform honourable senators that our next meeting will be this afternoon at 3 p.m. ET to resume our study on Supplementary Estimates (A).
With this, honourable senators, I now declare the meeting adjourned.
(The committee adjourned.)