Proceedings of the Standing Senate Committee on
Agriculture and Forestry

Issue 1 - Evidence - Meeting of March 30, 2010


OTTAWA, Tuesday, March 30, 2010

The Standing Senate Committee on Agriculture and Forestry met this day at 5:26 p.m. to examine the current state and future of Canada's forest sector.

Senator Percy Mockler ( Chair) in the chair.

[Translation]

The Chair: Honourable Senators, as we have a quorum, I would like to call this meeting to order. Today, we welcome Mr. McSweeny and Mr. McGrath to the Standing Committee on Agriculture and Forestry.

My name is Percy Mockler. I am a senator from New Brunswick and the chair of the committee.

[English]

I would ask senators to introduce themselves, starting on my left.

Senator Mercer: I am Terry Mercer, from Nova Scotia.

Senator Robichaud: I am Senator Robichaud, from New Brunswick.

Senator Lovelace Nicholas: I am Senator Lovelace, from New Brunswick.

Senator Plett: I am Don Plett, from Manitoba.

Senator Ogilvie: I am Kelvin Ogilvie, from Nova Scotia.

Senator Eaton: I am Nicole Eaton, from Ontario.

Senator Rivard: I am Michel Rivard, from Quebec.

The Chair: Witnesses, the committee is continuing its study on the current state and future of Canada's forest sector.

[Translation]

The topic of discussion for today's meeting is the use of wood in non-residential construction.

[English]

We invited representatives of the cement and construction industries to talk to us about possible consequences to their industry and to be partners with governments and the committee so that we can bring this to the attention of all stakeholders. You are important stakeholders.

We have two panels of witnesses today. On our first panel, we will hear from representatives of the Cement Association of Canada, Mr. Michael McSweeney and Mr. Rick McGrath.

Michael McSweeney, President and Chief Executive Officer, Cement Association of Canada: Thank you, Mr. Chair. We welcome this opportunity to talk to you today about the cement and concrete industry. With me is Rick McGrath, our Director of Codes and Standards and Engineered Structures. He is an award-winning industry expert who has been providing professional services and advice to our industry for almost three decades.

I would like to thank the members of the committee today for this opportunity to appear and to provide you with our perspectives on the government's role in the wood first policies as they impact the forest and other industries.

The Cement Association of Canada represents all of the domestic cement manufacturers in Canada. Our eight companies operate 15 plants across the country including one in Brookfield, Nova Scotia; three in St. Basil, Joliette and St. Constant, Quebec; five or six in Ontario; two in Alberta; and three in British Columbia.

In case you did not know, cement is a fine grey powder. You never have to fear that someone will put a pair of cement shoes on you, because cement is just like baby powder. If someone says he will put a pair of concrete shoes on you, however, then you must take note. Stay away from the water.

As I said, cement is a very fine grey powder. It is very portable. In fact, today it is shipped from Asia to British Columbia. In the last year, we have seen imports grow by 20 per cent, so you can actually manufacture and ship cement from Asia and land it in Vancouver for $44 a tonne. We cannot manufacture it in Canada for $100 a tonne.

Cement is mixed with crushed stone, sand, gravel and water to make concrete. Cement is the glue that binds it all together and, in any portion of concrete, roughly 10 per cent of the mixture added to the recipe is cement.

Cement and concrete product manufacturing operations contribute about $3.2 billion annually to the Canadian economy and employ approximately 27,000 people in the process. The sole purpose in manufacturing cement is to make concrete. There is no other purpose for manufacturing cement, other than in solidification and stabilization. As Senator Mercer will know with the Sydney Tar Ponds, cement is being chosen as the remediation technique for cleaning up one of Canada's worst environmental disasters.

Concrete is the most used construction material on Earth, next to water. I do not have to tell you about lumber and wood. We are all proud of Canada's long history in lumber and wood, from our earliest settlements and the buildings of our national railway to the development of the wood housing industry. However, because of the importance of the nation's economy, the Canadian government has historically supported the forestry sector with a variety of initiatives and financial assistance programs.

The cement industry is well aware of the challenges that are facing the forest industry today. Our industry understands that governments right across the country desire to provide support to the industry. I want you to know we do understand that desire. We understand it only too well. We understand their plight because our industries — our concrete facilities — are located in the small towns and communities beside the forest and lumber communities.

Our industries, and industries like steel, have also been equally affected by the devastation of this economic climate. We continue to struggle with the declining demand in both our domestic and export markets. The cement industry does not believe it would be good public policy for the government to promote one building material over another building material — wood in this case — by excluding some competitors. In so doing, the government would be supporting the competitiveness of one industry over another industry or, as some would say and as we have told our children, "robbing Peter to pay Paul." It is just not good policy.

We have a few main areas of concern. The first National Building Code was developed in the 1940s in response to the growing demand for wood frame housing following World War II. One of the first goals of the code was to provide acceptable and uniform levels of safety and serviceability in all housing across Canada. The Canadian construction industry has evolved significantly over the past 100 years, adapting and changing with new building materials, practices and designs uniquely suited to the demands of both the Canadian climate and our changing infrastructure.

Canadian building codes were developed to address the needs and expectations of Canadians in the area of building construction and have done so admirably for almost 60 years. Canadian codes reflect the values of Canadian society — values such as fair and equitable minimum building solutions that are acceptable to the citizens of our country.

The National Building Code establishes provisions to address the four objectives of safety, health, accessibility for persons with disabilities, and fire and structural protection of buildings. The National Building Code restrictions on wood frame construction are borne out of fire and safety concerns because of the combustible nature of wood. As a result, wood frame construction in the National Building Code is restricted to four storeys or less almost across the country.

These restrictions are based on the consensus agreement of a balanced technical committee overseeing the development of the National Building Code. As a result, these requirements reflect the attitudes and expectations of the Canadian people, as do all the provisions of the building code.

It is therefore not appropriate for governments to intercede in the long and well established practice of building codes that could negatively impact the health and safety of Canadians. As an extension of this principle, the selection of an appropriate building material must be left in the hands of those who are qualified and licensed to practise in the area of building design and construction, not at the whim of politicians. Licensed professional engineers and architects are well positioned to select the best building material for the project under consideration.

We also have other concerns. By virtue of the federal Competition Act, the federal government has the legally stated purpose of maintaining and encouraging competition in Canada and promoting equitable opportunities for the participation in the economy of all industries. Giving one sector, the wood industry in this case, the inside track removes competition and the market balance generated by supply and demand, which clearly violates the spirit of Canada's Competition Act.

In addition, an unintended consequence of the wood first policy could be increased construction and building maintenance costs. With the deficits and debt levels of all our governments, it occurs to me that a politically motivated policy would likely increase the costs for public works and buildings, and would face concerned scrutiny by the public. In our opinion, that is quite rightly so.

We would like to say that governments should always choose the right product for the right job when they are spending taxpayers' money, meaning that the choice of the construction material depends on the needs of the final product and through the operation of a free construction market.

An obvious example of this principle would be the Confederation Bridge. I was hoping Senator Duffy would be here today. Imagine that 13-kilometre structure constructed of wood. Would it even have been possible? Nor would I suppose would it be fair to consider the restoration of the longest covered bridge in Hartland, New Brunswick, out of concrete. That was a shout out to those of you from New Brunswick. Would that not be a shame? Use the right building product for the right job.

Consumers and governments are increasingly demanding that their homes, workplaces and other infrastructures be constructed and operated in a more sustainable manner. Proponents of Bill C-429 have claimed that wood is the most sustainable building material in the world. This conclusion is a subject of debate, especially given the research which supports life cycle sustainability attributes of concrete construction. Initial embodied energy and building construction, while easy to measure and to point a finger at, accounts for only 15 per cent of the total energy consumed by a building over its entire lifetime.

Of much more importance, though, is the concept of the total cost of ownership, or life cycle assessment, of the environmental impact of a structure over its entire lifetime. The energy efficiency, the serviceability and the durability of a building are of paramount importance in providing a long service life. As a sustainable building material, concrete performs very well on all of these criteria.

We can all agree we want to get our economy moving again. We want all building products more widely used right across the country. However, Canada needs building products that suit the intended purpose. We need to see buildings that are hybrids in nature, using different and applicable materials for the intended purpose but which can also contribute to the aesthetic nature of a building.

I think we can all agree, if you have seen the Richmond Oval in British Columbia during the Olympics, that it is a wonderful combination of concrete, steel and wood. That building is the first building to have an underground parking garage on the Fraser River, which could not have been built without concrete. In fact, the length of the speed skating structure could not have been built had it not been made out of concrete. The wonderful roof could not have been held up unless it was on concrete pillars with wood wrapped around the steel.

Another example is the wonderful Vancouver Convention Centre and the glass and steel used in that building. However, let me tell you, there are tens of thousands of metres of concrete that were poured into the Vancouver Harbour that are holding that building up, out of the water. Therefore, use the right building material for the right job. That should be our goal.

In conclusion, we express our strong disapproval of Bill C-429. We respectfully request that the government and the opposition refrain from adopting any legislation that would artificially bias the selection of building materials in any federal building project. Thank you. We are here to answer any questions you may have.

The Chair: Thank you very much, Mr. McSweeney. We will consider questions.

[Translation]

Senator Robichaud: Thank you for your presentation, Mr. McSweeney.

[English]

I do not know why you mentioned Senator Duffy. At the time the bridge was constructed, he was far away from that site.

I was a member of Parliament for Beauséjour at the time, and you know Cape Tormentine is the starting point of the bridge to the island. I visited les chantiers, and it was interesting to see how they did it, as this was a major project. I can see that concrete was the material of choice.

You say "the government." We are not the government. We are a committee of the Senate, which is quite different. How do you see a competition between wood and concrete? Both are used in all types of construction, and I cannot see one replacing the other.

Mr. McSweeney: I will give you an example, senator. In British Columbia, for example, the premier of the province decided to instruct the government bureaucracy to change the codes to allow six-storey wood structures over four- storey wood structures, which are the norm in the rest of Canada and in the National Building Code. Sometimes government gets involved in changing the code rather than letting the technical committees, the volunteers and the professionals who work on the technical committees make the proper and right decisions. Perhaps Mr. McGrath has further comments.

Rick McGrath, Director, Codes and Standards, Engineered Structures, Cement Association of Canada: The building code changes we saw in British Columbia were unprecedented in the history of building code development in Canada. I referred to it as eight weeks to eight changes. The addition of two additional storeys to wood frame construction raised concerns amongst the fire services agencies in British Columbia. Some jurisdictions are looking for clarification on those code changes before they enact them in their jurisdiction.

As I say, it was unprecedented. Of the eight changes that were made, seven were simply made to facilitate the introduction of six-storey wood frame construction. Only one change addressed the issue of fire safety in these buildings, which is the primary reason why wood frame construction is limited to four storeys in this country. That one code change, in my estimation, did not go far enough to provide equivalent fire safety in a six-storey wood frame structure that is provided in a four-storey wood frame structure.

Mr. McSweeney: Normally it takes five years for changes to the code to be introduced, discussed by all the professionals, and then adopted. As Mr. McGrath said, this was eight weeks to eight changes.

Senator Robichaud: So this was in direct conflict with the code, for safety reasons, and it was in direct competition with materials you would have supplied if that change had not been put into effect?

Mr. McGrath: The issue of being in competition is an aside. The issue, in my estimation, as a professional engineer whose professional career has been spent in codes and standards, was the total disregard for the code development process. There were information meetings held and whatnot, but all this was completely outside the context of the standard code development process. A great many changes were rushed through quickly. Even now, the supporting documents from the industry to support these changes are not fully in place, and yet the regulations permit you to build six storeys without, I believe, sufficient standardization and instruction as to how to safely do this.

Senator Plett: Thank you, gentlemen, for coming and speaking to us today.

Mr. McSweeney, you had me almost convinced until you made the statement "not at the whim of politicians." I will echo Senator Robichaud; we are not the government. As a matter of fact, some people would say we are not even good politicians. That is debatable.

We have been tasked with a mandate, and that is not to take over and cut out concrete or steel. We have been tasked with the mandate of trying to find uses for wood and wood by-products and so on, and that is what we want to do.

I want to touch on one of the first comments you made. You say there are 27,000 people employed in the cement industry in Canada; is that correct?

Mr. McSweeney: Yes, in the cement and concrete industry.

Senator Plett: You say we should not tamper with that industry, because it would affect those 27,000 people. You said that to do so would be robbing Peter to pay Paul. Yet, you are starting to import more and more of your concrete. Is that not doing exactly the same thing that you are asking us not to do? Is it not true that the more concrete or cement you import, the fewer people who will have work in Canada?

Mr. McSweeney: That is a very good question. The reason we have seen imports rise from 5 per cent to 20 per cent in British Columbia is not as a result of anything that we want; it is a result of the carbon tax that was imposed upon the industry and population in British Columbia by Premier Campbell. The carbon tax in British Columbia is only on the fuel used — in our case, coal, to produce cement — and not on cement that is imported into Canada from the United States or Asia. The only reason that we have seen our domestic production and our plants having to take longer shutdowns in British Columbia is because of the importation of cheap cement from jurisdictions that do not have the same environmental regulations.

In fact, we see this in Quebec and Ontario. I stand to be corrected, but we have seen an increase of about 6 per cent on imports, in Ontario and Quebec, from other jurisdictions, because they can manufacture it more cheaply than we can because they have fewer environmental regulations.

Senator Plett: I hope the term "cheap cement" means better priced cement as opposed to cheap cement.

Mr. McSweeney: Yes.

Senator Plett: I appreciate the fact that it is a money issue, but I suggest we are trying to do the same thing. We are trying to find better and more economical ways of constructing buildings. I suggest that really we are doing largely the same thing.

My next question is in reference to this terrible government in British Columbia.

Mr. McSweeney: No one said it was terrible.

Senator Plett: Unfortunately, they do not have a Conservative Party there that is ready to take over. Nevertheless, the codes that the premier has imposed upon the industry in British Columbia are not unique. We had the privilege of touring a six-storey building in Quebec City, built entirely out of wood. The architect of that building was here just a week or two ago and testified. He told us about some of the problems that he had in obtaining the approvals, which took well over a year. However, he built a wonderful building there. Having toured it and having been in the construction industry all of my life, I would argue the fact that there are any more safety issues in regard to fire in that particular building. We have had witnesses tell us that people typically do not die in a building from a building burning; they die in the building from the furniture, the smoke and so forth. We have seen timbers that are set up so that when they burn, the scoring of them cuts off the oxygen, and they do not burn properly and so on.

A fire chief said that as long as you use an efficient sprinkler system, you do not have a safety issue. Safety is not the reason for not going higher. In Europe, they are building them, and I believe we were told that the highest one is 20 storeys. They are going well up in other parts of the country.

I would like you to at least clarify that part of it because we have been told by others that that is not the case.

Mr. McGrath: That is a very good observation, and one I would like to address. In 2005, the National Building Code of Canada adopted an objective-based format to the code, which facilitated the introduction of new and innovative solutions. It was recognized that a five-year building code cycle was too slow for the emerging technologies that were coming at an ever increasing rate. To solve that problem, the objective-based code was formed whereby a designer or a developer could propose an alternative solution that is not currently recognized by the National Building Code, but which demonstrates the same safety and meets the objectives of the code to the same level of the existing solution. Once you have done that, you can receive a building permit in your area, and build your six-storey wood building, provided you have demonstrated equivalent performance of that six-storey wood frame structure to the solutions already accepted in the National Building Code. It took your developer a year to get all the approvals because he was going through the alternative solution approach, which is fair game and fully recognized in the current National Building Code of Canada.

That is not the concern of our industry. Our concern is for an initial predisposition toward a wood solution before the examination of any other solutions. We are all for fair and open competition in the marketplace, and we do our best each year to improve our product and our building solutions. We just want to make sure that the situation is not predisposed before a developer or a practitioner embarks on the building project.

Senator Mercer: Obviously, I am familiar with the plant in Brookfield, Nova Scotia. We appreciate it. That plant is an integral part of the industry in Nova Scotia and strategically located in Brookfield, so it is able to reach a good part of the Maritimes from there.

I am concerned, though, as Senator Plett picked up in your not-at-the-whim of politicians comment, that you changed the words "meddle" to "interested" in your verbal presentation.

I want to talk about the fact that we are importing cement from elsewhere; it does not matter from where. You said we import it at $44 a tonne, and we cannot produce it here for $100 a tonne.

Our objective is not to put you out of business. Our objective is to see if we can maximize the business opportunities for Canadians. We grow a lot of wood; it is everywhere in the country. We are looking at opportunities.

Senator Plett's comment is right on about the fire chief from Brampton. His comments were very clear that if the building is properly sprinkled, there are no safety differences between wood and any other product.

Cement or concrete has its own problems. We do not have to go too much farther than Haiti to see what happens. It is not necessarily just that their building code is not as good as our building code, but many people were killed because the cement buildings collapsed on them in an earthquake situation.

Are we keeping up with the technology? You talk about an objective-based code adopted in 2005. There have been many changes since 2005. In 2005, we would not have built the Richmond Oval the way we built it. We would not have built a six-storey building in Quebec City the way it has been built.

Have we kept up with the changes to the code that involve not only wood but also concrete and steel?

Mr. McSweeney: In British Columbia, the code was changed at the whim of a politician, so please, do not take any offence. I know you are not politicians; you are senators.

Senator Mercer: It is a pretty fine line.

Mr. McSweeney: That is what happened in British Columbia. However, we are seeing from British Columbia and marching across the country a "wood first" policy that is saying, "above all." In the public sector, when you are considering building a building with public dollars, build it in wood first.

We are saying use the right building material for the right building job. That is at the nut of what we are saying. We are saying use the right building material for the right job. Do not subscribe to the onslaught that is moving west to east with respect to trying to use public dollars to encourage the use of wood in publicly financed buildings over all other construction materials.

Senator Mercer: Previously, wood would not have even made the list. It would have never been considered. At least we have put wood on the shopping list. Yes, some people have said, "wood first," but I am not saying wood first; however, wood needs to be considered because in some cases it never would have been considered.

Mr. McSweeney: You are absolutely right, senator, and that is where near the end of my comments I said "hybrid" and why I did not mention them both in the written text. The Vancouver Convention Centre is spectacular. There is no question about that. We all should be very proud of it as well as the Richmond Olympic Oval. Those buildings were created from the vision of some politicians saying we need to do more with the natural resources that we have.

I am saying hybrid, and to your point, Senator Mercer, we need to get wood on the agenda. There is no question, but not by subscribing to the philosophy of using wood in every instance, at any cost, to the exclusion of other building products. That is what is happening in British Columbia.

Mr. McGrath: First, with regard to the situation in Haiti, not only are there insufficient building codes in Haiti, there are virtually no building codes in Haiti. You have five-storey concrete structures erected there without supervision or professional design assistance.

The more recent seismic event in Chile is much more relevant to our situation. The Chilean government adopted the American ACI-318 concrete design code, which is similar to our concrete design code. I am vice-chair of the Design of Concrete Structures Committee. Murat Saatcioglu of the University of Ottawa headed a 10-man delegation to Chile to investigate the performance of the structures and bring back the knowledge to improve our codes.

The experience in Haiti will not tell us anything. I was looking at the rubble video footage. I could see immediately that the concentrations of reinforcement that I would expect to see in these structures were not there. It was evident from the state of the rubble that the buildings did not have a chance to survive the earthquake. Concrete is 10 times stronger in compression than it is in tension. That is why we insert steel reinforcing bars in the tension areas of the concrete structure, while the concrete itself takes the compression. In a seismic event where the structure is mobilized, those lightly or un-reinforced concrete structures did not have a chance of surviving.

As to the fire safety of the wood structures, typically, in these massive wood member frame structures, they overdesign the wood member. You are correct, senator, that there is a char effect on these members where, because of the mass of the element, the fire chars into the structure but slows down. This gives you the one or two-hour fire resistance that you need. Initially, those elements need to be overdesigned. If the developer is willing to over-design and put more material than is structurally necessary for the provision of fire safety, well and good, yes. With a sprinklered structure, realize that a lot of the passive fire resistance has already been traded off in that structure in favour of the sprinklers.

Senator Eaton: You talk about predisposition. We have heard some remarkable witnesses in this committee. We heard about the national building codes, and we saw a definite predisposition there to try anything to move ahead and to do any specific tests on wood. We have certainly seen a predisposition from the heads of schools of architecture from British Columbia, Edmonton and Laval to teach design in wood. We have seen another predisposition by engineers to use wood.

This committee would like to promote not so much wood first but, perhaps, encourage people to do what they are doing in France now. Having 3 per cent or 5 per cent of a building in wood is perhaps not so outrageous when we are the most forested country in the world.

We learned something last week when we interviewed the people from the steel. They speak with one voice nationally, as I assume you do. The architects to whom we spoke are also good in going into engineering and architectural places of education and keeping architects and engineers abreast with the latest product development. Do you do that?

Mr. McSweeney: Yes, we do.

Mr. McGrath: I produced the concrete design handbook on behalf of the association, which is the premier reference textbook for reinforced concrete design at Canadian engineering universities. We produce it every 10 years, and I have produced the last three for the association.

Senator Eaton: You are hands-on at teaching people to use your product in the very best way.

Mr. McSweeney: Yes. Where I think we have to improve, and I had this discussion with the Deputy Minister of Forests and Range in British Columbia, is in developing partnerships with the Forest Products Association and the Canadian Wood Council and going in to see major developers, both commercial and residential, to see how we can increase the wood component in aesthetic areas. Where it cannot be for structure, where can it be for aesthetics? Where it can be for structure, maybe you can have polished concrete floors. We need hybrid designs that make use of all of Canada's natural resources, as well as partnerships, rather than one or the other. Again, I come back to the right building material for the right job.

Senator Eaton: I do not think anyone in this committee would disagree with you. Thank you.

Senator Ogilvie: Thank you, both, for your presentations, which I found to be interesting and clear. I noted a couple of things that you identified with which I agree entirely, one of which is the importance of building codes and the idea that these move forward as new materials and innovation comes along. If we have the opportunity to use a range of products or use opportunities in different materials, then the builders have the greatest degree of flexibility in terms of designing for the particular beauty or functional use that they have. I could not agree more that the situation in Haiti is a perfect example of why codes are essential for the conditions under which the buildings and structures are put up.

I would now like to come to something that struck me directly, the issue of the carbon tax on the production of cement in British Columbia. We know that how things are produced, the origin of materials and so on, is becoming an increasing issue in the supply chain, with end users wanting to determine the carbon imprint of the materials that they are using.

I have two questions. First, you implied that the carbon tax alone was largely responsible for imports going up from 5 per cent to 20 per cent.

Mr. McSweeney: Correct.

Senator Ogilvie: I heard that correctly?

Mr. McSweeney: Yes, you did.

Senator Ogilvie: I do not understand the logic of imposing a carbon tax on one supplier, one source of supply, in the presumed intent of improving an environmental condition, and then not imposing it on your other supply chain. I do not see the logic especially when we know that other supply chain comes from one of the highest carbon producing regions, where coal is a major source of energy and is among the dirtiest coal in the world.

Under what logic do we close down Canadian producers and admit material that circumvents the presumed objective of that tax? To put it more positively, why was the tax not applied uniformly to all suppliers?

Mr. McSweeney: The cement industry is part of a global cement industry. It is a small industry. You will all know the names. It is Lafarge, Holcim, Ciment Québec, ESSROC Italcementi, Lehigh and St. Marys. It is a small, multinational industry. We have a cement sustainability initiative. We consider ourselves to be among the first recyclers, because every bit of concrete that we take out is recycled and put into road bases, for example. In our hearts, many of us who work at the Cement Association are environmentalists. We all know that 1 tonne of greenhouse gases produced anywhere is bad.

To create policies that will shut down an industry in Canada and force the production of the same product in another country is called leakage, a term with which this committee is familiar. It means that the production leaks to another jurisdiction. In this case, the carbon tax has a loophole in it that allows the carbon tax to be charged on the manufacturer of cement, but only cement made in British Columbia. We all know that, under WTO rules, we cannot have favourability on domestic products versus imported products. It is a big question. We are trying to work our way through with the Government of British Columbia to level the playing field. Otherwise, the increase is happening at about 2 per cent a month. All those greenhouse gases that are being produced in Asia to make the cement are finding their way through the trade winds to British Columbia. Not only that, but they produce 25 per cent more greenhouse gases in the transportation of the cement from Asia to British Columbia.

When tax systems are designed, loopholes happen. They do not happen because you intend them to happen. We are trying to work with the Government of British Columbia to close the loophole and level the playing field so that we can keep the jobs in Kamloops, Richmond and Delta. We are trying to keep those jobs rather than have to lay off those employees while the same cement is being produced in less regulated countries and being shipped into either Vancouver or Seattle, and then railed or trucked up to Vancouver.

Senator Lovelace Nicholas: My concern is the difference in cost of a wood building and a concrete building. Is it cheaper to use concrete or wood for a residential building?

Mr. McSweeney: We always say that in order to answer that question, you have look to look at the total cost of the building over its entire life. If a wood building lasts 50 years and a concrete building lasts 50 years, you want to know how much does it cost to heat each of those buildings over a 50-year period. Most people would acknowledge that a concrete building keeps heat in the winter and keeps the building cooler in the summer. If you look at that intuitively and think it through, we definitely need to do more work on empirical studies. If you look at the total cost of ownership over the life of a building, there is no question that we compare favourably if not better than a wood frame building.

Senator Lovelace Nicholas: What is the life span of the concrete, not as a building but as a block?

Mr. McSweeney: The pyramids are still standing; the Pantheon in Rome is still standing; and the fort in Quebec City is still standing. Our concrete buildings have a pretty good track record going back centuries. That was one of the ways to build at the outset. Many countries did not have the forest industries so they chose to use the stone from the available quarries. Some of the world's greatest buildings are made of concrete and stone and are still standing.

Senator Lovelace Nicholas: Which is cheaper: training people to build in wood or in concrete?

Mr. McSweeney: It is a trade for both forms of construction. We should encourage more people to get into those trades because we need them.

Mr. McGrath: You have asked a good question, senator. There are times, depending on the form, function, requirements and demands on the structure, where a wood frame structure might be first and foremost the best solution. We see that in many of our structures. There are other instances where although it is possible to build the structure with wood but the additional requirements and material that you have to pour into it to meet code make it cost prohibitive. Therefore, it is sometimes much more cost effective to build in steel and concrete when it is more adapted to the purpose of the structure. It depends on the project. That is why we are so concerned about a preference for one material at the outset because it depends on the demands and the needs of the structure.

The Chair: The witnesses have made an informative presentation and have enlightened the discussions. Perhaps we could follow up with additional questions and answers in writing to the chair.

Mr. McSweeney: Certainly.

The Chair: No doubt Mr. McGrath will be part of that process.

You mentioned that Bill C-429 was presented in the House of Commons by the Bloc Québécois. We are following those discussions on the matter of forestry and other materials. There is no doubt that using the right building material for the right job is commendable.

I ask the clerk to share with you the mandate of the Standing Senate Committee on Agriculture and Forestry. We have additional questions that we would like to bring to your attention. May we send these to you in writing so that you could return to the committee with responses? Feel free at any time to intervene or to add to your presentation. We are open for additional comments.

Thank you both for appearing today. Your ideas on hybrid products and value-added products are part of the vision that we want to bring to the attention of all stakeholders.

Honourable senators, we will now hear from the second panel of witnesses. We have three representatives from the Canadian Construction Association.

[Translation]

I would like to introduce the witnesses to the committee.

[English]

We have Michael Atkinson, President; Dwight Brown, Vice- President and District Manager of PCL Constructors Canada Inc.; and —

[Translation]

Mr. Alex Rankin, Past Chair of the CCA's Canadian Design Build Institute.

[English]

On behalf of the committee, I thank you all for being here this afternoon.

Michael Atkinson, President, Canadian Construction Association: Thank you. I am the President of the Canadian Construction Association, which is the chief staff position. I am delighted to have with me these two gentlemen who are well-known in the design and construction industry. I hope to turn it over quickly so that you can be enlightened by their knowledge and not have to listen to me very long.

We were formed in 1918 and we represent the companies that build everything except single-family dwellings. For example, we build bridges, water treatment facilities, high-rise commercial building, schools, hospitals, et cetera. To distinguish us from our colleagues at the Canadian Home Builders' Association, it is not housing starts we are interested in; it is building permits. We represent every sector of the non-residential construction industry right across the country.

We appreciate what the committee is attempting to do in examining the extent to which forest or wood products are being used in the non-residential construction industry and how that use might be augmented. In this regard, I want to make it clear that we are not opposed to the greater use of wood in non-residential construction. We believe that through more effective promotional initiatives, industry education and research and innovation to develop new innovative products, we will go a long way to evolving to that objective that I think this committee is looking for. You will hear more about that from these distinguished gentlemen.

It is also important to understand as well, particularly in the public sector industry, that the traditional procurement method under which we usually work is the so-called design-bid-build. This is where a hopefully full set of design specifications is put out and the builder is asked to price those specifications and build without deviation from that specification, including the specified materials. As the other witnesses will tell you, even that procurement method, which to some extent works against the use or introduction of new innovative products and materials, is slowly evolving and changing to more integrated design and construction approaches that perhaps will favour the objective of this committee.

Alex Rankin, Past Chair of the CCA's Canadian Design-Build Institute, Canadian Construction Association: Thank you. I am a practicing architect based here in Ottawa with a firm of just under 30 architects. I am also on the board of the Royal Architectural Institute of Canada. I know your committee has heard of with a presentation from Mr. Hobbs, its director. Naturally, I am a member of the Ontario Association of Architects, which is the provincial association. You have heard from Jerry Doyle, our President.

Not only am I on the board of the RAIC, I am also Chancellor of the College of Fellows, which is a position that is chair in charge of the juries for all design awards, including the Gold Medal, the Governor General's awards, practice award of the year and so on.

I also co-founded — and this is the particular point that I would like to make — in 1996 the CCA's Canadian Design-Build Institute, which serves the interests of a very diverse group of practicing individuals involved in design- build construction. We use the acronym CDBI.

CDBI is the voice of Canadian design-build practitioners and operates on a national level. It is able to connect all of its members across Canada. Membership includes owners, consultants, contractors and providers of allied services such as insurance and bonding companies, financial institutions and firms.

Why did this develop? Being a co-founder, I can speak to the heart of that. The heart is an integrated design process for delivering a project, be it a building, a bridge, whatever. What it also purports is best value and not lowest price. We are all aware of how the bid-build situation has reached a level over the last few years where low price is lower than you should be paying, as Ruskin said two centuries ago, for what it is you wish to have.

Therefore, the evolution of best value, which takes technical, esthetic and other factors into account together with price on the decision of what it is you build, including materials, structure and so on, with all the parties involved, from owners right through to all stakeholders, is called the integrated design process. The pivot to that is the design-build process whereby the design consultants and the contractor form one team. Predominantly in Canada, that means the design consultants will be legally hired by the contractor. The reason for that is usually because he has the money and consultants do not. When it is properly done, it is not a working of who owns who; it is a working of, "Let us find the right solution for the projects." This is a growing type of attitude of building that I am proud to say was sponsored by the CCA and has been growing since 1996.

I was the first architect in virtually 90 years of history to sit on the board of the CCA. They have engineers coming out of their ears, but they have never had an architect on the board until me. Since that time, it is growing. I am proud of that because, again, it shows architects integrating with the rest of the construction industry as opposed to playing designer prima donna.

I am here today to share with you some of the opportunities the design-build community particularly faces in greater good use in non-residential construction.

First, it is important to note that we select materials based on the structural properties of the material, which include maintenance, durability, price and aesthetics. Margins are often very small, particularly in challenging economic times when the competition for a limited number of projects can be extremely intense.

However, for my record of accomplishment as a practising architect, I can say that for nine of the last 15 design-build projects we have done — maybe 10, I cannot remember exactly — we were not the low bid as a team to win the project. In other words, it was a value dependent on technical expertise, timing, finishing the job, the aesthetics and the price. When I say that is nine out of 15, that is not a bad record, where the price was not low.

The fact that is starting to happen gives me hope that an architect will be disposed toward using any material in a much more sustainable, green and viable manner, as opposed to just focusing on whatever material is the low price of the day.

I think that is important for this committee to realize. That certainly would occur with the issue of concrete, steel or wood. In my experience as an architect, wood has had a degree of imbalance, particularly in the east compared to the west. We have done about eight or 10 buildings which have been all wood.

As an architect, I have mainly had to explain to parents that it will not burn down quickly, et cetera. Although people like wood, they are nervous to use it in home construction. That perception is changing. I think marketing and showing people how wood can be used as a material in a safe manner as well as an aesthetic manner will help the public perception.

When I came to Canada in 1965, I had worked in the Scandinavian countries where wood is a way of life. I came here and, yes, stick building for housing was a way of life, but wood in other buildings was almost taboo. That is changing and I think the Olympics are giving an example of this change.

Two factors change it. One is perception, and that is the most important one. It is a soft reason, not a hard-nosed, measurable and technical reason. To me, that is more a factor than the issue of the complexities of the code. The other factor is simply what people feel. It is a similar way in other residential parts in Europe. I come from Ireland originally and I ran a practice over there until recently. You could not get wood to build a house. No one would buy a house that is not made of concrete blocks. The issue of codes is really non-existent. The issue is perception. Marketing and perception will change that.

As an architect, I can say that concrete is one of my favourite materials. Together with this gentleman and many others on the team, we built the War Museum on LeBreton Flats. Concrete was the right material for that job, not wood. I love wood. Raymond Moriyama loves wood. That is not the point. "It is horses for courses." That is an Irish saying. Each building has its own particular products which are used, which is a combination of, first, what the owner and the stakeholders feel, followed by what the designer wishes to have, which could often be an artistic choice.

To do it better than that is like the design-builder construction management: You bring all technical factors into play right from the beginning. With our computerized world today, that is not difficult. It takes quite a lot of work for an old guy like me, but that is the real way to do it. That is what is happening. Therefore, wood will find its own level.

Frank Gehry, to whom I personally gave a gold medal here in Canada before he got his gold medal in the United States, chose wood as the major finishing material in the museum in Toronto. He did so for two reasons, and I heard this from him. First, he loves wood. It is a beautiful material and it is Canadian. Second, relative to a high-level museum, it is a cheap material. Relative to a school, it is an expensive material. It is all to do with what it is you are doing at the time. Those are the main things.

I have strayed off my notes but I hope that is okay in getting my point across.

Dwight Brown, Vice-President and District Manager of PCL Constructors Canada Inc., Canadian Construction Association: Thank you. I will try to keep this brief. I am the District Manager and Vice President for PCL Constructors Canada Inc. here in Ottawa. We are one of the largest general contractors in North America and the largest in Canada. We operate out of 27 centres, servicing Central America, Canada, Alaska, the Bahamas and the Hawaiian islands. Our head office is in Edmonton, Alberta. We are an employee owned Canadian company.

You may have seen our signs around or heard of us on some of our projects around town. We have done Scotiabank Place, the Ottawa International Airport, the War Museum, as Mr. Rankin mentioned, and now we are working on the Convention Centre close to here and on the Victoria Memorial Museum, or Museum of Nature, as it is known.

I have a few comments, though I will try to be brief. I am a carpenter by trade, so I prefer wood. Wood is a versatile material — there is no doubt about it; you can use it for a variety of applications. However, when you are doing institutional work, you have to consider the durability, the costs of construction, the structural implications, fire ratings, susceptibility to mould, et cetera. There are many different things we take into account when we are building a project, or, rather, when it starts from the design side, as to what will go into the project.

Since we are mainly into institutional commercial construction, I thought I would look at our volumes. Over the last 10 years, we have done $300 million worth of construction in wood. However, if you look at our volumes of $6 billion a year, that number is miniscule.

It comes down to the appropriate material to do the job. I also do not see the wood industry out there selling themselves to the engineering and designing community. I do not think it is anyone else's job to do that work.

The majority of our industry projects are done by design-bid-build, which is the traditional way of doing it. However, we do quite a bit of design-build models. Again, I come back to the criteria. We look at whether it the right material for the right job. You must also consider when you are getting the material, how close the material is to you, how far away it is and the footprint you are making with it. Speaking as a contractor, I would like nothing better than to see wood become a more viable cost-effective product to use in our projects. It just creates more competition with the steel and concrete, but again, I think the marketplace has to take care of itself on that issue.

Senator Eaton: Thank you. Horses for courses, absolutely. A topic came up in this committee with the director of architecture from University of Toronto. If the federal government were to mandate a percentage of wood use, would that, over the course of five or six years, encourage — and he seemed to think it would — engineering and architectural schools to start honing in on how to use wood in construction? Would that encourage the manufacture of cross- laminated timber, which we have heard is a very stable, strong, value-added wood product?

You have made the point, Mr. Brown, that it is up to the wood industry to promote itself. One of the reasons we are sitting here today is to try to come up with some recommendations for the government and the industry to help promote wood in non-domestic uses.

Mr. Rankin: I would not mandate anything. I think it is important to encourage something. In fact, I strongly believe that wood should be encouraged more, and this is lacking, but I would not mandate its use.

Senator Eaton: How would you do it?

Mr. Rankin: I would do it with good marketing through wood councils to all the colleges. Presently, we are designing a building in Perth for Algonquin College, which will become a design build building where the trades of carpentry, which Mr. Brown here started with, and specialized cabinet making and so on are all happening.

We have decided with the client, the owner, that the building will be made of wood. It is a sort of logical relationship to do that in something that is technically also very easy to cut a hole in and extend and move around the building flexibly, relative to the scale of the building and what it is all about. We analyzed it in a broad way in constructability. I did not use that word earlier and should have because that is really the essence of good design build building. In other words, if you have an idea of a building and you come to me and I have a team with Dwight Brown as part of that team, I may have ideas as an architect conceptually, but constructability relative to that building for what it is is where Mr. Brown would come in to answer it.

That means it finds its own level. Why wood would be used can only be answered by saying it is a good material. I have never met people who do not like wood as a material.

Senator Eaton: Architects from Victoria, Laval and University of Toronto have told us is that there is simply not enough knowledge. It is much easier for their students to whip something out in concrete or steel and use wood here and there, because that is the way they are trained. An engineer from the faculty of engineering from the University of Edmonton told us they offer very little education in the use of wood design or construction.

Mr. Rankin: I do not agree regarding architects. Regarding engineering, on the last six buildings we did that were all wood, I had to find an engineer who could use wood. This is Ottawa; if I were out West that would be slightly different.

Why does it make a difference?

Senator Eaton: He was in Edmonton.

Mr. Rankin: It is a difference of marketing because the engineer knew how to do wood once but he has not been doing wood buildings because he has never been asked to do a wood building. You get rusty. He does steel and concrete buildings, but if you want him to do a good wood building, that is a challenge. You have to either invoke the challenge, because it will be a special building, or find an engineer who is familiar with all the standards and so on to do a wood building.

I do not think it is the education. It is really a matter of just developing a position that shows that wood is a viable alternative. It is a perception.

Senator Eaton: You are right. Many witnesses have come to us with their perceptions — wood burns; it is unsafe; et cetera. It is a huge challenge to change people's perception without educating them.

Mr. Brown: I am not a marketing person, but if I were in that end of the industry, I would be doing something similar to Mr. Rankin's suggestion. I would get into the schools. I would be getting in front of owners, the same as you see the concrete and steel industries doing. Are they marketing those products effectively? They have to bring tangible items to the designer, the builder and the client that are usable for us. I do not see that from that industry.

Mr. Atkinson: Legislation and regulation will not change perception. What is needed here, and what perhaps the wood industry and the construction industry generally need, is perhaps more support from government in research and innovation. Ninety to ninety-five per cent of the companies that make up our membership are small- to medium-sized businesses, family-owned businesses. We do not have extra funds to invest in research and development.

Perhaps where our industry suffers is that we do not have a coordinated approach, particularly in the building products area, to look at not just wood but steel, and looking at innovative new applied products that can be used and marketed and can meet the demand, so that when someone comes back to you and says, "I do not prefer wood in this particular instance" for these reasons, that you can come back with a researched application that says, "Yes, you can. Here is how."

If there is a role for government in that area, perhaps it is as a partner with the industry in developing a coordinated research and development approach. We have often felt in our industry that there is a bit of a gap between the research community and the industry practitioners. What it is that the industry needs, what are our client needs? Often, what is being done in the research community does not necessarily go hand in hand with what the industry needs.

If this committee is looking for an area where the public sector could work with the private sector, perhaps it is in that area of applied research and technology transfer. It could be a way and means of trying to address the needs of builders and designers and, in the case of the wood product industry, finding a way that they can approach that niche.

I strongly argue that mandating a result in those circumstances will not change perception. All it will do in some cases, and I am not saying this with respect to the wood industry, is that mandating a result discourages people from promoting in a competitive marketplace that their product is just as good or better than other products, because why go through that effort if it will be mandated for you?

I caution against that approach. Perhaps you could take a more partnered approach with the building industry and with the building product industry in looking at ways and means how the government can assist in some kind of coordinated research and development approach. That partnership would then allow the wood industry, the steel industry and the concrete industry to develop new products that could be exported to other parts of the world.

Mr. Rankin: I have a comment regarding an example in marketing, relative to one's own knowledge. Two schools won an OAA design award and a Wood Council Design award and that was it; we did not hear any more about those awards. Then we did the Canadian War Museum, a building in concrete. I have given four lectures in the last two years about the use of concrete. The concrete industry approached me, as an architect doing concrete on a significant building that won an award. I did not get that from the wood industry.

Senator Mercer: Thank you for your presentation, gentlemen. We had a number of architects do just that, Mr. Rankin, namely, design quite remarkable wood buildings, or wood in mixed environments. For example, Ottawa airport uses wood and recycled wood, which was interesting to hear about.

When talking about architects and engineers, it goes back to what is happening in the schools. That is, what they are being taught in the schools. Yes, there may be mandatory teaching of the use of wood, but when they get down to the serious business of what they will be doing when they walk out the door of a school of architecture or a school of engineering, they are not thinking wood, they are thinking steel and concrete.

You said that mandating does not work. I will not argue against that.

Mr. Rankin: I have been an adjunct professor since 1979 at Carleton, in the school of architecture. I was teaching the fifth year, which was the thesis year. It is now six years to become an architect. That is interesting. What do you do in those six years and how much do you do on the practical side? Carleton is an academic frame of school. There are variations across the country of the 10 schools; I have given lectures in most of them. You will find that the materials and the use of materials is generally always a broad perception on any of them, be it wood, concrete or steel for structure and finishes, as well as other innovative usages.

The one area where research has advanced, through Carleton out to Manitoba, is concrete. There is a lot of the system of an investigative nature of using nylon for developing shapes, and there is the German process of being able to pour concrete in various forms, which Zaha Hadid an architect from England uses. Those innovations are very integrated. I do not see much on wood, but, equally, I do not see much on steel. However, the market will change that. During the process of being trained as an architect, you are really trained in all of them because your training is predominantly to do with function and form in what will be the total building industry. You are using the materials that come to hand, with no preference. It is not a biased way of education to say that you would receive more education on wood compared to concrete or steel.

Senator Mercer: Mr. Brown, PCL is a huge company. You said that wood is not a viable product cost wise. Why do you think that is? What is the cost problem? I know we are not talking about home construction, so what is the cost problem when it comes to using wood in non-residential settings?

Mr. Brown: For the structural members that you need for the spans that we need in commercial construction, it is cost prohibitive to do. You are using a lot smaller members and materials in order to achieve the same structure with other products than you do with wood. Your column spacing tightens down on you, and architects will choose not to use wood because your spacing on your grid for your layouts does not work into your functional programming or facility. Once you start enlarging the members enough to do the spans, you start to have issues with the cost.

Senator Mercer: That worked in the Richmond Olympic Oval, though.

Mr. Brown: Was it the most cost-effective material? It is certainly beautiful. I were selling wood products, I would be out there waving it everywhere. I would have it on every television ad going.

Senator Mercer: It was reclaimed wood. It was pine beetle damaged wood from northern British Columbia. The other wood used in the Richmond oval, besides the beams — and, I am doing an advertisement for them — was wood that was harvested on the property itself. When they cleared the land, they saved the wood that was on the land, milled it, and used it in the building.

Mr. Brown: You should build on that.

Senator Ogilvie: Rather than putting one material against another, the issue seems to involve looking at the basis that materials ultimately are appropriated into one kind of use or another.

Mr. Atkinson, I certainly appreciated your remarks, because the issues of marketing and all that sort of stuff can only occur after you have something to market. We are getting a clear impression that the concrete producers, in their various forms and the association as a whole, are much more interested in investing in research as to how their materials can be used. The steel industry has done a tremendous job coming through various stages of difficulties in their industry in looking at how to produce their materials and enhance the strength to deal with the issues of environmental impacts, and so on.

The wood industry does not seem to be at the same level at all, in terms of investing in the kind of basic research of the materials itself, to develop a range of new applications that allow you folks a broader series of materials to use in different ways and to incorporate into your buildings. We have heard from you and from others that when you are building, you look at what is available and what you are aware of in terms of proven materials that can meet an objective. There is not a fundamental bias against one material or the other, it is what will work under the circumstances; that is, meet the shape, design and ultimate effect of the building you are trying to produce.

Is my sense correct? From the practitioner's point of view, do you see the wood industry investing in the basic research in terms of using wood in a structural way to the same degree that the other two major producers do?

Mr. Rankin: I do not see them doing it to the same level. One of our most awarded buildings is the Nepean Sailing Club. People get married every week in that place. Its construction includes glued laminate beams and all sorts of things. Why is it that? It is because we wanted to do it. An upturned boat was the conceptual idea. In other words, the fact that it ended up as wood doing that was the result of a conceptual idea. That wood was more expensive. If it had been a steel truss building, it would have been cheaper than wood by far. Why did we use the wood? Because we got the client to agree that there is some value in the exposure of those particular wood glue laminated beams.

Senator Ogilvie: I want to come back to the research issue. I understand your point, but I would like your comment on the research. At the fundamental level, Wright was using the upturned boat in Nova Scotia several years ago. It is a great technique.

Mr. Brown: From my perspective visually, we do not see them putting their money into it. They are not in our face selling their product, in my view.

Mr. Atkinson: The first thing they should do is hire Senator Mercer because he did a great job of promoting a particular wood product.

The Chair: There is one matter that we have had all previous witnesses address. We will follow up in writing with additional questions from the researchers. I have one final question: How many workers does the Canadian Construction Association employ annually?

Mr. Atkinson: We do not have a figure specific to non-residential but the construction industry globally in Canada hires about 1.1 million men and women directly in our industry. If you use the rule of thumb of 50-50 residential to non-residential, that gives you some idea of the number of employees.

Senator Mercer: How many man-years of labour is that?

Mr. Atkinson: We would not have that figure nationally because it is not kept in the same manner in each province.

The Chair: Could you provide that information?

Mr. Atkinson: We could come close to it. I am not sure that the figure exists but to the extent that it does, we will find it.

The Chair: On behalf of the Standing Senate Committee on Agriculture and Forestry, I thank you for appearing this evening. You have been most informative.

(The committee adjourned.)