THE STANDING SENATE COMMITTEE ON NATIONAL FINANCE
EVIDENCE
OTTAWA, Tuesday, October 25, 2022
The Standing Senate Committee on National Finance met with videoconference this day at 9:01 a.m. [ET] to study the subject matter of Bill C-31, An Act respecting cost of living relief measures related to dental care and rental housing.
Senator Percy Mockler (Chair) in the chair.
[English]
The Chair: I wish to welcome all of the senators as well as the viewers, Canadians across the country who are watching us on sencanada.ca.
[Translation]
My name is Percy Mockler. I am a senator from New Brunswick and the Chair of the Standing Senate Committee on National Finance.
[English]
I will now ask each senator to introduce themselves, please.
Senator Loffreda: Senator Tony Loffreda from Montreal, Quebec.
Senator Pate: Kim Pate from here on the shores of the Kitchissippi, unceded, unsurrendered territory of the Algonquin Anishinaabe.
Senator Omidvar: Ratna Omidvar from Toronto, Ontario.
Senator Anderson: Senator Anderson, Northwest Territories.
Senator Boehm: Peter Boehm, Ontario.
Senator Duncan: Pat Duncan from the Yukon.
Senator Harder: Peter Harder, Ontario.
Senator Marshall: Elizabeth Marshall, Newfoundland and Labrador.
Senator Smith: Larry Smith, Quebec.
[Translation]
Senator Dagenais: I am Jean-Guy Dagenais from Quebec.
[English]
The Chair: Senators, this morning we begin our study on the subject matter of Bill C-31, an act respecting cost of living relief measures related to dental care and rental housing, referred to this committee on October 20, 2022, by the Senate of Canada.
We have the pleasure, honourable senators and Canadians, to welcome Mr. Yves Giroux, Parliamentary Budget Officer, or PBO. I would like to share with you, honourable senators and the Canadian public, that Mr. Giroux was supposed to be in Halifax today. When we called him yesterday, he immediately made himself available with his team.
Mr. Giroux, thank you very much. Every time we have called you, you have responded positively.
He is accompanied by two adviser-analysts, Ms. Busby and Mr. Ammar. Welcome to all of you and thank you for accepting our invitation to appear in front of the Senate Finance Committee. It’s always enlightening, Mr. Giroux, to welcome you and your team. Your testimony always helps us senators on behalf of all Canadians to focus on our four main objectives — transparency, accountability, reliability and predictability of the finances of Canada.
We will now hear opening remarks and comments from you, and then it will be followed by questions from the senators.
[Translation]
Go ahead, Mr. Giroux.
Yves Giroux, Parliamentary Budget Officer, Office of the Parliamentary Budget Officer: Thank you, Mr. Chair.
Honourable senators, thank you for the invitation to appear before you today. We are pleased to be here to discuss our analysis of Bill C-31, An Act respecting cost of living relief measures related to dental care and rental housing, which we published in two separate legislative costing notes on October 14 and 20, 2022.
With me today, I have Carleigh Busby, the lead advisor-analyst on the cost estimate of the one-time top-up to the Canada Housing Benefit Program, and Nasreddine Ammar, the lead advisor-analyst on the cost estimate of the Canada Dental Benefit.
Part 1 of Bill C-31 proposes a Canada Dental Benefit, or CDB, that would provide upfront tax-free payments to cover dental expenses for children under 12 years old, based on a family’s adjusted net income. We estimate the cost of the proposed Canada Dental Benefit to be $703 million over the two benefit periods, which span from October 1, 2022 to June 30, 2024. We also published a supplementary table of the projected cost of the CDB by province.
[English]
Part 2 of Bill C-31 will enact the Rental Housing Benefit Act. The act proposes the creation of a one-time $500 benefit for low-income Canadian renters. We estimate that this measure will increase federal spending by $940 million in fiscal year 2022-23, the current year, with an estimated 1.7 million recipients. Our independent estimates do not align perfectly with the government’s figures. However, we are unfortunately unable to provide you with a full reconciliation of the variance between the estimates, as the government has not yet published the details or methodology to support its calculations.
Ms. Busby, Mr. Ammar and I will be pleased to respond to any questions you may have regarding our analysis of Bill C-31 or other PBO work. Thank you.
The Chair: Honourable senators, before we proceed to questions, I would like to ask the members and witnesses in the room to please refrain from leaning in too close to the microphone or remove your earpiece when doing so. This will avoid any sound feedback that could negatively impact the committee staff in the room.
Now, we will proceed to questions. Senators will have a maximum of five minutes each, for only one round of questions. We do have another panel immediately at 10 o’clock. Therefore, please ask your questions directly to the witnesses.
To the witnesses, please respond concisely and the clerk will inform me when the time is over.
Senator Marshall: Thank you, Mr. Giroux, for being here and to your officials also.
I want to start off with the rental program. I think you partially answered my question. On the rental, the government estimated the cost to be $475 million, and your estimate is the $940 million. In your remarks, you gave a reference to the word “full.” Are you able to provide any explanation as to why there is such a big difference between the government’s cost in the budget and what’s in your briefing note?
Mr. Giroux: Not on rental. On dental, we can assume that some of the difference relates to administration costs. But on rental benefit, we don’t have any precise idea, unless Ms. Busby has more information. Yes, she has more information.
Carleigh Busby, Advisor-Analyst, Office of the Parliamentary Budget Officer: I would like to add the $475 million that you speak of was an initial estimate provided by the government in the budget. They since updated that estimate to $1.2 billion and 1.8 million recipients.
Senator Marshall: Would you know how they went from the $475 million to the $1.2 billion? It’s a really big difference.
Ms. Busby: Unfortunately, I do not know.
Senator Marshall: Thank you very much.
Do you have the information broken down by province? Is that something that could be provided to the committee? I would be interested in seeing that because the different provinces have different types of dental programs. Some provinces are going to be helped financially more so than others, and I wanted to take a look at that. Thank you.
Also, you did indicate the estimation and the projection method for the rental program.
Do you have any insight into how government officials can determine with certainty that recipients are eligible for the funding when people apply?
Mr. Giroux: My understanding of the legislation is that they will require an attestation as to the amount of rent that individuals are paying, but maybe the details of the administration will be further elaborated on by the government.
Senator Marshall: There is an assortment of rental subsidy programs throughout the country by province.
Mr. Giroux: Yes.
Senator Marshall: If an applicant is already receiving a subsidy, how is it going to be cross-checked to make sure they are not being compensated twice?
Mr. Giroux: That will be an important detail for the administration of the program.
And, senator, to your question about the provincial breakdown for rental housing, in anticipation of that being an important point for consideration by senators, we published that this morning on our website.
Senator Marshall: Oh, it is published?
Mr. Giroux: Yes.
Senator Marshall: I was looking for it. That’s where it is. Thank you.
Moving on to the dental program, in your legislative costing note, what is “adjusted net income”? What do you mean by that? What exactly is “adjusted net income”?
Nasreddine Ammar, Advisor-Analyst, Office of the Parliamentary Budget Officer: We are using the same definition of “net income” that was used for the Canada child benefit. “Adjusted net income” is the net income minus all the previous Universal child care benefit.
Senator Marshall: That’s the only thing that is removed from the net income?
Mr. Giroux: There are a couple of things deducted from total income, such as — if I’m not mistaken — RRSP contributions and pension plan contributions. It’s after a couple of deductions.
Senator Marshall: For the dental program, I know you indicate how you came up with your projections on that, but do you take into consideration the dental cost? How did you determine what the cost was going to be if the recipients can tap into other programs or if the child could be insured under somebody else’s dental plan? How did you factor that in?
Mr. Giroux: We looked at data that already exists on the utilization rate of dental services as well as the average cost of dental care. There exists data by age group, and we also have data on the proportion of children that are insured by private insurance.
We also looked at the provincial benefits that are covering children under a certain age, and it varies by province. By recouping all that information and also adjusting for the fact that when a plan makes benefits available, the uptake rate tends to go up for dental services. We came up with the estimate by taking all that into account.
Senator Marshall: Is the provincial breakdown on your website for both the dental program and the rental program? Both of them are on your website now?
Mr. Giroux: Yes, under the two different notes.
Senator Smith: Welcome, Mr. Giroux, and your assistants.
You used data from the Canadian Income Survey, 2018, and the 2016 Census to estimate the cost of the housing benefit act, which is part of the bill before us. You noted in the costing analysis that the 2016 Census and the 2018 Canadian Income Survey do not reflect the population of Canadian tax filers today.
The quality and timeliness of the data is important in the work your office does. I would like to have your thoughts on data challenges facing governments when putting together programs like this to ensure they capture all under service.
Mr. Giroux: It is, indeed, a challenge when using data that is a couple of years old. It forces us to rely on assumptions regarding demographic growth and income growth. We make assumptions regarding the growth in certain segments of the population — in this case, children under the age of 12 — as well as the income growth of the families in which they are raised, which may be off by a few percentage points given that we rely on assumptions. It’s not real, actual data.
This introduces a certain level of uncertainty regarding our estimates, but the government is faced with the same challenge unless they have more recent data that they are using and not sharing with us. I would be surprised. We probably are working with the same data sets when it comes to income and population, but it is, indeed, a significant challenge.
Senator Smith: Does the problem exist more in regional areas that may be hard to access as opposed to large metropolitan areas?
Mr. Giroux: It exists. The further down you go into detail, population or smaller segments of the population, it increases the level of uncertainty.
For example, if we’re doing a cost estimate at the national level, we have a higher level of certainty than if we go to the provincial level. The smaller the population base of a province, the more uncertainty we’re faced with in terms of population growth because there might be population movements across provinces that are not captured in our estimates. It is the same with income growth.
Senator Smith: Bill C-31 does contain clauses referring to violations, offences and penalties for people who make misleading or false claims and receive benefits for which they are not entitled. Fraudulent and misleading claims in the Canada Emergency Response Benefit, or CERB, and rental subsidy programs during the pandemic were prevalent.
I would like to know if your analysis of these programs looked into the potential for fraudulent and misleading claims or whether or not it’s an area of concern for you.
Mr. Giroux: That’s a good point. Our analysis did not factor in fraud or take into account the possibility for fraud because it’s highly contingent on how the program will be administered by the department.
However, based on what is in the legislation, an attestation that dental services were provided or are intended to be provided suggests that it will be based on attestation and on expectations of a dental service being used. The potential for fraud will probably be significant, so it will depend on strong enforcement and verification measures.
Given that it’s likely to be based on attestation, yes, administration will need to be tight. Otherwise, it could lead to abuse. That’s one of the concerns that I personally have as a taxpayer.
Senator Smith: If we go back to the CERB situation, I think the government’s policy position was, “Let’s get it out and get it into the hands of people.” That’s the purpose of asking the question. I wonder if there is some percentage that is put into the estimates that says, “There is potential for fraud, and we should be aware of it, so we don’t get caught potentially like last time.”
Mr. Giroux: We have not included a percentage for fraud, per se. We have assumed that the uptake will be higher because when you introduce a benefit, you make it essentially free to use dental services, which is the purpose of legislation. We did not put an additional amount for fraud.
Senator Smith: Thank you.
Senator Harder: Thank you to our witnesses. The work that you do helps the Senate and Canadians understand costings.
I wonder, though, whether you looked at any of the existing costs of not having dental care to the health care sector.
Mr. Giroux: That’s a very good question, and we did not look at that. We did not look at the benefits of the piece of the legislation. It is well-known that there are costs avoided by using dental services, so our focus was exclusively on the cost of the piece of legislation itself.
Senator Harder: Would it be possible for you to extend your review to examine that cost?
Mr. Giroux: It would be possible, but it would require significant resources and assumptions regarding the uptake rate and the type of costs that are avoided when children under 12 are more assiduous in going to the dentist. It’s possible, but we need to look at precisely what type of cost we are looking at.
Senator Harder: From my point of view, it would be beneficial for the understanding of Canadians to have that balance because I suspect some would argue — and I would be among them — that the benefits to the health system outweigh the costs that we will find in extending dental coverage.
My second question extends to whether you have done any review of the capacity of the dental services to absorb the increased dental coverage and what that might do to overall costs.
Mr. Giroux: We did not look at the capacity of dentists across the country. It’s dentists, but also orthodontists and other dental care professionals. We have assumed there is sufficient capacity. That might be true. That might not be true in certain areas of the country.
We have assumed overall there is sufficient unused capacity in the dental care system.
Senator Harder: Can you examine that and tell us over time whether or not that assertion is actually true?
Mr. Giroux: We could certainly look at that if the committee wishes us to do that and wants to have a motion to request us to do that — as well as the benefits.
Senator Harder: I think both of those pieces of information would be very helpful to the committee. I will leave it to the committee as a whole to determine whether or not they would request that information. I think it would be very helpful.
Senator Pate: Thank you to the witnesses. I echo my colleagues.
Picking up on what Senators Harder and Smith just raised, I’m interested in the flip of that as well. In addition to the long-term savings in terms of health care — of not having as many emergent dental concerns arising — what about the adequacy of the resources available? When most of us look at what it costs each year for our dental services, $650 is not a great deal. The fact that it’s based on attestation in a context where you may be dealing with families who are also struggling to pay rent and put food on the table, I am less concerned about fraud, quite frankly, than I am about adequacy.
As well, if individuals are on provincial programs, it’s less likely because this is aimed more clearly at the middle class. If I’m wrong, I would like you to correct me on that. My concern is — and you have raised it in your reports — that there may be clawbacks as well from provinces.
I had a quick look at what you put out this morning. I can’t see that you have done that analysis about whether there are clawbacks from provinces where there may be limited dental benefit availabilities.
I realize this is a big piece, but I’m following up on my colleagues. Any additional information would be extremely useful.
Mr. Giroux: Thank you. I’m not aware that any provinces have suggested there would be clawbacks from their own programs in response to the introduction of the federal program. It might be the case, but I’m not aware that any province has declared that.
With respect to the adequacy of $650, we looked at the average, and the average seems to be below that. For sure, there are probably cases — and probably a significant percentage of cases — where expenditures are above that.
Mr. Ammar has more information. He has looked at the average expense in more detail.
Mr. Ammar: Thank you. For the dental benefit, we checked the population distribution by income group, and we have not seen that the largest portion of the population belongs to families under $70,000 as net income. This means that most of the eligible children will receive the maximum amount of $650. But combine that with children belonging to other higher-income families, the average will be less than that — around maybe $500 or $550 as benefits.
Senator Pate: In terms of the rental benefit, is this issue the same in terms of clawbacks or have you seen the potential? Because certainly if people are in subsidized housing or it is rent geared to income, I could see this having a direct impact on some.
Mr. Giroux: Again, I’m not aware that there has been any publicly declared clawback intentions from provinces. Ms. Busby says no. She is not kicking me under the table, so that suggests she is not aware either of any intentions to claw back.
Senator Pate: If I could be so bold, Mr. Chair, in the analysis that Senator Harder suggested, could it also include some extrapolation based on the clawbacks that existed for CERB and some of the other benefits where provinces did actually have a bit of a windfall from some of those by kicking people off or clawing back their benefits?
Mr. Giroux: We will be exploring that possibility, yes.
Senator Pate: Thank you.
Senator Boehm: Welcome, Mr. Giroux and your colleagues. I wanted to continue in the line that Senator Harder started and Senator Pate just followed up on — to look at more of the future projection. Budget 2022 proposes a national dental care plan that would provide funding of $5.3 billion over five years starting in the current fiscal year with $1.7 billion ongoing.
Of course, it starts this year with children under 12 and then next year it will expand to people under 18 years of age, seniors and people with disabilities with full implementation by 2025.
If you project towards the future — not least because of inflation — is the money the government has planned to spend on this program realistic in your view? Can we expect significant increases? How would you assess that versus long-term savings?
I guess I’m asking you to look into your PBO crystal ball.
Mr. Giroux: I don’t have such a crystal ball. But one important aspect in determining future costs will be how the program is administered. If it’s the same type of program that you are considering under Bill C-31, the cost will be contingent on how strong the administration is. If it’s more akin to a real dental care program where receipts have to be provided and then reimbursed, the cost of administration will be significantly higher. Another important factor will be what types of services are covered. Without having all these details, it’s difficult to determine whether there is enough money or whether it will cost more.
Senator Harder alluded to the capacity of the system. If there were to be capacity constraints and we were to see dentists and other dental care professionals increase their fees, it’s clear that the costs could quickly go beyond $1.7 billion. All that to say that there are too many unknowns as to the format and program designs to say whether or not it’s enough money.
Senator Boehm: Thank you.
Senator Loffreda: Thank you, Mr. Giroux, for being here with us this morning — always insightful.
I would like to address two concerns that we haven’t addressed yet. One would be the inflation concern. Obviously, in a $2 trillion economy, we all know that with $475 million or $945 million, according to your estimates, the impact will be nominal. I would like your thought on inflation. We have heard many people complain and argue that these targeted and relatively small measures will also result in additional inflationary pressures in Canada. Will it be so, and does the fact that the measures target the low-income population and specific expenditures lessen the concern that this bill will have a significant impact on increasing inflation?
The other concern I do have is this: What we measure improves, and at times, if we want results, we have to measure and track. I would say that a weakness of this dental benefit is the payment to the parents. Do we know it will actually be used for dental care and dental benefits? We have heard that concern before.
Is there anything you would like to add? What are your thoughts on that given the fact that you are always leaning into the numbers, the reports and what we can do? Is there any other way to measure this or to mitigate this risk?
We trust Canadians and that they will use this benefit for their children. How long can they take to go to the dentist?
It would be nice to have a tracking system nonetheless and measure the actual benefit that Canadians are getting from this benefit. Is there a report that we can have with respect to how many children have dental benefits before this payment and how many will have had dental benefits after this bill received Royal Assent? Is there any report that is possible to have those figures?
Mr. Giroux: Thank you, senator. You talked about the inflationary aspect of the bill, and you pointed out correctly that in a $2 trillion or $2.5 trillion economy, $1 billion or $1.5 billion is unlikely to make a big difference overall. However, going back to a point that Senator Harder indicated, there could be capacity constraints or there could also be some profit-taking by some health or dental care professionals or some landowners. When they see that some Canadians are receiving government assistance, they could decide to try to capture some of that assistance by increasing rents or increasing the fees. It’s something that we have seen before, and it’s probably the reason why the government has asked the Competition Bureau to look into other lines of business to see if there is an undue profit-taking during the pandemic. It’s possible that in some areas there could be price increases as a result of these benefits.
The fact that it is targeted, however, likely lessens the impact of this undue profit-taking because it will be targeted to specific segments of the Canadian population.
With regard to measuring impact, I personally think it’s essential when government introduces measures that they try to capture the benefit and measure whether they are having meaningful impacts. I haven’t seen anything in legislation to that effect, nor have I heard any intention on the government’s part to measure the benefits or the positive impacts of Bill C-31. However, if the past is any indication, I’m not confident it will be done because, for example, when we looked at performance indicators in the area of Indigenous services, we found that the government — when setting specific targets and adjusting them as years go by — has failed to meet a significant portion of their own self-imposed targets or performance metrics.
If I were a betting man, I would say that it’s unlikely we’ll see the government measuring the impacts of Bill C-31, which is unfortunate.
Senator Loffreda: Thank you.
Another concern I have is that the logistics to manage these new benefits rely on targeted populations to file their income tax returns, as we know. Just to have your thoughts on that. I’ve discussed this issue before in committee with Minister Freeland and others, but here we are again. As we know, there is 10 to 12% of the population who do not file their income tax returns and won’t be eligible for these benefits from the Canada Revenue Agency, or CRA.
What could we do in the future given that you are deep into the reports and the numbers? Any solution to that? I think we never discuss it enough because this is 10 to 12% of the population that really may need these benefits and yet we can’t reach out to them. We don’t know where and who they are. Canada is here since 1867. We’re a mature country by now. We should look into the 10 to 12% and take care of these people. Any thoughts on your part?
Mr. Giroux: Well, more and more benefits rely on the tax system of either being delivered directly through the tax system or they depend on individuals and families filing tax returns. Yet the government is not as proactive as you would think it could be in 2022, for example, in reaching out to these individuals who fail to file taxes.
We have good metrics as to the proportion of Canadians who should file because they’d get benefits and don’t, yet the government seems to be relying on the voluntary programs where volunteers help Canadians file their taxes.
I would think that by now there would be easier ways to proactively reach Canadians who don’t file tax returns for whom it would be beneficial. We can easily identify Canadians who owe money and don’t file. It’s probably not that much more difficult to identify those who don’t file and who would get benefits.
[Translation]
Senator Dagenais: Thank you, Mr. Giroux.
By way of background, when I was vice-president of finance at the Association des policières et policiers provinciaux du Québec, I was in charge of overseeing the health and dental insurance plans. We had 13,000 plan participants. It’s nothing if you consider what will happen under the Canada-wide plan, but I can tell you that, year in, year out, we had deficits.
When I look at the government’s figures, I wonder whether it’s a political decision. Considering the nature of dental care systems, I think the program could turn into a money pit.
Is it normal for Canadians to have to assume the cost of the program when the government didn’t provide more comprehensive projections?
Mr. Giroux: That’s a good question, senator. I think you could answer that better than I could.
The government provided cost estimates for Bill C-31. However, the bill, at least the part related to the CDB, is supposed to represent the beginning of a national program. It would probably behoove lawmakers to have much more detailed projections than what you saw, not only for Bill C-31, but also for the dental insurance program as a whole. It’s only a taste of what is supposed to be a much broader permanent program.
I don’t think it’s normal that you don’t have better information.
Senator Dagenais: When I was in charge of the dental insurance plan, I noticed certain things. When you go to the dentist and you say that you have insurance, you aren’t charged the same fees as someone who doesn’t have insurance. I even had to call dentists to tell them that they were charging too much.
Have you heard anything about a cost control mechanism or rate table for dental care? That would help to avoid surprises like cost overruns.
Mr. Giroux: No. Bill C-31 seeks solely to provide dental care to Canadians for their children, or access to it, I should say. With Bill C-31, as it currently stands, you could have a situation where a parent pays $150 or $200 for a cleaning, but still receives the $650 dental benefit.
The bill doesn’t seek to limit or define dental expenses according to a fee schedule. That is left up to dentists and oral health professionals, in accordance with applicable provincial schedules. Fees vary significantly from one city or province to another. Bill C-31 doesn’t have any measures to limit dental expenses for children under the age of 12.
Senator Dagenais: I hope cleanings covered under the dental health plan won’t cost $200 or $300.
[English]
Senator Omidvar: Thank you very much, Mr. Giroux, for being here. My questions pick up on things raised by my colleagues. Senator Pate raised the issue of clawbacks. Clawbacks are not desirable, but harmonization with the provincial government and municipal programs is — there are more than 80 federal, provincial or municipal dental programs. More than 30 are targeted at children. To what extent does the legislation intend to harmonize with the existing provincial programs?
Mr. Giroux: I haven’t seen any provision in the legislation on the dental side that seeks to harmonize. It refers, rather, to the fact that those whose parents are benefiting from a private dental insurance are not eligible, and those who are covered by a provincial program are eligible only to the extent that they have out-of-pocket expenses.
It relies on the fact that provinces and private plans are first payors, and the federal dental plan comes in second or third. I haven’t seen any intention to harmonize beyond what I just mentioned.
Senator Omidvar: Would you recommend that at some point in the life of this program someone takes an evaluative assessment of whether Canadians actually got more money for these services as opposed to being subjected to clawbacks?
Mr. Giroux: That is a good question, but I think it’s a design and a policy question that would probably be best answered by the witnesses who will follow us. But it’s a very interesting point.
Senator Omidvar: One of my colleagues talked about the percentage of Canadians who do not file income tax returns and, therefore, are not eligible for these benefits — 10 to 12%. I understand that the CRA is launching an initiative called “Get ready to do your taxes.”
Did your costing include some margin of additional uptake — let’s say even 3% — which would be desirable? Did your costing take that into account, optimistically?
Mr. Giroux: Yes. Our estimate took into account the fact that once you introduce a benefit, access or use of dental services increases. We have taken the high-income end because we know from statistics and historical usage that low-income individuals or families tend to use dental services less than middle- and high-income families. Given that this program will not be very stringent on asking for proof of payments and invoices, we have taken the assumption that it’s the high-income usage rate that will apply for children.
Senator Omidvar: I see. I’m just wondering, getting back to the interplay between provincial programs, do you believe that it would have been more efficient for the government to transfer money to the provincial governments, who are responsible for health care, as opposed to creating new plumbing?
Mr. Giroux: It certainly would have been better tailored to provincial realities and needs to transfer this money to provinces and territories. However, it would have required what would probably be lengthy discussions and negotiations with provinces.
Senator Anderson: Thank you, Mr. Giroux.
I note in your Canada Dental Benefit paper that you reference non-insured health benefits. As you may be aware, within the Northwest Territories, 50% of us fall under non-insured health benefits. That includes dental.
My question is: How does this money come into play with non-insured health benefits? Does it impact non-insured health benefits? Is it clawed back by non-insured health benefits?
Mr. Giroux: My understanding is that it will be a complement to non-insured health benefits. However, I may be wrong on that. Based on what I read in the legislation, non-insured health benefits, or NIHBs — as we call it familiarly — will be the first payor, and if families still have out-of-pocket expenses after non-insured health benefits, then they would be eligible to the dental benefit.
Senator Anderson: Just to make you aware, in the Northwest Territories, there are three communities with dental clinics. We have a total of nine clinics within the Northwest Territories — actually, it’s eight — and five dental therapist clinics.
Currently, in a small, isolated community, what happens is that if someone has a dental issue, they have to go see a nurse. That nurse then has to complete a form. The nurse is not qualified to do dental. The nurse has to complete a dental form that is submitted. Even with some severe dental cases, I have been advised they take up to two months, which then impacts their physical health as well. I want to point out that there are definitely some huge challenges within the Northwest Territories, and I would imagine it’s very similar in Nunavut.
Quite often, children’s dental care is taken care of in the south, which means that families have to travel to the south with their child for dental care. I want to know if that money that they qualify for — for their children — does it have to go directly to dental? Can it go toward transportation and food?
Mr. Giroux: That level of detail, I think, would be better answered by officials who will be assigned with the administration of the program. Unfortunately, I don’t have that detail, based on what was in the legislation and what information was provided to us by the departments.
Senator Anderson: Thank you, sir.
Senator Marshall: Mr. Giroux, looking at the dental program again, when you estimated your cost, you put in $35 million for administration. You provided an explanation in your note as to why you used 5%, but when I look at the program, it’s only, really, a mailing out of cheques.
Mr. Ammar was saying that the adjusted net income was that you roll off your Canada child benefit. It seems like you just calculate it in your computer system and mail out the cheque.
So $35 million seems like a lot of money. I’m wondering if you can comment on that. It seemed like $35 million was excessive to mail out the cheques.
Mr. Giroux: I agree with you. It certainly looks generous, and, yes, it is generous. It takes into account the fact that we estimate that it would likely be similar to the non-insured health benefit, but the government could easily do it for less. However, that would mean they would just send cheques and take in applications without doing much verification.
The government could decide to spend what we estimate in terms of administration costs if they were to do some verification, but they could do very little verification or a lot of verification. That’s why it’s difficult to ascertain with a high level of certainty how much administration cost will indeed be incurred.
Senator Marshall: That could include post-disbursement verification?
Mr. Giroux: Yes.
Senator Marshall: I’m thinking about the growth now in the public service. Do you foresee that there would be additional staff needed for this program?
Mr. Giroux: Based on what we’ve seen in the last several years, I am certain there will be additional staff for the administration of this benefit.
Senator Marshall: But you would have no idea as to how many. Thank you very much.
Senator Smith: Mr. Giroux, in your costing of the Canada Dental Benefit you noted the behavioural costs are sensitive to the choice of participation rates. You note this is a source of uncertainty. Can you expand on the specific issue of behavioural costs, which you estimate are approximately $128 million over the life of the program? And relating back to previous questions, is this sensitive to geography and where people are located in terms of where they live?
Mr. Giroux: The behavioural cost is related to the fact that we witness, generally speaking, that low-income households tend to use dental services to a significantly lower extent than high-income individuals. There are a variety of reasons for that, one of which is probably cash flow issues. Or they have much more pressing issues to deal with, such as feeding themselves and finding appropriate shelter.
We have assumed that with this benefit, which will take care of some of the cash flow issues, the use of dental services will increase and will probably be much closer to that of high-income households. Not 100% of children visit dentists, even among high-income individuals, so we have assumed with the benefit that even low-income households will visit the dentist in the same proportion as high-income individuals or households.
Senator Smith: Can you tell us how you came up with the $128 million? That is an estimate based on what factors?
Mr. Giroux: It’s an estimate based on that factor — the proportion of children who use dental services in the income groups that are targeted by Bill C-31 and increasing the uptake rate to reach that of high-income households.
Senator Smith: Thank you.
Senator Pate: I want to pick up on the discussion of the costs of verifications and administration. It strikes me that the discussion often focuses on poor people as more likely to be fraudulent than sometimes we see in terms of higher-income focus. You’ve done a fair bit of costing on things like the guaranteed livable income and basic income as well as on the manner in which these sorts of measures are pursued.
I’m reminded that about 20 years ago, when we looked at a massive verification program that was implemented in Ontario, it was shown to be costing somewhere in the neighbourhood of $200,000 minimum per month to monitor 90% of the people who were being reported as fraudulent as not even recipients of social assistance of the Ontario Works. So I’m curious as to whether you have done any costing of that in terms of this notion that we somehow believe poor people or people with lower incomes will be more fraudulent than those with higher incomes.
Also, could you comment on the component that we’ve already talked about, which is that if people are accessing the money but using it for food, is that going to ultimately impact the long-term health consequences in a more positive way than if they were not getting those resources?
I recognize that requires a whole number of assumptions that may not be within your bailiwick, but if you have looked at some of those, I’d be very interested in what your analysis is.
Mr. Giroux: Thank you. I wouldn’t go as far as saying that poor people have a higher fraud rate than richer people. I don’t think I’ve said that. If I hinted at that, I’m very sorry because I have no evidence to suggest that. In fact, when I was at the CRA, I don’t remember seeing higher incidents of fraud among low-income individuals versus high-income individuals. It may be the case, but I am not aware of any facts that would back that claim.
With respect to the benefits of using the benefit for other purposes such as finding better shelter or housing or better, more nutritious food, it’s an interesting question. I haven’t looked at that. We haven’t looked at that yet, but it’s quite clear that if the use of this benefit were to go for these purposes, there would be benefits for families as well. However, we haven’t looked at that.
Senator Pate: Just for clarification, I wasn’t suggesting you suggested that. However, it’s a common assumption that somehow poor people are more likely to game the system than wealthier folks.
The Chair: Thank you, Senator Pate, for the clarity.
Senator Duncan: I apologize if this question has already been asked and answered. It may be, Mr. Giroux, that you want to answer in writing.
I’d like you to elaborate on this government’s proposal of Bill C-31’s intersection with non-insured health benefits. For example, we should know how much it costs to administer the Non-Insured Health Benefits program for First Nations and Inuit people throughout Canada.
There is also the issue of what is covered, what’s not covered, how these claims are processed and how non-insured health benefits work one-on-one with Indigenous people.
Also, I’m concerned. Canada is really the fourteenth province at the table when it comes to health care because they have responsibility for National Defence, the RCMP and Indigenous people throughout Canada. Regarding the cost of dental benefits for those individuals, I don’t really see the intersection in terms of where it’s covered in your costing notes and benefits — where that recognition of Canada’s responsibility in that area is covered in terms of what the cost is.
Mr. Giroux: I think I understand your question, but I may misinterpret it, so correct me if I am wrong.
We looked at the proportion of children who are already insured privately or through government-sponsored programs. I think we have captured the fact that a proportion of children are covered by the non-insured health benefits. We also recognize the fact that even with these provincial and federal programs, there may remain some out-of-pocket expenses that are not covered. For example, some provincial programs or the non-insured health benefits cover only a limited number of procedures per year — for example, when it comes to cleaning or other types of procedures. I’m not a dentist, so I won’t try to name them. So there might be out-of-pocket expenses.
To the best of my knowledge, we have captured that, and the costs of the bill represents that some of these costs are already picked up by provincial and federal programs. But there remain out-of-pocket expenses even for those who are covered.
Mr. Ammar: I want to add my information. You are right about that. In our costing, we don’t cover the whole population of Canada. Some population groups like First Nations, populations living in the territories or who are in the army are not covered because we don’t have the data for that. The dental costing that we estimate is only for the main provinces in Canada and does not cover these population groups.
Senator Duncan: I think we need a deeper dive into the information that’s available through non-insured health benefits. For example, I believe Senator Harder asked about the health outcomes. The school-based oral health programs that are offered in the Northwest Territories and the Yukon — I don’t want to speak for Senator Anderson — but certainly throughout the Yukon, they have been offered for years for children from kindergarten to Grade 8. There is no income testing on school-aged children. It is offered through the school. We must have the data from the health outcomes from that if we ask the right department in government. In the whole-of-government approach, I think there is a lot of information available through the Non-Insured Health Benefits program and how it works that could enhance the debate and your deep dive.
May I suggest that be examined?
Mr. Giroux: Senator, I wish I could share your optimism regarding the breadth and scope of data that’s available on health outcomes when it comes to specific programs, but I’m not as optimistic as you are on the availability of that data.
[Translation]
Senator Dagenais: Mr. Giroux, I have a quick question about Bill C-31. When I consider the housing assistance program and the current economic situation, it’s hard to be opposed to providing that financial assistance to families. That forces us to focus on the part of the bill that deals with dental care, a program that will lead to huge expenditures the government won’t always be able to control.
Wouldn’t it be better to have two separate bills? That way, the dental care plan could be subjected to rigorous scrutiny, given that the spending associated with the program will be out of control. Conversely, the financial dimension of the housing benefit is easier to evaluate. The part of the bill that deals with dental care comes with great uncertainty.
Mr. Giroux: You’re right, senator. They are two distinct issues. Under the bill, the housing assistance is a one-time benefit, whereas the Dental Benefit Act represents the initial implementation of a permanent program. Yes, it would have been preferable to have two separate bills, since the two benefits differ in scope and duration. That, however, is a matter of legislative strategy, as well as House and Senate management. Unfortunately, I’m not qualified to speak to that.
Senator Dagenais: Thank you, Mr. Giroux.
[English]
The Chair: I will ask the Parliamentary Budget Officer to complete his presentation. Mr. Giroux, do you have any closing remarks on Bill C-31?
Mr. Giroux: No. We tried to answer your questions to the best of our capacity. We wish you good luck in your deliberations.
The Chair: In the event that you feel you should add additional information, please do so before November 2 through to the clerk, Mr. Giroux.
Senators, we now move on to the second panel. We have with us officials from the Canada Revenue Agency, the Canada Mortgage and Housing Corporation, Health Canada and the Public Health Agency of Canada. I am told that one senior official from each department will offer opening remarks and will then be supported by his or her colleagues during questions from the senators.
We have Ms. Gillian Pranke, Assistant Commissioner, Assessment, Benefit and Service Branch, Canada Revenue Agency; Nadine Leblanc, Senior Vice President, Policy, Canada Mortgage and Housing Corporation; Lynne Tomson, Associate Assistant Deputy Minister, Strategic Policy Branch, Health Canada; and Dr. James Taylor, Chief Dental Officer, Government of Canada, Public Health Agency of Canada.
Welcome to all of you, and thank you for acknowledging and being present today for Bill C-31. Before we begin, I would like to ask all other witnesses that I didn’t name to please introduce themselves should they be called upon to answer.
On this, we will now hear comments. First, Ms. Gillian Pranke, Assistant Commissioner, Assessment, Benefit and Service Branch, Canada Revenue Agency.
Ms. Pranke, the floor is yours.
Gillian Pranke, Assistant Commissioner, Assessment, Benefit and Service Branch, Canada Revenue Agency: Thank you for the invitation to be here today, along with my colleague, Heather Daniels, Director General, Benefit Programs Directorate, Assessment, Benefit and Service Branch, Canada Revenue Agency, to discuss the subject matter of Bill C-31, an act respecting cost of living relief measures related to dental care and rental housing.
As you are aware, the CRA is responsible for the administration of federal and certain provincial and territorial tax programs, as well as the delivery of a number of benefit payment programs. Each year, the agency collects hundreds of billions of dollars of tax revenue for governments of Canada, and distributes timely and accurate benefit payments to millions of Canadians.
The CRA also offers help and information to those who need it, and the CRA is working hard to reach Canadians who might not be receiving the tax credits or benefits to which they are entitled.
With respect to the two measures included in Bill C-31, the CRA, pending parliamentary approval and Royal Assent of the legislation, would administer and deliver both the proposed Canada Dental Benefit and the proposed one-time top-up to the Canada Housing Benefit program. The CRA’s goal in administration and delivery will be to minimize the administrative burden on Canadians while mitigating the potential for misuse.
Mr. Chair, at this time we will be pleased to respond to any questions you may have.
[Translation]
Nadine Leblanc, Senior Vice President, Policy, Canada Mortgage and Housing Corporation: Good morning, Mr. Chair. Thank you for the invitation and the opportunity to discuss this bill.
[English]
As Canada’s national housing agency, Canada Mortgage and Housing Corporation exists to house Canadians.
[Translation]
We play an important role in the housing system through our commercial products and programs under the National Housing Strategy.
Across our country, far too many low-income families struggle to pay their rent or find affordable rental housing. The COVID-19 pandemic and the recent rising cost of living have only made matters worse.
Vulnerable Canadians need additional help to make ends meet now.
[English]
The one-time top-up payment to the Canada Housing Benefit of $500 is estimated to support roughly 1.8 million low-income renters. Eligibility for the one-time top-up to the Canada Housing Benefit would be open to applicants who apply for the benefit and meet all of the following criteria: have filed a 2021 tax return or who are at least 15 years of age at any time in 2022; have an adjusted net income below $20,000 for individuals or $35,000 for families; are a resident in Canada; their principal residence is situated in Canada; paid rent for their own shelter in 2022; and paid at least 30% of their adjusted net income on rent.
The Canada Revenue Agency would process the applications and payments for the one-time top-up to the Canada Housing Benefit on behalf of the Canada Mortgage and Housing Corporation. Pending Royal Assent of the bill, eligible applicants would be able to apply via My Account for Individuals or by calling the CRA contact centre. Those who apply are eligible and have signed up for direct deposit would receive their payment quickly, within five business days.
The new one-time benefit would be in addition to the Canada Housing Benefit currently co-funded and delivered by the provinces and territories. The one-time top-up to the Canada Housing Benefit would be one element of a tool kit of solutions intended to address housing affordability across Canada, and it is to support low-income renters. The solution is aimed at providing a home to as many Canadians as possible, as well as making housing affordable to everyone.
Thank you. At this point, I would be happy to take any questions.
The Chair: Thank you.
Lynne Tomson, Associate Assistant Deputy Minister, Strategic Policy Branch, Health Canada. Ms. Tomson, the floor is yours.
Ms. Tomson, we will go to Dr. Taylor, and we will try to reconnect you with our IT people, okay?
I would like to recognize for opening comments Dr. James Taylor, Chief Dental Officer, Government of Canada, Public Health Agency of Canada.
Dr. James Taylor, Chief Dental Officer, Government of Canada, Public Health Agency of Canada: Thank you for the invitation to speak today.
I’m pleased to speak to you regarding the importance of oral health and dental care. Having good oral health allows us to speak, eat and socially interact. In addition, good oral health plays a central role in protecting against microbial infections.
Three quarters of Canadians visit the dentist at least once a year. However, in 2018, 35% of Canadians did not have dental care coverage and 22% did not visit an oral health professional because of the cost.
Bill C-31 would help those Canadians who don’t have dental coverage and would make it financially feasible for many more Canadians to visit oral health care professionals.
According to the World Health Organization’s 2019 Global Burden of Disease study, the most common health condition worldwide is untreated dental caries, or tooth decay.
By the time they become adults, 96% of Canadians have been impacted by dental decay. This disproportionately impacts our most vulnerable populations — especially those in rural communities, seniors, those from a low-income household, those with disabilities and racialized persons, including Indigenous people.
According to a national survey, 20% of Canadians have moderate to severe gum disease — a disease that is largely preventable. This number is amplified in older adults and in those with lower incomes.
Oral health is a fundamental part of our overall health, and neglecting it can lead to some serious medical conditions. There are associations between oral disease and other health problems such as diabetes, cancer, heart disease and stroke, respiratory illnesses, as well as dementia, obesity and preterm birth.
Poor oral health and oral diseases can also worsen existing health issues, and they can affect one’s quality of life. Oral pain, missing teeth or oral infections can affect how a person speaks, eats and socializes, and can have an impact on childhood development.
Many Canadians face barriers accessing dental care because of the cost in spite of a variety of public programs that complement private, employment-based insurance coverage. People without access to dental care often resort to overburdened hospital emergency departments. An estimated 1% of all emergency room visits every year are made by patients with non-emergent dental conditions. In 2017, an estimated $1.8 billion was spent on these avoidable emergency room visits.
In many of these cases, the patient left the emergency department with untreated oral health issues and nowhere else to seek help. It is not often that these hospital visits actually address the underlying dental issues, which can lead to return visits.
In the area of oral health, the Public Health Agency of Canada has been working with partners, including various Canadian universities, on multiple initiatives. The agency has worked with the University of Saskatchewan and the University of Alberta to produce user-friendly online information on proper teeth cleaning for infants and children, adults, seniors and pregnant women, as well as for caregivers supporting older adults living with dementia at home.
In the area of disease prevention, the agency partnered with the University of Manitoba and collaborated with many key national health professional organizations to produce the Canadian Caries Risk Assessment Tool. This enables Canadian health practitioners to confidently assess their preschool-age patients and take the steps necessary to prevent early childhood tooth decay. It also helps to guide those patients into the appropriate care approaches.
The agency also partnered with Université Laval and collaborated with key national health professional organizations to produce the Canadian Oral Health Screening Tool for Seniors. This tool allows Canadian primary health care providers to assess the oral health of seniors, particularly in the context of institutional settings, to ensure they receive the necessary oral health care.
The health of Canadians continues to be a priority for the government. As oral health is an important part of our overall health, it, too, is a priority.
Thank you. I’m happy to respond to questions.
Lynne Tomson, Associate Assistant Deputy Minister, Strategic Policy Branch, Health Canada: Thank you for the opportunity to speak to the Standing Senate Committee on National Finance about Bill C-31. I’m here with Lindy VanAmburg, Director General, Dental Care Task Force.
I would like to explain how this bill, if passed, would provide financial support to Canadian families to start accessing much-needed dental care.
As you know, Budget 2022 committed $5.3 billion over five years with $1.7 billion ongoing to provide dental care for Canadians with a family income below $90,000. Starting this year, the government is taking the first step towards meeting this goal with the creation of the Canada Dental Benefit. This is an interim benefit payment for eligible families with children under 12.
This legislation would provide the —
The Chair: Ms. Tomson, we’re having some technical difficulties.
In the event we cannot connect with you, there is no doubt we will be asking for you to come to the committee later on. Thank you.
Honourable senators, I would like to share with you that we will have a maximum of five minutes each for only one round of questions. Therefore, please ask your questions directly. To the witnesses, please respond concisely. The clerk will inform me when your time is over.
I will now recognize Senator Marshall.
Senator Marshall: I have the same question for both programs. I would like to know the logistics for the implementation as to how beneficiaries can access the funding.
For the dental, it depends on what other coverage they have through other programs. For the rental, it depends on rental subsidies that are available, I would think, through the provincial housing corporations.
What exactly are the procedures for implementation? What verification procedures are carried out upfront and what sorts of post-implementation procedures do you envision doing once the money has been paid out?
Ms. Leblanc: Thank you for the question. Maybe we can start with the rental benefit.
Just to clarify, the access to this benefit is not dependent on receiving a subsidy through the province and territory program. They are based on eligibility criteria that we have mentioned and that are captured in the bill. I can repeat that. But just to keep this response concise, in terms of the implementation, it will be an attestation-based application through a portal administered by the Canada Revenue Agency. Applicants will need to have filed their 2021 tax return. The reason for that is that the application will be validating their income upfront as part of their application process. This is one of the checks and balances of the attestation process.
As we process the application, as I mentioned in my opening remarks, if they have access to direct deposit, it could take up to five business days to receive the cheque, if they are eligible. I will end by saying that there is a compliance and audit check following approval.
Senator Marshall: Could you clarify this point: Before the cheque is mailed out, there is no verification to determine whether that applicant is already subsidized, say, through the provincial housing corporation or through some other program? It’s totally dependent on their income?
Ms. Leblanc: There are a few criteria, but the answer is no. One of the criteria is definitely income, so $20,000 for individuals and $35,000 for families. But it will also require the applicant to provide information with respect to their rent paid during 2022. That rent paid has to be at least 30% of their adjusted net income. There will be validation upfront of that calculation.
Senator Marshall: For the post-cheque issuance procedures, you’re saying that there will be some sort of verification or audit.
Is that area or directorship set up and already in place?
Ms. Leblanc: Of course, pending Royal Assent of this bill, CRA will be setting up the administrative function to support this program, including the audit and compliance checks. They are leveraging lessons learned as well as practices that they have put forward during the pandemic, and those audits will be mainly with respect to validation of rent based on a risk-based methodology.
Senator Marshall: For the dental program, can somebody tell me what sort of verification will be carried out upfront? The impression I’m getting is that it’s just an issuance of a cheque. If you’re entitled to the Canada child benefit and you meet the income criteria, you will get the cheque. I would like to have that confirmed. I would like to know, once the cheque is issued, is there some sort of verification or audit process after the fact?
Ms. Tomson: Thank you for this opportunity to speak to you this morning. I would like to explain how this bill, if passed, would provide financial support to Canadian families to start accessing much-needed dental care.
As you know, Budget 2022 committed $5.3 billion over five years with $1.7 billion ongoing to provide dental care for Canadians with a family income below $90,000. Starting this year, the government is taking the first step toward meeting this goal with the creation of the Canada Dental Benefit. This is an interim benefit payment for eligible families with children under 12.
This legislation would provide the Minister of Health with the authority to define that benefit and, with the support of the Minister of National Revenue, to disperse funds to eligible recipients.
[Translation]
Now I’ll turn to the eligibility criteria. In order to be eligible, the person applying for the benefit must have a dependent who is under the age of 12 and who does not have dental coverage through a private plan. The applicant must have filed their tax return for the previous year and received the Canada Child Benefit for the dependent child. Their adjusted net family income must be less than $90,000, and they must have incurred, or expect to incur, the dental expenses for the child during the benefit period. A parent cannot apply if they have been, or will be, fully reimbursed for the dental costs under another program, provincial or federal. Eligible parents can apply for the benefit for each dependent child, as long as they can show that they are eligible and retain necessary receipts.
[English]
Payments for eligible applicants will be in the following amounts: $650 each year for a child whose family income is less than $70,000; $390 each year per child whose family income is between $70,000 and $79,999; $260 each year for a child whose family income is between $80,000 and $89,999. An upfront payment recognizes that many eligible recipients do not have the financial flexibility to wait for reimbursement. Once the benefit is received, it may be used to pay for dental services from any licensed, regulated dental professional in good standing with the regulatory body to obtain whatever dental care that provider judges necessary.
Eligible applicants can apply for a benefit for each child in their care and will be able to demonstrate eligibility, as I said, by keeping receipts. CRA will verify information in the existing tax and Canada child benefit systems, like the income, age of children and the applicant’s relationship to that child. When applying, an eligible parent will also be asked to provide information on the following to help confirm eligibility: Contact information for the dental professional who did or will provide the dental services and information about the date of the appointment; contact information for their employer, if they have one, as well as that of their spouse or common-law partner for purposes of verifying access to an employer dental care plan; and any other information requested to verify their eligibility.
Only the parent in receipt of the Canada child benefit for that child may apply, and dental professionals may be contacted by the CRA to verify the details provided in the application. This benefit is not taxable, since it’s intended to pay for specific health-related costs. To that end, the bill amends the Income Tax Act to include amounts received under the dental benefit act under subsection 81(1) — Amounts not included in income.
It also amends the Income Tax Act’s Excise Tax Act and Excise Act, 2001, to permit confidential information to be provided to an official at the Canada Revenue Agency or Health Canada in order to administer and ensure the integrity of the benefit. I look forward to your questions.
Senator Marshall: Ms. Tomson, your explanation was very helpful. I’m able to narrow down my question. How do you verify that the applicant was actually entitled to the benefit and that it was used for dental care? The post-audit process — that’s what I’m calling it because that’s what it sounds like it is — that will be carried out after the cheque is issued, has that already been established or is it almost established?
Ms. Tomson: In terms of the front end of your question — determining eligibility — because CRA administers the Canada child benefit — you have to have access to the Canada child benefit — these children are known to the CRA, so they are already able to determine based on the income that is that child of that parent. There is a lot of upfront that is done.
As I mentioned, the parents then need to attest to different elements and also provide information. Once all of that is collected and assessed, the benefit is an upfront amount so that could be used to purchase dental care services given the populations that this is targeting. Parents are expected to keep receipts so that after the fact CRA can then do compliance. It is based on existing models of compliance. I don’t know if Ms. Pranke has something more to add on the compliance piece to this.
Senator Marshall: Thank you very much. That’s good. Thank you.
Senator Smith: Question for Health Canada and the Public Health Agency. Following up on some of the conversations that arose during our first panel. The increased participation rate of Canadian families seeking dental services as per the dental benefit will increase demand for these services. Simple economics suggest that increase in demand leads to higher prices. Has the government analyzed the potential for higher dental fees as a result of these benefits?
Ms. Tomson: In terms of establishing the dental fees, that is being done at a provincial level. Dental professionals — and I’ll turn it over shortly to Dr. Taylor to explain that piece — can then use that as a guidepost. It can go above or below. That is set by the provincial levels. It is for all practitioners within the province.
Dental care is, in large part, delivered by these private practitioners, and there are many private plans that do follow. By trying to establish if rates are raised because of this benefit, we don’t know if that will happen in the marketplace. I don’t have data in terms of sensitivity analysis as to if that were and the impacts. We know there are about 500,000 children that will be benefiting from this interim benefit across the country.
There are already shortages in certain areas. Urban areas are more dense with dentists, we know, but there are dental hygienists in certain areas that have shortages. That’s why this benefit, too, is not just aimed at dentists but at the broader profession to ensure that we do have possibilities of the greatest access to services, and we don’t expect in the short term to be much movement. That is obviously something we’re taking into account as we’re thinking about what the long-term program would consist of.
The Chair: Dr. Taylor, any additional comments?
Dr. Taylor: Thank you very much, Mr. Chair. As Ms. Tomson was saying, these fee guides are set in each of the provincial-territorial jurisdictions by independently practising regulated professions, and they’re set to the Uniform System of Coding and List of Services, or USC&LS, that is set out by the Canadian Dental Association, which is the grid against which the individual fees are assessed. But in my many years — and I won’t say how many — of being a licensed dentist and watching the processes by which provinces and territories set those fees, the associations — and I do understand it’s set by a private association — in my experience, it’s more based on cost of materials, cost of labour and not simply a supply and demand process.
Now, I don’t want to speak on behalf of the provincial associations. The Canadian Dental Association is in a much better position to help with that, but I will say I don’t think that’s going to be a factor. Understanding that $1.7 billion a year going into a $16-to-$17 billion annual industry is not going to turn the industry on its head.
I will be happy to respond to further questions if I’ve been unclear or if I have used too much technical terminology.
Senator Omidvar: I’m reminded of a time in 2016 when a family of 12 Syrian refugees that we had sponsored arrived. Eight of them were children. Their teeth were shot through completely because apparently too much candy is distributed in the camps. I can tell you that the $650 per child would have made a huge difference, but instead we had to rely on the volunteer spirit of the dental community. So I welcome this benefit from lived experience in a sense.
My question, though, is to the officials from the CRA and it is about the 10 to 12% of Canadians who do not file an income tax return. Could you describe your “Get ready” strategy for us, and could you tell us whether you have indicators and benchmarks for performance built into the strategy, so that you can evaluate whether or not the strategy was successful and whether you have a goal in mind for the percentage of Canadians who will file their income tax return off this 10 to 12% that do not?
Ms. Pranke: Thank you, Mr. Chair, for the question. With respect to the “Get ready” campaign, it’s a campaign that was launched. It was available on the Canada.ca website. It was launched the day the bill was tabled or following the tabling of the bill in Parliament. That is a campaign that is explaining to citizens what they need to do now. There are two main channels for individuals to access these benefits. It would be either doing so through the secure portal, the CRA My Account, or, alternatively, through My Service Canada Account. They can link through that channel, therefore online. There is also an opportunity for individuals to apply by telephone.
The “Get ready” campaign encourages individuals to sign up for a My Account if they don’t currently have a My Account and to sign up for direct deposit if they don’t currently have direct deposit.
I can speak very briefly with respect to take-up rates. As my colleague Lynne Tomson made reference to, the dental benefit is anchored in many of the controls in the systems that exist for the Canada child benefit, and the vast majority of individuals who are in receipt of the Canada child benefit currently have a My Account. So they have online access to their account, and the vast majority as well are signed up for direct deposit.
If this legislation is passed in Parliament and receives Royal Assent, we’re quite confident that when the program launches that individuals who are applying for the dental program will be able to do so fairly seamlessly. I think that’s an important piece for you to know.
As far as other things that we’re doing in the Canada Revenue Agency to help people get prepared, we are looking at a mail-out campaign that could be used. We’re also leveraging our partners in the Community Volunteer Income Tax Program to get the message out. We’re looking at lots of different ways to make sure citizens are aware of this new program. We’re working closely with our colleagues in Health Canada in that regard.
I would also like to mention, you talked about the non-filer rate. One thing I think is important for this committee to know is that for the past several years — going back to at least 2014 — the Canada Revenue Agency has been working to identify individuals who aren’t filing taxes, and not simply those who aren’t filing taxes that would clearly be in a position where they owe the Canada Revenue Agency money, but we’ve been focusing on individuals who are in the lower and modest income levels who are not availing themselves of the benefits and credits to which they’re entitled.
This is a program that we’re continuing. We’ve continued it throughout the pandemic, and as a result of these efforts we have seen and we continue to see an increase in the number of individuals who are availing themselves of benefits and credits.
If I may give you an example from 2020, there was $40 million paid out in refunds to individuals who otherwise wouldn’t have been able to access these benefits. For the Canada child benefit, there was over $15 million in benefits paid out.
Those efforts that the Canada Revenue Agency has undertaken for the past several years are helping identify those, particularly in the vulnerable sector, who are not accessing benefits and credits.
Senator Omidvar: [Technical difficulties] there was one positive outcome of the COVID crisis, it is that more people are now filing their income tax returns because people are generally more aware that that’s the trigger for benefits.
Ms. Pranke: Pardon me, Mr. Chair, I want to understand the question.
Senator Omidvar: I wondered whether you can assign the credit for the increased rate of tax filings to your efforts or to the increased awareness through the COVID crisis that benefits are generated from filing income tax returns.
Ms. Pranke: Thank you for the question, Mr. Chair. I would speculate here, but I would speculate that it’s likely a combination of both. You’re absolutely correct in that there is a requirement. These programs are rooted in a requirement to validate income, and individuals need to have filed a tax return in order to validate income.
One item I’d like to point out is unlike the early COVID programs, both the Canada dental program and the Canada Housing Benefit program require that there be a 2021 tax return on file. It’s a firm time frame. It’s not a sliding window, which was the case with the Canada Emergency Response Benefit. With respect to validation integrity, there is a requirement to peg eligibility against income that has been reported as one of the factors. But there are many matters or initiatives that help increase filing rates across the country.
Senator Pate: My question is for Health Canada. Thank you for the information you provided about the long-term benefits of health care. I’m wondering if you’ve done any combination with either the Auditor General, Canada Revenue Agency or the Parliamentary Budget Officer to look at what the actual cost savings are long-term in terms of providing these kinds of benefits and saving in emergent health care-related costs down the road. And if not, if you would be willing to undertake that.
Ms. Tomson: Thank you for the question.
We do know there are significant social and economic consequences of poor oral health. You just mentioned emergency rooms. About 1% of emergency room visits are made by patients with non-urgent dental conditions that do have a cost to the health care system. About $1.8 billion was estimated in 2017, for example.
Children do miss a significant number of school days due to oral health pain, about 2.6 million school days missed. A significant number — 57% of children between 6 and 11 years old — do have a cavity with an average of 2.5 teeth affected by decay. Those are significant impacts of poor oral health.
That is something we want to assess, especially on the preventive side with the importance of investing in the preventives so that there are cost savings later on, especially with children as they progress through the years. Earlier detection, earlier care will have less cost on the system at large.
I don’t have specifics with the program and what we’re trying to achieve in terms of those quantitative outcomes, but that is something that we are looking into as we look into establishing a long-term program for dental care.
Senator Boehm: I explored the history a little bit of the Rowell-Sirois Report in 1940 on federal-provincial relations — or dominion-provincial relations as they were known then — which concluded that dental care should be a full part of the essential services offered on health. It concluded that with the shortage of dental professionals, there might be a problem. There was a similar conclusion in 1964 with the Hall Commission.
My question is for Dr. Taylor, initially. In your overview of dental services in the country, do you think there are enough dental professionals to handle what might be a surge — or might not be? Could this also move towards recognizing the credentials of newcomers who are coming to Canada who might be qualified?
I would be interested in your comments on that.
Dr. Taylor: Thank you for your question, senator. Before passing over to my colleague, Ms. Tomson, on the specifics of health human resources and how Health Canada is working in that regard, as was mentioned by a previous witness, the primary issue is distribution of oral health care professionals with a paucity in rural areas, northern areas, remote areas and inner cities.
Realizing that there are current pressures in several of the regulated oral health professions with regard to numbers that they are working hard to address through training, currently I would say it’s more a question of distribution of providers.
Senator Boehm: Thank you.
Is there a follow-up comment, perhaps?
Ms. Tomson: If I may, in terms of this interim benefit, it is aiming for children under 12. We are estimating there are about 500,000 children that will have access to this benefit. This is spread out across the country.
Knowing that there are differences across the country — urban, rural and remote areas — that is also why the bill does explain and allow for oral health practitioners — so not only dentists, but oral hygienists and different practitioners — to ensure there is still access across the country.
In the longer term, the elements you mentioned in terms of recognizing credentials or other things we could support for professional development and training — those are all elements that we are taking into account as we think about the longer-term program.
Senator Boehm: This is for Public Health Agency of Canada, but Health Canada might want to jump in, too.
One of the biggest issues when it comes to benefits is ensuring that people who are eligible not only apply, but that they know about the program in the first place. We’ve heard some references to outreach that is being undertaken, particularly with hard-to-reach and vulnerable populations.
I would like to know if there is any plan to get information out in languages beyond English and French, so Indigenous languages and other languages that might include newcomers to Canada.
The last part is, as we’ve seen during the COVID period, misinformation and disinformation are a growing concern on many subjects, and health, of course, is no exception. Is there any concern about misinformation around the Canada Dental Benefit and dental and oral health in general? If so, is there a plan to combat that?
Dr. Taylor: Thank you for the question, senator.
On my side of the house, I will defer to my colleague from Health Canada because that’s where the communication campaign around this program will take place. I do agree that outreach will be an important element of that.
Ms. Tomson: Thank you.
We are planning on a large communication and outreach program. It’s already started with “Get ready.” Once Parliament provides the passage of the bill and we receive Royal Assent, another launch of the program will be undertaken.
It’s based on a couple of pillars. There will be an extensive internet and social media campaign. We are looking at advertising as well, and preparing materials that could be downloaded by various oral health practitioners to really be able to communicate with the various populations. There is a very robust program in place.
This is a benefit. When you say could there be confusion, we really want to be clear that this is an interim benefit for two years only as the federal government looks at implementing a program. This isn’t a program. It’s an interim benefit to really support children in its first instance as we look at broadening it, as per the parameters of the budget.
We will be getting statistics from CRA to see what the uptake is by provinces so that we can always readjust the campaign as well.
In terms of various languages, that is my understanding, but I will turn it over to my colleague Lindy VanAmburg, Director General, who is responsible for the Dental Care Task Force, to add a little bit more on that point.
The Chair: Ms. Tomson, I’ll direct my comments to you: Can you send that additional information in writing, please, to the clerk on that last question in order that I can permit all the senators around the table to ask questions to the four departments?
Is that okay with you, Ms. Tomson, that you will answer that last part of the question in writing?
Ms. Tomson: Absolutely, yes.
Senator Duncan: Thank you to the witnesses who have appeared before us today.
My question is following up on Senator Boehm’s question regarding availability of services. There was mention of northern, remote and rural areas and service availability.
Dental services are covered under non-insured health benefits, so the Indigenous population will not be accessing, necessarily, these services. Their dental services are provided by non-insured health benefits, but that’s also dependent upon the ability to access the services.
I would like to hear a plan to ensure that not only will the services be available in northern, remote and rural areas, but that those services will continue to be available and we won’t see a drain of services to Southern Canada where there are services already available.
Ms. Tomson: Thank you for the question.
As you mentioned, non-insured health benefits is a public program. It is a comprehensive public program based on medical needs. It is not income tested.
This is really meant to be filling the gaps. It is for dental care services.
Again, this is an interim benefit meant to provide some access to children under 12. We don’t expect — we’ve been consulting with various associations; I believe some are coming to this committee later — that there will be that movement in the next two years.
Senator Duncan: Thank you. I appreciate this. What this emphasizes is that this is targeted at more Southern Canada than it is about Northern Canada, because we access the services differently. I fully support that initiative.
I would just like to follow up with CRA in terms of my concern, which is that individuals will be caught in a bit of a bureaucratic public service tangle when filing their income taxes and dealing with CRA in terms of this particular benefit.
If I could ask our CRA representative to address how the agency intends to handle this benefit program as it intersects with non-insured health benefits and Northern Canadian residents. Also, where have we received some of the numbers for the benefit of the program?
Ms. Pranke: Thank you for the question, chair. I believe my colleague, Ms. Tomson, will want to add with respect to some of the numbers.
In response to your question as far as interactions with CRA and what the service experience will be for applicants — and your emphasis particularly on those in northern and rural areas — we currently are working to make sure that we have expanded our contact centre operations. We’ll have employees who are there that can respond to questions and assist individuals with the application process in the event that they’re not able to or not interested in applying for the dental benefit through the online process.
I’d also like to point out that in 2019 there were three northern service centres that were created that are staffed by CRA employees. Around that same time, there was a dedicated line that was established for northern residents. There is a dedicated line for individuals from that community as well that’s available that is fully accessible to citizens in the North.
The expectation is that individuals will be able to apply either online or through the phone channel. We’re making efforts to ensure that the service experience is as positive as possible.
There was a question with respect to language and availability of information. I can share with you at the present time there’s information on the Canada child benefit, which is the gateway to this proposed Canada Dental Benefit. The information on this Canada child benefit is available in 12 Indigenous languages. That information is currently out there. We will look to expand it in the event that this bill passes in the House and receives Royal Assent.
The Chair: Thank you, Senator Duncan.
Honourable senators, and to the witnesses, we have three senators in order to complete the round: Senators Loffreda, Harder and Dagenais. If we are precise on the question and succinct, in the event that time does not permit us, I will be asking the officials of those departments to complete their answer in writing. Do we have agreement on that, officials? Yes.
Senator Loffreda: Thank you to our panellists. I welcome this benefit. I think all Canadians should have access to dental care; it’s so important in our overall health.
Dr. Taylor did state that it’s an addition $1.7 billion in a $17 billion industry. That increase of 10% won’t turn the industry on its head. I’m sure many will argue that. In today’s day and age, I’m sure that many entrepreneurs would welcome a 10% increase in their business.
My concern is on capacity. Based on my discussions — and maybe you can reaffirm the facts — we are not short of dentists, but we may be short of hygienists. Will that increase demand or salaries to the point that inflation will be a concern?
Looking ahead to the impact on corporations because you did mention, Dr. Taylor, that 25% of Canadians have no dental insurance. Twenty-two percent don’t have dental care because of costs. But 75% of Canadians do have health insurance. If we look ahead and this is expanded eventually, or even today, will corporations say let’s cut the insurance and then we will have the boomerang effect where fewer Canadians will have access to dental care?
Dr. Taylor: Thank you, senator, for the question. I’ll defer on the access question to my Health Canada colleagues in particular with regard to the boomerang.
I can say that, yes, indeed, there are shortages of dental hygienists and dental assistants. But again, the main issue is distribution — rural versus suburban versus urban.
We are currently, in those specific conversations, taking those into account. Our Health Canada colleagues are currently consulting with the professional associations and the academic community that trains those professionals on exactly how to figure those dynamics into the plans going forward. I will defer the specific nature of those conversations to my Health Canada colleague.
Ms. Tomson: In the interests of time, as I have mentioned, this bill that will be before this committee is about a two-year interim benefit targeting children.
Based on conversations that we have had with industry, we do not see a displacement at this time for this benefit. Those are all important issues that you have raised.
Displacement is a concern. The development of the oral health care professional is a concern. Those are all elements that we need to take into account as we design and think about the longer-term program.
Senator Loffreda: Thank you.
Senator Harder: Two quick comments and then a question.
Number one, I would encourage officials as they move forward to a broader program to be more upfront on the capacity issue, particularly the distribution.
Number two, I’d encourage you to make a broader case for the cost in terms of both health outcomes, but also where the savings might be, as Dr. Taylor has already said, where they may come in the emergency rooms. I suspect there are other costs to health care that we’re not capturing in the material thus far.
My question — and I’m happy to have this in writing — the PBO earlier today said in respect of the administrative costs identified in the material that it was “very generous.” I suspect that in “bureaucratese” means highly inflated. Is that your view? If so, how did you come up with the administrative cost sum? Thank you.
The Chair: Your question was directed, Senator Harder, to?
Senator Harder: The administrative cost experts. I would assume Ms. Pranke and Ms. Tomson are the principals in the architecture.
Ms. Pranke: Thank you for the question, chair. I can start.
We have been working closely with our colleagues in Health Canada with respect to specifically the Canada Dental Benefit, the proposed benefit, to determine what our portion of the costs would be to deliver. Of course, they have their portion of their costs.
I can share with you that we have learned many lessons in delivering benefits that are designed in a condensed period of time. Lots of lessons learned from the CERB and other benefits, hence, you know, why there is this requirement to link the delivery of the Canada Dental Benefit to a tax-filing year so it’s clear to be able to assess eligibility.
As far as the requirements for the Canada Revenue Agency specifically, we’re ensuring that we have the appropriate level of coverage to deliver service. These benefits are available to citizens. The proposal is that the benefit is launched on December 1, so we are making sure that we’ll have the appropriate contact centre capacity to be able to serve citizens for that first application period, which ends June 30.
The Chair: Ms. Pranke and Ms. Tomson, could you continue that answer to that question in writing please?
[Translation]
Senator Dagenais: The witnesses can follow up with written responses.
My first question is for Ms. Pranke. You are responsible for administering the dental care plan under an existing program. You work at the CRA. The agency had to hire more staff to administer the CERB, the Canada Recovery Benefit and other emergency supports. I assume you’ll have to hire more people to administer the dental care benefit.
How many more people do you plan to hire? We are talking about dental care, here, so I imagine they will be people who are familiar with dental services. Will you be contracting out any of the work? How much more funding will you need? You can get back to us in writing, if you like.
Ms. Tomson, you talked about insurance companies. It’s a well-known fact that dentists always charge more for their services if the patient has insurance versus if the patient is paying out of pocket. The Parliamentary Budget Officer, himself, told us there wasn’t a fee schedule to limit the dental expenses. Do you think it’s normal not to have any such controls in place?
You can get back to us in writing, if you like. We always appreciate written responses, because when you have the information in writing, you always have it.
The Chair: I’m going to end the meeting now. Our sincere thanks to the witnesses for being here today. Your participation was greatly appreciated.
[English]
Before adjourning this meeting, I would like to remind the witnesses to please submit written responses to the clerk by the end of the day on Wednesday, November 2, 2022. This said, I would also like to inform honourable senators that our next meeting will be tomorrow evening, Wednesday, October 26 at 6:45 p.m. to continue our study on the subject matter of Bill C-31. Thank you very much.
(The committee adjourned.)