Proceedings of the Standing Senate Committee on
Agriculture and Forestry

Issue 16 - Evidence - Meeting of February 20, 2007 - Morning


CORNWALL, PRINCE EDWARD ISLAND, Tuesday, February 20, 2007

The Standing Senate Committee on Agriculture and Forestry met this day at 8:05 a.m. to examine and report on rural poverty in Canada.

Senator Joyce Fairbairn (Chairman) in the chair.

[English]

The Chairman: Good morning. It is a pleasure and an honour to be here in Prince Edward Island, which our colleague Senator Callbeck always reminds us is the birthplace of our nation. It is all too easy to forget that at Confederation Canada was a truly rural nation. Upwards of 80 per cent to 90 per cent of Canadians lived in communities with fewer than 1,000 people. In 2007, only 21 per cent of Canadians live in similarly sized communities. This nation's transition from a rural to a largely urban country has not been easy, and the consequences are still being felt today in the form of rural poverty.

Prince Edward Island has to some extent resisted those trends. Prince Edward Island is the second most rural province in the country with just under 50 per cent of its residents living in rural and small towns. Of the Atlantic provinces it has the lowest overall poverty rate, although clearly there are some areas of the province that are less well off than others.

With us this morning to tell us more about rural Prince Edward Island is Elaine Noonan, Executive Director of the Population Secretariat for the provincial government.

We are delighted that you have come out on this crisp and sunny day, and we look forward to hearing from you.

Elaine Noonan, Executive Director, Population Secretariat, Government of Prince Edward Island: Good morning. Welcome to Prince Edward Island. Senator Callbeck said that P.E.I. was the birthplace of Confederation, and in addition to that both she and I were born in the same little community, Bedeque, which is close to Summerside. We have a lot in common. When I drive back to that community now, and I am sure Senator Callbeck would agree, I find it quite different than when I was a little girl growing up there. We had a school, we had the one little Callbeck store which was known across the province, and we had all kinds of things which are just not there anymore. I think it is an indication of what is happening across the country, particularly in the smaller communities.

I appreciate the opportunity to be here. I have to admit that when I was first asked to come I said that I did not think I could offer very much on this particular topic. Then Senator Callbeck's office called back and said, "Just tell us about the changing demographics and so on." I apologize upfront for my lack of knowledge on the topic of rural poverty, but hopefully I can share with you some of the overall picture. It is very hard to cover such a large topic in 10 minutes, so I will try to talk quickly, although I know the interpreters are trying to follow my Island accent and may have a little problem with some of the interpretation.

The first few slides in the presentation give a picture. I think a picture says a thousand words. If you look at the first couple of slides you will see what is happening overall to our population.

When you look at the 2001 census data and then at the projections for 2030, you see that we are aging. Our biggest concern is that bottom cohort where we are not having as many children and our younger people are leaving. As a result, if something is not done, the image of the population will change drastically.

You will note as well that the breakdown between males and females is pretty even, although there are probably a few more females in the older categories.

The next slide is very telling; it shows our school age enrolments and our projected enrolments over the next few years. I was in education in 1996 and at that time we had 24,000 students in our Grade 1 to 12 system. Today we have closer to 18,000 students. That decrease happened in only a 10-year period.

The slide on projections of aging population versus youth population in P.E.I. gives you the picture of when the group of people aged 65 years and above and the group from zero to 29 years of age cross over. You will notice that the number of younger people is falling while the number of older-age people is growing. We have a lot of people age 65 and older and that number will continue to rise as the number of youth decreases.

I will say though that Prince Edward Island is the only Atlantic province, and probably the second province in all of Canada, to still have a net population growth. Even though we were up only 0.18 per cent last year, we can still say that we are continuing to grow, albeit at a much slower pace than we were. We have heard the horror stories of so many people, especially young people, leaving and going west, particularly to Alberta. I will show you a chart later that explains a little bit about what is happening there.

We do have a very high labour market participation rate. Of course, seasonal industries do skew the figures a bit. They give a perception of very high unemployment levels. It is hard to believe, but right now Island companies are experiencing labour shortages. I will mention two or three examples. In the fishing industry, there is Ocean Choice International. There is the aerospace industry, and fishing and farming operations. I have two brothers in the potato business and they have difficulties in the fall finding workers to help them get their crops out of the ground. The long- haul trucking industry is another case; I think it is a Canada-wide issue.

These are all examples of areas where we are already experiencing labour shortages. We have started bringing in temporary foreign workers. It is nothing compared to the numbers that Alberta is dealing with, but at the same time it is still an issue, and it is relative when you consider the overall population in both provinces.

Obviously we have an aging population. The Population Secretariat was established to look at three areas to address the issue of decreasing population: immigration; repatriation, to bring back some of our Islanders and to bring people from other areas in Atlantic Canada; and retention. I think we can deal with the immigration issues; we have all kinds of mitigating circumstances around that. However, our biggest challenge is trying to retain our youth.

Many of these slides show figures. We do not have much time available, so I will not go through them all, but you can review them.

The next slide gives you the picture of where people are going and where they are coming from. The overall in- migration to P.E.I. last year was 3,356 people. The mobility within the country is amazing. The out-migration was 3,483 people. Just within Canada we lost a net of 127 people, but we offset that with our immigration initiatives. That is why, as I said earlier, we are able to say that we are still growing ever so slightly.

We have heard a lot in the media about the droves of people moving to Alberta. You will notice that last year 734 Islanders moved to Alberta, but we got 205 people from Alberta. Those numbers are from Statistics Canada. Previously, Ontario was where most of our people who left went. Ontario still got 858 people last year, but we had 1,139 come into our province from Ontario. Those are interesting figures if you analyze them to see what is happening.

The next slide is the scary one; it talks about our young people. If you look at who is leaving, in the age group 30 to 44 years, 99 people left the province; in the age group 15 to 29 years, 342 left. If you look at the percentages, that is where we have to concentrate our efforts. How do we reach out and keep our youth, particularly in rural P.E.I.?

We have identified two or three factors. One of them, of course, is opportunity. Another is the fact that really there are advantages for people to go away, to learn other experiences and experience other life, and then perhaps they appreciate some of what we have to offer here. Also, many have to leave because of our limited amount of post- secondary training in certain specialized areas. We do not have a university that offers post-secondary education in every faculty. In order to become a lawyer or a doctor or any of those professions, students leave P.E.I., and they are leaving at an age when they are meeting other people and they are determining what they will do with their lives.

A big factor in rural P.E.I. is that many young people have to go into residence at universities and their costs for university are higher than those of students who live within the area of Charlottetown where the university is located. As a result, students coming from rural areas have a high debt load, and they want big paying jobs when they graduate so that they can pay down those debts earlier, and so they leave. Those are all factors that we are looking at.

The next slide talks about the changing skills in occupations and the need for high skills. The growth in our economy has been phenomenal. We are trying not necessarily to change but to add on to our economy. Primary industries will always be important to Prince Edward Island, but we are also looking at diversifying into bioscience, aerospace and some of the information technology areas. We have attracted many new companies. We are trying to provide opportunities for highly skilled people. Twenty-one per cent of the growth in occupations in the last few years has been jobs that require high-end, specific skill sets.

What are our challenges? The next slide lists some of the challenges with immigration. We talk about the homogeneity and non-multiculturalism of P.E.I.; when you walk down the streets of Charlottetown you do not see an obvious visible minority presence, although that is changing. There are many different cultures here actually. I think we have over 90 different ethnic cultures represented, but the numbers are very small in many of those groups.

It is a difficult society to penetrate. I think that is due in part to the fact that we are an island, although of course we are all immigrants or descendants of immigrants of one form or another.

Health care is a big challenge. Public transit is a major challenge, particularly to our rural areas. There is also a limited range of cultural activities, sports, shopping and other services, and social and recreational opportunities. All of those are factors in retaining and attracting youth to our province.

If we compare rural versus urban, we have a lot of anecdotal evidence that suggests that the out-migration of people is much more concentrated in the rural areas of our province. We want to do more research on that. I found your introductory comments about rural interesting, senator. Depending on the definition of rural, we can do anything with the numbers. We were working with numbers from Statistics Canada that said our population was at 55 per cent, but if you are looking at areas within a certain distance of a larger urban center, then the figures that you mentioned are probably accurate. In any case, we have noticed a major change from rural to urban or suburban.

I know I am probably over my time already, so I will try to skip through this quickly.

I want to mention farming as an example of how the rural-urban split is changing. In 1996 we had a total of 2,217 farms and by 2001, the next census, we had 1,845 farms. Yesterday, people in the provincial Department of Agriculture told me that the number now is probably closer to 1,500 farms. The trend is evident, and that is a higher decrease than the national average. As I mentioned earlier, farm operators are having trouble finding workers.

Why is rural P.E.I. suffering? I talked about the youth and about the lack of social and recreational activities. The highest proportion of low-income residents in the province are in rural areas and wages are lower in the rural areas. I think someone will speak to you a later on about some of the social implications.

In the rural areas we also have the highest incidence of and greatest growth in single-parent families, which is really quite an interesting statistic. We have gone from 9.8 per cent in 1991 to 25 per cent in 2001. That is a quite substantial increase.

The urban centers have the newest housing in the province and more construction is happening there. As a result the value of those properties is much higher.

Increased distances and commute times to access government services is a factor in rural P.E.I. I am sure you folks will laugh at that because in P.E.I. you are never very far from anywhere, but when you are spoiled and you used to have to drive for only 10 minutes to go to work or to access services and now you have to drive an hour instead, it is difficult. It is all relative, I think. As we say, we do not have a traffic jam or a rush hour, we have a rush minute. That is one of the selling points we use in trying to promote the province to immigrants; we do not have the massive areas you might see in Calgary, Toronto, Montreal or Vancouver. We have to promote that, I think.

We have to remember that we have to find a balance between the rights and responsibilities of the individual and the community. Resource industries in our province will continue to expand. There is greater demand across the world for food and for housing and so on. I do not think there is a fear there. The size of our farms has changed, though. When I was a little girl, my father grew 30 acres of potatoes. My brother now grows 700 acres. The nature of farming has changed within the province.

I can skip to other areas, but we have to remember that there are social problems caused by unemployment, by poverty and by stress levels, particularly with the difficulties in the farming communities.

I have outlined for you some initiatives that the province has identified. We are working very closely with our neighbours in the Atlantic provinces. We have a committee, a population table, that we feel is a much more efficient way of promoting the whole region of Atlantic Canada, since because we are so small it is both costly and difficult for us to work on our own to promote our province.

We are increasing our immigration numbers. We have a provincial nominee program. Last year we nominated over 638 people. That does not mean that they all came here, but at least we reviewed and we are working to increase those numbers. Our goal is to increase our population by 1.5 per cent annually, which would be about 2,100 people. Half of those we hope to gain through immigration, and the other half by making efforts to repatriate Islanders and to retain or bring back our youth.

We are also seeking recognition for more support for immigration. Last year the government identified additional money for settlement services. We were pleased with the money but felt that we needed to have a base from which to build. It is very difficult when you work on a per immigrant basis for funding and Atlantic Canada is getting only 1.7 per cent of the total number of immigrants who come to Canada and we have 7.6 per cent of the population. We do not feel that we are getting our share. Part of the problem is some of the settlement services, the English language training, and all of the factors that are involved in helping immigrants become part of and be integrated into the community.

We are also developing youth mentorship programs. We are trying to enhance the career portal, which can be reached around the world by people looking to come to the province. We are setting up a tracking system for our graduates to keep in touch with them wherever they go and let them know what is happening here and what opportunities there are.

We are doing research on short-term and long-term labour market needs. We are developing some best practices manuals, looking at what is working in other areas — not what is working in Toronto, Montreal or Vancouver, because they have the support services, but what is working in areas we can relate to. Different ethnic cultures exist in all of those big cities. Here we do not have that, so that is a challenge for us. Many of the people who come to Canada move to those big cities where there are already supports for them, and we just do not have that presence. Thus, we have different challenges than those of the larger centres.

We are working in partnerships with other communities. We are researching tax issues and incentives that help to attract people. We are trying to diversify our economy and to create higher-wage positions. We have recently attracted two or three major companies, including CGI and Trimark, to our province, and those are creating opportunities.

Public transportation is also a major challenge across the province, particularly in rural areas.

There are people coming later today to talk to you about seniors and the challenges that they face, particularly female seniors living in rural P.E.I., who in many cases do not have pensions; they have lived on the farms all their lives and now they are struggling to get access to health care and so on.

I will stop there. I am sorry I went over a little bit, but I am trying to talk as quickly as I can.

The Chairman: Thank you very much.

Senator Callbeck: As you said, we grew up in the same village and went to the same two-room school. You are correct when you say how much that village has changed. When we went to school there were three stores, a feed mill, a meat market, a barbershop, a garage, a service station, two churches, a community hall — I could go on and on. It is unbelievable how that community has changed over the years.

The Community Futures Program has been some help in that area. Bedeque, like all other rural areas, needs a lot of assistance.

You were talking about the problem with youth, and certainly the figures that you presented here this morning show that we are losing our youth. I see youth mentorship programs mentioned. I wonder if you would explain that.

Ms. Noonan: Last year the province started to provide opportunities for students to be identified and matched with appropriate companies. For example, if you are in an accounting course they would try to identify an accounting company to make that link and to help provide employment opportunities. Even if you work there only for the summer you have made those contacts. We are trying to set up a relationship so that the people that you worked with in that firm will continue to keep in contact with you even if you leave. Most positions advertised say "Needs experience." You need three years experience or whatever. People are not willing to take a chance on someone who has not had that experience. We are trying to encourage companies to work closely with young people while they are still in school so that when they graduate and they have those skills they would probably be the first people hired. This initiative is about setting up relationships and identifying volunteers, even retired businesspeople, people who have actually worked in those areas to work closely with and guide those young people. We are just getting it off the ground now, and we are looking for volunteer mentors.

Senator Callbeck: You are doing many things here.

When you bring immigrants to the province, are you trying get people who come from countries that are mainly rural or people who live in rural areas in other countries?

Ms. Noonan: Ideally that is our goal. As you know, the Canadian immigration system is a long, complicated process. I think it takes up to 48 months or even five years for someone to come through the Canadian system. Our provincial nominee program is helping to reduce that time to something like nine or 10 months, probably a year at the most, because our program officers do all of the pre-assessments when people apply.

Under the program we have four categories. One of them is a skilled worker category. For that category we work closely with employers who have identified labour shortage needs. If they say we need long-haul truck drivers, we will go to the countries where we know long-haul truck drivers are plentiful or where people have identified through their embassies or their high commissions, or even through agents, that they want to emigrate. That one is easy.

There are also an investor program, an entrepreneur program and a family connections category. If there are people here now from Korea, China, India, Holland or wherever and they want a family member to come, they can identify and nominate that person. Then the province will review their application and do the processing.

Our long-term goal is to work with our employers to identify particularly our labour shortages, but immigration is not tied only to labour shortages. It is also tied to the bigger, cultural picture. We are trying to identify areas where we know there are people who have particular skill sets that match the areas where we are looking for more workers. As well, there is the language issue, and in many instances the issue of credential recognition. There are so many areas, but we have been open and are trying to grow many different cultures. However, we will try to be more targeted, particularly on the labour side.

Senator Peterson: This is my first visit to your island, and in the short drive from downtown to here I tried to grasp the overwhelming situation of so few people and such a big area. Thinking of all the infrastructure you need and then looking at your graph — if I were the financial officer of this area I would almost be terrified. How is this going to play out? It has got to be an alarming problem.

Ms. Noonan: Absolutely. There are economies of scale, and we talk about access to health care and transportation, everything that we could to do. Have you seen our bridge? We are quite proud of it. We have done research locally and have interviewed people who have come here, and many of them said they would never have thought of moving here if the bridge were not there. That is an example of what infrastructure has been able to do, plus what it has done for the transportation of goods. It is just amazing. I am sure Senator Callbeck can recall many, many hours waiting for the boat before the bridge was built. I had the honour of being on the longest crossing ever. We were stuck in the ice up off of Summerside for over 36 hours. It was quite an experience.

You are right. That is part of our problem when we look at formulas for funding. For example, I mentioned the settlement monies that were identified. We tried to impress upon the folks in Ottawa that when you use the same formula in P.E.I. as you do in Toronto it does not work because we have very different circumstances and different issues that we have to address. It becomes a major problem. For economies of scale, I always use the example from schools: there might be 30 children in a classroom in Charlottetown and only eight children in a classroom in a rural area, but you still need a teacher and a classroom; you still have those basic costs. Per immigrant or per capita funding does not meet the challenges.

Senator Mahovlich: In Ontario, many problems are from large businesses and stores coming into the area, such as Costco, Wal-Mart and Canadian Tire. This has ruined the smaller main streets of rural areas. Has P.E.I. suffered the same problem?

Ms. Noonan: I would say yes, in a sense, although sometimes I wonder where all the people come from to shop. We do have the Wal-Marts and the Canadian Tires. We do not have Costco, but we have many of the major chains. Pretty near all of them have set up here. Of course, we do not have Callbeck's general store in Bedeque anymore. We do not have any of those.

Senator Mahovlich: They were forced out of business.

Ms. Noonan: Yes.

Senator Mahovlich: You were talking about skilled workers. I read an article yesterday about a fellow in Campbell River, British Columbia. He is a gynecologist. He has been waiting five years for his citizenship and has decided he has to move. He will go to Australia. Are there similar problems in P.E.I.?

Ms. Noonan: I read the same article. Each case is different. I think he had left the country twice and gone to South Africa, and part of the issue was checking on why and serving in the military. I understand the issues around security and fraud and so on that Citizenship and Immigration Canada has to deal with. We have not had too many examples of that kind of situation.

We use the same analogy with immigrants as we do with our university students. We figure we put our money in and we provide their training and then they leave. With many immigrants, we provide English language training and we get them to a point where they are able to function well in the language, but the cultural connection is missing because we just do not have the numbers in their ethnic communities, so they leave and go to Toronto or Montreal where those other elements exist. That is a challenge for us.

Our retention numbers are improving, I have to say. We are retaining more of our immigrants than we were. Really, we have put dedicated resources to this only in the last two or three years.

Senator Mahovlich: I think you have to pay more attention to the skilled and trained workers with experience.

Ms. Noonan: Right.

Senator Mercer: As a fellow Maritimer, I appreciate that some of P.E.I.'s problems are similar to those of Nova Scotia. I find it curious that over the last three to five years immigration has become a hot subject in all of the Maritime provinces. When we grew up, you in Prince Edward Island and I in Nova Scotia, immigration was never spoken of in the positive light that it is today. Now we are actually shopping around for people, which is an interesting change in the dynamics of our economy.

You mention in your brief that temporary foreign workers are becoming more common and may soon become the norm. Which countries are they coming from?

Ms. Noonan: The largest group we have had so far has come through Ocean Choice International. I believe 40 workers came last year and the company is looking to bring in 80 workers this year. We have also had requests from other people in the fishing industry to bring in workers; I think they are looking at Poland. Many employers have come to us for help because they do not understand the system and believe it is very complicated. We are there to facilitate the process and make employers aware of what is available. This is quite new.

Senator Mercer: The workers who come must do a good job or you would not invite them back. Do any of them try to stay or want to stay?

Ms. Noonan: In my experience, none of them have said they will not go back to their own country, but many have indicated that they would like to come here. The first big group of people who came here last year have gone back but it is my understanding that they are returning here again this year. Some have indicated that they would like to come permanently. The province would nominate them if they had an offer of a full-time position.

Senator Mercer: With respect to the shortage of labour, you highlighted four industries: Ocean Choice International, the aerospace industry, fishing and farming operations, and the long-haul trucking industry. The lack of long-haul truckers is a big problem everywhere since driving a truck is not considered to be a skill, according to the immigration people, until you try to hire one.

What is the shortage in fishing and farming operations?

Ms. Noonan: Last year, a fisherman, actually it was a mussel farmer, had to tie up a couple of his boats because he could not get anyone to go out and work on the water in the fall. At the same time, the farmers were trying to get the potatoes out of the ground. We had a terrible fall; in October we had heavy rains and the soil was very wet. People were quite panicky and were trying to get more workers but they just were not there. Fish processing plants and other workers were actually going out and doing some of the fishing for the mussels. It was amazing.

Senator Gustafson: Most of your farmers are potato farmers, are they?

Ms. Noonan: The majority are, yes. Spud Island.

Senator Gustafson: Would quite a few of them be dairy farmers?

Ms. Noonan: Yes, we have quite a few dairy farmers.

Senator Gustafson: The headlines in your paper today indicate that the farmers are in big trouble here. Input costs are the big cause. We are an agriculture committee studying rural issues. Tell us, if you could do one thing to help the farmers, what would you do?

Ms. Noonan: I think you will have a witness later who knows a whole lot more about that than I do. Even though I was brought up on a farm, I have not been there for a long time. I am sure that there are people who can answer that question much better than I can. However, from my perspective regarding the area that I work in, we could help the farmers find the workers they need, if in fact that is part of the problem. I know there are costs. Farmers have experienced border closures and diseases. They have had problems with weather, which we cannot control at all. The costs of transportation and of labour are huge. The costs of land and of machinery, just to get someone started, are phenomenal. I do not know how young people would ever get into farming today. It is a family thing, I think.

Senator Gustafson: The committee has had no trouble finding the problems. The problem is to find the answers.

Ms. Noonan: I know, and they are not easy to come by.

Senator Gustafson: Your experience is, I must say, and I want it on the record, quite general to the problems of all of Canada for agriculture. I believe that our governments, regardless of political strife, are going to have to take seriously the situation of agriculture in Canada and start to take steps to turn this around, or as a country we will pay a big price for our negligence.

The Chairman: That is one of the reasons we are having the committee.

Senator Gustafson: It is the only reason.

The Chairman: Yes.

Thank you very much, Ms. Noonan. It was great to have you here to get us off to a quick start. We would be more than happy if you remained and at the break we can have another chat.

Colleagues, I would like now to welcome our second witness for today, Jeanette MacAulay, Deputy Minister of Social Services and Seniors in the Government of Prince Edward Island.

Jeanette MacAulay, Deputy Minister of Social Services and Seniors, Government of Prince Edward Island: Good morning to everyone. Welcome. It is a beautiful cold day in P.E.I., but that is all right.

I put a few comments to print, which I think you have in front of you. It is great to be here today. The opportunity to discuss rural poverty is important to us since we are considered a rural province. Most of us from P.E.I. have our roots in the rural communities. I come from a farm in Souris, east of Charlottetown. In 1931, 63 per cent of our people lived on farms. Today, that figure is 4.5 per cent.

Compared to the rest of the country, the status of the poor on P.E.I. is relatively good. Ten per cent of our children live in families considered to be living in poverty, compared to a national average of 17.7 per cent; and of all Islanders, 6 per cent are considered to be living in poverty, compared to a national average of 11.2 per cent.

However, 13 per cent of our children aged five and under are living in families with income below the low-income cut-off level. That really speaks about our younger families, a higher proportion of whom are living in poverty.

What do we believe is the state of poverty? Why do we believe it is not quite as acute in this province? P.E.I. continues to believe that some infrastructure investment in our small communities, schools, health centres and libraries must be in place to support rural life. While there is an issue of sustainability, that has been a consistent policy perspective of many governments.

Community development initiatives are well supported by both federal and provincial governments as well as by the communities, further maintaining economic and social development. However, with the diminishing critical mass in our communities, it is an uphill battle.

There has been increased investment in programs that support the "hand up" for people as opposed to the "hand out." For example, the Family Health Benefit Program is a modest and yet effective low-cost drug program for the poor in the province. There are also child care subsidies and other needs-based programs that are not tied to financial assistance.

There is a perception that P.E.I. is rural and very scattered, but, with 24 people per square kilometer, we are one of the most densely populated provinces. It is likely that the closeness and the connectivity within our small communities keeps many people from being destitute, because the best of P.E.I. is that everyone knows everyone; the worst of P.E.I. is that everyone knows everyone. As a result, often those in most need do get community support.

However, even if we are not as bad as the rest of the country, 10 per cent within our communities is still too many children living in poverty.

Who are the poor in P.E.I.? They are the most elderly senior, the single parent, the 55- to 64-year-old, or the disabled. Any of these is more likely to be poor if they are female and single.

My day-to-day business deals with the population of Islanders who are the most vulnerable. We are the last resort providing the basics and the supports to meet the obligations of the state. Over the last ten years we have seen a 40 per cent reduction in the number of financial assistance cases. Our caseload now is dominated by single adults, often with mental health issues or with a disability. We have much work to do with these populations.

We must understand that while poverty is often measured materially, poverty is also reinforced by social isolation. Rural Islanders often lack transportation, which further isolates them from the broader community and affects their physical and mental health.

Although we have had success with a reduction in social assistance, leaving social assistance is not a success in itself. One moves to low-paying positions that really do not move one out of poverty. However, with programs that support this group, such as drug coverage, child care subsidies and housing supports, we can begin to break down the welfare wall and move towards assisting Islanders and their families out of poverty.

Our cultural reliance on seasonal work topped up by employment insurance has been the lifeline of our traditional industry base. It is quite pervasive in our rural communities and we need to support families to move beyond this.

What more do we need to do? The greatest freedom from poverty is to deal with the issue of literacy. The Government of P.E.I., in partnership with community and educational institutions, has taken this issue on as the greatest challenge we must all work on. We have extensive research that shows that the literacy levels are most severe in our rural areas.

We must continue to provide the right incentives that support people to work and not rely completely on financial assistance. Incentives could include increased wage exemptions under the provincial Financial Assistance Program or a national pharmaceutical and drug program.

It is interesting to see the discussions across this country around a catastrophic drug program. If you have a child with asthma and you are making $22,000 a year, there is no way you can afford that medication unless you have a drug plan, which most people at that wage level do not. That is catastrophic for such a family.

We must ensure that training opportunities are available to all individuals and not only those who use the EI system. The lack of supports to the underemployed to improve their skills requires serious improvement.

We know that if people can increase their standard of living and stay in their communities, they have pride; they show the pride in their children; they own their own homes. These are very important dimensions of people moving out of poverty.

We need comprehensive economic plans for rural areas that include access to high speed, Community Access Program sites, transportation alternatives, affordable housing through a modern social housing policy, and access to training and skills development. Housing is one of the areas under our portfolio, and the need for a national housing strategy is absolutely critical. One of the more well-considered programs across this country is RRAP, the Residential Rehabilitation Assistance Program, which supports renovations and repairs in homes. We have a six-year waiting list for people. These are rural homes for the most part. It is a tremendous program, but poorly funded.

We also know that we must go to the people. Research indicates that many of our residents do not have the skills or the confidence to move outside their community to attend some form of post-secondary education, and that further perpetuates the cycle of dependence. Early childhood development and Best Start, which is a highly successful early intervention program, help to stop the cycle of reoccurring literacy and learning challenges.

Finally, we must continue to support community programs like Seniors Peer Helping, where seniors visit an often poor and certainly lonely senior in their home, offering conversation and friendship, or the federally funded network of family resource centres that reach out in a non-judgmental manner to at-risk families. These are important community programs that identify and support our poor.

We are blessed in this province to have a very high percentage of people who still want to volunteer, who still go to church. These important elements help our communities to stay vibrant and to reach into the homes of the most poor.

In summary, rural poverty does exist and it holds our communities back from their full potential. The key in designing appropriate social policy to address poverty is to acknowledge that poverty is complex and that it does exist. Simple one-on-one solutions are not effective. Policy development in this area must be multi-pronged, across our governments and long term in its nature. We have to address economic and community development and include the federal and provincial governments in an integrated way.

The Chairman: I was delighted to hear that Prince Edward Island focuses constantly on literacy. Literacy has been the core of everything I have done since I became a senator, and I have spent many a vigorous and happy hour travelling every square inch of this province with your literacy workers. It never gets easier, but you are darn good at it. Thank you for that.

Senator Mercer: I will continue the discussion of literacy, because if you want to get the chair's attention you put the word literacy in whatever you say and her ears perk up, for good reason. It is an important issue and one that she has championed.

I want to talk about the cuts that the current government has made to the funding of literacy programs. What effect will that have on Prince Edward Island when we come into the new fiscal year? You have identified literacy as the number one thing to do and the Island has a reputation of trying to address this issue. What happens now that the money has been cut?

Ms. MacAulay: My understanding is that the funding that was cut was not going directly to programming, but I could stand to be corrected on that. I think Premier Binns has spoken with some concern about that to the Prime Minister. Money is always an issue, but how we get in and do it is perhaps more important.

I just spent three years at our local college. At Holland College we have a strong adult education program and we had ample research money to try to help people on reading and recovery. With support from Human Resources and Social Development Canada, we approached people on EI to work on this research project around reading. Most people did not think they had a problem. Most were in levels 1 and 2. How do we get people to understand that levels 1 and 2 are not enough, that there is a freedom in being able to read at a higher level? Their coping skills have been so honed over years of faking it.

I think that while money is critical, so is getting the attention of maybe the business community in terms of the lost opportunity. The Irvings have been very successful with education and training right in their workplace. They support their employees and give them time to do the training. Those are more the issues right now, and getting the attention.

We have been at this for a long time, as has the rest of the country, and still we have a 40 per cent literacy problem. We have not made any improvements, so I think that somehow we still do not have it right.

Senator Mercer: It is a constant struggle that we all working hard at, but as the population changes and we keep bringing new people to the country the problem will continue to exist.

Unfortunately, the money that was cut may not have been going directly to programs, but it was going to the people who run those programs. If we do not have those people, the programs will suffer.

I will move on to another question. Child care was mentioned. Has the government's new program of $100 per child per month, $1,200 per year, had a positive effect on Prince Edward Island? What has it done for families who need full- time professional child care?

Ms. MacAulay: The Universal Child Care Benefit brings about $10 million into our province; that is a sizeable amount of money coming into circulation.

Last week we released our action plan for child care based on the trust money that was provided to us. We are aware that most child care centres increased their costs to parents last July at the time the $100 commenced. Some of the day cares increased their fee to as high as the $100 a month and there was of course a push back by parents.

Unlike in the rest of the country, where only 14 per cent of children have access to regulated child care, about 50 per cent of our children have access to child care. Our issue is the sustainability of our child care centres. In the urban areas it is not a problem, but in the rural areas, sustaining them with our seasonal rural economy is a bit of an issue. We announced a program last week that puts about 25 per cent more into that sector on an annual basis. We are still hearing that it is difficult for all parents to get access to the kind of regulated child care they want. Frankly, we are anxious to see how the second component of the government's program will work around helping the business community with the unique things that need to happen to respond to the needs of shift-working families. Our child care centres do not accommodate that sector very well.

Senator Mercer: As an Atlantic Canadian, I recognize the need to preach in Ottawa about the need for decentralization of government departments and services. Prince Edward Island is the Petri dish for this; you have a unique situation. I would appreciate hearing your comments, and I will ask others throughout the day to comment also on the positive and/or negative effects of having Veterans Affairs Canada come to Charlottetown and the GST centre in Summerside.

Ms. MacAulay: You may be aware of a report that was completed by Veterans Affairs Canada about two years ago, which showed that there certainly was an economic benefit. Many of my colleagues and friends have gone to work at Veterans Affairs Canada. I think it has been hard on their personal life because of the travelling back and forth. The centre of the universe is still Ottawa when it comes many of their issues. Some of those employees are encumbered by having to make three trips to Ottawa every week, and that does not change. We have to take into account the effect on their lifestyle.

However, we have seen a shift in our culture. The numbers of English and French-speaking people have changed because of Veterans Affairs Canada in particular, and that has been very positive for our community. I think it has added a lot to P.E.I. It is an asset. Many of our leaders within the volunteer sector are from the federal government. Also, it has been quite beneficial to have good paying jobs. Altogether it has been very positive.

Senator Peterson: You indicated that in 1931, 63 per cent of the people lived on farms and now only 4.5 per cent do. Has the footprint of the rural area changed since that time? Are we still talking about the same number of acres or has urban sprawl taken some of the land?

Ms. MacAulay: I do not know exactly. I do know that only 30 years ago, Souris Line Road, where I grew up, was a prosperous community of dairy farms. My brother still farms, but he has moved from dairy to potatoes. Souris Line Road is a sad-looking community now because it does not have the level of beautiful, well-kept farms that it used to. It has a lot of land that is flat and growing potatoes.

My sister and her husband grow potatoes in Fortune, which is a beautiful, pristine area of the province. Many individuals are buying up shore property and they do not like the spraying schedule. It has been a real challenge to have urban or part-time individuals retiring in our rural communities and exerting their influence over farming practices. Some of it is good, mind you, but very frustrating for the farmers nevertheless.

Certainly there has been an incredible change.

Senator Peterson: You did not mention food banks in your report. Do you have food banks, and how prevalent would they be?

Ms. MacAulay: We do have food banks and, unfortunately, they are well used. We have a soup kitchen. The Salvation Army is alive and well in both Charlottetown and Summerside. There are nearly-new shops in our smaller communities. Our churches offer a lot during the Christmas season and at other times.

Senator Peterson: Is it mostly urban or rural?

Ms. MacAulay: Visibly it is urban, but on a smaller scale maybe the churches in our rural areas are still offering that kind of help. If people cannot make it to the next cheque, whether that is financial assistance or another type of cheque, they will avail themselves of the local church to ask for help. That still happens a lot.

Senator Callbeck: Has the demand at food banks gone up much in the last five years or is it stable?

Ms. MacAulay: I understand the demand has gone up. Sometimes they have been very effective and the community has been supportive in the outpour of support. I do not want to diminish the need, but I often think supply creates the demand a little bit too. Unfortunately, when you speak to the manager of the food bank in Charlottetown he sees more and more of our younger families getting support from the food bank.

We are hoping to get an increase in the allowance for food under the Financial Assistance Program. It has not been increased for four years. We know that that needs to change.

You ask what is wrong that the farmers still are not surviving. We are trying to put enough money into financial assistance, but $1.5 million, which is a lot of money in a small budget, would represent only about a bag of apples a week for a family with the number of cases we have. It takes a lot of money to go around. One reason is the cost of vegetables and fruit at the grocery store — not what the orchard grower would get, but rather the cost at the store. Especially at this time of year, the cost of vegetables and fruit is prohibitive. I expect families with small children are buying fruit and vegetables at the grocery store and then going to the food bank to get their staples. That would be my guess.

Senator Callbeck: You mentioned an improvement plan for rural homes and that you have a six-year waiting list. How many people, roughly, would be on that list? How many can you do in a year?

Ms. MacAulay: I am trying to remember how many we do a year. CMHC administers that program, and it is funded 75 per cent by the federal government and 25 per cent by the province. I believe we do fewer than 100, but it is a sizeable amount when you consider that we have a five or six year waiting period and you need a new roof on your house. They are queued based on priority, but it is unacceptable. Getting on the list indicates that you have a need already. Often the people on the list are our seniors in particular who are living still in the old home. There would be 500 or 600 people easily on that list.

Senator Callbeck: Is that right? I know there is a demand, because I have had people talking to me about it.

Ms. MacAulay: You would hear it through the RRAP program, senator.

Senator Callbeck: When you spoke about comprehensive economic plans for rural areas, you mentioned access to training and skills development. Certainly the statistics that Ms. Noonan showed us earlier indicate that that is very much needed because of all the new jobs requiring more skills and education. Have you got any ideas about how we should be doing that or what the federal government's role might be?

Ms. MacAulay: When I was at the college I took great interest in seeing who went for adult training. Often people who have had a bad experience in the educational system, which is many of the people we are referring to, do not go for adult training. There are those who just want to learn for the sake of learning, but most people need to see the relationship between education, skills development and training on the one hand and where it can take them in their job or in the economy on the other. Without that connection, I am not sure how helpful it is. We would see the number of people at the college going for adult education, but it was not often the people who were on the fish plant line. Some might have gone because they had to in order to keep their EI, but that is the wrong motivator. Somehow we have to make the connection between training and employment. Some of the western provinces have done interesting work on essential skills development where, if you want to be a truck driver for example, they identify the literacy and numeracy skills needed for that profession and then train you to that level. Then people see an outcome for the training. They see what they are driving toward, as opposed to just another bad experience. That would seem to be an appropriate motivator that I could imagine, senator.

Senator Mahovlich: Is there a country that you look up to for an example in the way they handle their poverty? Do they do a better job than we do? In the 1950s I was in Chicago's skid row and there were lineups miles long of soup lines. Somehow they got rid of that. They put a highway through there. They solved that problem. I am wondering if we are on the right track here in Canada.

Ms. MacAulay: I do not have a particular country, but I have begun to look. We know that Ireland has done something right even though it has been highly fiscally supported by the EU community.

Senator Mahovlich: What about Norwegian countries?

Ms. MacAulay: Looking at what Ireland has done in education and what Finland has done in terms of the emphasis on family, I think what is right in a community is a well-educated, functional family, and perhaps everything else goes from there. We want to see families that are not so strapped, that recognize when they are stressed and understand that they have to do something about it, that understand the importance of spending time with their children and modeling reading to them. Statistics Canada's most recent report mentioned parents' spending 45 minutes — it may not sound like a lot, but consider how little now is spent with our children.

The emphasis has to be on family and on education. Premier Binns is very committed to the economic strategy, and I will say to him and to the staff that if we can get people healthy and make them feel that they are contributors to our society, our economy will run. Which comes first in this instance? We are a country preoccupied now by economic growth, I think at the cost of the foundation, the family. If we restore the balance needed there, our economy will grow even more.

Senator Mahovlich: There are many changes in Ireland's tax laws. Their population has increased from 3 million up to 5 million people.

Ms. MacAulay: As I understand it, they are now the gateway into Europe, and there are incentives to get Bill Gates and his companies and other such companies into Europe through Ireland, which is smart of them.

Senator Mahovlich: They have incentives for people like Bill Gates.

Ms. MacAulay: Absolutely. They also have incentives for people to go to education. They stream people in the latter part of high school, telling you that you will be a tradesperson whether you like it or not or you will get a science degree and they will pay you to do that. I do not think I support that. However, they have a much greater emphasis, perhaps, on education.

Senator Gustafson: I had the privilege of sharing an apartment with your premier, Pat Binns, who, incidentally, comes from Radville, Saskatchewan. He is in good shape to put this province right on the map. You can tell him that if you happen to get the opportunity.

Ms. MacAulay: I will.

Senator Gustafson: There is a phenomenal thing happening in agriculture across Canada and that is ethanol. Has your province some opening for that kind of thing?

Ms. MacAulay: I do not know enough about it, senator, but there have been recent initiatives to build an ethanol plant here. Some of the environmental organizations are concerned that it is just one step up, that it is not very environmentally friendly compared maybe to wind, but there is great interest. An entrepreneur is pursuing it and it has been in the press recently, but I do not know the details.

Senator Gustafson: What would they use for the raw material? Potatoes?

Ms. MacAulay: Yes, potatoes, and maybe the sugar beet as well. A company has been prospecting in the Georgetown area and talking with farmers to see if there is an interest in growing sugar beets.

Senator Gustafson: With 1,800 farmers and the opportunity that you would have on this island, you could become almost self-sufficient in energy, which would be a tremendous, unbelievable boost.

Ms. MacAulay: Yes.

Senator Gustafson: I would encourage that kind of direction.

Ms. MacAulay: For a long time there has been a growing emphasis on alternative energy sources, because for the most part we are reliant on New Brunswick. Our windmill centres in the east and the west are certainly a tremendous asset. Government does have a strategy of significant diversion by 2015. It is an ambitious agenda, but that is the plan.

Senator Peterson: Is there any First Nations impact on your province?

Ms. MacAulay: Yes. We have a very small First Nations community, about 1,000 people. This community has the same issues as First Nations communities across the country — many children and families that are in need of support. It does not get on our radar screen perhaps as much as it does in the west, but the same issues exist.

The Chairman: Thank you very much, Ms. MacAulay, for appearing here today. We wish you good luck with your future work.

Senators, we now welcome Rory Francis, Executive Director of PEI BioAlliance.

Rory Francis, Executive Director, PEI BioAlliance: Madam Chairman, it is a pleasure to be here this morning. I also welcome everyone to Prince Edward Island, and I appreciate this Senate committee taking the time to be here on this very important subject.

I have copies of a slide deck that you can peruse at your leisure. I will not go through each slide individually. I will just hit on some of the key messages and leave more time for discussion than presentation.

I have perhaps a little different take on what you may have been hearing in your travels across the country on this topic, in that the main premise of my presentation today is that we need to prevent rural poverty, as opposed to having the difficult job of dealing with symptoms after the fact. Senator Fairbairn and I were talking about prevention earlier, and I will come back to a topic that is also important. In fact, I would offer that the Senate is the appropriate body in Canada to be thinking about the preventative side of public policy, because having to deal with the crisis of the moment seems to be the job of the House of Commons and the government of the day and all too often there just is not the energy left to think about the preventative side. Prevention does not get the headlines in nearly the same way as does reacting to crisis situations and being seen to respond to issues of the day. Therefore, the Senate has a very appropriate role in thinking about poverty in terms of prevention and not only in terms of how to address problems after the fact.

I would start off by saying that governments must be prepared to invest in new economic infrastructure in rural communities if we are going to be able to break the vicious circle of reduced economic opportunity, reduced job opportunities, increased out-migration, reduced population density, lack of critical mass to support key infrastructure, which leads to rural poverty. I really like the graph in I believe your second report that showed that cycle. We are trying here in Prince Edward Island to reverse that cycle before it gets a foothold. It is extremely difficult. If you do not break the cycles early, or prevent them from happening, it is very difficult to turn them around after the fact. It is awfully difficult for communities to recover once they have started in the downward spiral.

That is what we are trying to do here in P.E.I. Over the next 10 to 15 years, the Atlantic region will be facing difficult, shifting demographics: the population is aging and declining, and you have seen the demographics for the labour force. There are serious signs on the horizon that Atlantic Canada's ability to sustain businesses and to sustain communities will be much challenged over the next 10 to 15 years. The Conference Board of Canada is predicting dire economic and social results for the region if something is not done. There is no point in waiting until we are in that situation and then saying, "Gee, we need to do something to reverse this trend." The time to act on these matters is now.

I would like to speak to the approach. How can we put public policy instruments and investments in place that can avoid and reverse a trend that is already well established as the direction we are going in Atlantic Canada, if we do not have an opportunity to re-establish our economic platform? I will use Prince Edward Island's bioscience cluster as an emerging example of an approach that we think is working and can work as a means of re-establishing a basis for an economy in what is definitely a rural part of Canada.

Bioscience use of biological materials, processes and technologies in the development of new products is a relatively new sector of the economy, producing products for health, nutrition, materials, bioenergy, environmental remediation and so on. It is still very early days in the application of these technologies to societal needs, but already biotechnology and bioscience are making a very big contribution in many areas.

In Canada, generally, we have a choice. The application of biotechnology and bioscience to needs in society will happen. It is already happening. The only question is whether Canada wants to be a participant in the development and the innovation of new products and these new technologies and thus capture that value for the Canadian economy. Or will we just be the buyers of the results, the better ideas and the better products, while other parts of the world will be where the innovations, the new products and the new economic opportunities happen?

Successful participation in the bioeconomy as a provider of those innovative products requires a very strong research and development foundation. It requires entrepreneurial companies and the support of public policy. Some would say that that means that only big players like Boston, San Diego, Toronto, Montreal and Vancouver can be competitive in the biotech sector. We are here to say that that is not the case, that there are opportunities for the rural parts of Canada. If done properly and in an organized way, bioscience clusters that have a market focus based on strong science and solid companies can be effective and can be the foundation for new economic growth in parts of Canada other than the large centres.

Slides 3, 4 and 5 give a quick statement on the Prince Edward Island BioAlliance. We are a not-for-profit corporation which has been formed as the facilitating structure for the work of business, research and government agencies all growing in the same direction to build a bioscience cluster in P.E.I. Our board of directors is made up of a consortium of business, research, academic organizations and government. It is a unique model in the country for bioscience and cluster development, but one that to date has been effective in making sure that we are very focused and have a plan that everyone builds on.

On page 3 and the following pages of the slide deck there are graphs that make the case of the changing nature of the economy of rural Canada, in this case Prince Edward Island. The impact of our primary resource industries on the overall economy is declining. Job opportunities are declining, and the demographics are going to create a real crunch for our economy here if new opportunities are not created to reverse those trends.

Geographically, we are limited in Prince Edward Island. There is only so much land base, only so much lobster and fish in the ocean, and we cannot continue to operate in a commodity market on a limited scale. Agriculture is a commodity business. That is not our strength. Thus, we are moving from that limited opportunity to the more limitless opportunity, which is using brain power to create new product opportunities in the bioeconomy.

Page 7 of the deck highlights our vision as a bioscience cluster and the nature of the collaboration happening there. It is important that this is a community-led effort to build a new economy and a new economic opportunity. The community of businesses, research organizations and government agencies is coming together within an organized model to have a plan that we can communicate internally and externally.

The slides on page 8 talk about what it takes in terms of the innovation environment to build a successful cluster. It needs a strong scientific foundation as well as entrepreneurial companies willing to take risk in establishing businesses that will be globally competitive, because that is the nature of this business. The companies are not selling into an Atlantic market or a Canadian market; it is a global market.

The next slides show what we need to create bioscience businesses and to attract bioscience-based businesses to this region and the infrastructure that is required to create job opportunities. We know from experience, even recent experience, that if we can establish in job opportunities that are challenging and well-paying, there is no difficulty for us to attract people here. The good news of the last couple of years has been our ability to attract high quality scientists, and businesses have moved some of their best people and leaders from China and Australia to Prince Edward Island to run their businesses here in our backyard. That has created jobs that span P.E.I. This is not just about Charlottetown; people are working here in research facilities in Victoria by the Sea and people commute to facilities from other parts of P.E.I. There is an impact all across the rural landscape of P.E.I.

We have also been clear about the targets we have set for our economic growth in terms of jobs opportunities, the scale of our private sector, and the scale of the research and development platform in the province, and we challenge ourselves to reach those targets. Our efforts are focused on particular areas within the big world of bioscience and biotechnology. We feel that you have to be very good at a small number of things at our scale, and that is our approach.

The slides on page 11 indicate our results to date, and you can see the growth in the number of companies that have established here or have moved to Prince Edward Island over the last few years. There are 23 companies with over 650 employees in the sector, which represents about $60 million in revenue per year. You can also see the growth of the research platform at the University of Prince Edward Island, not counting our new National Research Council facility. The money coming in for research contracts has more than doubled over the last five years.

Page 12 of the slide deck talks about our value proposition and how we communicate to the world what Prince Edward Island has that justifies an investment by business in our bioscience cluster and what else we can bring to create value for companies that are interested in the sector on which we are focusing.

The final two slides are about our recommendations. I want to go back to basics for a moment. I strongly believe that, given the demographic profile of Canada — of Western countries generally but particularly Atlantic Canada — we have been ignoring an important aspect of developing the labour pool: that is, we have not been spending enough time and effort on the basics of literacy and numeracy, starting from the base up. Without many very smart people working in clusters of bioscience or other sectors of the economy, we will simply not be competitive. We are leaving way too many people on the edge of the opportunity because we are not supporting families early in establishing sound literacy and numeracy skills. P.E.I. programs like Best Start are outstanding in North America and need to be supported. Programs that support parents from day one of a child's life to make sure that parenting and further supports are there to ensure literacy and numeracy skills are basic. With respect to school achievement, I believe that we do not put enough emphasis on the importance of the quality of education that our children need in Canada if we are to be competitive in the global economy. This applies to rural Canada at least as much, if not more, as to any other part of the country.

Access to capital for start-ups and emerging and growing companies is very important. There are a number of recommendations for what we can and should do regarding access to capital for private sector companies. I want to reinforce also the importance of investing in the infrastructure necessary to build in a sector like bioscience in rural places like Prince Edward Island. Those investments include the facility for the National Research Council Institute for Nutrisciences and Health, the expansion of the veterinary college in the province and the establishment of a bioscience technology program at Holland College. Those infrastructure components are crucial investments and we believe that all of Canada will see a return on the investment of public funds in those facilities through the establishment of a much more self-reliant economy in Prince Edward Island.

The Chairman: You certainly made my day with your recommendations on literacy and numeracy starting on day one, and where better a place to hear that than Prince Edward Island. Thank you.

Our next presenter is Erkki Pohjolainen, Economic Development Officer for Resources West. Before he begins, I would like to acknowledge our local MLA, Ron McKinley, who is in the audience. It is great to have you here. Thank you for coming.

Erkki Pohjolainen, Economic Development Officer, Resources West Inc.: Thank you for the invitation to speak. I would like to focus on Western P.E.I. It is probably no different than communities elsewhere, but I have become quite intimate with this community since I arrived in P.E.I. seven and a half years ago. I serve now as an economic development officer in the area, and before that I was the editor of the local community paper.

There are many influences at play that create and sustain rural poverty — everything from a lack of post-secondary education to employment opportunities to transportation issues and wage disparity. Rural development, quite simply, has not kept stride with urban development. I will focus on a few key factors.

There is no public transit service in Western P.E.I. and there are no taxis. We are a vehicle-dependent community with great distances between places of work and schools and so on, and there is no opportunity to get to those places for people without a car. Those who rely on neighbours and relatives for rides are at a significant disadvantage with respect to employment opportunities and access to education, medical services and all manner of social engagement. They remain in a perpetual state of disadvantage just by not being able to get about.

There are instances of seasonal employees not renewing their vehicle plates until they are back to work, and so through the winter months their vehicles are in minimal use, illegally if at all. That affects everything from children's participation in after-school programs to the adults leading a social life outside of their immediate community. Even grocery shopping can be a difficulty, which generally stigmatizes families.

Adults over the age of 60 years in West P.E.I. recall having to coordinate rides with teachers and so on to get to Summerside so they could attend high school. For the majority of them, schooling ended around Grade 8 or 9. Until recently, youth in the community have lived in their elders' shadows with the mentality that what is good enough for the father is good enough for the son. In some pockets there remains a lack of appreciation for the opportunities that an advanced education can provide. There remains an attitude that reading a book does not put food on the table. That mentality echoes through many conversations in subtle ways, and of course it advances literacy challenges.

There is limited college programming available locally. Holland College just started a business program in Tignish, but until then we had only one community college which offered a sporadic, one-specialty program in business. There is no on-going, consistent effort to deliver college programming, let alone university. Some industrial courses are available in Summerside, but attendance requires transportation. The university is in Charlottetown, so youth would have to leave the community, and in some instances they are expected to stay home and work.

Furthermore, those who do obtain university degrees often find that there is no work in their discipline locally, so they have to leave in order to pay off their student loans. The result is a drain on the community.

Our primary industries are farming and fishing, and tourism is a close third. All three are seasonal and therefore fall short of providing year-round, permanent employment. That leads to employment insurance dependency through the off-season. EI is consequently used as a subsidy rather than as an insurance program.

There is a reluctance to change, but the mixed family farm cannot support families. To be successful, farming has to be a business venture as opposed to a way of life. Specialized crops and livestock, such as organic produce, milk and eggs or exotic meat, offer opportunities for family farms to enter niche markets that industrial farming cannot serve.

Local small business owners typically started as owner-operators and through time required help as their businesses grew. The owners seldom have a background in human resource management or work delegation. Throw high unemployment into the mix and what results is a staff selection process that has less to do with the job that has to be done than with a friend or relative needing a job. Often this works out okay, but in some instances, the result is a lackluster performance that prevents the business from growing further. As a result, income levels suffer for all involved.

Often, too, the jobs immediately available in rural settings are basic positions offering little challenge and poor to mediocre pay, with little to look forward to in the way of promotion. Because of higher unemployment there is a persistent nuance that employees should feel lucky to have a job and that if they are discontent they can be replaced. Hence, pay scales that might in other circumstances be higher remain low, and individuals capable of more advanced challenges remain underemployed.

There are challenges for entrepreneurs. There is a dependency on self-employment to create work in the rural areas — everything from car garages to plumbers. However, many of the budding entrepreneurs are ill-equipped to overcome the challenges of a business start-up. Furthermore, if someone is successful in a given field of self- employment, others in the community will promptly try to emulate that success, leading to poor results for the upstart as well as diminishing the success of the original entrepreneur.

In retirement, after a lifetime of seasonal employment and low wages, the accumulated Canada Pension Plan benefits are minuscule, and private pension plans and registered retirement savings plans do not exist. Consequently, retirement is a continuation of the same poverty that was experienced throughout the working life, and to make ends meet, Old Age Security payments are supplemented with periodic bouts of menial employment during what should be life's golden years. At times, such elderly folks are forced to take residency with their children for lack of other options, and the cycle of perpetual poverty flows from one generation to the next.

I would like to wrap up with a couple of solutions. On public transit, there is a study underway to implement public transit throughout P.E.I. That will be a significant boost.

We have to foster more demand for education, and it has got to be a mindset that wants the education as opposed to just making it available. The World Wide Web can offset the void of local post-secondary institutions. There are programs for entrepreneurship development that could be expanded upon. Continued training for business owners does happen and the more it happens the better.

Financial institutions could extend a little more risk to development outside of the urban areas. They tend to focus their investment more in the municipalities.

The wage disparity between rural and urban should be minimized to reduce the drain of talent and ambition. A case in point would be doctors. A provincial announcement just came out about pay equity. For some reason, doctors in Montague are paid $400 a day better than doctors in Alberton, and there is a greater disparity still between city doctors in Charlottetown and Summerside versus rural doctors. I understand that in other jurisdictions it is the other way around.

We have to confront the make-do attitude where individuals dare not entertain aspirations for a better future for fear of failure. That attitude is a safety net that people have developed over time; they try not to succeed in order to avoid disappointment.

Finally, we have to offer an environment where everyone can aspire to gain meaningful, permanent employment rather than hoping to get their stamps to qualify for EI.

The Chairman: Thank you both very much. We do appreciate your concern about the various aspects of education at every level.

Senator Gustafson: Mr. Francis, the idea of preventing poverty is very positive. Our researchers should take special note of that; it is a point we have to emphasize.

The big problem in agriculture today right across Canada is the commodity prices. In 1970 we had a barrel of oil at $2.00 and a bushel of wheat at $2.00, and now we have oil at $60.00 and a bushel of wheat is still at $2.00. We have come up with all of the grandiose ideas of how to solve the problem, except putting more money into the farmer's pocket. As long as we do not put money into his pocket we can educate the world, and he is not going to be able to hire any help.

I met a fellow on the way from Regina. This will take a minute, but it makes a point. He was dressed for the south, flying to Arizona, so I thought he was a prosperous farmer. I asked him what he did for living, and he told me he was a farmhand working for a farmer all his life. I asked him what he lived in in Arizona. He said he had a fifth wheel trailer and a half-ton truck that he just parked; it costs him $1,300 a year to park his trailer in Arizona. I thought, now here is a story of a successful man who worked as a farmhand all his life; he has done well and has a good retirement. The problem is that the guy who hired him cannot afford to hire him now. That poor farmer would never make it. Until we solve that problem, we are in big trouble in agriculture in Canada. Therefore, I commend you on your approach of dealing with the problem before it becomes a problem.

Mr. Francis: I was in the public service in P.E.I, including with Premier Callbeck. Over the years I have found that P.E.I. always had a very close connection with Saskatchewan from a public policy standpoint. Whether it was agriculture or health policy, we always seemed to have a tight connection. I think that is because of the nature of the communities. We also have a close relationship with folks in Saskatoon who are working very hard to develop new economic opportunities in Saskatchewan around the bioscience sector. Back in the early 1990s some very smart people in Saskatchewan and Saskatoon stepped out and said, "We will make a significant investment in the future in the area of biotechnology and try to create new opportunities for agriculture and for our communities." That was very forward thinking. We would like to have moved that early as well. We are playing catch-up with Saskatoon to a certain extent, but I think they have done some great work there.

Senator Gustafson: I would like your thoughts on this. It appears to me that we have not done a good job of looking at the global situation and how it affects us. In research I think we have to start to look at the global situation and how we as Canadians fit into that picture.

Mr. Francis: We can sit back and curse the darkness all we want about how the world is changing and so on, but that does not help much. We have to get over that fairly fast and decide how are we going to be competitive given that the world is changing and how our rural communities can be part of the new economic opportunities that are coming along. That is certainly part of the thought process behind what we are trying to do in our own way here in P.E.I.

Senator Peterson: Mr. Francis, I am interested in your cluster development. Do you have a research park?

Mr. Francis: The university campus has become our research park at this stage given the presence of the university science faculty there; the Atlantic Veterinary College and the Food Technology Centre are on the campus, and now the new National Research Council institute is there. Not all of the facilities are on the campus, but the research park is largely located there.

Senator Peterson: Is it like an incubation centre then? Is private sector money going into this?

Mr. Francis: Novartis recently invested about $8 million in a new facility to expand an aquabusiness in the industrial park, which is five minutes from the university. A lot of private sector money is going into collaborative research programs with the National Research Council and the university researchers, particularly through the Atlantic Innovation Fund. This Atlantic Canada Opportunities Agency initiative has been an important public policy instrument to help bring private sector investment into the cluster in the bioscience area.

Senator Peterson: I gather that the bioscience cluster is relatively new. Have you had any direct success in commercialization? Have you been able to commercialize something and say, "Look, here is what we did"?

Mr. Francis: Commercialization has to be done by private sector companies.

Senator Peterson: I understand that.

Mr. Francis: The companies have to be here. The first DNA plasma vaccine registered in the world was developed here on Prince Edward Island. That was done in a fish health application by Novartis Animal Health within the last year and a half. Taking that product to market was hugely important for the aquaculture industry on the West Coast of Canada. Progressive BioActives Inc. developed a yeast beta glucan product that is being used in Canada, the U.S. and internationally as an antibiotic replacement in animal feeds for swine and poultry. It has applications in shrimp as well, as another example. BioVectra DCL, the largest company here, is working on a series of contracts. Over many years they have established a reputation as one of the best contract manufacturers developing pharmaceutical ingredients for large pharma companies. They run the largest and most capable facilities east of Montreal for extraction purification processes. I could go on with other examples.

Senator Peterson: As a centre of excellence in the bioscience sphere, would you rank fairly high then across Canada?

Mr. Francis: We are small, but in the areas we have focused on we have some companies and researchers who are unquestionably absolutely world class. We are focused on a few areas, including animal health and nutrition; fish health products; and human health in a few areas where the National Research Council people have expertise, such as Alzheimer's and other neurological diseases and obesity-related diseases. In those areas of focus we have extremely competent people.

Senator Callbeck: Mr. Francis, that is a very encouraging presentation. Your targets for where you want to be by 2010 are aggressive; hopefully, they will be met.

You mentioned that to create these new bioscience businesses you need research entrepreneurs and the infrastructure to support the start-ups. What does that infrastructure include?

Mr. Francis: We need the ability to move companies. Currently the infrastructure we have for research programs is housed in the National Research Council Industrial Partnership Facility; there are six modules there for businesses carrying out research programs in areas of collaboration with NRC researchers. Five of the six modules are full already, and the facility opened just last week. Already we are running out of space for companies wanting to do that product development work.

For the next stage of development, we have floor plans ready now for a project called a business accelerator, where early-stage companies can share common infrastructure, common facilities, access to equipment, and so on. That keeps their operating costs low for the early stages. A portion of that facility will be for fish health product development, so it will have tank space and so on to support the work needed to bring products, vaccines, and therapeutics for fish health through the commercialization process.

The focus has to be on what it takes for companies to develop their products successfully and get them to market. This project will provide customized infrastructure for early-stage companies to help them pass successfully through the valley of death between a good science idea and a successful business.

Senator Callbeck: You said that most of the market for these products is international, in other countries. Is it getting easier to market the products?

Mr. Francis: It has always been challenging, but I think the skills of the people involved are getting better. I think in Canada generally the next generation of people are much more comfortable with the international market and travel and movement and so on. They probably have a second language. We have come out of our shell over the last generation in particular. It is mostly a mindset and an ease of movement in the world that are important in this context, and I think we have made fairly large strides forward in that regard in Atlantic Canada. It is so important for children to be exposed at an early age to other languages and to have the opportunity to travel internationally, because that is the world we are in.

Senator Callbeck: In your slide deck, under the recommendation to improve access to capital, you mentioned angel networks. Are they becoming bigger in Atlantic Canada?

Mr. Francis: Yes. Angel capital is capital from investors who can be patient, who have probably made a good deal of money in some other business. They may be retired, but they want to be involved in business. They want to invest in something new and interesting, and they do not need their money back next year. They can be more patient. They may even provide advice because of their experience in business, which comes with the money, if you will. First Angel Network Association out of Halifax is also active here in Prince Edward Island. It is the first network of its kind in the Atlantic region that I am aware of. Other venture capital operations — GrowthWorks Atlantic Venture Fund and Farm Credit Canada's venture fund — have been important contributors as well, but the First Angel Network Association, which is still in its early days, is our first experience with having access to that kind of patient capital.

Senator Callbeck: Mr. Pohjolainen, you mentioned some solutions. I want to ask you about a couple of those. You said that we have to foster more demand for education. Do you have any suggestions as to how we do that?

Mr. Pohjolainen: I think a good start is to see what is happening in the fishing industry, for example. Youth can no longer expect to take over the father's boat when the father decides he will not fish anymore. It is happening naturally anyway, but accelerate that. As Mr. Francis said, maybe exposure is needed to more of an international culture where you cannot be dependent or reliant on things the way they were. You have to look forward. Maybe if we can introduce youth at a younger age to that mindset, there will be fewer roadblocks ahead for them if they are in an environment that is changing already or if they recognize the changes taking place.

Senator Callbeck: You mentioned programs for entrepreneurship development. Such programs exist; I see them advertised in the newspaper.

Mr. Pohjolainen: We delivered three of them: marketing manoeuvres, honing human resources, and planning for growth. They are designed to address specific issues. We have had tremendous success with funding from federal and provincial agencies. As I said earlier, entrepreneurs typically start up a business on their own, grow with it, and never really focus on the growth of their business. We encourage them to take a step back and to look at the business as a business rather than as a way of life or a thing they do, and that fosters the opportunity for greater growth and expansion and sharing of knowledge. In doing so, we have already developed some networks. Businesses are now doing business with each other locally as opposed to relying on suppliers from overseas or across the country.

Finding the bits of information that business owners are missing and then delivering education to meet those needs is paving the way ahead.

Senator Callbeck: If you had three successful programs, there must be a real demand for them.

Mr. Pohjolainen: Absolutely.

Senator Callbeck: Is the demand from business entrepreneurs? Do they want to attend programs?

Mr. Pohjolainen: Yes. Typically we charge about $200, and the model we have developed has a consultant working one on one with the business and then there are five or six group sessions as well. Thus, for their $200 commitment, the business owner gets 20 hours of one-on-one time with a consultant and all the in-class work. Two of the three programs were fully subscribed. The other program had room for 12 participants, but because a couple of businesses did not want to participate or did not really meet the criteria — they were full-time, year-round employers of two to 20 people, which was not the market we were trying to reach — we had to settle for 10 participants. There has been great uptake from the business community.

Senator Callbeck: Do we need more of these programs and to expand on them?

Mr. Pohjolainen: Absolutely. Yes.

Senator Mahovlich: I want to commend Mr. Francis on a great presentation. I see the cluster of colleges and schools, and one sticks out in my mind, Holland College. Do they study culinary arts there? Do chefs come out of that college?

Mr. Francis: That is right. The Culinary Institute of Canada is within Holland College.

Senator Mahovlich: Do you attract students from the mainland?

Mr. Francis: Oh, yes. Senator Callbeck will know more about this than I do, but the majority of the students are from outside Prince Edward Island. Holland College has always been of a different cut than many colleges in Canada. In many of its programs, the majority of the students are from outside of Prince Edward Island. It has been an entrepreneurial college for many years.

Senator Mahovlich: How many years?

Mr. Francis: Senator, help me out with this. How many years has Holland College been in existence? Since the early 1970s, I think.

Senator Callbeck: I was going to say 1979 off the top of my head, but maybe it was earlier.

Mr. Francis: Somewhere in that range.

Senator Mahovlich: We have chefs in Toronto, probably, who have come out of Prince Edward Island.

Mr. Francis: Absolutely. Holland College turns out world-class, award-winning chefs on a regular basis.

Senator Mahovlich: I see many studies are happening around lobster and shellfish. Have we made any progress with lobsters? Do we have an abundance of lobsters now because of the studies?

Mr. Francis: I would not say it is because of the studies. In my opinion, the health of our lobster industry, which is still quite good, has been more luck than good management, frankly. Amazingly, there has be been a sustainable harvest each year for many years, which has not been the case for other groundfish species. With all due credit, there have been a limited number of fishermen and a limited number of traps, and so it is a limited-catch fishery. There have been some moves, not always popular, to make sure that there were abilities to protect small lobsters for the future. All of that seems to have been part of making that a sustainable fishery.

In the absence of a lot of good biology and good science about the fishery, the AVC Lobster Science Centre was established at the Atlantic Veterinary College within the University of Prince Edward Island. With its emphasis on fish and shellfish as part of its mandate, the veterinary college is quite unusual in North America. Most of the veterinarians who support aquaculture in North America come from the Atlantic Veterinary College, which leads in part to our focus on fish health products in our bioscience cluster. The lobster folks have also been working not only on understanding population dynamic issues in lobster, but also on issues like how do you know when a lobster is healthy when you take it out of its natural environment and what are the best storage systems for lobsters. How do you maintain the health of the lobster, or how do you measure the health status of a lobster? We can take our own temperature and blood pressure, and there are traditional ways of checking the health of food animals, but for lobster that kind of research had not been done. Now it is happening and it will certainly contribute to reducing storage losses, which amount to millions of dollars a year in the North American lobster industry.

Senator Mahovlich: That is very interesting.

Mr. Pohjolainen, you mentioned retirement, and I am at that particular age. I find I do not have enough money, and I did not plan properly. It is very hard to break the mould, to get companies to think about the future as far as pensions go. I was a professional athlete at one time, and they did not think about what the cost of living would be today. They were not prepared for what is going to happen. At the present day, I am not quite sure. The present players do not really need a pension, because there is so much money there, but for teachers and for farmers particularly the situation is different. Do have any idea what governments should do for a farmer to look forward to a nice retirement?

Mr. Pohjolainen: I do not have any suggestions, no.

Senator Mahovlich: This it is. We have to break the mould, and yet no one can do it. No one has a vision. We have to do something or else the children will have to look after me or the farmer.

Mr. Pohjolainen: I do not know that the answer is exclusively a reliance on government to do something. Socially, we have to accept responsibility for ourselves a little bit as well.

Senator Mahovlich: Well, we are the government really.

Mr. Pohjolainen: We are, that is right.

Senator Mahovlich: We have to come up with a game plan of some kind.

Mr. Pohjolainen: Could that game plan then be incentives for businesses to put in RRSP packages to supplement or to complement what is already in place through the Canada Pension Plan? If so, then maybe some influence could be leveraged to encourage that conduct from businesses.

Senator Mahovlich: Yes.

Mr. Pohjolainen: If that influence were from government, then perhaps it could be through taxation incentives.

The Chairman: Thank you for raising that point.

Senator Mercer: I want to talk about the funding for your project. You mentioned the Atlantic Innovation Fund and Atlantic Canada Opportunities Agency. Has the federal government provided funding for a chair at the University of Prince Edward Island, or has the university done it on its own?

Mr. Francis: There are several chairs, actually. The university has been quite successful in competing for Canada Research Chairs, which has been a federal government initiative over the last several years. That has provided an important opportunity to bring in highly skilled people. The leadership and commitment at the university have meant that the chairs have been brought in in areas that complement our efforts at cluster development. Our accomplishments to date are a result of the university president and vice president being part of the team and saying, "Okay, we will allocate resources and we will hire consistent with the plan that we as a community have put together to develop this cluster." That commitment and leadership have been so important, and the Canada Research Chairs is a good example.

Here is a great story, for example. The Canada Research Chair in Marine Natural Products was a University of Calgary Ph.D., originally from Scotland. He came to us from Florida Atlantic University where he spent about 14 years developing quite a large program in natural products chemistry, marine bioactive compounds. He was not recruited until he indicated that he was interested. He decided he wanted to move his family to Canada. His wife is from South Florida. He brought himself, his wife, his children, two of his post-docs, research lab technicians — they all moved to Prince Edward Island in the last year.

He came for a number of reasons. First, obviously, there was the opportunity of the Canada Research Chair. Second, there was the opportunity to collaborate with the National Research Council people who would be focusing on the same science and research area. Third, the safety, security and sense of community he felt when he was in P.E.I. was an important part of his decision. Finally, there was the opportunity to execute what we call freedom to achieve, the opportunity to execute his plans for research in an environment that suited him. In other words, it was the combination of the Canada Research Chairs Program and also the fact that P.E.I. is attractive to folks who are looking for a better balance between work life and family life than perhaps the San Diego bright lights, for example, can provide.

Senator Mercer: That is a good news story. I asked that question specifically because I anticipated your answer and I think it is important for my colleagues around the table to understand how successful the Canada Research Chairs Program has been, particularly for small universities.

Mr. Francis: For small universities, absolutely.

Senator Mercer: When the program was initiated, those of us from small areas feared that we would be shut out and that the chairs would go to the University of British Columbia and the University of Toronto. Of all the senators around the table, only Senator Mahovlich comes from or lives in a large metropolitan area. He is from Timmins.

My second question is with respect to your program. The slide about targets for 2010 mentions increasing research and development expenditures from $40 million to $80 million.

Mr. Francis: That is a target, yes.

Senator Mercer: How will you do that? How are you doing so far?

Mr. Francis: Unfortunately, Statistics Canada's latest numbers are for 2004. We are always behind in terms of being able to measure research and development expenditures. Those expenditures are from local and from outside sources.

There are three or four sources of those research and development expenditures. One is the ability of the Atlantic Veterinary College at the university to attract funding from the Tri-Counsel funding sources, the Canadian Institutes of Health Research, the Natural Sciences and Engineering Research Council of Canada, the Social Sciences and Humanities Research Council of Canada and so on. In the last five years, that funding has gone from zero to $5 million a year, which shows the trend we are on of being able to write high enough quality proposals and carry out high enough quality research to access those kinds of funds. That is academic research related to health. Even though we do not have a teaching hospital, the vet college has effectively become the teaching hospital with the biomedical people that are there.

The other sources are private sector, and companies here are investing literally millions of dollars each year. It is not a large number of companies yet, but those are private sector investments. More recently, in the last four rounds of Atlantic Innovation Fund investments, which are loans to companies, not grants, the private sector matching has been in the order of $55 million over five years. That is private sector investment in research and product development.

The other sources are from Agriculture and Agri-Food Canada's research budget here in the province and the research commitment of the National Research Council Institute of Nutrisciences and Health. We are well over $40 million, probably in the $60 million range already, and growing quite quickly right now. We have more demand to carry out contract research. I say "we" meaning the cluster. There is more demand for contract research in fish health product development at the vet college. We do not have physical tank space and so on to support that research demand. The demand is from multi-national companies, not only our own small start-ups. Big companies need access to these facilities, and there are only four of them in the world, all in Europe, and we will have one here.

Senator Mercer: That is terrific.

My last question, and again I am anticipating the answer, but I do want it on the record, regards the activities of the Atlantic Canada Opportunities Agency in both your venture and other ventures on Prince Edward Island. Is ACOA working? Is it going in the right direction? There are always problems with programs. Are there problems with ACOA that we should be looking at and fixing?

Mr. Francis: This is on the record now.

Senator Mercer: Yes.

Mr. Francis: Some government programs work well and others probably need improvement or do not have the impact that one would like. Perhaps they are well intentioned, but sometimes government programs do not have the leverage to get the desired effect. However, I do need to dwell on the positive. ACOA has been a very strong partner in what we have been doing in terms of cluster development and the Atlantic Innovation Fund. I am not familiar with other aspects of what ACOA is doing, but the Atlantic Innovation Fund is unique across Canada and the investments it has made have had an impact. However, again it is a loans program, not grants. I think we have developed a holier- than-thou attitude in Canada. The Americans are very entrepreneurial and they provide grants to early-stage companies for commercialization. We do not do that in Canada. The Atlantic Innovation Fund, through the grant programs, have brought the research community and private sector businesses together to support product development commercialization like no other program has. We have written to government to let them know that we are seeing very positive results from those investments.

Senator Mercer: I have it on the record, because I get nervous about the government perhaps taking the axe to ACOA as they have done to other programs. We in Atlantic Canada certainly cannot afford that. Thank you.

The Chairman: Thank you very much. You have been a very positive and uplifting pair, and we wish you all the best in what you are doing. It certainly is very good for Prince Edward Island, and a good example for other places as well.

Colleagues, we have heard a lot about education in the last couple of days, including here this morning. We are very pleased to have with us now Catherine O'Bryan, who has a long history in the PEI Literacy Alliance and who has done an enormous amount of work on this issue.

Catherine O'Bryan, Executive Director, PEI Literacy Alliance: It is my pleasure to have the opportunity to speak to you today about rural poverty. First let me say who I am. I was born in P.E.I. I lived in Charlottetown until I was a teenager and then my father bought a 150-acre farm on the south shore. We did not farm the land but rented some of it to farmers.

In high school few of my friends wanted anything more than the chance to leave P.E.I. and make some money. Education was valued by only a few who planned to attend university and move away. Most of my contemporaries wanted to get married or get a job. Many dropped out before completing Grade 12 to work with their fathers on the farm or on the water.

That was nearly 50 years ago and I do not think the trend has changed so much. Today young people are leaving school for high paying jobs in a booming economy in Alberta. Unfortunately, many of these migrant workers have low literacy skills.

I am the executive director of the Prince Edward Island Literacy Alliance, which is an umbrella group of 30 provincial organizations with an interest in literacy. Our members include Women's Network PEI, the Department of Education, the University of Prince Edward Island and 28 others. Our mission is to advance literacy for Islanders. Rural poverty is not our area of expertise but we know that low literacy skills contribute to poverty, unemployment and poor health.

Here is what we know about literacy. In 2003 the second International Adult Literacy Skills Survey was released. It showed that literacy rates decreased from west to east across Canada. P.E.I. rated low in literacy and numeracy skills. New statistics for health literacy as well are alarming.

Most people do not understand what literacy is and what it is not. Literacy is defined as the ability to understand and use printed information in daily activities at home, at work and in the community. It is not whether or not one can read, but how well one reads. Because they misunderstand the meaning of literacy, many people do not believe the literacy statistics, nor do they see it as a serious issue. Many Islanders say they do not know a single adult who cannot read or write so they do not believe that 43 per cent of Islanders have low literacy skills.

Numeracy is more than an ability to do basic arithmetic. It involves developing confidence and competence with numbers and measures. It requires an understanding of the number system, a knowledge of math techniques and an ability to solve numerical or spatial problems in a range of contexts. Numeracy also demands understanding of the ways in which data are gathered by counting and measuring and presented in graphs, diagrams, charts and tables.

Here is a table, and these are the only statistics I will show you.

Many do not understand that low literacy and numeracy are no longer just social problems that involve a few people. Now it is a major economic problem that affects the whole province.

What does this mean for rural P.E.I.? More and more farmers are being asked to become modern businessmen and women so that their operations can make money and they can increase yields. Modern business practice needs literacy and numeracy skills.

Farmers need to mix chemicals, calculate yields, determine prices and costs of production. All these activities require both literacy and numeracy skills. If they are not done well it can be costly and dangerous.

Government adds to the need for literacy skills. Farmers must adhere to a number of provincial regulations about their farm practice. Income stabilization programs, production insurance and risk management programs all require sophisticated literacy skills so that the farmer can read and understand all the implications.

New pesticide regulations are an example of an area that needs understanding in order to prevent workplace injuries. Labels on chemical containers are not always written in plain language. Safety warnings are sometimes represented by symbols that not all people can understand. Supervisors may be in a rush to get the work done and time for training on new equipment or with new materials is sometimes overlooked. We have heard lately in the news that workplace injuries in Alberta have increased dramatically because new migrants do not have the reading skills needed to keep them safe.

Low literacy skills pass from generation to generation as the family farm used to. Farm parents may be too busy to provide or promote literacy and learning on their farm or to encourage their children to complete their education. They may need the children to provide extra hands to share the workload. Literacy skills used not to be so necessary for people working with their hands, but as times have changed the need for these skills has increased.

Older people tend to move back to rural areas when they retire. Rural P.E.I. has few educational opportunities for those interested in life-long learning. Health resources in rural P.E.I. are also scarce. Few doctors are willing to move to rural areas to set up practice. They lack the support of a modern hospital or a cadre of colleagues whom they can ask for advice. Gerontologists tend to settle in the larger centres. Opportunities for social interaction and physical exercise may be limited.

Literacy is a skill that you have to practice or you will lose it. For people in rural areas interested in improving their literacy there are few options. Laubach Literacy has provided a one-on-one literacy tutoring program for individuals across Prince Edward Island. The number of tutors available has decreased and the number of people coming forward to be tutored has declined. This is due to many factors. Young people are not attracted to the organization to relieve the older volunteers of the work of tutoring. The group is completely made up of volunteers. The group lacks funding to produce vigorous advertising campaigns to let others know about their free and confidential service.

Holland College, a community college, has a number of sites across P.E.I. They provide some literacy training if the applicant qualifies for employment insurance or is supported by social services. Occasionally free seats are available to the public.

Learners have told the Literacy Alliance that they prefer not to take their training in an institution that resembles the school where they have already failed. Some Holland College sites are in modest buildings but the classes still conform to Holland College regulations and style. Community schools are active in some areas and provide opportunities for informal learning.

From our perspective, the situation in rural P.E.I. is dire. Fewer young people are returning to the farm after receiving their education and many others are leaving farming to pursue a more lucrative future in the tar sands. It does not appear viable for young people to make a living on the family farm unless they are well educated, not only in farming practice but in global economics.

Scott Murray of Statistics Canada says that a 1 per cent increase in literacy skills would lead directly to a 1.5 per cent increase in the gross national product. Canada's ability to achieve this goal is in jeopardy. The cuts and delays in the federal funding for literacy are crippling the ability of literacy organizations to support the field, and this will affect the capacity of the delivery system.

We need straight answers from the Harper government. What is the plan for literacy? What has happened to the idea of a national or pan-Canadian strategy proposed in 2003 by the all-party Parliamentary Standing Committee on Human Resources Development and Persons with Disabilities?

The PEI Literacy Alliance looks forward to having the results of your deliberations. In the meantime, we ask that you speak out and ask questions about the need for a pan-Canadian literacy strategy. This is one way to reduce rural poverty and revitalize the Canadian economy in all sectors.

The Chairman: Thank you very much. We know how hard you and people on the Island have worked, and we will just hunker down and keep on doing that.

Ms. O'Bryan: That is right.

Senator Mercer: I want to follow up on your last comment about the cuts. While you have been working very hard on the Island, Senator Fairbairn, not as chair of this committee but as a senator and previously as a cabinet minister, has been working very hard on literacy for a number of years, and she has recruited a large number of her colleagues, including myself, to join the crusade.

If the cuts indicated by the current government come into effect, what will be the immediate effect on Prince Edward Island and on the programs in which you are involved?

Ms. O'Bryan: On Prince Edward Island we have been very lucky. We received two-year funding. I cannot get an explanation as to why. Nova Scotia received one-year funding for a project. All the rest of the provincial and territorial coalitions have not received any funding. The national organization has one month left of funding and then it will have to close.

The closing of the Movement for Canadian Literacy will have a big impact on the PEI Literacy Alliance because that is my professional organization. They provide all kinds of information about what is happening in Parliament and about the discussions on literacy in the different committees. They keep us up to date on the trends in Ottawa so that we can respond to them on Prince Edward Island.

When the last international literacy survey was released, they provided lots of background material for us to distribute in our constituency. I would simply tailor their templates to Prince Edward Island's needs and I would have items that were already researched for me.

We have a staff of two, and we do not have a researcher on our staff able to keep in touch with all the happenings around the country. That will be a huge loss to me personally and to our organization.

Senator Mercer: Your two-year funding ends in 2008?

Ms. O'Bryan: November 14, 2008.

Senator Mercer: You are very lucky. I wish you had written the proposals for Nova Scotia so that we would have gotten the two years.

Senator Callbeck: It is amazing what you have been able to accomplish with a staff of two. If you do not get more funding at the end of 2008, will that mean that all of your activities will be closed down, like your phone line and the tutoring that you do in the summer for kids?

Ms. O'Bryan: Yes.

Senator Callbeck: I think you should talk about the summer tutoring program for kids because it is a very valuable service you provide.

Ms. O'Bryan: The PEI Alliance is the community sponsor for the summer tutoring program for kids. Resource teachers in all the elementary schools refer students who are having trouble with their literacy and learning skills during the year and who need extra help in the summer. We hire 20 to 23 bachelor of education students to be tutors for about 700 children every summer. This program runs all across the province. We usually have a tutor for English as a second language as well as francophone tutors and anglophone tutors.

We have been the community sponsor for about six years. Part of the money comes from Service Canada under the summer career placements program, which I understand has been cut quite dramatically. I still do not know what will happen with that. We also get donations from businesses and from the provincial government. We were the recipient of $32,000 from the Raise-a-Reader Campaign this year. This was the first time the campaign ran on P.E.I. That money will help us if the cuts to the summer career placements program are severe.

Senator Callbeck: If the Service Canada summer program is cut, will you be able to continue your program for kids to the fullest?

Ms. O'Bryan: Not to the level we have been, because each year there is more and more demand for tutors. We also have to fundraise for travel costs so that our tutors can go across the Island, because of course most of them live in Charlottetown near the university. We send them on a daily basis to Tignish and to Souris. We spend about $11,000 or $12,000 just on mileage claims for our tutors so that they can meet the students close to their communities.

Senator Callbeck: What is your budget roughly?

Ms. O'Bryan: Do you mean the PEI Literacy Alliance budget or the program budget?

Senator Callbeck: The Literacy Alliance budget.

Ms. O'Bryan: The Literacy Alliance budget altogether is approximately $150,000, depending on how many project grants we can acquire.

Senator Callbeck: You receive $125,000 from the federal government; is that right?

Ms. O'Bryan: This year, for the first time, they raised it; it was $137,500 per year. There are all kinds of criteria, stipulations and accountability attached to that. It is not just free money.

Senator Callbeck: Were more criteria attached this year than other years?

Ms. O'Bryan: I submitted my first proposal in February. I got a phone call in June saying it had to be rewritten. We rewrote it, and there were many different details and demands. We understood that they were going through changes. Then they called in July and wanted it rewritten again. Since I was away on holidays, my colleague had to rewrite it, and he submitted it in August. Then we had the teleconference call with the officials at what used to be the National Literacy Secretariat telling us that none of the provincial organizations were going to be funded. We had a couple of weeks of panic wondering what we would do, and then suddenly the funding was reinstated for some and they were going to look at the proposals. I heard in November that we would get funding for two years. It has been a roller coaster ride for a whole year.

Senator Callbeck: It is great that you got the funding; it is very much needed.

Ms. O'Bryan: We are lucky. I must say, though, that I have survivor guilt, because all my colleagues ask what I did, and I do not know. I just wrote my proposals like I do every year. It is kind of an embarrassment of riches at the moment but we are making plans to try to replace the money for December 2008.

Senator Peterson: You indicated in your presentation that 43 per cent of Islanders have low literacy skills, and I imagine there are varying degrees of low.

Ms. O'Bryan: Yes.

Senator Peterson: Assuming that that number remains static and that you have funding to November 2008, what impact will you have on that number in that period of time?

Ms. O'Bryan: I do not think we will have a direct impact because we do not work directly with learners. We provide support services for the field, we train literacy instructors, and we provide bursaries to adult learners. We will not move everybody up a level. That is a huge job. To raise literacy levels requires a concerted and coordinated effort across the province and across the country.

Senator Peterson: We are talking about almost a year and a half with no measurable change.

Ms. O'Bryan: There will be people who learn how to read and write.

Senator Peterson: Is that not a positive change?

Ms. O'Bryan: That is a positive change.

Senator Peterson: Is it a measurable change?

Ms. O'Bryan: It is not statistically significant when the large international surveys are done. Twenty-five people making a change will not have an impact on the statistics.

Senator Peterson: Perhaps not on the statistics, but it would certainly have an impact on trying to show the seriousness of the situation, would it not?

Ms. O'Bryan: It would if we tracked those figures, yes.

Senator Peterson: Government may know they have a serious problem, but if we could quantify it a bit more would that help?

Ms. O'Bryan: Statistics Canada does quantify it; that is where these numbers come from.

Senator Peterson: You are saying that by November 2008 we would have no way to see if that number had changed. Would somebody else be able to measure that?

Ms. O'Bryan: If Statistics Canada does another study they will know whether people have changed. People can move within levels too, and that is not measurable. In one survey you can be in level 1 quite far from level 2, and then in the next survey you might be at 1.99 but not quite at level 2; you have changed and have learned to read better, but you are still not able to meet the requirements of the tests that they use for their studies.

Senator Peterson: Has anybody determined how much money it would take to make a measurable difference?

Ms. O'Bryan: Yes, certainly. I participated in a series of meetings in Ottawa a year ago in November when Minister Claudette Bradshaw was putting a push on for literacy. I met with 22 other people from different sectors across Canada and we came up with a pan-Canadian plan. We hired a financial person who costed out various things, although there was not enough information available for him to extrapolate all the figures. However, it was in the billions of dollars for Canada to make a big difference, because a lot of support is needed in many areas.

Senator Peterson: Is the number of people with low literacy skills still growing, or do you think we have hit the bottom? Are people now getting training and going to school and so on?

Ms. O'Bryan: If the present cuts stay in place, the number will grow. In other provinces, literacy programs are losing their funding. People who directly teach adult learners are losing their funding. I can only imagine that the statistics will go up when those supports are taken away. If the infrastructure of the literacy community across Canada is taken away, I expect the statistics will go up.

Senator Peterson: Would the costs accordingly go up as well?

Ms. O'Bryan: Yes.

Senator Gustafson: I want to congratulate you on your work. I sat in on one of the hearings in Ottawa, and it brought tears to your eyes to hear about the people who have learned to read who could not before.

My question is on the schools. You must look at what is happening in our schools in regards to the three Rs. Every once in awhile we hear that we are turning out some students who cannot read very well and others who can hardly read at all. Sometimes I wonder if our advanced technology has taken over. We rely on the adding machine and all the electronics we have and we do not learn to read and write.

What is your observation on that, and what could be done about it?

Ms. O'Bryan: I have some positive news for Prince Edward Island. Our provincial government is putting together a provincial literacy and learning strategy. I have been working closely with them. They are going to implement regular literacy assessments for students in school so that children who are having problems will be identified and no child will come to Grade 3 without knowing how to read. Such regular assessment has been missing in the school system.

As well, we now have a learning disabilities coordinator in our province. Perhaps more children will be assessed for learning disabilities, which is a factor in being able to learn to read. Hopefully children with disabilities will have access to programs that will help them do better in school.

Senator Gustafson: Do you think that work needs to be done to make teachers aware that some students need extra attention? I am thinking back to when we went to school; there was always someone who found learning extremely hard and at that time there was not much sympathy for them or understanding on the part of the teachers. I think there needs to be some emphasis on that area.

I am dating myself now, but I recall we used to have spelling matches in the old town hall. There were a couple of old farmers and the kids could not spell by them; they would win every time. That told me there was an emphasis on those areas of education. Certainly today we should be able to meet that challenge.

Ms. O'Bryan: I agree. We brought Dr. Satya Brink from Statistics Canada to share the results of that international survey and to tailor a presentation about Prince Edward Island so that people on P.E.I. understand the scope of the problem.

We sponsor workshops for teachers to talk about learning and literacy. Most of our work is promoting literacy and trying to get the message out that everybody needs to work together to promote literacy on P.E.I. We want to turn us into a learning culture.

The Chairman: Thank you very much.

Senators, our last witness is Aileen Petrie, Executive Director of the Family First Resource Centre.

Aileen Petrie, Executive Director, Families First Resource Centre: In case you are not all familiar with the mandate of family resource centers, I will begin with a bit of history and background.

We are funded federally by the Public Health Agency of Canada and have been for some 12 years now. You will hear acronyms for two projects: CAPC is the Community Action Program for Children, and CPNP is the Canada Prenatal Nutrition Program. Together these two programs encompass families with a pregnant mother or children up to the age of six. However, we do try to go outside our mandate a bit and encompass more families, and I will demonstrate how we have done that.

CAPC and CPNP were developed in response to extensive research documenting the importance of the early years. The federal government, which has been behind us for a long time, has been in the right place at the right time and has done the right things. These programs are all over the country and have been instrumental in helping families in rural Canada.

There are seven centres in Prince Edward Island. I am from Montague, on the eastern end of Prince Edward Island, and we service the Southern Kings and Queens area. C.H.A.N.C.E.S. Inc. Family Resource Centre is in Charlottetown. There is one in Summerside, and there are few more on the western end. There are a francophone and a Mi'kmaq family resource centre as well.

Family Resource Centres were announced as part of the Government of Canada's approach to meeting the challenges posed by the 1990 UN World Summit for Children, and we still exist today. We are hoping to exist forever because we know that we do good work.

We have partnered with the government on a couple of great social initiatives. Perhaps you are familiar with The Rural Think Tank 2005. I would strongly suggest that you find that report. It is a good read, and instead of reinventing the wheel it contains some good information that you might be able to use. For example, the challenges of rural living have been identified as access to services and transportation, economic and employment realities, and food security, and the focus groups tell you why. It is a very good document.

We were instrumental in that project. It was funded by the Public Health Agency of Canada. CAPC and CPNP monies went into it and the projects throughout Canada were instrumental in getting the focus groups together to gather all of that information.

Another initiative in which we are quite involved in Prince Edward Island is the Strategy for Healthy Child Development. The province put five years into this work because they consider it important for us to invest in our children . It is a strategic plan for five years. Our children start learning as babies, and literacy starts with babies. We can save a lot of money in the long run if we have healthy children, and so our program starts with helping pregnant women with nutrition and education. We promote breastfeeding, healthy child development, literacy, and programs for parent education. That is the gamut.

We are heavily involved with the government on some initiatives. We do extensive, five-year evaluations on our programs. The last evaluation was done in 2005 so these results are relatively significant and current. We are key players in the delivery of child and family programs. We are firmly established and well integrated in the broader network of policy, program and research initiatives for children and their families, as I have already shown you, helping to create supportive environments for individuals, projects, communities and the system through opportunities to share perspectives, expertise, and resources.

We contribute to policy, practice and research development at the system level, building community capacity across Atlantic Canada. We are affiliated with Atlantic Canada. All the other projects across Canada have their own mandate. Each project is different. Even in Prince Edward Island each centre is different because we serve different communities and the needs of our communities continually change. We provide the system with the means to work towards improved public health for Atlantic Canadians. All of that is in the repor "From Babies to Boardrooms . . . CAPC and CPNP are Involved!"

Above and beyond that, we provide good work placements for post-secondary students in early childhood education and nursing. Recently we had two placements at our center. These young people on their education path can see a hands-on work environment, and we make sure their placements are meaningful. We support them in every way. Part of our mandate is to help young Canadians in their quest for education.

The Chairman: Before you leave, perhaps you could let us copy those documents.

Ms. Petrie: I will leave these documents with you.

The Chairman: That would be great. Thank you very much.

Senator Mercer: Is your funding that comes from the Public Health Agency of Canada secure before the 2007-08 budget year?

Ms. Petrie: Yes. We have been quite proactive. We have just heard the good news that our funding is good until March 31, 2008.

Senator Mercer: That is good news, and it answers one question.

Ms. Petrie: I hope so.

Senator Mercer: Ms. O'Bryan told us that literacy funding is secure to just beyond that time as well, which is also good news.

We are talking about rural poverty. You indicated that there are 17 locations for your program on the Island.

Ms. Petrie: There are seven centres on Prince Edward Island.

Senator Mercer: There is one in Charlottetown?

Ms. Petrie: There are two centres in Charlottetown: C.H.A.N.C.E.S. Inc. Family Resource Centre and the Mi'kmaq Family Resource Centre, although the latter serves the whole province.

Senator Mercer: Are any of the other five centres in rural parts of the province?

Ms. Petrie: Well, Summerside is now considered a city, but it has been my understanding that Prince Edward Island is called rural, period. Am I right in that?

Senator Callbeck: According to Statistics Canada.

Senator Mercer: Yes.

Ms. Petrie: Everyone's definition of rural is different. However, for example, there are many differences between C.H.A.N.C.E.S. and us in terms of staffing and the way we deliver programs. It is like comparing apples and oranges.

Senator Mercer: How do you identify your clients, or do they self-identify?

Ms. Petrie: We call them participants. Our target population is families who are at risk of not having enough education or at risk in any way. However, we have opened up that word, because I believe every family with children risks not knowing how to parent and not having all the education they need. We would like to reach all families on Prince Edward Island, not specifically those on social services, because we feel that every family needs extra support, especially in our rural setting. In Montague there are isolation factors, transportation issues, and the whole gamut of issues that families face.

Senator Mercer: Can a family self-identify or does a third party have to refer them?

Ms. Petrie: No, but we do partner very closely with the provincial departments for public health and child and family justice. We have referrals but our first point of entry is with the public health nurses and the babies being born. Also, the public health nurses identify who is pregnant and we try to reach women when they are pregnant. It does not always happen, but when the baby is born that is our point of entry for sure.

Senator Mercer: There is a Canadian prenatal program. Is there a Canadian postnatal program?

Ms. Petrie: CAPC is a postnatal program, while CPNP is the prenatal program, so we have covered both bases. CAPC is also from zero to six years old.

At C.H.A.N.C.E.S. they work with babies only to six months. We have babies up to a year old because we do not deal with as many families. Basically, you have to design your programs according to the staff you have and what you can do well. Each program is different, but our postnatal program is from zero to six years.

Senator Mahovlich: Do you have many volunteers?

Ms. Petrie: We consider our participants to be volunteers because when they come to our resource centre they come with their family; the parents are there — they do not simply leave their children with us. The parents help us with the programs.

Senator Mahovlich: The parents are the volunteers.

Ms. Petrie: That is right.

Senator Mahovlich: When you make your report for the government, do you report on all the volunteers that you have?

Ms. Petrie: Yes. They are all counted as part of our statistics. However, the parents do not always give themselves credit for being volunteers. We tell them, "Look what you have done. You have helped with the snack, you read the story to the children, you have participated, you are a volunteer," and that increases their self-esteem once they realize their contribution. Also, our volunteers are our board members.

Senator Mahovlich: I had to take a summer or two off for one of my children. He was having a difficult time so I had to drive him to school in the summertime. I took the whole summer off because he was having a difficult time. I think it is very important that the families get involved.

Ms. Petrie: Exactly. That is all part of it, because it teaches families to work together, to play and have fun together, and to grow together.

Senator Mahovlich: The government would look at this report and be enthused about that too.

I think that in the coming year the government will have a huge surplus and you should not have any trouble getting funds for literacy.

The Chairman: One would think.

Senator Mahovlich: We hope.

Senator Callbeck: There are seven family resource centres on P.E.I. You operate out of Montague. How many families would you be involved with?

Ms. Petrie: I can speak only for my own centre in Montague. The statistics fluctuate. For the Community Action Program for Children we have 192 families now, and for the Canada Prenatal Nutrition Program we are working with 44 families.

Senator Callbeck: You mentioned that the way you deliver programs and the way C.H.A.N.C.E.S. delivers programs in Charlottetown can be like apples and oranges, and that depends a lot on the number of workers you have. Do you get your budget directly from the federal government?

Ms. Petrie: Yes, but my budget is not the same as C.H.A.N.C.E.S.' budget. Every centre has a different budget. That budget was set in stone. I am not quite into my second year yet, so all of the budget negotiations were before my time.

The budget has stagnated; whatever our budget was five years ago is all we will ever get. It will never increase, which is why we end up doing other programs to get other money into our organization so that we can stay alive.

Senator Callbeck: Were you told by the federal government that your budget will never increase?

Ms. Petrie: Basically, they said, "What you see is what you get, and when you get funding again that is what you will get."

Senator Callbeck: You have funding now until the end of March 2008. Is that right?

Ms. Petrie: Yes. We had a five-year block of funding, which goes to 2009, so I am confident that we will be operating until 2009. However, it is still a year-to-year commitment, even though it is a five-year block of funding. There is always that "with 60-days' notice" clause that you might be terminated. Technically, the funding is until 2009; at that point we will have to submit a new request, but we have been told that our current budget is the figure we will be working with.

Senator Callbeck: You certainly do good work. I am very familiar with C.H.A.N.C.E.S. and know what goes on there. I commend you for your efforts.

The Chairman: We very much appreciate both of you coming here today. This is a tough issue. I sincerely hope that there will be some light at the end of a currently dark tunnel and that you will stay in business and be back doing all the good things you do.

Senators, we now have an important presentation on behalf of Hospice Palliative Care Association of Prince Edward Island. We are joined by Executive Director Graham Gaudet and President Ed MacLaren.

Ed MacLaren, President, Hospice Palliative Care Association of Prince Edward Island: Honourable senators, on behalf of the directors of the Hospice Palliative Care Association of Prince Edward Island, I would like to express our sincere appreciation for allowing us to make this presentation today.

Our mission at the hospice is to provide care and support to Islanders living with or dying from a life-threatening illness and to their families. We train the volunteers who provide this care. In keeping with our mission, our presentation today will focus on issues that affect terminally ill rural Islanders.

In your report Understanding Freefall: The Challenge of the Rural Poor, you state that the Organisation for Economic Co-operation and Development defines the entirety of Prince Edward Island, including Charlottetown, a city with a population of 32,000 people, as predominantly rural. While this may be true from an national perspective, it hardly rings true to residents of Prince Edward Island. However, when it comes to health, Prince Edward Island suffers from a lack of health care similar to any other rural area in Canada.

Hospice volunteers provide services in the home, hospitals, manors and on the palliative care units. During the past year hospice volunteers have provided service to more than 110 terminally ill patients and their families living outside the greater Charlottetown area. Hospice service is provided at the intersection of formal and informal care and our programs have a powerfully positive effect on the quality of life of the patient, the family caregiver, other family members and friends.

Hospice services are not covered under health plans. According to the 2001 census, 12.6 per cent of P.E.I. residents earn less than the national standard; therefore, hospice services are provided free of charge.

Hospice Palliative Care Association of Prince Edward Island has chapters in Charlottetown, Summerside, West Prince, which covers the Alberton, O'Leary and Tignish areas, and Eastern Kings, which takes in Souris and the surrounding areas. Because we have volunteers in both urban and rural settings, we believe we are qualified to make observations on the situation in rural P.E.I. as it concerns our farming and fishing families.

In February 2000, before a Senate subcommittee, Dr. Harvey Chochinov said, "Unfortunately, in end-of-life care, we do not have a vocal constituency. The dead are no longer here to speak, the dying often cannot speak, and the bereaved are often too overcome by their loss to speak."

A 2006 Canadian Hospice Palliative Care Association fact sheet states that hospice palliative care is important and relevant to everyone and touches us all at some time in some way. According to the association, 90 per cent of us will die of a protracted life threatening illness; 75 per cent of these deaths take place in a hospital; fewer than 10 per cent of us will die of sudden events such as myocardial infarction or accidents; and fewer than 20 per cent receive hospice palliative care. According to Statistics Canada, there were approximately 1,393 deaths in P.E.I. in 2005.

Taking care of loved ones can be full-time job. The average time spent caring for dying loved ones at a home is 54 hours per week according to Ipsos Reid in 2004. Every year 1 million Canadians are affected by the loss of a loved one.

Hospice palliative care provides options that guide Canadians through dying and death. It is estimated that the caregiver in the home palliative care setting provides 80 per cent to 90 per cent of all care. This environment often leaves the caregiver's self-esteem and confidence battered. Emotionally and physically they spread themselves too thin. There are a range of options in support services, hospices, hospital homes, including private homes, nursing homes and long-term care facilities.

Issues affecting Island farmers and fishers are many. Farmers and fishers do not have the luxury of belonging to a group health insurance policy; therefore, when a terminal illness strikes, the patient is responsible for covering all the costs related to the illness.

Transportation difficulties, isolation, few supports other than immediate family members, low income and/or there being only one source of income, seasonal employment, no health insurance plans, little or no access to community support systems — these are only a few of the many issues that keep the rural farmer and fisher poor. Most farmers and fishers have little help other than hired hands. If you are a hired hand working on the farm or the second man on a lobster boat you probably work for minimum wage on a seasonal basis. Off-season you draw employment insurance and there could be many weeks when you draw nothing at all.

If you cannot drive due to a terminal illness or you do not have access to an automobile, it can be very difficult to obtain the help and assistance offered at a hospital or clinic or even to reach a pharmacy or see your doctor as often as required. There are no buses running out in the country, and taxis are almost non-existent. If they exist, the cost is beyond what the person can afford. A taxi from Montague to Charlottetown costs $80 to $100 for a return trip. If you are receiving daily chemo treatments you cannot get there by taxi. Transportation issues affect all rural people here on P.E.I. There are few alternatives to the family vehicle.

Isolation is also an issue. On the family farm all family members are required to work. Often the patient is home alone and without immediate help or assistance. In the case of the fisher, most of the economic life revolves around the boat. There is no time left for patient care if the rest of the family wants to continue to make a living.

As stated already, it is estimated that the caregiver in the home palliative care setting provides 80 per cent to 90 per cent of all care. The Ipsos Reid survey of January 2004 estimates that taking care of loved ones can be full-time job. The average time spent with a dying loved one at home is 54 hours per week. This report also states that Canadians under the age of 55 or older cannot devote that amount of time to care for a terminally ill person without some sort of assistance.

A case from our records is as follows: "Joe Fisherman" was diagnosed in 2001 with kidney cancer at the age of 39 years. He died in October 2006. He was employed as a hand on a fishing boat in rural P.E.I. and enjoyed his work. He continued to work as a hand when he was able until two months prior to his death. In the last year of his life his medications alone cost him, on the average, $850 a month.

He also had other significant medical costs associated with his illness, such as travel to different hospitals in and out of the province for treatment. He did not qualify for assistance for his medication because he chose to continue to work. The extraordinary medical costs caused him much stress and hardships in the last months of his life. Because "Joe" lived at home with his parents and did not have his own address, he was ineligible for social assistance. His parents were forced to use their already stretched income to meet his daily needs.

Many Islanders employed in both the farming and the fishing industries are the only wage earner in the family, and many are too proud to apply for government welfare. The cost of medications and supplies for the terminally ill person can be exorbitant: long-acting morphine, 30 milligrams a day, twice a day, $75 a month; breakthrough morphine, 250 milligrams a day, $250 a month; Dilaudid, $125 a month; most pain medications, $250 to $300 a month. Home-based oxygen can be as much as $20 per tank, and the average patient on oxygen 24 hours a day requires five to six tanks. That would be a cost of approximately $3,000 per month. Medications for nausea are anywhere from $20 to $250 a month. The average total cost for medications and supplies could total well over $850 to $1,000 a month.

This comes at a time when one wage earner could be the patient who can no longer contribute to the family income. Should the other partner need to provide care and stay at home, money issues become critical. Many Islanders, especially seniors, do not qualify for the compassionate care benefits because they do not qualify for unemployment insurance. Even if there is some health insurance, most plans require 20 per cent to 30 per cent co-pay.

The Hospice Palliative Care Association of P.E.I. has been advocating to the present government for complete coverage of drugs and medications for all patients requiring end-of-life care. On the national front, the Canadian Hospice Palliative Care Association is lobbying for a comprehensive palliative care program for all Canadians. A comprehensive palliative care program would be a big asset to the terminally ill rural Islander. It is our hope that the final days of a terminally ill person's life are not spent worrying about finances but may have a high quality of care in a setting of their choice surrounded by their loved ones.

The Chairman: Thank you. This issue does not get talked about very often and we very much appreciate your coming.

Senator Mercer: The work you do is very important and goes quite unrecognized by most people until they need your help. I want first of all to thank you for what you do because it is important to everyone, not only you in Prince Edward Island but your associates across the country.

In your recommendations you talked about complete coverage for drugs and medications. How extensive is drug coverage in Prince Edward Island? Is it there only for people who are on social assistance as opposed to the general population?

Graham Gaudet, Executive Director, Hospice Palliative Care Association of Prince Edward Island: For most of the drug coverage on Prince Edward Island, a person has to be in an acute care setting to receive it, or in one of the Island manors or senior citizens' homes.

There are certain medications that people on welfare would qualify for but most of them are not what I would call the most up-to-date and modern pharmaceuticals.

Senator Mercer: If I were an Islander and I was diagnosed with cancer that was quite serious and that was probably going to end my life prematurely, I would have to fund it all myself? There is no catastrophic drug program at all?

Mr. MacLaren: No.

Mr. Gaudet: No. The only way you would be able to get assistance is if you were admitted into an acute care facility or you were a patient in one of the Island's long-term senior citizens' units.

Senator Mercer: In a sense, Prince Edward Island's economy is based on primary producers — fishermen and farmers — who are not groups known to have a great benefit package.

Mr. Gaudet: That is right.

Senator Mercer: It is hard enough to get the potatoes planted. The problem is magnified in Prince Edward Island.

Mr. MacLaren: That is correct, even with a medical plan. I went through this 10 years ago with my wife, and it cost me close to $1,000 a month over and above what my medical plan covered.

Senator Mercer: It is a huge cost factor that we do not notice until we are in it.

Mr. MacLaren: Until you are in it, right.

Senator Mercer: Then really it is too late to fix at that point.

Mr. MacLaren: That is right.

Senator Callbeck: I, like Senator Mercer and all of us here, am well aware of the great work that you do. I believe on Prince Edward Island you are engaged with 150 to 200 families a year?

Mr. Gaudet: Approximately.

Senator Callbeck: We have had this discussion, because I met with you a month or two ago. Certainly, there needs to be a plan for catastrophic drugs. I do not know how many people do it, because the costs of drugs are high and unfortunately it looks as though they will continue to increase with all the new drugs coming on stream.

Mr. Gaudet: That is right.

Senator Callbeck: As I told you that day, I support your efforts. I commend you for coming here today and making all of us more aware of the need.

Mr. Gaudet: Our main concern is that the federal government provide drugs for people who are in an end-of-life situation and want to stay home to die.

If a person wants to take up a bed and die in the hospital that is available to anybody right now, but most people do not want to die in a hospital, they want to die at home. Mind you, not everyone can die at home. Many have to go into a palliative care unit or in the end do have to be admitted into the hospital, but many prefer to spend as much time as possible at home. Under the present situation in Prince Edward Island they cannot do that because they are forced to pay for the entire cost of their medication, which sometimes can run as high as $1,000, $2,000 or $3,000 a month, whether they have a drug plan or not. We believe that in this day and age most people who die have been taxpayers for many years. Many of the seniors fought in the war. It is a shame that they have to spend the last days of their life sitting in a cold hospital bed, probably by themselves.

Senator Callbeck: It does not seem fair that the drugs will be covered in a hospital but not if you want to die at home.

Mr. Gaudet: That is right.

Senator Callbeck: Is there anywhere in Canada that we are doing this?

Mr. Gaudet: There are three or four provinces now: British Columbia and Ontario, and I think Alberta. Another province also has catastrophic drug plans that do provide drugs to end-of-life care patients. Prince Edward Island does not.

Prince Edward Island has come a long way in providing end-of-life care, but only in the hospitals — not at home. There are, I think, four provinces now that do have some kind of drug plan that will provide medications to people who want to stay at home. I know British Columbia instituted a very nice plan about a year and a half ago.

Senator Callbeck: That is not a pilot project? It is a plan?

Mr. Gaudet: No.

Senator Callbeck: It is the whole province?

Mr. Gaudet: Yes.

Senator Peterson: Thank you to the presenters. It is very difficult task you are undertaking.

How does one get into an acute care facility and who pays for it?

Mr. MacLaren: The government pays for the acute care facility, which is either the hospital palliative care unit or a long-term care facility. While you are in those facilities, your drugs are covered.

Senator Peterson: Is that open to anyone?

Mr. MacLaren: Yes.

Senator Peterson: The concern we are talking about here then is the staying at home.

Mr. MacLaren: Yes.

Senator Peterson: If you wanted to go into the hospital you could and it would all be covered?

Mr. MacLaren: Yes.

Senator Peterson: The issue is if you wanted to stay at home. I presume studies have been done to show that if you stayed at home it would probably save the government money.

Mr. MacLaren: This is it. Many people who are in a hospital could be at home. In Charlottetown we have a palliative care unit with eight beds, and in Summerside the hospital has four beds. That is 12 palliative care beds for the whole province, and it is not unusual to have 15 to 20 names every week on the list of people trying to get in.

Senator Peterson: Getting in is not automatic then, I take it.

Mr. MacLaren: No, it is only on availability.

Mr. Gaudet: I would not stand behind these statistics because they are just a rough estimate one of our coordinators made, but in the Prince County Hospital in Summerside they have about 180 beds and at one time within the last month there were over 30 people in those beds who were there solely because they needed their medications covered. They would have been at home had there been a catastrophic drug program, but instead they were occupying a hospital bed in an area where they did not want to be.

Across the province and across Canada there are many people in hospitals who do not want to be there but who have to be there simply because they cannot afford to stay home. We hear talk about wait times and people trying to get into the hospital who cannot because there are no beds. The other side of that coin is that there are many people in those beds who do not want to be and do not have to be there.

As Senator Callbeck said, the acute care centres are providing the drugs in the hospital. Why can they not provide them at home and free up the hospital beds for somebody else?

Senator Peterson: Would the cost of the drugs be covered at home if you wanted to get into the acute care facility but were refused because there was no room?

Mr. MacLaren: No.

Senator Peterson: In other words, it is just the luck of the draw. If the facility is filled up it is just too bad for you.

Mr. MacLaren: Then you will be admitted to the hospital.

Mr. Gaudet: You would go through emergency. Sooner or later you would get in, but it would be a long process. Some people in Charlottetown face an 11 to 12 hour wait in emergency and then maybe a day or two on a stretcher out in the hall waiting to get a bed.

Senator Peterson: That is not too dignified, is it.

The Chairman: Thank you very much. That was an important way to end our hearing this morning. It has been quite a roller coaster and we have learned a lot. The messages that you have brought will, I am quite sure, prompt us to learn more.

The committee adjourned.