THE STANDING SENATE COMMITTEE ON NATIONAL FINANCE
EVIDENCE
OTTAWA, Tuesday, December 5, 2023
The Standing Senate Committee on National Finance met with videoconference this day at 9:03 a.m. [ET] to consider Supplementary Estimates (B) for the fiscal year ending March 31, 2024; and Bill C-241, An Act to amend the Income Tax Act (deduction of travel expenses for tradespersons).
Senator Percy Mockler (Chair) in the chair.
[English]
The Chair: I wish to welcome all of the senators as well as the viewers across the country who are watching us on sencanada.ca.
[Translation]
My name is Percy Mockler, senator from New Brunswick, and Chair of the Standing Senate Committee on National Finance. I would now like to ask my colleagues to introduce themselves, starting on my left, please.
Senator Forest: Welcome to the committee. My name is Éric Forest. I’m an independent senator for the Gulf senatorial division in Quebec.
[English]
Senator MacAdam: Jane MacAdam, Prince Edward Island.
[Translation]
Senator Loffreda: Good morning. Senator Tony Loffreda from Quebec. Welcome.
[English]
Senator Pate: Welcome. Kim Pate. I’m here in the unceded, unsurrendered territory of the Algonquin Anishinaabeg.
Senator Smith: Larry Smith, Montreal, Quebec.
Senator Marshall: Elizabeth Marshall, Newfoundland and Labrador.
[Translation]
Senator Dagenais: Jean-Guy Dagenais from Quebec.
The Chair: Thank you, honourable senators.
[English]
Today, we resume our study on the expenditures set out in the Supplementary Estimates (B) for the fiscal year ending March 31, 2024, which was referred to this committee on November 21, 2023, by the Senate of Canada.
[Translation]
Today, we have the pleasure of welcoming senior officials from the Canada Mortgage and Housing Corporation, CMHC, Correctional Service Canada, CSC, and Employment and Social Development Canada, ESDC. Since there are many of you here, I’ll introduce the officials who will be making opening remarks and ask the others to please introduce themselves if they are called to the table to answer a question.
So, from the Canada Mortgage and Housing Corporation, we have Romy Bowers, President and Chief Executive Officer; from Correctional Service Canada, Tony Matson, Assistant Commissioner, Corporate Services; from Employment and Social Development Canada, Karen Robertson, Chief Financial Officer and Senior Assistant Deputy Minister.
[English]
Welcome to all of you, and thank you for accepting our invitation to appear in front of the Senate’s National Finance Committee to answer questions on your budgets.
We will start with opening remarks from Ms. Bowers, to be followed by Mr. Matson and then to be concluded with Ms. Robertson.
Ms. Bowers, the floor is yours.
Romy Bowers, President and Chief Executive Officer, Canada Mortgage and Housing Corporation: Thank you very much, Mr. Chair. It’s a pleasure to speak to you here on the traditional, unceded territory of the Algonquin Anishinaabeg people.
[Translation]
As Canada’s national housing agency, CMHC exists to house Canadians. Our commercial products, like mortgage loan insurance, play an important role in supporting a stable, well-functioning housing finance system. Our research and policy experts provide trusted knowledge so that all participants in the housing system can make better decisions.
Finally, we deliver key programs through the multi-billion-dollar National Housing Strategy that are creating homes for people across the housing continuum.
[English]
As this committee knows, Canada needs more homes, and it needs them by the millions. Our research shows that, to restore affordability by 2030, Canada needs to create 3.5 million more homes than it is currently on pace to build. This will take a monumental effort that calls upon the federal government to use a whole range of measures that create new homes and maintain existing ones all along the housing continuum.
Today, I’m here to provide information about the specific initiatives supported by the supplementary estimates referred to this committee. Each of them plays an important role in helping Canadians to keep a roof over their heads in these difficult times.
First, our most vulnerable neighbours will have access to more affordable housing through the Rapid Housing Initiative and the National Housing Co-Investment Fund, renamed in the government’s Fall Economic Statement as the Affordable Housing Fund. Middle-income renters will benefit from funding for the Rental Construction Financing Initiative, now known as the Apartment Construction Loan Program. It will provide more low-cost, fully repayable loans to developers to build much needed purpose-built rental homes.
Homeowners will also benefit from two initiatives supported by the supplementary estimates. The residential flood insurance program will help protect households at a high risk of flooding that don’t have access to adequate insurance. This is especially important with the increased frequency of severe weather events. There are also funds to help property owners in Quebec who need to remediate their homes due to foundation damage caused by pyrrhotite.
Some of the reprofiled funding will help Indigenous people in communities across the country who face some of the greatest levels of housing need. This includes funding to co-develop, with Indigenous partners, the Urban, Rural and Northern Indigenous Housing Strategy and more support for safe places to shelter as part of the Shelter Initiative for Indigenous women and children program.
[Translation]
As this committee knows, fixing Canada’s housing crisis is one of the biggest challenges of our times. Canadians are struggling and they are calling on the federal government to take decisive, meaningful action — the kind of action that’s only possible with an all-hands-on-deck approach to housing.
[English]
The programs I’ve mentioned are key to this approach. Together with other measures proposed in the Fall Economic Statement, they will help reach our shared goal: housing affordability for everyone in Canada.
Thanks again for the opportunity to present more information about these programs. I’m happy to answer any questions that this committee may have.
The Chair: Thank you, madam. Mr. Matson, the floor is yours.
Tony Matson, Assistant Commissioner, Corporate Services, Correctional Service Canada: Good morning, Mr. Chair and members of this committee. It is a pleasure to be here with you once again at the Standing Senate Committee on National Finance to speak to the Correctional Service Canada’s Supplementary Estimates (B) for the fiscal year ending March 31, 2024.
[Translation]
My name is Tony Matson, and I am the Assistant Commissioner, Corporate Services, and the Chief Financial Officer for the Correctional Service of Canada.
[English]
I am pleased to be here today with both Jay Pyke, Acting Senior Deputy Commissioner and France Gratton, Assistant Commissioner, Correctional Operations and Programs.
I will take this time to briefly highlight some of the significant investments being sought in these supplementary estimates.
[Translation]
My statement will be brief to allow more time for questions from the committee members gathered here today.
[English]
Through the Supplementary Estimates (B), the Correctional Service Canada is requesting $303.5 million. Specifically, Correctional Service Canada is seeking Treasury Board authority to increase its appropriations by $290.6 million to support operations and legal obligations, $13.3 million for statutory requirements as well as authority to transfer $400,000 to other departments.
Of these amounts, the largest component is related to a reprofiling of funds for a class action lawsuit associated with the previous administrative segregation regime, which was abolished back in 2019 and replaced by a historic transformation of the federal correctional system and the establishment of structured intervention units, or SIUs. Additionally, $45.6 million is being sought to support increasing operational workers’ compensation costs.
[Translation]
As I am sure you can all appreciate, in the field of corrections, the nature of the work can be difficult and unpredictable.
[English]
In order to ensure the safety of our institutions and communities, we are required to ensure operational posts are adequately staffed at all times. The approved funding will be used to support pressures related to workplace injuries and permit the Correctional Service Canada to continue to maintain operations and support our legislated requirements.
Another element is $42 million in funding, which will address financial pressures due to fluctuations in offender population levels and/or price inflationary pressures on specific quasi‑statutory items.
In terms of other expenditures being sought, these Supplementary Estimates (B) also include a request of $15.1 million for equipment and licences to maintain a hybrid workforce. Associated costs are for additional information management and information technology devices and licences to respond to the increase in remote work requirements.
Additionally, contained within these Supplementary Estimates (B) are investments for maintaining enhanced cleaning protocols across correctional facilities, funding to make infrastructure changes designed to improve inmate safety as well as funding to increase capacity to foster a timely resolution of offender grievances. Together, our funding requests support the Correctional Service Canada’s ongoing work to create safer institutions for employees and offenders as well as safer communities for all Canadians.
[Translation]
I’ll be pleased to answer any questions you may have.
[English]
The Chair: Thank you, Mr. Matson. Ms. Robertson, the floor is yours, please.
[Translation]
Karen Robertson, Chief Financial Officer and Senior Assistant Deputy Minister, Employment and Social Development Canada: Good morning, Mr. Chair and members of the committee.
First, I’d like to acknowledge that the land on which we gather here today is the traditional unceded territory of the Algonquin Anishinaabeg people.
I am pleased to appear before you in my capacity as Chief Financial Officer for Employment and Social Development Canada, ESDC. I’m also accompanied by a few of my departmental colleagues. They will help me provide additional details and perspective on the items that are included in the department’s Supplementary Estimates (B).
The department delivers a range of programs and services that affect Canadians throughout their lives. For example, we provide seniors with basic income security, support workers, help students finance their post-secondary education and assist parents who are raising young children.
Through the Labour Program, we also have the mandate to maintain a strong, productive, healthy, and competitive workplace within federal jurisdiction.
Moreover, Service Canada delivers ESDC’s many programs to citizens, as well as other Government of Canada programs and services.
Allow me to present to the committee an overview of ESDC’s portion of the 2023-24 Supplementary Estimates (B) tabled on November 9, 2023.
[English]
As part of its Supplementary Estimates (B), Employment and Social Development Canada, or ESDC, is seeking $402.2 million in voted appropriations. This includes a net increase of $106.5 million under vote 1, operating expenditures; and $295.7 million under vote 5, grants and contributions.
Supplementary Estimates (B) includes several measures announced in Budget 2022 and Budget 2023. I would like to take a few minutes to highlight some of these initiatives.
Budget 2023 announced the continued investment of $200 million for Labour Market Transfers with provinces and territories to maintain investments from Budget 2017, which had sunset on March 31, 2023. These agreements enable provinces and territories to provide skills training and employment programming with a focus on those further removed from the labour market and those wishing to upskill.
Budget 2022 proposed $625 million over four years, beginning in 2023-24, for the Early Learning and Child Care Infrastructure Fund. These supplementary estimates include $75 million, which will enable provinces and territories to make further investments in child care infrastructure that support greater inclusion in the Canada-wide early learning and child care system for underserved communities.
Additional commitments of $60 million were announced in the Fall Economic Statement 2022 for the Community Workforce Development Program. Included in these supplementary estimates is $19.8 million to create supplemental supports to existing federal and provincial or territorial programming. Projects funded through this program will respond to the needs of local displaced workers and their communities.
Budget 2023 committed $48.2 million over two years to improve the employer compliance regime under the Temporary Foreign Worker Program, including more program inspectors and maintenance of the worker protection tip line. Building upon Budget 2022 commitments, these supplementary estimates include $12.1 million to specifically allow ESDC to continue making improvements to the quality of inspections and hold employers accountable for the treatment of workers.
Additionally, Budget 2022 announced $29.3 million over three years for the Recognized Employer Pilot for the Temporary Foreign Worker Program, which includes $10.6 million in these supplementary estimates. This pilot program is designed to reduce administrative burden and simplify the hiring process for employers who regularly access the program.
In 2020, the government committed to implementing the Canada Disability Benefit. Budget 2023 provided $21.5 million to ESDC and the Canada Revenue Agency. Included in ESDC’s supplementary estimates is $10.5 million to support initial implementation. This benefit is a cornerstone of the Disability Inclusion Action Plan and is intended to reduce poverty and increase the financial security of working-age persons with disabilities.
Finally, these supplementary estimates also include $54.2 million in funding reprofiled from previous years into 2023‑24 for the Benefits Delivery Modernization, or BMD, programme. This funding is key to completing the work required to onboard Old Age Security, or OAS, onto BDM successfully.
[Translation]
I hope this overview has given you a better understanding of the Supplementary Estimates (B) for our department.
My colleagues and I would be pleased to answer your questions.
The Chair: Thank you very much, Ms. Robertson.
[English]
Honourable senators, we will move immediately to questions, with five minutes each for the first round.
Senator Marshall: Thank you to all the witnesses for being here. I’m going to start with Ms. Bowers.
You mentioned in your opening remarks the rental property rebate, which hasn’t been approved yet because the bill is still going through Parliament. When Mr. Dugan appeared here a few months ago, he said that there hadn’t been any assessment done as to the impact of the program. We saw in the fiscal update that is laid out, I think, that it’s around $4.5 billion over six years. Is there any assessment done now of that program as to what impact it’s going to have on the shortage of housing over the next five to six years?
Ms. Bowers: Thank you very much for that question. We’re still doing that analysis and I don’t have that number in front of me. Once we have it available, I will be happy to provide it to this committee.
Senator Marshall: You don’t have the number yet.
Ms. Bowers: We don’t.
Senator Marshall: You’re still working on the number.
I was looking at what was in the fiscal update, and I used the $25,000 rebate, which is a number that the minister had used. I estimated that over the next five to six years, it should work out to maybe 30,000 units a year. I was looking at the 3.5 million houses that are needed, which would be half a million houses per year, and then I tried to compare it to the 30,000 that I calculated.
Is there any kind of overall plan that would indicate how the government is hoping to get to the 3.5 million deficit in homes? It seems like it’s being done on a piecemeal basis right now.
Ms. Bowers: In terms of the number, the 30,000 number seems quite low to me. Part of the reason why we need more time to do the assessment is because it’s very difficult to estimate the number of housing units that will be created because there are many factors that contribute to housing production, including things like interest rate trajectory, the availability of skilled labour and local conditions that impact housing delivery.
What I would like to highlight is that when you’re thinking about housing in Canada, it is mostly created by the private sector. The government creates conditions and makes changes to create housing, but it’s actually private sector actors that create the housing. If you listen to some of the recent comments made by the housing minister, Minister Fraser, he talks about the multiple different measures that are in place to create those conditions for housing. One I would highlight is the Housing Accelerator Fund, which provides incentives for municipalities to change local conditions.
Senator Marshall: I’m familiar with that. Is there an overall plan? We know there is a 3.5 million deficit at the end of six or seven years. It just seems like there are things being done on a piecemeal basis. Is there an overall strategy that we can look at to see how the government intends to get there? I do realize there is a role for the private sector. I just need an answer. Is there a plan yet?
Ms. Bowers: No, there is not a plan, but my understanding is that it’s in development.
Senator Marshall: Thank you.
There are not many details surrounding the rental property rebate. My understanding is that there is going to be some regulations that will further define the program, how it will be administered, et cetera. When are the regulations expected? I would think that the private sector would be interested in the program, but without the regulations they really don’t know what the program is about. When do you expect to have the regulations done?
Ms. Bowers: This is not really a question for the Canada Mortgage and Housing Corporation, or CMHC. This is a tax legislation, so it’s the Department of Finance officials who are responsible for that. I think it’s best to direct this question to them.
Senator Marshall: But will CMHC will be responsible for administering the program?
Ms. Bowers: I think you’re talking about the GST rebate. This is not the responsibility of CMHC.
Senator Marshall: Okay.
This question is for ESDC. I want some information on the Benefits Delivery Modernization programme. I’d like to know if you have any current numbers with regard to that computer system. Who is in charge of implementing that system within the department? Do you have your own chief information officer?
Ms. Robertson: We absolutely have a chief information officer, senator. We have a deputy minister responsible for that programme, Cliff Groen. One of my colleagues here today, Susan Ingram, is one of the assistant deputy ministers responsible.
Senator Marshall: I’d like some information as to revised timelines and revised cost estimates. It is a major program, and the Auditor General has some serious concerns with regard to the programme. Is there someone here who can answer a few questions briefly?
Ms. Robertson: Ms. Ingram will join me, but you can ask me the questions too because I’m the chief financial officer and I’m familiar with the financial profile of the program.
Senator Marshall: The completion date was estimated to be December 2023, then it was moved to next year and then it was contemplated that it wouldn’t be until December 2025. Is there a new date now? Is 2025 firm?
Ms. Robertson: Senator, may I ask for some clarification, please? I think you’re speaking specifically to Old Age Security going on to the platform.
Senator Marshall: I am, yes. I realize there are three components.
Ms. Robertson: Okay, thank you.
Susan Ingram, Assistant Deputy Minister, Program Strategy and Design, Benefits Delivery Modernization, Employment and Social Development Canada: Excellent. Good morning. Thank you for the question. My name is Susan Ingram, Assistant Deputy Minister, Program Strategy and Design, Benefits Delivery Modernization programme within ESDC.
The Auditor General had raised the concern around the possibility of potential delays in the programme. However, we did achieve our very first milestone in the implementation of OAS on BDM this summer on time and on schedule. In June 2023, we launched the OAS benefits for international benefit recipients, and now 600,000 clients are being served through the programme. We are currently on schedule for December 2024, and work is continuing to progress with that date.
[Translation]
Senator Forest: Thank you very much for being here this morning. We know we’re going through a major crisis, particularly when it comes to housing.
My first question is for Ms. Bowers.
The National Housing Co-Investment Fund, which includes a component dedicated to housing victims of domestic violence, is an effort that has been unanimously praised. However, this summer, I heard a vigorous critique of the Alliance of second-stage shelters for women and children who are victims of domestic violence. This raises two main issues.
Firstly, before the first instalment can be obtained, 50% of the work would have to be completed, which I think is quite a large figure. Secondly, there are energy efficiency requirements, according to which a 55% gain has to be improved.
In terms of social housing, housing co-operatives or non-profit organizations are supported by municipalities, which carry out these projects. We haven’t talked much about this until now.
Have these criticisms led you to make certain changes to the program? This is an important and very relevant program, given the urgency of the needs, particularly in this sector.
[English]
Ms. Bowers: Thank you for that question. With respect to the co-investment fund, this is one of the flagship programs of the National Housing Strategy. CMHC has had many lessons learned since the program was launched in 2018. I recognize the difficulties that non-profit organizations have had in accessing the programs. We have made a concerted effort to make the process simpler and to simplify the documents that are required. We’ve reduced the processing times by about 50%.
Having said that, it is mostly a loan program. CMHC does have to conduct financial due diligence to ensure that the funds are being used as they were intended. This may not apply as much to shelters because most of those are grants, but we still need to do some level of due diligence. There are opportunities to improve, but we have made concerted efforts.
With respect to the energy efficiency, we had very ambitious targets in terms of the climate-compatible features of all housing supported by the National Housing Strategy. We have made modifications to some of these requirements, especially for repair projects. For the new builds, we continue to try to support the non-profits to achieve the ambitious targets of the government.
[Translation]
Senator Forest: I hope there will be changes allowing for slightly more flexible rules. My second question is again for Ms. Bowers.
Since I was mayor in a previous life, CMHC was our partner. We took full advantage of it and I think you’re really a key player. The program is so important on a Canadian scale, that all first-level stakeholders need to work together.
Have there been any consultations with municipalities, non-profit organizations, housing co-operatives and the provincial government so that we can join forces for this huge effort that needs to be made for housing, particularly affordable housing — especially knowing that there’s a project coming up that should give tax credits for all rental housing stock?
So, my question is about how we can really stimulate affordable housing. I have the impression that a private company is rather quickly going to take over housing projects that will be more “luxurious.”
[English]
Ms. Bowers: Thank you for the question and for recognizing the importance of CMHC. CMHC is a very important public institution. It’s been an honour to be the CEO of the organization.
I agree with you 100% that the way to address affordability challenges is all levels of government working together with the non-profit sector to provide affordable housing. Canada has a very low level of social and community housing relative to the G7. We have about 16 million housing units in Canada. Less than 4% are social housing units. The G7 average is 8%.
We have not invested in social housing for many decades. This deficit is the result of that underinvestment. It is very difficult from a fiscal perspective to overcome this deficit in a very short period of time. There are many opportunities to work with for‑profit developers who are experts in building housing, combining them with the efforts of non-profit organizations who know best how to take care of those most in need. That’s one option.
Another option is to create housing that is truly affordable for those in the bottom quintile of the income distribution. Rents have to be below $1,000 a month. I don’t think it’s possible for the private sector to create units at such a low rent. A significant level of government subsidy is required over many years to create this social infrastructure.
[Translation]
Senator Forest: You’re telling us that there are 60 million housing units in Canada, 4% of which would be dedicated to affordable housing, so all housing co-operatives.
A balanced market is said to have a 3% vacancy rate. Let me take the example of my city, Rimouski. The vacancy rate is 0.008%, which is really critical. We’re witnessing the 4% being slowly erased, because more and more landlords are taking possession of housing, moving people out of affordable housing to turn them into more luxurious housing, condos; it’s a major phenomenon we’re experiencing.
So, the 4%, which is already 50% less than OECD countries, is on the decline. Is there anything we can do to reverse this trend?
[English]
Ms. Bowers: The first action is to continue to invest in social community housing by all levels of government.
The second action is to create housing supply of all types. We are short of housing units for young people, homeowners and rental apartments. Each province and each municipality has to understand what the deficit is for each type of housing, at what price level and make plans for how to address that in the short- and medium-term.
[Translation]
Senator Forest: Could you speak to one of your assistants to see what’s going on in Rimouski, because a pretty significant reversal has been achieved there?
The Chair: Senator Gignac, could you please introduce yourself? The floor is yours.
Senator Gignac: I apologize to my colleagues and witnesses for my tardiness. My name is Clément Gignac, I’m an independent senator from Quebec.
My first question is for Ms. Bowers.
CMHC is asking for $27.5 million earmarked for homeowners affected by pyrrhotite. In fact, I think it was even in the 2022 budget, which called for these funds to be spent in 2023.
So, what delayed implementation so that it’s now in the Supplementary Estimates (B) for the year ending March 31, 2024, and not in the year just passed?
[English]
Ms. Bowers: This is an amount of money that CMHC does not deliver directly to residents affected by this in Quebec. We have to deliver in cooperation with the SHQ in Quebec. Unfortunately, we were not able to conclude an agreement with SHQ for the March deadline. That’s the reason for the reprofile.
We are making sure that all efforts are being made to ensure that the agreement is signed so the money can be forwarded to affected residents as quickly as possible.
[Translation]
Senator Gignac: So, I understand that the Société d’habitation du Québec or SHQ administers it.
Are you able to tell us more about this? There must have been negotiations. What percentage of expenses is reimbursed and how does this program work? Are you in a position to tell us about that?
[English]
Ms. Bowers: Those are the details being determined in the agreement. We’re in the process of negotiating that with the SHQ. The intent is to make as much of the money as possible available for residents as quickly as possible. We need to identify where the need is, who is eligible. Those are the details being determined. It is a priority for us to get this resolved as quickly as possible.
[Translation]
Senator Gignac: Your very transparent answer worries me a bit, because this was announced in the 2022 budget and it hasn’t been done yet. I understand from your answer that there are negotiations with the SHQ. Yet, in the Supplementary Estimates (B), there is still $12 million.
I understand that you haven’t yet completed negotiations with the SHQ. So it’s not certain that you’re going to spend it in the next fiscal year, if I understand correctly.
[English]
Ms. Bowers: Our intent is to use all the funds in the next fiscal year, subject to those agreements with the SHQ.
There is some complexity here in that there are insurance companies who are also providing funds. We need to understand how much the insurance companies are paying, how much government is paying; that adds to some of the complexity as well. We are trying to expedite this with all the resources that we have.
[Translation]
Senator Gignac: Thank you. I think some affected homeowners in Quebec will be burning a few candles this holiday season hoping for an agreement. I don’t necessarily blame you, but I kind of deplore the situation, which is that you’re still negotiating.
We’ll change the subject; I’ll turn to Employment and Social Development Canada. Supplementary Estimates (B) include $12 million for the Temporary Foreign Worker Program’s employer compliance regime. In fact, the Auditor General of Canada had prepared audit reports in 2017 and 2021 which raised certain issues related to inspections, housing and occupational health and safety.
Where are we now on this? Do you think this funding will be sufficient to address most of the problems that have been identified by the Auditor General?
Ms. Robertson: Thank you for the question, Senator Gignac.
I’d like to invite my colleague to join us; his name is Michael MacPhee.
[English]
This is Michael MacPhee, Assistant Deputy Minister responsible for the Temporary Foreign Worker Program.
Michael MacPhee, Assistant Deputy Minister, Temporary Foreign Worker Program Branch, Service Canada, Employment and Social Development Canada: Thank you for the question. As mentioned, my name is Mike MacPhee. I’m the Assistant Deputy Minister for the Temporary Foreign Worker Program with ESDC.
The $12 million investment that has been identified here as part of Supplementary Estimates (B) is a further investment, and it is actually a full amount of $40 or $48 million over two years. So what it allows us to do is to further our efforts to rebuild the compliance regime. You’re correct in identifying the fact that there were issues identified specifically with the compliance regime, and since those were brought forward, we have made concerted efforts to focus in on establishing a more rigid regime, but it’s not just the compliance or the inspections themselves that we’re focused on. We’re building awareness within the worker community so that they actually understand their rights within the program; we’ve also funded a tip line that allows them to engage with us 24 hours a day in over 200 different languages to provide tips on situations that they believe we should be looking into.
Every single one of those tips is evaluated within 48 hours and actioned as appropriate, either by ourselves, referring them to other government departments or organizations, or adding them to an existing undertaking that we have already established. Further, we are working with our provincial counterparts in order to establish a baseline of accommodation criteria to which they all need to adhere. The tricky part with accommodations is that it is multi-jurisdictional, with provinces holding many of the responsibilities associated to the actual standards. We are in the process of finalizing work in that space as well.
[Translation]
Senator Gignac: Thank you, and I commend you for your efforts. It’s encouraging to see that you’re taking care of temporary foreign workers.
In fact, there are two jurisdictions: one at the provincial level and one at the federal level. When it comes to inspectors, is it the federal government that takes care of that, or is it the role of the provinces to go on site?
Also, are there more inspectors now assigned to this file, to go check on site? How does it work? Are the provinces or the federal government sending inspectors?
[English]
Mr. MacPhee: Again, it’s a joint responsibility. Within the Temporary Foreign Worker Program, we have inspectors across the country numbering anywhere between about 180 and 200. Pre-pandemic levels, there were less than 100 in place. We have responsibilities to evaluate up to 28 different conditions, and that has expanded dramatically over the last decade from when we first started.
[Translation]
Senator Gignac: Thank you.
[English]
The Chair: Mr. MacPhee, if you want to add to the question, you can do it in writing, please. Is that okay, Ms. Robertson? Thank you.
Senator Smith: Following up on Ms. Robertson, the access to benefits for hard-to-reach populations; Senator Marshall, I believe, introduced the idea. Could you expand on the program? How is the department working to provide access to benefits for the hard-to-reach populations?
Ms. Robertson: I’m going to ask my colleagues for help on that.
Brian Leonard, Director General and Deputy Chief Financial Officer, Employment and Social Development Canada: Apologies, senator. Which amount is this? Which program?
Senator Smith: The Auditor General’s published report in 2022, Access to Benefits for Hard-to-Reach Populations. My question was: How is the department working to provide access to benefits for hard-to-reach populations because I have a follow-up question to that in terms of dealing with seniors. If you could address that question, it would be appreciated.
Ms. Robertson: There was a similar question asked, and it was more about access, like internet access in northern communities, et cetera. But are you asking about the Benefits Delivery Modernization programme, for which, as Ms. Ingram described, we’ve only released the first very small component? So are you asking, in the future, what will that look like?
Senator Smith: I asked you to expand on it: Where is it going? Could you give us a little more information?
Ms. Robertson: With your permission, I’ll ask Ms. Ingram to join us again to talk about that program. Thank you.
Ms. Ingram: Thank you. Hello. The Benefits Delivery Modernization programme, as I mentioned earlier, our first focus was onboarding our Old Age Security benefits recipients; the intention is to do this by December 2024. Following that, we will be onboarding our Employment Insurance benefits recipients, and part of that will be introducing capabilities that allow citizens to access the benefits through all channels ensuring that there is no wrong door to enter and receive benefits.
We’re also doing research, as part of our implementation and design, on understanding what the barriers are that prevent people from applying for benefits and understanding what benefits they’re eligible for. Part of our transformation is going to look at introducing new capabilities that are going to allow citizens to learn about the benefits and also to access and apply for them more easily.
One example I’ll use is that recently we introduced for Old Age Security a new benefits estimator, and that tool was introduced to give citizens a simple tool to assess what their future Old Age Security and pension benefits might be. So far, it has been used over 200,000 times by citizens across Canada, and we’ve got rave reviews, indicating that citizens are really appreciative of the ability to be able to plan for their future.
Senator Smith: Another question that comes to mind: What about remote areas, people living in more distant areas, especially those who don’t really have technology to utilize who then refer back to the traditional methods of accessing?
Ms. Ingram: Absolutely, and as I mentioned earlier, part of our plan is to look at all modes of service. In fact, yesterday I was speaking with a community leader in the far north of Quebec, and we were seeking advice from her on how to reach those remote clients.
Part of the solution is, obviously, investing in infrastructure, and I know the community is investing in internet access for some of their more remote communities, but some of the solutions they were talking about certainly involve having that face-to-face, in-person connection.
We’re also investing in our call centre capabilities as well to ensure that that all services are provided through the channel of choice.
Senator Smith: Knowing what we do about access to the workforce and the shortage of people who are in the workplace, in remote areas, does that compound the problem of trying to give access to seniors?
Ms. Ingram: I think part of our plan is to look at how our own workforce is distributed across the country, make sure that we’re maximizing the use of that workforce and make sure that they are located in the right places.
Our intent is to start transitioning some of our capabilities online, so that it might free up some of our workforce, and we’ll be able to reassign that workforce to some of the more vulnerable communities in the country.
Senator Smith: Thank you.
Senator Loffreda: Welcome to our committee this morning. Thank you for being here.
My question is for CMHC, and I’d like to have your thoughts on the housing affordability crisis we’re currently faced with and how we can improve the situation. We notice that Canadians’ mortgage debt keeps growing at an even quicker pace when it comes to uninsured. Debt delinquency indicators show some are struggling. To what level is mortgage debt a problem at this point in time, according to you? Are there any concerns going forward? What could be done? I see there are a lot of initiatives, and I’ll question these initiatives afterwards, but I’d like to have your preliminary thoughts on how we can address this situation as quickly as possible.
Ms. Bowers: I am concerned about the level of household debt. Canada has the highest level of household debt in the G7, driven largely by mortgages, so I am concerned about that. Luckily, we have a very strong finance system. We have safeguards in place that vet potential mortgage holders to make sure they can service the debt, so that’s a good thing, but I feel that the debt issue and the affordability issue are very serious concerns for our country.
The reason CMHC is very eager to make sure there’s a more balanced housing market is because we need to create housing options that are cheaper for Canadians so Canadians aren’t saddled with such high levels of debt. When you plot house price growth, rental growth and income growth for the last 20 years, rents and house prices are exceeding income growth or economic growth. When you have a more balanced market, you need house prices and rents going at the pace of economic development, and that’s what we need to aim for.
From our perspective, when you have a deficit of housing supply and large demand, you’re going to have escalating house prices, and that’s something that needs to be addressed.
Senator Loffreda: Thank you for that. We talk about housing supply and the lack of housing supply, but when I talk to builders, they tell me they can build as much as is needed but that demand is lacking at this point in time because of the interest rates. You did mention non-profit organizations, that we should work more closely with the non-profit organizations and that the builders should work more closely with the non-profit organizations. What kind of initiatives could be put in place with the non-profit organizations? What has been done in the past? What are some best practices across the world that are being used?
Ms. Bowers: Thank you for the question. When you look at some of the programs of the National Housing Strategy, under the Co-Investment Fund, there are examples of many projects where a commercial developer is actually responsible for the construction, and certain units within a certain building are allocated for more affordable housing outcomes. The builder works with non-profits, often in combination with government subsidy programs, to ensure that the project is actually mixed income.
When you actually go into the building, you see that all units are similar, but there are units set aside, supported by rental supplement, to provide those units for those who are in greater need. That’s just one example, but I think that can be replicated across the country.
Senator Loffreda: You are asking for $12 million in authorities at this time for your Rental Construction Financing Initiative. Since the program was launched in 2017, close to 40,000 units have been committed and built, including close to 30,000 below market. However, can we not do much more? We’re talking about 3.5 million more homes being needed by 2030 to correct or restore affordability. Why can’t we do much more than 30,000 or 40,000? These are nominal numbers compared to what is needed.
Ms. Bowers: Absolutely, and if you look at the recent Fall Economic Statement, there was a top-up of this program for another $15 billion to continue to provide low-cost lending, so I think that’s a great thing.
In addition to that, most of the lending for property development is done by the regular banking system. CMHC, through our mortgage insurance program, provides guarantees to some lenders to reduce some of the risk associated with property development. That’s another way that CMHC supports the creation of purpose-built rental, and this year has truly been a banner year in terms of creation. To date, we have financed about 220,000 units of purpose-built rental in this year alone. There are ways we can work with the banking sector as well to support more purpose-built rental development in Canada.
Senator Loffreda: Thank you.
Senator MacAdam: Thank you to the witnesses for coming today. My first question is for Correctional Service Canada. Could you explain the nature of the request of $158.7 million in the estimates for the class action lawsuits in your operating vote?
Mr. Matson: Absolutely. This is a request to reprofile funds that were previously approved I think in Budget 2021. At that time, there was an estimate made of the total probable payout for the class action lawsuit of about $360 million. To date, we’ve paid out approximately $85 million of that, and so the money earmarked for the last fiscal year has been moved to this fiscal year through these estimates, and we will continue to reprofile the money as the actual payout occurs over the next three to four years. This is just a reprofile of funds that were previously approved.
Senator MacAdam: What is the nature of the lawsuits?
Mr. Matson: I’ll turn to Mr. Pyke for that, please.
Jay Pyke, Acting Senior Deputy Commissioner, Correctional Service Canada: Essentially, the nature is any offenders who were housed in segregation prior to the launch of the class action brought forward damages, both personal damages and systemic damages. There are three tracks to the Reddock, Brazeau and Gallone class actions. Track 1 was established if you were 15 days or more in segregation through an administrator appointed by the court. In accordance with distribution of individual issues protocol that was issued by the court, there was a set amount.
So for all track 1 class actions, for example, $5,469.85 was distributed to any inmate that was in segregation for 15 days or more. There were 5,311 eligible claimants that met the criteria for a total of $29 million. Track 2, that is beyond the established track 1, anybody who may have had self-harm incidents or aggravated through self-harm, there’s a scale as well under track 2, and then there’s a third track. The third track relates to personal damages beyond a $20,000 request, and that can be in relation to aggravation of a mental health disorder, the ongoing aggravation to those circumstances or conditions, just as an example. There’s no limit to that. That top-up would be an unlimited amount.
Senator MacAdam: So the supplementary estimates seek an additional $42 million in operating costs to offset increased expenditures related to changes in offender population volumes and price fluctuations. I’m wondering to what extent prison populations are growing in Canada. Are there upward population capacity pressures or is it related more to rising inflationary costs? I’m wondering if you have any information on that.
Mr. Matson: Thank you for that very good question. This amount is mostly for price inflationary cost issues. Every year, we receive funding that is a calculation basically of the offender population and then the price of goods for us to service the offenders, and so this specific amount is mostly related to inflation although we do receive money for increased populations and we also lose money when the population goes down. So it fluctuates according to the population and also according to the cost of goods to support the offender population.
As I understand it, this year we’ve seen unprecedented population growth from previous years. It’s already gone up I think at least 6% just this year, and it’s forecast to continue to grow in the future.
Senator MacAdam: Thank you.
[Translation]
Senator Dagenais: Thank you. My first questions are for Employment and Social Development Canada. I’d like further clarification on the budgets affecting the Temporary Foreign Worker Program, which my colleague, Senator Gignac, just spoke about.
I’d like to go a bit deeper into the use of the $12 million you just explained. Can you tell us what will be done with the $10 million earmarked for a pilot project for employers? How will you spend this money? What is the nature of the project? In which regions of the country will this money be spent?
[English]
Ms. Robertson: I’ll ask my colleague Mr. MacPhee to return to the table. He’ll speak to that second initiative in the supplementary estimates, including the regional distribution that was requested.
Mr. MacPhee: Thanks for the question. The Recognized Employer Pilot is a program that is designed to facilitate access to the Temporary Foreign Worker Program for employers that have a demonstrated not just use of the program but a positive track record in terms of compliance efforts and their treatment of workers.
The $10 million identified is actually there to help us establish the program from the outset, make the necessary technical changes in order to allow employers to apply for the program and, subsequently, implement upfront controls. That is an additional checking in on the nature of their compliance history prior to being approved as a recognized employer within the program.
In addition to that, the funding is spread across the four regions to support enhanced check-ins with these employers over the duration of the program to confirm they are adhering to all of the program terms and conditions.
[Translation]
Senator Dagenais: I noticed that there were a lot of budget items for temporary workers, among others in your department. Can you tell us what the overall annual budget is to support these workers who have become so essential due to the labour shortage?
How are you working to respond to complaints about delays and the confusion employers have to go through? Among other things, they complain about delays. I’d like to hear from you on this.
[English]
Mr. MacPhee: For 2022-23, the Temporary Foreign Worker Program budget was in the range of $136.2 million to $140 million. That’s the all-in costs to deliver the program. That’s the processing of all of the labour market impact assessments as well as the compliance efforts.
In terms of employer concerns raised about the program, at this time, we are meeting internal targets for our processing times for our priority areas. For the agriculture sector, that is 15 business days, and we are in the range of 8 to 10 days for that. For the global talent stream, it’s 15 business days, and we are hovering around 14 to 16 days in that space.
When we talk about the employer experience, we have to remember that our component of the Temporary Foreign Worker Program is just their application for that labour market impact assessment, which evaluates that they have actually done their due diligence and there is a legitimate need for that employer to hire a temporary foreign worker.
Subsequent to that and subsequent to them receiving that positive labour market impact assessment, they and the worker then need to apply for a work permit. The work permit application is done through Immigration, Refugees and Citizenship Canada, or IRCC.
[Translation]
Senator Dagenais: Thank you very much.
[English]
Senator Pate: My question is going to be to Correctional Service Canada for Mr. Pyke.
Following up on Senator MacAdam’s question, I’m curious if you can provide a list of all of the lawsuits that have been settled that are covered by the $159 million. I’m also curious how many more are anticipated. I’m aware there has recently been a new case certified in Quebec regarding similar violations of human rights now in the SIUs, the new units that replaced the ones that were supposed to eliminate segregation. Please provide us with an estimate of how much of that is anticipated as well as what you’re anticipating going forward in terms of those issues.
When Bill C-83 was passed, there was an allocation of resources for mental health beds. Previously, in response to a question I asked about Main Estimates, the Correctional Service Canada pointed to 18 external beds available at the Institut national de psychiatrie légale Philippe-Pinel in Quebec. Those predated the Bill C-83 provisions, so I’d like some idea of what, in fact, the money has been spent on in terms of the additional external beds.
Mr. Pyke: Thank you for your question. I don’t have an exhaustive list with me. I can provide that as a supplement in terms of the total amount of litigation costing out there.
To answer one of your other questions in relation to similar class actions, it’s very difficult to tell at this point, to be very candid. They’re evolving and being submitted. I can’t predict. You’re correct in that I can say that we’re seeing other litigation applications related to lockdowns, for example, and even exceptional searches at times and how long those exceptional searches lasted.
I can’t predict that amount or how many we will have, but the trend is that we’re certainly seeing more litigation any time offenders or inmates find themselves in a lockdown situation within our service.
In terms of the allocations for the mental health beds, I don’t know that I can respond to the beds themselves. I might have to get back to you on that, Senator Pate. My apologies. I just don’t have that information readily available.
Senator Pate: That’s great.
Mr. Matson: We did get funding for mental health in Bill C-83, for sure. We do have 18 beds currently at Pinel, as you mentioned, that have been in existence, but we will get back to you with the specific numbers.
Senator Pate: That would be great. And if you have any cost estimates in terms of future litigation, that would be great.
Does the $159 million cover all settlements to date?
Mr. Matson: The $159 million in these estimates is only related to the Brazeau, Reddock and Gallone class action, and it’s a reprofile of a portion of the total amount of $360 million. We’re moving money year to year as we pay out. It’s only related to that one class action.
Senator Pate: My other question is for ESDC. In terms of the Canada Disability Benefit, which received Royal Assent earlier this year, as you know, what steps have been taken to ensure that this will be rolled out by June 2024, as promised? Also, what measures are being taken to ensure the benefit will be adequate? In particular, has ESDC responded concretely to P.E.I.’s request for a federal partnership on the cross-party supported and fully funded guaranteed livable income, which is also to add to the disability benefit?
Ms. Robertson: Ultimately, in order to implement that benefit, we will need a bigger funding decision. That’s still outstanding, but I’d like to invite my colleague Mr. Ram to the table. He is responsible for that program and can speak to the specific details you’ve asked, senator.
Elisha Ram, Senior Assistant Deputy Minister, Income Security and Social Development Branch, Employment and Social Development Canada: Good morning, senators. Thank you for the question. As my colleague mentioned, I’m responsible for the implementation of the Canada Disability Benefit.
Senator, you noted the key date of June 2024. That date applies to the latest date by which the act itself must come into force. Subsequent to that, of course, the details of the benefit itself will need to be spelled out in regulations, and the act indicates that we have a year from the act coming into force to introduce those regulations. That puts an upper limit at June 2025 for when the regulations will need to be introduced.
We are currently in the process of the pre-regulatory consultation on the benefit for which we are looking to secure input from Canadians with disabilities and the disability community on the key element that should form part of those regulations. The next step will be the publication of the draft regulation in Canada Gazette I, after which there will be the open consultation regulatory on those regulations prior to the regulation being finalized and introduced in Canada Gazette II. We are working toward that deadline of having the regulations in place no later than June 2025.
Senator Pate: Are you saying there won’t be a benefit before then?
Mr. Ram: That is the upper limit. If we can do it sooner, we would like to do it sooner. But in addition to the regulatory process and the time that it takes is the time needed to build the system for delivery. As my colleague mentioned, there is still an outstanding funding decision on the benefit itself.
Senator Pate: Have you responded to the P.E.I. proposal that has been put forth in terms of how that might benefit folks with disabilities or impact this?
Mr. Ram: We have an ongoing dialogue with the provinces and territories about the benefits, recognizing that this is an area where both the federal government and the provinces and territories are very active. Our intent is to have the disability benefit be a supplement to the existing benefits that are currently being paid to individuals with disabilities by provinces and territories. However, the provinces and territories have indicated to us that while they’re open to having that discussion, they are interested in seeing the details of the benefit before they are able to comment on how that might impact their own programs. The interaction between the P.E.I. project and the disability benefit will also need to wait for those regulations to be spelled out.
The Chair: Senators, before we go to second round — and I have three senators asking for a second round — I’d like the indulgence of senators. I have a few questions I’d like to ask.
I’ll start with Correctional Service Canada. You talked about hybrid and workforce. Can you expand on that? Is that better? If it is better, can you give us some examples?
Mr. Pyke: Thank you for your question. A hybrid workforce — obviously, the pandemic put us in a situation where, historically, we didn’t operate as hybrid at all. For health and safety purposes, we responded by coming out with the mandate of a minimum of two days on site. We found, because we’re so operational as a department, that two days in the office as an enabling group, for example, at national headquarters or regional headquarters, is not enough. We set our minimum mandate at three days per week. Although operationally, on the ground in the institutions and the parole offices, it’s five days a week. It’s full-time. That’s the nature of the business.
Are we able to accomplish our mission with our three-day mandate and our full-time mandate in our operational sites? Yes, we are. Does it present challenges from time to time in terms of procedures and making sure we take the time to ensure we have coordinated team meetings, for example, and coordinated communications across the board for a hybrid environment? For sure.
I would like to acknowledge, chair, that in terms of protection of the public and case management in the community, there is nothing hybrid in that sense. We still do our frequency of contact, for example, our meetings with offenders in the community and workplaces as we did prior to the pandemic. It’s not hybrid in that sense.
The Chair: Thank you. My next question is for the Canada Mortgage and Housing Corporation. I’ll share with you that when I was minister of New Brunswick housing for New Brunswick in the early 2000s, I have to admit that you played an important role with all the provinces and territories when it came to social community housing. And I look at what you’re asking.
[Translation]
In the 2023-24 Supplementary Estimates (B), CMHC authorizations total $6.5 billion. Last year, CMHC expenditures totalled $4.2 billion. Does CMHC, under your leadership, Ms. Bowers, intend to spend all of these authorizations?
What efforts will CMHC make for social and community housing?
Three weeks ago, I had the opportunity to talk to some homeless people, who were on the street. Some of these people told me — two out of five — that if there were more social community housing, they’d probably be off the streets.
I’d like to hear from you on this, as your organization is an indispensable working tool for social housing development.
[English]
But there is affordable housing for low income. I’d like to hear what the best practices are going forward to make sure that they’re not left unattended.
Ms. Bowers: Thank you very much for that question. It’s quite a complex question.
One thing I would like to highlight is that since the National Housing Strategy was launched, there has been close to $39 billion in investment by the federal government to create or repair over 350,000 units of social or community housing. This is not enough, but it is very significant when you compare it to the very low levels of funding that existed for 20 or 30 years prior to that.
In terms of what the best practices are, I think the best practice as a country is to consider social or community housing as part of the infrastructure of our country and not to think about it as something for which you need a 5-year program or 10-year program. You need to think about continuous investment over time.
We work with many non-profit organizations, and the thing that makes it most difficult for them to build houses is uncertainty about where the funding is coming from. During the years when CMHC was more active, there was a commitment by CMHC to provide low-cost financing over many decades. I think it’s that level of certainty that is required to create social or community housing as social infrastructure.
The Chair: Thank you. If you want to add something, you’ve heard some of the questions that were asked by the senators.
Ms. Bowers: I didn’t have a full chance to answer the question from Senator Marshall. I don’t know if I have the opportunity. It was quite rushed. She asked about a plan. I can’t comment on a written plan, but I thought it might be helpful for you to hear about themes that Minister Fraser talks about. I consider it a plan.
He talks about six themes in his public remarks. One he calls “making the math work” for developers. The recent changes in GST, the low-cost financing through CMHC and our involvement in mortgage finance are things that the government can take on to make the math work for developers. That’s one.
The second is changing the way cities and municipalities build housing. As you know, housing is very local, but there are many policies, procedures and practices at the local level that prevent housing from being constructed. One of the innovations under the current government is the launch of the Housing Accelerator Fund, which CMHC administers. It’s a $4 billion investment. It’s not meant to directly fund housing. It’s meant to provide an incentive for municipalities to reform their land planning and other processes to incent housing growth. That’s sort of the second wave.
The third element of the plan goes back to what you mentioned, chair, which is investing in the social community housing sector. There are direct supports in terms of contribution funding through some of the National Housing Strategy programs, but it’s also creating the capacity of the non-profit sector. In the 1970s and 1980s, there was government funding to create real estate development expertise in the non-profit sector, and that has not taken place for many years. There are some non‑profits that have an expertise in real estate development, but there are many others that do not. I think there needs to be government support to create more capacity in that area.
The fourth element that the minister often mentions is homelessness. Again, this is not something CMHC is directly responsible for, but Reaching Home is the federal response to the homelessness challenges we experience in the country. I think there is need for continued investment there.
Last but not least, and I think Senator Loffreda mentioned this, homeowners are struggling with the recent rapid increase in interest rates. We saw in the recent Fall Economic Statement efforts to support homeowners to be aware of the tools available to them, working with their financial sector partners, to make some of the mortgage payments more affordable.
If you look at those holistically, these are the ways that I see Minister Fraser is addressing the housing challenges in Canada.
The Chair: Thank you. We’ll go on a second round. I will recognize Senator Marshall to be followed by Senator Forest, Senator Smith and Senator Loffreda. We’ll wrap up with Senator Pate.
Senator Marshall: Thank you very much, Ms. Bowers. I was going to come back to the plan.
With all the programs that are at CMHC that have the objective of increasing the housing supply, I know the money is being spent, but the number of housing units being created is difficult to track. Why isn’t there some sort of a plan that would list off all the programs and how many units government is expecting to have built in each year? Then when the year is over, you could find out that they actually met their expectations and where those units are located. It’s very difficult. Now we’re talking about half a million units per year on average to reach the 3.5 million housing units in seven years’ time. Why is it so difficult to report back so people know what’s happening?
Ms. Bowers: Thank you very much for that question. With respect to the spending under the National Housing Strategy, the $82 billion investment, we have a website called “a place to call home.” If you go there, we’ve made a lot of improvements to that site so you can actually drill down by program to see how much the target was, how much is being spent and how many units are being created. We tried to provide a lot of granular information, but there are definitely improvements there, so we’re very happy to get any feedback that would help us improve it.
I would also like to highlight that most of the housing in Canada is created by the private sector. This is why it is so important that we have at CMHC a group of about 100 market economists across the country, and we publish regular reports about housing starts, rent levels and construction levels. I think that’s another element for private sector actors to understand what’s happening in local jurisdictions.
Senator Marshall: The information on the progress that’s being made is not out there. With the problem with regard to the housing shortage, if there was more information available at a higher level, people would see that progress is being made. Thank you.
[Translation]
Senator Forest: Ms. Bowers, we are waiting on two important bills, Bill C-59 and Bill C-56. The aim of these bills, particularly Bill C-56, will be to meet the demand for housing. I think it’s particularly important to have incentives to promote affordable housing.
Does your organization have a study or market statistics that would indicate where the shortfalls are? Is there a shortage of two-and-a-half-room units, three-and-a-half-room units for the elderly, or five-and-a-half-room units for families? Can you provide expert support to local organizations? They know their environment, but they could often use a little more expertise from you.
[English]
Ms. Bowers: About a year and a half ago, CMHC published a report that quantified the housing supply gap, the 3.5 million. We updated the report this year to reconfirm the number. We are continually improving the quality of the report. The next iteration of the report will provide breakdown by municipality, types of housing units that are needed and the level of affordability. We feel that by providing more transparent information, we can help provide decision makers with the right information to create housing supply in their localities.
Senator Smith: I have a question for Mr. Matson and Mr. Pyke. I’ll ask you one question and then maybe on the second one, you can provide us a written response.
In the estimates, $45.6 million was for the stabilized operations related to workplace injuries. Can you explain how the funding is being used and what prompted the request?
Second, your departmental plan highlights that there is a risk for operational safety and security, and the Correctional Service Canada may not be able to maintain required levels of operational safety and security. You could write us back on that one, talking about the risk. Is it an ongoing risk, a new risk? How is the Correctional Service Canada working to resolve it?
Mr. Matson: Thank you for the question. Absolutely, the $45.6 million that you referred to is for workers’ compensation costs. Those are basically related to workplace injury. We have a large number of employees, as you know, who work on the front line, and it’s a traumatic area to work in. There are a lot of workplace injuries that occur, and that amount is going up every year. This is the amount we need this year just to cover workers’ compensation benefits costs that we pay, I believe, to our friends at ESDC, who administer that program on our behalf. That is purely to cover those workplace injury costs.
Senator Smith: On the second question about your departmental highlights on operational safety, security and the institutions, you may not be able to maintain required levels of operational safety and security. I wonder if you can talk about the risk. Is it ongoing or new? How are you working to resolve it?
Mr. Matson: The funding that we’ve requested for operational security in this is highly related to the infrastructure in our organization. We have aging institutions, if you will, and it is getting increasingly dangerous to ensure a safe work environment under those circumstances. We also have changing work environments for which we have to modify the infrastructure to deal with the security appropriately. This funding is a portion of funding that was approved in Budget 2022, I believe, to address essential infrastructure issues in the institutions themselves.
Senator Loffreda: My question is for Employment and Social Development Canada. I would like to revisit an issue that generated many headlines last year, which is passports. I noted in your departmental plan that ESDC was able to eliminate the passport backlog completely by March 2023. In light of the pressures you experienced last year, ESDC developed solutions to streamline the passport program, including the introduction of the online application status checker.
First, what measures did ESDC implement to address the passport backlogs? Was it a question of staff? How much staff did you have to hire? Are these individuals still employed?
Furthermore, what are the department’s service standards in terms of application processing times? Is this a problem that’s permanently resolved?
Finally, I’d like to know more about the pilot and readiness activities for the Passport Program Modernization Initiative. Can you expand on the digital services application that you hope to launch in the near future? How confident are you that this application will be secure, user-friendly and reduce wait times?
Ms. Robertson: Thank you, Mr. Chair, for the question. That is a very significant question, and my colleague Ms. McDowell is joining us from Nova Scotia. She is responsible for citizen services, which includes the passport program.
This is a partnership with IRCC. We work very closely with them. Our funding at this time is stable. We have maintained no backlog. We’re doing extremely well.
I’ll turn to Ms. McDowell. Senator Smith asked a question earlier that could have been interpreted as 1-800-0-Canada and Canada.ca; Ms. McDowell is responsible for those services. Time permitting, if you wanted to ask more, she could provide that information.
The Chair: Ms. McDowell, could you introduce yourself and answer that question, please?
Christine McDowell, Assistant Deputy Minister, Citizen Service Branch, Employment and Social Development Canada: Good morning, everyone. My name is Christine McDowell. I am the Senior Associate Deputy Minister for Citizen Services at Service Canada, including the passport program.
In terms of our experience with passports, we completely eliminated the backlog in March of 2023. There were a number of measures we took to be successful in that endeavour. First, we increased our staff. We doubled our workforce and got them trained up quickly. We got them to work on the overall backlog situation itself. We also undertook a series of reviews of our processes to make sure that we were reduplicating efforts. We worked hard to streamline our efforts in the processing environment.
Then we made sure that we triaged clients according to their travel date to make sure that no clients actually missed their trip because of delays in passport processing.
We had an opportunity to explore, where we could, with technology at the time, better ways of doing business across the country, virtually processing passport application, moving the demand to where the capacity actually existed.
Today, we maintain those efforts. Our service standards right now are 96% for mail-in applications — that’s a 20-day service standard — and between 96% and 97% for in-person applications that we receive — that’s a 10-day service standard.
We continue to do well there while, at the same time, Senator Loffreda, turning our attention to the modernization of the overall passport program. The Passport Program Modernization Initiative consists of three elements. One is an intake tool, where officers actually receive the applications from clients in a new application. The other is a processing tool. Both of those, while we’re under 20% implemented in that across the country, the intention is that we would see increased deficiencies, particularly for renewal applications. The other piece of technology that we’ve implemented is new, high-volume printers that actually link up with the processing system but at the same time allows us to print the new passport books that have been generated.
In terms of the online application, that is — as Ms. Robertson mentioned — a partnership we manage with IRCC; it is actually IRCC who is responsible for developing the technology. They would be better positioned to give an update on the progress of that particular application.
[Translation]
Senator Dagenais: Thank you, Mr. Chair.
I wanted to make a comment before asking my question, because sometimes you need good news.
I went to the passport office in Blainville about a month ago. There was no lineup, and three weeks later I received my passport. The service was fast. I congratulated the person who received me at the passport office. I encourage you to go to Blainville, since there’s no lineup.
The Chair: Did you have a question?
Senator Dagenais: Yes, but sometimes you have to share good news.
On the capital assets front, I’d like to return to the issue of prison facilities. Obviously, we have to think about inmate safety, but we also have to think about corrections officers.
I’ve visited a few prison facilities in my other career and I can tell you that some of these facilities are outdated. Do you have any plans to build any new facilities, or are you planning to close any that might be outdated?
[English]
Mr. Matson: Thank you for that question; it relates to the question asked by Senator Smith.
At the moment, we have no plans to build new institutions. Our institutions are getting old. For example, some of the electronic fences are failing, and that’s what some of that funding was for in the essential security infrastructure we talked about earlier.
There are no plans currently to build new institutions. We’re mostly focusing on renovating and fixing problems as they arise. We try to be proactive as much as possible. But we’re mostly reacting to issues as they arise. We did receive significant funding. We received $6.1 million this year of over $200 million that was approved in Budget 2022 for infrastructure over the next five to six years. It’s a significant amount. It will help a lot.
At the end of the day, if we wanted to significantly enhance our safety, security and service delivery features of our institutions, it would require a significant investment in new facilities. Right now, we’re in a maintenance mode and trying to be as proactive as possible in preventing issues before they arise.
Senator Pate: I have two questions, one for ESDC and one for Correctional Service Canada. The Ontario courts recently ruled in the Francis case that those with serious mental health issues cannot be placed in isolation or segregation.
I’m curious about what the plan is going forward in terms of future mental health beds because that will likely impact planning. I recognize you just said you are mostly reacting to issues that are being raised. This strikes me as potential for additional lawsuits if, in fact, those beds aren’t contracted. Do you have that plan?
For ESDC, further to my previous question, when Minister Qualtrough was before the Social Affairs Committee on the disability benefit, she said, “I have been saying consistently . . . the benefit will be delivered in 2024.”
Is the current minister planning to honour that commitment or has there been a resiling from that position? Those are my two questions.
Mr. Pyke: In terms of pending lawsuits, litigation and the like, as you say, and the decision — to delineate, we don’t have segregation by definition any longer; we have structured intervention units — we’ve invested significantly in terms of mental health resourcing into structured intervention units in the event they’re required.
I won’t get ahead of myself by indicating structured intervention units are the last resort, obviously. We try to manage in a mental health diverse way in terms of intermediate mental health units, providing regular health care and mental health opportunities to general population offenders. The question related to if they were part of a subpopulation or segregated. Again, we don’t have segregation by definition.
We have reinvested in terms of mental health practitioners. We’ve recently introduced behavioural skills coaches into structured intervention units. The focus there is to work through with the inmate in terms of clearly delineating working through, with the mental health capacity, where are we; what is the plan moving forward; what are the supports we could possibly provide in terms of trying to alleviate any kind of isolation status or structured intervention unit status, for example, to try to best respond and return to a more general population environment?
I hope that answers your question, but I’m here if it didn’t.
Senator Pate: Can you indicate in writing where the plans are to develop the mental health beds in provincial psychiatric and mental health institutions?
Mr. Ram: Yes. I wanted to respond to the senator’s second question with respect to the Canada Disability Benefit. As I said earlier, we are doing everything we can to make sure that the benefit can get into the hands of those who need it as quickly as possible.
We’re trying to balance, on one hand, the requirement in the act for the meaningful and barrier-free consultation process, which is undergoing; introducing the benefit quickly; but also ensuring it’s delivered efficiently and safely, which required the development of the delivery system. All of those pieces need to work coherently with each other.
As I said, we are working to develop the regulations as quickly as we can. As soon as the regulations are introduced, that will give us the timetable for the actual delivery. The act, as I said, does require that the regulations come into place no later than June 2025 but hopefully sooner.
The Chair: Thank you.
Honourable senators and witnesses, this is the end of our meeting. There’s no doubt that you have seen from the questions being asked that we have a common denominator as senior public servants. It’s all about transparency, accountability, reliability and predictability in terms of defending your budgets, which is the budget for Canadians.
That said, you’ve been very informative and enlightening. I would like to remind our witnesses to please submit written responses, if you want to follow up on questions that you’ve heard and that you want to add to, through the clerk by end of day Tuesday, December 19, 2023. Do we have an agreement on that, officials? Yes? Thank you.
Senators, we will now continue our meeting considering Bill C-241.
We will continue with the observations of Bill C-241. We are now in public, so I ask the following question: Is it agreed that the committee proceed in camera to discuss the observations? Agreed. Thank you, honourable senators.
(The committee continued in camera.)