(Pursuant to rule 3-6(1) the Senate was recalled to sit this date, rather than April 21, 2020, as previously ordered.)
The Senate met at 4 p.m., the Speaker in the chair.
Business of the Senate
Motion Appointing Acting Speaker Pro Tempore for Today’s Sitting Adopted
Hon. Yuen Pau Woo: Honourable senators, with leave of the Senate and notwithstanding rule 5-5(j), I move:
That, notwithstanding any provision of the Rules or usual practice, the Honourable Senator Ringuette be Acting Speaker pro tempore for today’s sitting.
The Hon. the Speaker: Is leave granted, honourable senators?
Hon. Senators: Agreed.
Hon. Leo Housakos: Honourable senators, I have a question for the leader of the ISG, Senator Woo. I don’t necessarily have a problem with his motion, but I would like to ask a few questions of the senator. We do have rules and procedures in this Parliament that have governed this place for 153 years, and it seems that since you arrived here, Senator Woo, you are hell-bent on constantly questioning each one of those rules and procedures. I assume there must be some logic and reason, but where I come from, you usually don’t spend time trying to fix things that are not broken.
Some of our colleagues may or may not know that in the absence of the Speaker pro tempore, the Acting Deputy Speaker, the prerogative of choosing that Speaker in that role is the actual Speaker. We see Senator Woo, with this particular motion, as breaking from that tradition. My two questions are: Why do you think, Senator Woo, that you are more eminently qualified than the actual Speaker himself to make the choice of Speaker pro tempore? And why don’t you have confidence in our most eminently qualified Speaker? We in the opposition have full confidence in the Speaker. I would like to think that all senators in this chamber do. Why not allow the Speaker to take prerogative, exert his authority and allow him to do his work here?
Why do you think you are more eminently qualified than the actual Speaker?
Senator Woo: Thank you, Your Honour. It’s unfortunate that Senator Housakos would raise this kind of issue at a time of great urgency in our country, at a time when we want to get on with the business of having a Speaker pro tempore to preside over a session where we can ask the minister questions about a very important bill, which will affect the lives of many millions of Canadians and which all of us, I hope, want to properly scrutinize but get through before the end of today.
I have the utmost respect for Your Honour the Speaker and the utmost respect for my colleagues in the leadership of the Senate, and the choice of Senator Ringuette does not in any way violate that trust, violate that confidence and does not in any way run counter to the agreement of my colleagues in the leadership team. Thank you very much.
Senator Housakos: Senator Woo, I have one last question. Again, because time is of the essence and we are dealing with issues of national importance, which is precisely why we should allow procedure and the Rules of the Senate to follow their natural course and not waste time with unnecessary motions. If you had confidence in the Speaker, you would have allowed him to conduct his job.
The Hon. the Speaker: Is it your pleasure, honourable senators, to adopt the motion?
Hon. Senators: Agreed.
(Motion agreed to.)
Motion to Extend Today’s Sitting and Authorize Senators to Speak or Vote from a Seat Other Than Their Assigned Places During the Sitting Adopted
Hon. Marc Gold (Government Representative in the Senate): Honourable senators, with leave of the Senate and notwithstanding rule 5-5(a), I move:
That, notwithstanding rule 3-4, the sitting continue beyond the ordinary time of adjournment today;
That rule 3-3(1) be suspended today; and
That, notwithstanding rules 6-1 and 9-8(1)(b), senators may speak or vote from a seat other than their assigned places during today’s sitting.
The Hon. the Speaker: Is leave granted, honourable senators?
Hon. Senators: Agreed.
The Hon. the Speaker: Is it your pleasure, honourable senators, to adopt the motion?
Hon. Senators: Agreed.
(Motion agreed to.)
Charter Statement in Relation to Bill C-13—Document Tabled
Hon. Marc Gold (Government Representative in the Senate): Honourable senators, I have the honour to table, in both official languages, a Charter Statement prepared by the Minister of Justice in relation to Bill C-13, An Act respecting certain measures in response to COVID-19.
Motion to Resolve into Committee of the Whole to Consider Subject Matter of Bill C-14 Adopted
Hon. Marc Gold (Government Representative in the Senate): Honourable senators, with leave of the Senate and notwithstanding rule 5-5(j), I move:
That, notwithstanding any provisions of the Rules or usual practice:
1.the Senate resolve itself into a Committee of the Whole at the start of Orders of the Day today to consider the subject matter of Bill C-14, A second Act respecting certain measures in response to COVID-19, introduced in the House of Commons on April 11, 2020, in advance of the said bill coming before the Senate;
2.the Committee of the Whole on the subject matter of Bill C-14, receive the Honourable Bill Morneau, P.C., M.P., Minister of Finance, accompanied by one official;
3.the Committee of the Whole on the subject matter of Bill C-14 rise no later than 125 minutes after it begins; and
4.the speaking time provided for in rule 12-32(3)(d) be five minutes for the Committee of the Whole today, including the time for both questions and answers.
The Hon. the Speaker: Is leave granted, honourable senators?
Hon. Senators: Agreed.
The Hon. the Speaker: Is it your pleasure, honourable senators, to adopt the motion?
Hon. Senators: Agreed.
(Motion agreed to.)
Motion Concerning Internal Economy, Budgets and Administration; National Finance; and Social Affairs, Science and Technology Committees Adopted
Hon. Marc Gold (Government Representative in the Senate): Honourable senators, with leave of the Senate and notwithstanding rule 5-5(j), I move:
That, notwithstanding rule 12-2(2) and usual practice, and subject to the terms of the following paragraph of this order, the Honourable Senators Carignan, P.C., Dean, Downe, Dupuis, Forest, Jaffer, Marshall, Marwah, McPhedran, Moncion, Munson, Plett, Seidman, Saint-Germain and Verner, P.C., be appointed to serve on the Standing Committee on Internal Economy, Budgets and Administration;
That, notwithstanding rules 12-2(2), 12-2(3) and 12-5, and usual practice, the Honourable Senator Munson, or any senator who has replaced him as a member of the Standing Committee on Internal Economy, Budgets and Administration, cease to be a member of that committee at the adjournment of the third successive sitting of the Senate with a daily attendance of at least 60 senators that follows the adoption of this order, with the resulting vacancy to be filled by the facilitator of the Independent Senators Group or a designate;
That, notwithstanding rule 12-2(2) and usual practice, the Honourable Senators Boehm, Dagenais, Deacon (Ontario), Duncan, Forest, Galvez, Klyne, Loffreda, Marshall, Mockler, Smith and Tannas be appointed to serve on the Standing Senate Committee on National Finance;
That, notwithstanding rule 12-3(1) and usual practice, in addition to the members appointed under the previous paragraph of this order, the Honourable Senator Harder, P.C., also be appointed to serve on the Standing Senate Committee on National Finance until the committee completes the study authorized by this order, at which time he or any senator who has replaced him as a member, cease to be a member of the committee;
That, notwithstanding usual practice, the senator who was most recently chair of the Standing Senate Committee on National Finance remain in that position, while still a member of the committee, until the committee decides otherwise;
That, notwithstanding usual practice, the senator who was most recently deputy chair of the Standing Senate Committee on National Finance remain in that position, while still a member of the committee, until the committee decides otherwise;
That, notwithstanding rule 12-2(2) and usual practice, the Honourable Senators Black (Ontario), Dasko, Forest-Niesing, Griffin, Kutcher, Manning, Mégie, Moodie, Omidvar, Petitclerc, Poirier and Seidman be appointed to serve on the Standing Senate Committee on Social Affairs, Science and Technology;
That, notwithstanding rule 12-3(1) and usual practice, in addition to the members appointed under the previous paragraph of this order, the Honourable Senator Munson also be appointed to serve on the Standing Senate Committee on Social Affairs, Science and Technology, until the committee completes the study authorized by this order, at which time he, or any senator who has replaced him as a member, cease to be a member of the committee;
That the Standing Senate Committee on National Finance be authorized to examine and report on:
1.all actions undertaken pursuant to parts 3, 8 and 19 of Bill C-13, An Act respecting certain measures in response to COVID-19, which received Royal Assent on March 25, 2020, as well as the provisions and operations of the act in general;
2.the provisions and operations of Bill C-14, A second Act respecting measures in response to COVID-19, if and when it receives Royal Assent; and
3.the government’s response to the COVID-19 pandemic and its economic consequences;
That the Standing Senate Committee on Social Affairs, Science and Technology be authorized to examine and report on the government’s response to the COVID-19 pandemic;
That the government be authorized to table with the Clerk of the Senate, following the processes of rule 14-1(6), any report or document relating to its response to the COVID-19 pandemic and its economic effects, and to actions undertaken pursuant to either Bill C-13, An Act respecting certain measures in response to COVID-19, which received Royal Assent on March 25, 2020, or Bill C-14, A second Act respecting measures in response to COVID-19, if and when it receives Royal Assent, as well as the provisions and operations of the acts, including any regular report on this subject tabled in the House of Commons, and that the Standing Senate Committee on National Finance and the Standing Senate Committee on Social Affairs, Science and Technology be authorized to consider any such reports or documents for the purposes of the studies authorized by this order;
That the Standing Senate Committee on National Finance and the Standing Senate Committee on Social Affairs, Science and Technology be permitted to deposit with the Clerk of the Senate any reports on studies authorized by this order, if the Senate is not then sitting, with the reports then being deemed to have been tabled or presented in the Chamber;
That the Standing Senate Committee on National Finance and the Standing Senate Committee on Social Affairs, Science and Technology have power to meet for the purposes of the studies authorized by this order when the Senate is adjourned, and that rule 12-18(2) be suspended in relation thereto;
That, notwithstanding any provision of the Rules or usual practices, and taking into account the exceptional circumstances of the current pandemic of COVID-19, the Standing Committee on Internal Economy, Budgets and Administration, the Standing Senate Committee on National Finance, and the Standing Senate Committee on Social Affairs, Science and Technology have the power to meet by videoconference or teleconference, if technically feasible for the purposes of:
1.the studies authorized by this order;
2.any business, in the case of the Standing Committee on Internal Economy, Budgets and Administration;
3.an organization meeting pursuant to rule 12-13;
4.electing a chair or deputy chair if there is a vacancy in either of those positions; or
5.holding a meeting called pursuant to the final paragraph of this order or the order of March 11, 2020, to which it makes reference;
That both senators and witnesses be allowed to participate in meetings of these committees by videoconference or teleconference, with such meetings being considered for all purposes to be meetings of the committee in question, and senators taking part in such meetings being considered for all purposes to be present at the meeting;
That, for greater certainty, and without limiting the general authority granted by this order, when a committee meets by videoconference or teleconference:
1.members of the committee participating count towards quorum;
2.priority be given to ensuring that members of the committee are able to participate;
3.such meetings be considered to be occurring in the parliamentary precinct, irrespective of where participants may be; and
4.the committee be directed to approach in camera meetings with all necessary precaution, taking account of the risks to confidentiality inherent in such technologies;
That, when a committee meets by videoconference or teleconference, the provisions of rule 14-7(2) be applied so as to allow recording or broadcasting through any facilities arranged by the Clerk of the Senate, and, if a meeting being broadcast or recorded cannot be broadcast live, the committee be considered to have fulfilled the requirement that a meeting be public by making any available recording publicly available as soon as possible thereafter;
That there be a minimum of 72 hours’ notice for a meeting of a committee by videoconference or teleconference, subject to technical feasibility; and
That, notwithstanding the provisions of paragraph five of the order of March 11, 2020, allowing certain members of a Subcommittee on Agenda and Procedure to direct the convening of a meeting of a committee, in the case of the Standing Committee on Internal Economy, Budgets and Administration, the Standing Senate Committee on National Finance and the Standing Senate Committee on Social Affairs, Science and Technology, the terms of that paragraph also apply so as to allow the members of their respective Subcommittees on Agenda and Procedure, other than the chair, to direct the convening of a meeting of the relevant committee, and, if such a request is made during a period that the Senate is adjourned, the meeting be convened at the earlier of the time provided for in that paragraph or, if technically feasible, 2 p.m., Ottawa time, on the fourth day during the period from Monday to Friday after the clerk of the committee receives the letter.
The Hon. the Speaker: Is leave granted, honourable senators?
Hon. Senators: Agreed.
The Hon. the Speaker: On debate, Senator Housakos.
Hon. Leo Housakos: Honourable senators, this is more of a question to the government leader than debate, and I’ll be brief.
I’m very concerned; could you provide a bit of an explanation? Obviously, I understand we’re trying to get our oversight committees up and running similar to the House of Commons, and I understand the importance of that. We have seen from the experience on the House side that from a technical perspective, there have been a lot of difficulties, particularly when it comes to translation, for example.
I’m concerned about CIBA in particular. As we all know, the Parliament of Canada Act has given special authority to that particular committee of the Senate, and it gives full authority to the steering committee of CIBA to operate on behalf of this institution, even when there is prorogation or when the Senate has suspended.
Why is there a need now to give this added authority for CIBA to sit via Skype or whatever format they use in terms of getting the Committee of the Whole to meet, particularly when CIBA is one of those committees that has a number of in camera meetings and requirements because of labour and security issues? A high percentage of those deliberations are done in camera. You said you have looked at the possibility of doing that securely.
How can we be specifically certain that a secure in camera meeting of the CIBA Committee can be conducted? And, again, from the official languages perspective in this country, how can we be assured that all of these committees that will be meeting — we have seen instances where we have a hard enough time getting one or two witnesses to testify remotely while translation, audio and visual are being managed? What precautions and assurances have you been given that things will be managed properly on those two fronts?
Hon. Marc Gold (Government Representative in the Senate): Thank you for your question. It is a fundamental one. I think, as the motion makes clear, not only — especially in the case of CIBA — is security and translation fundamental to whether the committee is able to proceed, but also the technological challenges of making sure that any such meeting is secure.
We all know of the efforts the Speaker and the administration have made, as well as the chair in the other place, to explore these issues. It will not be until and unless we have all the assurances from the administration through our Speaker that this is possible that this option will be implemented.
The Hon. the Speaker: Is it your pleasure, honourable senators, to adopt the motion?
Hon. Senators: Agreed.
(Motion agreed to.)
Motion to Strike Special Committee on the Lessons Learned from the COVID-19 Pandemic and Future Preparedness Adopted
Hon. Marc Gold (Government Representative in the Senate): Honourable senators, with leave of the Senate and notwithstanding rule 5-5(j), I move:
That a Special Senate Committee on the Lessons Learned from the COVID-19 Pandemic and Future Preparedness be appointed to conduct a sober second thought assessment of the various impacts caused by the coronavirus pandemic in Canada, as well as the initiatives that have been undertaken to address this crisis, to carry out a broad consultation of Canadians to determine the challenges and specific needs of various regions and communities, and to identify lessons learned to prepare for future pandemics;
That, without limiting its mandate, the committee be authorized:
1.to assess the key milestones and evolution of the coronavirus spread, both abroad and in Canada;
2.to review the federal government’s use and effectiveness of legislation, policies, federal-provincial-territorial collaboration initiatives, and fiscal and spending measures during this public health, social and economic emergency;
3.to examine the specific impacts of the pandemic and its management, including on the Canadian public, public health, healthcare and private sectors, federal departments, agencies and Crown corporations, essential workers, vulnerable groups, Indigenous peoples, as well as linguistic and cultural communities;
4.to review Canada’s compliance with its international public health obligations and cooperation with other countries and international organizations;
5.to explore how intergovernmental and international relationships can be addressed and strengthened at the national and international levels, while considering the division of jurisdictional powers for control of communicable diseases, safety and security of supply chains, and enhancement of public health investments and research; and
6.to develop recommendations to improve Canada’s preparedness and response for future pandemics;
That the committee be composed of 13 members, to be nominated by the Committee of Selection, and that 5 members constitute a quorum;
That, notwithstanding rule 12-13, the committee hold its organization meeting no earlier than the start of October 2020;
That the committee have the power to send for persons, papers and records; to hear witnesses; and to publish such papers and evidence from day to day as may be ordered by the committee;
That, notwithstanding rule 12-12(1), the committee have the power to appoint senators who are not members of the committee to be members of any subcommittee it may establish, with all the rights and obligations as a member of the subcommittee, and that the committee also be authorized to permit membership changes for such members in accordance with rule 12-5;
That, notwithstanding usual practice, if the Senate authorizes any other committees to study any issues relating to the COVID-19 pandemic, the Special Senate Committee on the Lessons Learned from the COVID-19 Pandemic and Future Preparedness be authorized to take those other committees’ reports and evidence into consideration for the purposes of its study as those reports are tabled or presented in the Senate;
That, pursuant to rule 12-18(2)(b)(i), the committee have the power to sit from Monday to Friday, even though the Senate may then be adjourned for a period exceeding one week;
That, the committee be authorized to report from time to time, submit a comprehensive interim report no later than six months after its organization meeting, and submit its final report no later than six months after the tabling or presenting of the comprehensive interim report;
That the committee be permitted to deposit its reports with the Clerk of the Senate if the Senate is not then sitting, with the reports then being deemed to have been tabled or presented in the Senate; and
That the committee retain the powers necessary to publicize its findings for 60 days after submitting its final report.
The Hon. the Speaker: Is leave granted, honourable senators?
Hon. Senators: Agreed.
The Hon. the Speaker: Is it your pleasure, honourable senators, to adopt the motion?
Hon. Senators: Agreed.
(Motion agreed to.)
Notice of Motion to Authorize the Clerk of the Senate to Prepare a Report Identifying the Procedural and Technological Options Best Suited to Ensure the Continuity of the Senate’s Operations in Emergency Situations
Hon. Josée Verner: Honourable senators, on behalf of the Honourable Senator Tannas, I give notice that, at the next sitting of the Senate, I will move:
That, in light of the impact that the COVID-19 pandemic has had on Senate proceedings, and that future emergencies may have similar effects, the Clerk of the Senate, under the direction of the Speaker of the Senate, be instructed to prepare a report identifying the procedural and technological options best suited to ensure the continuity of the Senate’s operations in such situations;
That without limiting the generality of the foregoing, this review include:
1.an evaluation of the efficacy of technologies, temporary rules and practices, and safety measures to protect the health and wellness of Senators and staff that have been adopted by the Senate to support its proceedings during the COVID-19 pandemic;
2.the technological best practices implemented in other jurisdictions, including provinces, territories and foreign countries, to support legislative proceedings during emergency situations, in particular those in Commonwealth countries operating under the Westminster parliamentary system; and
3.the development of recommendations for the implementation of a contingency plan that will allow the Senate to rapidly adapt its rules, usual practices and technologies during future emergencies;
That, the Speaker be authorized to distribute the report of the Clerk of the Senate to all senators upon receipt, and that he tables the report in the Senate no later than 45 calendar days after the adoption of this order, or at the next sitting thereafter if the Senate is not then sitting;
That, upon tabling, the report be deemed referred to the Standing Committee on Rules, Procedures and the Rights of Parliament, if and when it is formed, with that committee being authorized to examine and report on the findings of the Clerk of the Senate, and to recommend to the Senate the best practices it should adopt in a contingency plan to ensure the continuity of its legislative functions in the case of an emergency, including any necessary changes to the Rules and usual practices of the Senate;
That the committee submit its report no later than 60 calendar days following its receipt of the report from the Clerk of the Senate, provided that if the Senate is not sitting at the end of this period, the committee be authorized to deposit its report with the Clerk of the Senate, with the report being deemed for all purposes to have been tabled or presented in the Senate;
That after any report from the Standing Committee on Rules, Procedures and the Rights of Parliament arising from this order has been tabled or presented in the Senate, the subject matter of that report be referred to the Standing Committee on Internal Economy, Budgets and Administration to examine and report on any necessary administrative changes, including information technologies and capital purchases, required to implement the procedural changes recommended by the Standing Committee on Rules, Procedures and the Rights of Parliament to be part of a contingency plan; and
That the Standing Committee on Internal Economy, Budgets and Administration report thereon no later than 60 calendar days after having received the report of the Standing Committee on Rules, Procedures and the Rights of Parliament, provided that:
1.if the report of the Standing Committee on Rules, Procedures and the Rights of Parliament was deposited with the Clerk of the Senate, the period for the Standing Committee on Internal Economy, Budgets and Administration to conduct its study only begin on the next day thereafter that the Senate sits; and
2.if the Senate is not sitting at the end of the period for the Standing Committee on Internal Economy, Budgets and Administration to conduct its study, the committee be authorized to deposit its report with the Clerk of the Senate, with the report being deemed for all purposes to have been tabled or presented in the Senate.
ORDERS OF THE DAY
Business of the Senate
The Hon. the Speaker: Honourable senators, pursuant to the order of earlier this day, I leave the chair for the Senate to be put into a Committee of the Whole on the subject matter of Bill C-14, A second Act respecting certain measures in response to COVID-19. As has been agreed in discussions, the Honourable Senator Ringuette will chair the committee.
COVID-19 Emergency Response Bill, No. 2
Consideration of Subject Matter in Committee of the Whole
On the Order:
The Senate in Committee of the Whole in order to receive the Honourable Bill Morneau, P.C., M.P., Minister of Finance, accompanied by one official, respecting the subject matter of Bill C-14, A second Act respecting certain measures in response to COVID-19.
(The sitting of the Senate was suspended and put into Committee of the Whole, the Honourable Pierrette Ringuette in the chair.)
The Chair: Honourable senators, the Senate is resolved into a Committee of the Whole on the subject matter of Bill C-14, A second Act respecting certain measures in response to COVID-19.
Honourable senators, in a Committee of the Whole senators shall address the chair but need not stand. As ordered earlier today, the speaking time is five minutes — including questions and answers. As also ordered by the Senate, the committee will receive the Minister of Finance, and I would invite him to enter, accompanied by his official.
(Pursuant to the Order of the Senate, the Honourable Bill Morneau and his official were escorted to seats in the Senate chamber.)
The Chair: Minister, welcome to the Senate. I would ask you to introduce your official and to make your opening remarks.
Hon. Bill Morneau, P.C., M.P., Minister of Finance: Thank you very much. Let me start by introducing Andrew Marsland. Andrew is the senior assistant deputy minister of taxation and someone with a deep and broad understanding of taxation. He is here to answer any more detailed questions that you might have of him today.
I want to say I’m pleased to be here today, and while it would be under duress if you decide to end this shorter, I would be willing to acquiesce, so I will leave you to take that under consideration if you get bored with me at any time during this afternoon’s proceedings.
I would like to start by providing some context for why we’re here today. We obviously all know that the challenge that Canadians are facing and that we’re facing as people who are representing Canadians is enormous, and we know that people across the country are feeling anxious first and foremost about their health and then, of course, about their economic security. That is the way that our government has approached this challenge, first and foremost in thinking about ensuring that our health care system is up to the task of dealing with the COVID-19 crisis and then looking very carefully at how we can support Canadians through a particularly difficult time.
You will know that when I was last here, we were talking about our first set of measures, the Canada Emergency Response Benefit, trying to make sure we had a support mechanism for all Canadians who are not able to be working during this time. In particular, we were talking about the 5.7 million out of 19 million working Canadians who were not attached to an employer, so that was particularly important for us to get at immediately.
Today we’re talking about a second measure that we think will be very important, not only in providing support for Canadians but also in ensuring that, as we move out of this crisis, people will remain attached to their employer.
What we’re talking about is the Canada emergency wage subsidy, and the intent there is to enable employers to deliver up to 75% of an employee’s pre-crisis earnings up to a maximum of $847 to the employee and, in that way, ensure they are able to support themselves and their families, of course, and remain attached to the firm.
You will know that these two measures together are the most significant investments that Canada has made since World War II. They are, respectively, $24 billion in estimated costs and $73 billion in estimated costs for a direct impact on Canadians going directly to people, of, as you can add up, about $97 billion.
Those supplement other measures we’ve taken in support of businesses, such as another wage subsidy of 10% for small businesses across all lines of business, not just ones that are impacted by COVID-19, and additional measures that we know will support particularly vulnerable or impacted groups.
I’m very pleased to be here with you today. I know we need to look at next steps. I can assure you that we have more ideas about how to make life easier for Canadians during this very difficult time. This is a highly dynamic crisis, and the measures we propose need to be equally dynamic. We’re going to keep looking at what we can do to tackle this problem and, with your advice, I hope we’ll have some more ideas on next steps we can take.
Thank you very much. I look forward to your questions.
Senator Plett: Minister, when you were here on March 25, you dismissed my question out of hand asserting that your 10% wage subsidy was too low. You said I was incorrect. Forty-eight hours later, your government reversed itself and announced a 75% wage subsidy, but details weren’t provided until five days after that. Now we have Bill C-14 before us, two and a half weeks after your first attempt to offer a wage subsidy. Canadians will still have to wait another three to six weeks to receive their money.
Minister, it is great that corporations like Air Canada will hire back employees with this wage subsidy, but they have deep pockets to withstand the wait. With rent payments due for the month of May in short order, how do you think small businesses will survive while they wait to receive this wage subsidy?
Mr. Morneau: Thank you, senator. There are a number of things that you said in that statement. Perhaps I can unpack it one by one.
First, when I was last here, I was talking about the importance for us to have a made-in-Canada approach. If I’m correct, your question was about the approach of another country. In our situation, we saw it as critically important that we start with the idea that many of our employees, as I mentioned in my opening remarks — 5.7 million out of 19 million — would not be impacted positively by a wage subsidy because they are not actually attached to an employer. In that regard, we decided that the first and most important thing we could do was to have an approach that would, on an emergency basis, support them.
Second, the 10% wage subsidy we put in place originally was different than what we’re talking about today. That subsidy was for all small businesses without an impact on their business and necessarily in a direct way.
Senator Plett: You’re not answering my question.
Mr. Morneau: So for any business of up to 18 employees, they have that 10% wage subsidy.
What we’re talking about today is a 75% wage subsidy for employers who have a decline in revenues of 30% or more. You used the example of Air Canada. I could use many other examples of businesses in Canada that are significantly impacted by COVID-19. In fact, it is presenting enormous challenges for all of those businesses, large and small, because of the declines in revenue. We think it is critically important for them to retain their employee group.
With respect to the small businesses, you will know that we have introduced some other measures. We put in place, for the smallest of businesses, the Canada Emergency Business Account, which will allow them to have $40,000 in interest-free debt between now and December 31, 2022. If they’re able to pay that off by that time, $10,000 of it — or up to 25% — will be forgivable. This enables them to bridge a particularly difficult time.
There will be other things that we will need to consider. We think this will help many businesses, along with the ability to pay their employees. For those businesses that have taxes owing, whether it is GST or income taxes, we’ve deferred those as well, creating a source of liquidity for them.
Finally, we will put in place measures to ensure that people have access to credit across all sizes of business. We know that will also enable them to bridge this difficult time.
If you have any specific ideas, we are happy to consider them as something that we can look at in the future.
Senator Plett: I had a specific idea a few weeks ago.
Minister, Alberta, Saskatchewan and Newfoundland and Labrador are still waiting for help from your government as they deal with COVID-19 and a collapse in oil prices.
When you were here on March 25, you said that these provinces would receive help from your government in “hours, potentially days.” Why is there a delay? Where is the aid package you promised these provinces two and a half weeks ago?
Suncor’s cost of borrowing went up considerably earlier this week. You said in March you were looking at ways to backstop lenders to our energy companies. What will you do on that front?
Mr. Morneau: In fact, senator, there has been no delay. There have been a number of things we have done that will positively impact firms in the energy sector, as well as firms more broadly. We have done this step by step.
First, with respect to the many small businesses in the energy sector, the Canada Emergency Business Account will provide them with access to capital. That’s quite important. As you know, there are many small businesses in Alberta, Saskatchewan and Newfoundland and Labrador.
Second is the wage subsidy. Most of those businesses have been seriously hit, from a revenue standpoint, because of the three impacts —
The Chair: I’m sorry, minister, but we have to move to another question.
Senator Carignan: My question is about seasonal workers and the cultural sector. For those categories of workers, there is a delay between revenues and the target period. For instance, a company that is currently growing greenhouse produce won’t generate revenues until the summer. That means the drop in revenues will happen outside the eligibility period.
I’ve also been talking to people in print media. That industry hasn’t yet started to see a decline in ad revenue, because governments are buying a lot of ads right now. However, once the crisis is over and the government stops spending so much money on ads, the media will experience a decline, because the big companies that buy ads, like auto dealers, real estate and all things culture-related, won’t be buying ads this summer. The drop in revenue could come later.
What are you planning to offer those companies in terms of financial compensation or the possibility of making them eligible for the credit?
Mr. Morneau: That’s a good question. I know that many sectors are in a very difficult position right now. Obviously, businesses in the tourism and hospitality industries are in a very precarious situation.
We began by taking measures that will help businesses meet the major challenges they are facing today. We are talking about businesses whose revenue has dropped by 30% compared to last year or even compared to January and February. These challenges and other problems will continue. The situation is constantly evolving and we will make adjustments to find ways to help sectors in difficulty. Of course, access to credit is very important. That is why we are looking at ways of giving every sector access to credit. We will have more to say on that in the coming days.
Obviously, new challenges will arise, and we will have to look into them as we get more information.
Senator Carignan: How do you intend to help businesses? In some business models, a business may comprise a management company and an operating company. The operating company earns revenue and some of the expenditures are transferred to the management company. The non-arm’s-length revenue is transferred to the management company. Revenue must be taken into account in this business model. How do you intend to offer financial compensation to these management companies that do not deal at arm’s length with an operating company, for example?
Mr. Morneau: A number of companies have told us they are structured that way. While the group may be in good shape overall, one of the subsidiaries might be in a more precarious position. As we see it, the group should be treated as a single entity because it can help its subsidiaries. If another solution presents itself, we’ll look at it. For now, we think a group should be treated as a single entity with respect to revenue. As such, this is for enterprises that have lost all their revenue because of COVID-19.
Senator Carignan: I am talking about all management companies, not necessarily a group with several subsidiaries. Maybe your deputy minister can answer my next question.
On page 8 of the bill, in subclause 4, which is entitled “Computation of revenue”, at paragraph (d), subparagraph (ii), there is a formula: $100(A/B)(C/D). There seems to be an error in the formula because the descriptions of A and B that follow mean exactly the same thing. I don’t see the point of repeating the same thing twice.
Could you or your deputy minister clarify the difference between A and B in the formula at lines 27 to 37 on page 8 of the bill?
The Chair: I’m sorry, but the five minutes have expired. I invite you to provide a written response to the senator.
Senator Pate: Minister, my colleague Senator Renée Dupuis, an independent senator from the Laurentian region, and I would like to thank you and your colleagues for your work during this difficult time.
This legislation underscores the vital importance of a sufficient source of income to provide every Canadian with the stability and ability to follow and maintain their individual as well as our collective good health. It also aims to assist economic recovery post-COVID-19. While the emergency GST tax credit measures are a good start, they are not sufficient, and many of those most marginalized require special outreach and assistance to register for such measures.
What provisions are being made to ensure economic stability for all during this pandemic and beyond, including for those most socially and economically marginalized, particularly those who are vulnerable, poor, homeless, Indigenous, black and other racialized communities, and those who are not receiving enough to get by or have not been able to register for current emergency assistance?
Furthermore, does the federal government plan to use existing tools within our tax system to provide guaranteed minimum income measures to ensure that everyone, including the most vulnerable people of our society, can maintain a dignified standard of living?
Mr. Morneau: Thank you for the question. What we have attempted to do during this time of crisis is to deal with the challenges we’re faced with in this crisis. So we’re looking specifically at the people who have been impacted by COVID-19 and trying to ensure we support them during this time. This has driven how we’ve designed the measures we’ve put in place.
The idea behind the Canada Emergency Response Benefit was, for those many people who would fall out of the workforce quite quickly, to ensure they had enough money to continue to support themselves in terms of groceries and rent. The amount of $500 per week for 16 weeks, when we looked at it together with the GST low-income tax credit that we put in place and the one-time increase in the Canada Child Benefit, provides significant support for people at the low and approaching middle end of the income spectrum.
The wage subsidy is intended to help those who are attached to an employer, as I said earlier. It is intended for people in a slightly higher income bracket, but it caps off at $58,700 in terms of the annualized earnings that are used as the 100% level.
We are doing our best to find a way to ensure that people can bridge the gap at this time. That is not to say that there aren’t vulnerable Canadians who will remain challenged throughout this time and beyond. We also recognize that some of those vulnerable Canadians are particularly impacted by COVID-19, which is why we’ve allocated specific funding for Indigenous, First Nations, Métis Nation and Inuit peoples.
We’ve taken the approach where we’re looking at the specific issues people are facing and looking at particular groups. We have funding going to places that we know will need to provide services; for example, food banks and shelters, where we know people will be particularly challenged during this time. We’re trying to target our measures to places where we think they can have the biggest impact, recognizing that we are bridging a time period so that people can get back to a more normal economy, we hope, in the not-too-distant future.
Senator Pate: Thank you very much, minister. As you have already acknowledged, and as my colleagues have mentioned, we have deficits. A patchwork of approaches is being taken that still leaves people behind. What are the plans to ensure those individuals will actually be assisted in both the short and long term?
Mr. Morneau: There are specific groups of people for whom we need to ensure they are finding support during this time. I won’t give you a long list, but here are some examples: We have about 2.1 million students in this country. Of those 2.1 million students, last summer 1.6 million of them sought employment and 1.4 million of them obtained employment. It’s fair to assume that many of them will not be able to obtain employment this summer. This is an issue we’re looking at carefully in terms of how we can provide support. There are other places as well, which I would be happy to speak about later.
Senator Petitclerc: Thank you, minister, for being here with us to answer our questions. As we all know, the pandemic we’re dealing with has truly highlighted the tremendous work being done by our health care professionals. We thank them from the bottom of our hearts. It has also made us realize the vital work done by workers who are often undervalued. Of course I’m talking about grocery store clerks, sanitation workers, delivery workers and many others who put their health on the line every day to allow us to continue to function. As we all know, these people don’t earn a living wage. They don’t have access to benefits and often work part time in unstable, changing conditions.
What is the government’s plan to ensure that these individuals receive not only a proper salary, but also work protections such as sick leave during the pandemic and thereafter?
Mr. Morneau: This is another issue like the one I explained in my remarks about the students. We are, of course, looking at how to ensure that workers have the necessary protections so they can work in an environment that is safe for their health. We also want to ensure that they are earning enough to continue to work. We are working with the provinces. That is very important.
I’m sure you know that Quebec has already implemented measures to support essential workers and increase their hourly wages. We are looking at ways to work with the other provinces to get similar programs implemented for essential workers. Workers’ health is, of course, very important, which is why we must work with the provinces, while respecting their jurisdictions in our health care system.
Senator Petitclerc: I share a concern of Senator Simon of Alberta. The 75% wage subsidy program doesn’t apply to public organizations such as municipalities, libraries, universities and art schools. Many of those entities were forced to proceed with mass layoffs and, in light of all of that, we would like to know what federal support might be given in the near future to municipalities and the post-secondary sector.
Mr. Morneau: We decided to focus those measures on enterprises, including both corporations as well as not-for-profit enterprises, whose revenues have dropped. This means that municipalities and other government institutions are in a different situation, and we think it’s important to take the affected sectors into account immediately.
I have no doubt that we will work with the provinces going forward to see how we can also help other kinds of institutions. However, the vast majority of the institutions you’re talking about, as well as government institutions, actually come under provincial jurisdiction.
Senator White: I have two questions. The first one is for Senator Griffin of Prince Edward Island. She advises that the premier of Prince Edward Island has stated that the Prime Minister has told the premier that those whose EI benefits will run out and who have no seasonal job — in fishery, tourism, possibly even agriculture — would be able to continue with benefits through the Canada Emergency Response Benefit program. Can you confirm that today?
Mr. Morneau: I can confirm this is something we are looking at. We do recognize there are workers who are in difficult positions because they are in seasonal industries and that we do need to find a way to give more assurance to those people that they will be supported during this time, but I don’t have an answer on exactly how we’ll do that at this time.
Senator White: For Senator Black, Alberta: Minister, it has been two weeks or more since the promise of relief for the Canadian energy sector. When can the hard-working men and women expect an industry-specific relief measure? What can we expect and, more importantly, when?
Mr. Morneau: There are a number of measures on which we have already moved forward that are providing important support for the energy sectors. Clearly, the wage subsidy we are talking about today is going to be a huge support. As you know, many of the organizations in that sector, even when the revenue goes down, need to continue to employ their people because their assets will actually not be effective in the long term if they don’t do that. That means they are continuing to pay their employees and that, of course, means the wage subsidy will have a big impact on them.
Additionally, we are looking at measures of credit support for businesses across sectors, but importantly in the energy sector where we know people have been particularly impacted. We are nearing completion of those discussions with the banking sector on how we can guarantee those funds appropriately. I expect we will be able to talk more about that in the relatively near future.
Senator White: Thank you, minister.
Senator Munson: Minister, thank you for what you are doing, but I’m not sure the banks got the full message. Big banks are charging interest on interest for deferred mortgage payments, deferments up to six months. On average, for some families, this would be another $7,400 to pay in interest on interest. There are 600,000 Canadians who have applied for this. It sounds like a cash grab, in a way. Surely you can’t be happy with this?
Mr. Morneau: Thank you for the question. Our approach has been to try and engage all Canadians — that includes the banking sector and other sectors — in our efforts to get through this challenge. I’ve been working with the banking sector, in particular, because the idea of flowing credit is so critically important. We have released enormous sources of liquidity into the market. Our challenge is to make sure that liquidity is actually out there and working for Canadian businesses. That is quite important.
We have also pushed the banks to be involved in delivering the Canada Emergency Business Account for small businesses, an enormous undertaking for more than a million small businesses, which has now started. Finally, as you would have seen last week, after some fairly extensive discussions, we worked with the banks to get them to reduce their credit card fees in most cases by about half for Canadians who are facing challenges.
There is certainly more work to be done. I expect the banks will continue to be an important part of dealing with this challenge, and I am committed to continuing to work with them in that regard.
Senator Munson: I hope the banks pay a little more attention to these kinds of interest rates, minister. It seems greedy, as one person said.
Briefly, a plumber in Edmonton, Alberta, says his company won’t pay him the extra 25%. The Huffington Post is reporting that the company will get the 75% wage subsidy but now the company will not give him the other 25%. You said on Thursday that you encourage employers to do all they can to top up their employees’ pay to 100%. Can you have stronger words than that, something other than the word “encourage”? I know you want to tell the companies to pay the 100% but some companies are not.
Mr. Morneau: No, we won’t have stronger words than that. We won’t because we think it’s the wrong thing to do. We are saying that the subsidy is for companies that have a 30% or more decline in revenue. Many of them have zero revenue. For a company with zero revenue, we are asking them to keep their employees on and we are paying up to 75%. If we force them to pay the other 25%, then they won’t take the subsidy. It’s the law of unintended consequences, if we take your approach, sir. We have decided that we will go forward with the 75% wage subsidy. That will protect an enormous number of Canadians. For those businesses that can afford to continue paying people, we expect and we know that many of those businesses are willing to pay people up to the 100%, including their benefits. But for those businesses with no revenue, that would be an unrealistic expectation, except in the most benevolent of cases.
Senator Loffreda: Thank you for being here, minister, and for once again putting together a fine aid package, which has helped businesses and Canadian workers to remain working or getting back to work when it’s feasible. I understand it’s a dynamic process. It’s not static, far from being static. And we are building the tracks as the train is speeding along; I understand that.
One area of concern is the Business Credit Availability Program. There are no issues with the new loans, energy going forward. The concern is with the margin deficits on the existing loans, margined by existing assets, which have now decreased in value. Are you considering additional options or support in that area?
Mr. Morneau: What we’ve tried to do with the approach to the Business Credit Availability Program is to provide government guarantees for new loans so that banks will be encouraged to take on those new loans behind their existing loans. The guarantee of the federal government through the Business Development Bank of Canada and the Export Development Canada is an 80% guarantee for those loans, in two separate tranches but up to $12.5 million. That will allow the banks to bring that money in behind their existing loan, meaning they will have a reason to continue to lend because, as you know, they now have the ability to protect their original loan, putting more liquidity into the system, more credit for their existing clients. And they will have more skin in the game because they will put an additional 20% behind that.
We think it’s a mechanism that should work. It worked in the 2008-09 crisis when more than 11,000 firms were helped in this way. We are also looking at other measures to put in place for larger organizations, as well as the largest of organizations that are experiencing significant challenges as a result of this situation.
Senator Loffreda: There are some concerns with the clients and bankers on the existing loans, so I just wanted to share that with you. I want you to elaborate. Certain areas need specific measures. The program is exceptional in general, but when we expand on the sectors previously mentioned — the accommodation, food, entertainment and culture industries — they employ 2 million Canadians. The restart in those areas will be extremely difficult.
Are other measures or options being considered at this point in time? The next step would be to have the specific measures to communicate some hope in these areas because when I discuss this with some former clients in those areas, they need hope. They need something to look forward to. Maybe in the long-term, consider going back to 100% deductibility on the entertainment expenses. Short-term, perhaps consider eliminating the GST on some of the expenditures. Also, if I go a little further on payroll tax withdrawals, maybe consider deferring some of those payments so, when we do restart, the restart is a little easier. Have you considered some of these options, or are you considering other options for certain industries where the restart will be very difficult?
Mr. Morneau: We have considered some of them and, as you know, we’ve done some of them. The deferral of the GST payable in April, May and June represents about $30 billion in terms of cumulative impact into the economy. That’s liquidity for those organizations. The deferral of individual and corporate taxes represents about $55 billion. Those are pretty significant measures.
We are looking at other things, focused primarily on credit. It is credit those organizations can have to bridge themselves through this. We have announced some of it. We announced the first $12.5 million of potential credit. Some organizations are larger so they will need more credit. That’s something we are working on and are close to announcing.
There are many sectors that are going to be impacted. As the senator across from me referenced, some sectors are particularly hard hit but I’m sure many senators in this room can identify other sectors. We are doing our best to be sector-agnostic by providing support across different businesses and aiming to price it in a way to enable access should they need it, but not enable their equity to be impacted as they access that support. We think it’s important that we do it in an appropriate fashion. Those are the things we are moving forward with in the near future.
Senator Ngo: Minister, my question is regarding the Canada Emergency Business Account threshold of $50,000 to $1 million. That poses a huge problem for small- and medium-sized businesses that simply will not be able to qualify. I’m thinking of self-employed people, sole proprietors, hair and nail salons, cleaning ladies, other business owners who pay themselves through dividends instead of salary, those who don’t have many employees on the payroll and so on.
Minister, what is the rationale behind this threshold? To your knowledge, how many small businesses will not be able to qualify because of this threshold?
Mr. Morneau: You bring up an important point that I’ve heard from others as well. We are trying to make sure that the system works in the way it’s intended to. The starting point is to make sure we recognize in our system that people have, in many cases, incorporated because that’s an appropriate way for them to manage their tax situation. There are many businesses in this country that are merely the incorporation of an individual in order to have a tax situation. That’s not what we are intending to support with the $40,000 loan. We are looking to support small businesses.
For those individuals who are very small businesses or individual proprietors, we think the Canada Emergency Response Benefit is appropriate. It’s $5,000 per week for 16 weeks, so the annualized amount in that case would be someone getting up to $26,000. I recognize that’s a certain level of protection and not the protection that everyone would want, but we’re trying to make sure we have enough support.
In terms of numbers, the $40,000 is something that can go to over 1 million small businesses, so it’s a very broad measure we’ve put in place, in that forgivable part, to help people through their fixed-cost gap during the course of the next few months. We continue to look at the criteria for this loan, for example, to make sure it is appropriately targeted. Like everything in this challenge, it’s a dynamic challenge, and we need to make sure we have it right. I don’t have anything new to announce in that regard, but it is something we will continue to look at.
Senator Ngo: Thank you for the answer.
Second, this week the government announced additional changes to the wage subsidy and that hopefully the delay could be reduced from six weeks to three weeks. Sadly, I think six weeks to three weeks is still too long. Many businesses are on the verge of bankruptcy or have closed permanently. Business owners are in a very dark place. More than 1 million employees have been laid off. These businesses and employees need help right now and cannot afford to wait any longer.
Why is the government not implementing immediate and necessary measures that will actually put the money in the pockets of the small business owner, such as rebating the GST they have paid in the last year, which is the kind of support needed right now for them to stay afloat and retain their employees while they are waiting to receive the wage subsidy?
Mr. Morneau: First of all, we are trying to get the wage subsidy out as rapidly as possible. We have found the fastest way that we can do it, and I hope it will be shorter than the time period announced. We are working towards that.
Second, we have provided liquidity for businesses. The deferral of the GST payment and the deferral of taxes have provided immediate liquidity. Those are important measures.
The idea of rebating GST, which people have brought up, is just not functional. There are three reasons. First, businesses hold GST in trust. It’s not their money. They don’t actually own that money, so we can’t rebate something that is not theirs.
Second, it’s very unequal in terms of how it gets implicated. Because of the way GST works, it’s the value add that a business gets, in terms of the GST, which they would have because there are input credits behind it, so it would impact some people in a significant way and others, like farmers, not at all.
Finally, our GST system is different on a province-by-province basis, and the administration of figuring out GST/HST province by province would take so long that it would be a completely ineffective measure.
We looked at it. It doesn’t work, so we’re trying to get money to people as fast as we can and in the most practical ways we can. We think we have found the best way.
Senator Galvez: Thank you, minister, for introducing this bill to help Canada’s workers.
As we recently discussed, many amendments brought to Bill C-13 had the effect of attaching sunset clauses to many of the legislative changes in the context of COVID-19. Similarly, Part 2 of Bill C-14 has the effect of reverting back to the version of the Financial Administration Act that was in effect before Bill C-13. Essentially, this means that we are enacting emergency measures only temporarily in order to deal with the crisis without permanently overhauling our laws, without adequate parliamentary debate and oversight.
Given this, I’m concerned that the same is not proposed in Bill C-14 for all the laws. Are we permanently amending the Export Development Act while the changes to other acts are only in place long enough to address the crisis? How is the government choosing which changes are temporary and which ones are permanent?
Mr. Morneau: I will ask my deputy, Andrew Marsland, to answer with more specifics. Broadly speaking, we are seeking measures to deal with the situation that we’re in and the recovery. That’s the approach we are taking and that’s around how we’re designing the legislation in order to give ourselves those powers. That’s the reason there is a sunset clause for most of these powers. I will ask Mr. Marsland if he has anything more specific to add.
Andrew Marsland, Senior Assistant Deputy Minister, Finance Canada: Honourable senators, I believe the amendments that deal with the Income Tax Act do have a sunset clause by their very nature in the sense that they refer to specific periods — March, April, May — with the power to prescribe additional periods as required but no explicit sunset clause, with the exception that those prescriptive powers cannot extend beyond September 30.
Senator Galvez: Thank you.
Are you planning the economic restart in any specific sequence? Are you planning that some sectors should come back first, for example, infrastructure? In other countries, that’s the way they are doing it.
Mr. Morneau: We are obviously working on the next steps in our plan, but at this stage it is not far enough developed to give an explicit understanding of what those next steps are.
Senator Galvez: Thank you.
Senator Miville-Dechêne: Mr. Morneau, there are a number of programs that, according to some estimates, help 84% of those who’ve lost their jobs because of COVID-19. The Canadian Centre for Policy Alternatives, however, estimates that 862,000 unemployed Canadians won’t receive employment insurance or emergency benefits.
Do you think that estimate is accurate? If not, how many Canadians do you estimate will fall through the cracks? What are you going to do for those Canadians?
Mr. Morneau: In this time of crisis, we’ve looked at how we can improve the situation as quickly as possible. That means that we’ve created programs over the past three or four weeks. Of course, there will be people that we need to take into account in the coming days and weeks. I can’t say whether those estimates are accurate or not because I didn’t read the report. However, we’re definitely going to take people like seasonal workers, for example, into consideration. We still have work to do.
Senator Miville-Dechêne: Regardless of that estimate, have you come up with your own estimates of the number of Canadians who aren’t currently receiving any benefit because of the criteria for these two programs?
Mr. Morneau: We’ve taken people in difficult situations into account, and that’s why we’re trying to find solutions to every problem. I hope we’ll be able to present other approaches in the coming days.
Senator Miville-Dechêne: I’d like to pick up on Senator Ngo’s question about small businesses.
I’ve spoken to some people who represent small businesses, including a hairdresser. It’s obviously very difficult for her small business to benefit from these programs because she laid off her employees and can’t open her salon, so she can’t get the 75% subsidy.
Furthermore, the $40,000 loan is complicated because people have to start paying it back in a year. These businesses already have obligations they can’t exactly ignore. Do you believe that expecting people to start paying back the loan a year from now is a realistic time frame given that, according to some experts, we won’t have a vaccine for another 12 to 18 months and won’t be back to normal by then?
Mr. Morneau: First, if the small business in your example has employees who have no income coming in right now, the company can apply for the wage subsidy. That option is available. It won’t have to pay for everything, because 75% of the employees’ income can be subsidized for it. Moreover, if this small business has employees, that means its total payroll is probably over $50,000, which makes it eligible for the interest-free loan, and it won’t have to pay interest or pay off the principal until the end of 2022. That’s two and a half years away, which is enough time. Also, if that small business takes out a $40,000 loan, it will only have to pay back $30,000. That could help the company if it has other things to pay for over the next four months, for instance.
It’s not perfect, of course, but we’re going to consider other approaches, and there are measures we can take. That said, I think there are plenty of options available already to put this small business on a stronger footing.
Senator Miville-Dechêne: I’d like to clarify something. Are small business owners entitled to the Canada Emergency Response Benefit of $500 a week?
Mr. Morneau: Owners of very small businesses may access the Canada Emergency Response Benefit of $500 a week.
Senator Miville-Dechêne: Thank you.
Senator Housakos: Minister, this week we have seen several damning media reports outlining several failures to get a handle on this pandemic over the crucial early stages of the process. Your government continually defers to the experts in defending those early failures, but ultimately the decisions and responsibilities for those decisions always rest with cabinet.
I’m concerned about your government’s reliance solely on the Public Health Agency and not on the expertise of our military medical intelligence unit, which sounded the alarm way back in January. This unit relies on information not only from the World Health Organization but also on intelligence shared among our Five Eyes allies, including the U.S., whose intelligence was warning of this outbreak as far back as November 2019.
Minister, why did we rely on a body that appears only to be parroting the World Health Organization and information coming from communist China, and not on our military intelligence unit, which was certainly providing a different picture, if the cabinet was willing to listen a few months ago?
Mr. Morneau: Thank you for the question. I can assure you that we have and will continue to consider all the sources of information that we have, and that will form our response. In our estimation, we need to continue to consider the science and the medical expertise here, and also look toward the examples of other countries and how they are dealing with this challenge — some of whom are ahead of us in the sense that they have already experienced a worse challenge — and we can get some value in considering what has worked and what has not. We will consider all those sources of information, have done so, and we think it is important to do so.
Senator Housakos: Minister, again, we had intelligence information back in November and January that highlighted the danger of this, and had an urgency underlined in their evaluation of things, when our health officials were saying back in January and February that certainly we shouldn’t overreact and worry. I think the cabinet has to look at why some of that intelligence information didn’t get to the top and didn’t get a fair hearing.
The last time you and your colleagues were here, minister, I cited a 2006 report that was prophetic in its warning about what we’re seeing right now, as far as lack of preparedness for equipment during this pandemic. The report recommended a federal stockpile, the one I asked Minister Hajdu about, and she refused to answer the last time she was here. She has since acknowledged that the stockpile wasn’t maintained, and I’m concerned about what your government is doing now to ensure that gross negligence is rectified, not only for the next pandemic but for the current one.
In addition to the tons of money that we are understandably putting out for federal assistance to Canadians, have you entered into contractual discussions with manufacturers, not only to fulfil the current backlog need, but to look at setting up stockpiles if there is a second wave, a third wave or another pandemic in the future, so we are better prepared?
Mr. Morneau: I would like to start by rejecting the premise of your question. We do and will continue to consider all sources of information as we come up with our plans. We will need to consider the situation that we are in and the preparedness that we have as we consider next steps.
To your specific question about whether we are in the midst of contracting with organizations to provide the appropriate personal protective equipment, the answer is yes. To the extent that your question is asking about things like ventilators, the answer is yes. We are in the midst of ensuring that we procure the appropriate resources for our country now, and looking toward having a secure source of supply on an ongoing basis.
Senator Housakos: My last question has to do specifically with finances and directly involves the decisions you have made over the last four years. Your government decided to have a deficit management funding approach to the last four years of our fiscal policy.
Do you regret the fact that over the last four years you ran up deficits during a relatively decent economic time? And now that we are in the midst of a real, huge crisis, do you regret not having that $70 billion available in order to substantiate even further the aid you are putting out to Canadians?
Mr. Morneau: First, it’s important to consider the premise of your question. At the beginning of this challenge, we found ourselves in a very strong fiscal position. So what you have seen during the course of the last four and a half years, while we have been in office, we have reduced the amount of our debt as a function of our gross domestic product, and we think that’s appropriate. That puts us in a position where we have the capacity to fund ourselves through this challenge. We will continue to take that approach, of course, when we are not in a crisis period.
The Chair: I’m sorry, we have to move to another questioner.
Senator R. Black: Minister, at this time of year, many small towns and rural communities would normally be preparing for fairs and exhibitions. These fairs really are the fabric of many rural communities. Not only do they highlight local industries and agricultural products, but they contribute greatly to the local economy, provide employment for youth and contribute $2.9 billion annually to Canada’s GDP.
According to the Canadian Association of Fairs and Exhibitions, approximately 1 in 10 fairs will not be able to recover from this pandemic, and will have to close the gates forever unless support is provided. An additional 5 in 10 fairs are uncertain about their futures, again the result of the pandemic.
What is the government doing to ensure that these fairs, exhibitions, festivals and agricultural societies will survive this very difficult year?
Mr. Morneau: I think it’s fair to say that many Canadian organizations and many Canadians are significantly impacted as a result of the pandemic. I know that in many sectors, including in small towns and large cities, gatherings of multiple people are not going to be possible. That will present very real impacts.
We are going to need to think about the impacts across our entire economy. They will be in many different places. We are trying to put in place measures, first and foremost, to protect people, and as you’ve heard me say, to think about how we can support businesses through credit availability. Then we will need to think about whether there are specific interventions required in particular sectors. That will be the subject of continuing work. I don’t have anything to announce today, but we certainly understand the challenges.
Senator R. Black: Thank you. I have a second question. There are many family farms across Canada which don’t have employees; farms run by one or two individuals, in many cases husband-and-wife teams. As a result of the pandemic, they’ve lost market opportunities in full or in part. They are right now making business decisions with respect to planting, breeding and selling their commodities, that have long-range ramifications within their operations, yet they don’t want to take on extra debt that might be available through the FCC program or banks. What can these producers — operators of Canada’s small family farms — expect from your government in order to ensure that they don’t experience a final nail in the coffin for their operations?
Mr. Morneau: In a sense this question is like your last question. There are people across the country who are finding themselves in difficult situations. Farmers are certainly among them. Some of them will have had that 30% reduction in revenue; many of them won’t. But to the extent that they have, they will also be able to have the wage subsidy. To the extent that they find themselves not able to employ the people that they were employing, then they may be able to go on the Emergency Response Benefit. And for those that take advantage of the credit available through Farm Credit Canada, that will be helpful.
But I’m sure there will be other things we’ll need to consider. We’ve looked at a number of things in the food area to ensure our food security, and we will be continuing to focus on this area. Obviously, it is even more important during a time when food security is so much more critical.
Senator R. Black: My final question centres around the internet and access to the internet in rural and remote Northern Canada. Your programs focus on applications through the internet. How are you supporting those folks who don’t have access to high speed or accessible internet that can help them to apply to these programs?
Mr. Morneau: We recognized up front that this is a challenge with our approach. Not everyone has access to the Canada Revenue Agency for the Emergency Response Benefit. We found that about 70% of Canadians were on direct deposit, which is positive, which is probably something of a proxy for those who have online access as a minimum base.
What we then decided to do was to significantly augment the in-person telephone capability, so people could have access to in-person capability. We know that’s imperfect, and we’re trying to build the capacity, so that capacity is coming from the Employment Insurance group from the Canada Revenue Agency, remembering that a lot of those people — because we’ve deferred taxes — there is some capacity there that would normally have been doing other work. And we’ve stood up some separate teams of call centre people as well. There will be challenging times with the volumes. We understand that, but we’re going to try to support people through it.
Senator Boisvenu: Thank you, minister, and welcome again to the Senate.
First of all, I am very pleased that your government has increased the wage subsidy from 10% to 75%. I will point out that I had proposed this increase to you the last time you were here, but you did not deem it worthwhile. Thank you very much. I think you’ve proven to be a good listener, in this case.
My first question is from a group of unemployed workers who contacted me. Many of them feel that the Canada Emergency Response Benefit is unfair, and they are receiving less money than they are entitled to. For example, the maximum EI benefit is $2,484 a month, or $574 a week, but workers receiving the CERB are receiving $484 less in gross income every month. That’s a lot of money for someone who is unemployed and has responsibilities.
Minister, why does the Canada Emergency Response Benefit penalize a worker who paid into EI and is receiving less than he or she is entitled to?
Mr. Morneau: That’s a good question. We’re in an extremely difficult situation. A pandemic is a serious problem. We decided that, right now, the Emergency Response Benefit must be offered to everyone. It is necessary. Afterwards, we’ll continue with our Employment Insurance program. This means that, during this period, we’ll use the Canada Emergency Response Benefit for everyone and, subsequently, people will once again be able to apply for the EI program.
Clearly, there are differences between the Emergency Response Benefit and the wage subsidy. This is because of the pandemic. We are in a very difficult situation right now, and we have taken these steps in a very short period of time. We’ll see whether we need to make any changes in the coming weeks, but for now, we believe that we are protecting most people with our programs.
Senator Boisvenu: My last question has to do with the anticipated federal government deficit, which will be enormous. To the $100 billion you’ve accumulated over the past four years, we must now add nearly $200 billion for programs to manage this crisis. If we consider that the Canadian government’s revenue will decline by around $550 billion, we are talking about a cumulative deficit of nearly $400 billion to $450 billion.
Given that Canada’s national debt is currently $700 billion, that means that by next fall Canada could end up with an accumulated debt of over $1 trillion, which represents $50 billion in annual interest payments alone. Faced with this huge challenge of such a massive deficit, has your government already started preparing a recovery plan?
Quebec is thinking of boosting certain industries such as the construction industry. Do you have a strategy in mind to revitalize these businesses and, especially, give them funding, so that they can get back on track?
Mr. Morneau: That’s another great question. Like virtually every other country, we’re focusing on how we can protect our citizens and our economy right now. We know for sure that we need to make unprecedented investments and that we’ll face some challenges because of those investments, but we believe the most important thing is to protect our current status and our economy for the long term. We need to invest. After the crisis, we’ll be in a better position, and we’ll make other investments to boost our growth. That is for sure.
We’ll also have to tackle our fiscal challenge, but for now, I’m focusing on the crisis. We will certainly run into more problems going forward, and we’re going to work with you and other parties to assess the issue.
Senator Boehm: Minister, I’m right behind you, physically.
Mr. Morneau: I really like to hear that. You can just stop right there.
Senator Boehm: Thank you, minister and Mr. Marsland for joining us today. I will, with your indulgence, put all of my points into the beginning here to give you time to answer.
The G20 leaders met by video conference on March 26 and together said they would do whatever it takes to bolster the global economy. This has led to an injection of $5 trillion. My question related to that is: There is a consultative aspect to this. Finance ministers and central bank governors were charged with monitoring this, as was the Financial Stability Board as well, with talk of economies opening up, so to speak, at different times. What is the extent of the consultation between you and your colleagues? If you could give us a bit of an update on that, I would be grateful.
The second, Senator Black has really asked the question, but it does relate to the internet and particularly in rural areas.
We are talking a lot in this chamber and across the country about a guaranteed livable income. How about a guaranteed livable internet as well? Budget 2019 devoted $1.7 billion to establish a universal broadband fund. Perhaps work could be enhanced in this area and particularly with our telecommunications companies.
Working with Senator Boyer of Ontario, we are seeing people in remote First Nations, Métis or Inuit communities that are not tech savvy or even connected to the internet who are used to earning their meager living from selling or sewing crafts and other things and they really have nothing now. Although the targeted distinction-based funding is helpful, it isn’t enough to alleviate the financial issues that the Indigenous people in the cities are facing that also make their living by selling crafts, for example. Is there any relief in sight for them?
Mr. Morneau: Thank you. Those are three separate issues. On the first issue during this time of crisis we have been fairly extensively involved with our colleagues around the world. The Prime Minister has been involved with the G20 and with the G7. I’ve been involved with finance ministers and central bank governors around the world through the G7, the G20 and the International Monetary Fund.
This coming week we have a number of meetings. On Tuesday morning, there is a meeting of the G7 finance ministers; on Wednesday morning, a meeting of the G20 finance ministers; and Thursday morning, a meeting of the International Monetary Fund, finance ministers and central bank governors. These meetings will help us to continue to update how we’re doing in different countries. You are seeing measures that are fairly similar across industrialized countries in terms of the scale versus the economy, as well as in terms of the focus on supporting people and businesses. There are differences from country to country, but the approach is broadly similar. So we will continue to do that. It will give us insights into how we can continue to move forward in this dynamic crisis. Those discussions are also happening on a day-to-day basis with various of my colleagues.
With respect to internet availability across our country, it has been a key area of focus. Obviously that’s of particular importance now, where we’re all relying on it for our day-to-day lives. We think that some of the things we’ve done, the accelerated capital cost allowance, the funding we put towards the last mile and the funding that’s also through the CRTC have had some significant and positive impacts, but we do know there is more to do there, especially on some of our communities that are farthest away.
Finally, around Indigenous Canadians’ challenges during this time, we understand they’re real. The reason we put money out right at the very beginning was we knew that these were places that were going to be impacted significantly. Happily, we’ve not seen as many cases in some of the disparate communities, but we know the problems could be very real. We are looking at funding that we might need to be doing for our northern communities. We’re also looking at how funding can be provided for some of our other Indigenous communities. There is ongoing work. Obviously everything we are doing is urgent on that subject as well.
Senator Smith: Great to see you. You folks have been working hard. I have more of a question that may follow Senator Boehm’s. In regard to the delivery system, do you have a war room? What type of relationships are you setting up with the provinces, the governor of the bank, et cetera? Can you give us an overview of this massive activity at this early phase? As this progresses Canadians will probably look for some form of feedback, transparency and lessons learned so that the next time we’ll have a strategic plan in place so when pandemics occur we will be better prepared.
This is not a criticism of Canada or the government. This has happened in the United States. It happened all over the world. There are some countries that are more advanced than others in terms of how they address it. From your perspective, how do you set up your war room and establish relationships? Can you give us some insight of how this can work and where is it going to take you? When you want to report at the end of the day — and I know it’s very early — will that give some comfort in terms of direction or a strategy moving forward?
Mr. Morneau: That is an important question, and something that we are going to need to reflect on when we have a little more time.
If Andrew behind me looks tired, it’s because I’m sure he is. All of us have been working pretty much around the clock. That has meant that we have needed to find new ways to work together, because we’ve been working around the clock, but we haven’t been working in the same rooms. We’ve all been in disparate places, mainly in our homes. As an example, we have been in regular communication with the Office of the Superintendent of Financial Institutions and the Bank of Canada during this time period. When I say “regular,” I mean almost continuous.
There were periods of time where I think we had a conference call line that everyone was using all night long, including Andrew sitting behind me, in order to get some of the direct policies done.
We’ve set up some procedures for working across the provinces, so we have fairly regular contacts. I have a regular, once-a-week contact with all of the finance ministers in which we are sharing information. Also, we have good informal communications.
Luckily for me, I have been doing this job now for five years and I have strong relationships with many of the finance ministers, which has been very helpful in working together. The lessons learned will be important for us. We’ll need to think about how we can rapidly deploy resources for challenges like this. So far I would say that’s worked quite well.
Similarly, the finance, health, Prime Minister’s Office and the employment departments have been the most implicated areas of government, with the procurement department being important as well. We’ve been working together quite closely with working groups.
Senator Smith: Turning to service glitches Service Canada is closed down so it’s harder to get through or access. If you go through the internet, you can send messages in, but you don’t have that service contact.
Are you able to flag service glitches at this time and then immediately address them so that you can at least fix problems temporarily, which will lead to a longer-term fix for these types of situations?
Mr. Morneau: We have to take questions like that and be nimble. We chose to deliver the Canada Emergency Response Benefit and the wage subsidy based on what we thought was the most robust system we had in government. The good news is, it is working. Last week we had more than 3 million people come on to the CERB. That’s in a very short time period. You probably heard about some of the very short windows. It appears robust. I’m sure there are Canadians who are waiting in line for some things on the phone. That’s inevitable with this sort of volume, but what I understand so far is that it’s working.
The CRA is doing a marvellous job at setting up these resources, but we need to stay on it. We are going to have challenges with the kinds of volume that we have. It’s inevitable, but I would say so far so good.
Senator Dalphond: Minister, thank you for being with us today. I have two questions to ask you about not-for-profit organizations. My first question is about organizations that work with abused women, women who are experiencing domestic violence right now. Domestic violence is an unfortunate reality in our society, and being confined at home only makes matters worse.
In the last budget, you announced additional funding for shelters. With shelters already at capacity, what is being done right now to get that money to those organizations as fast as possible, so they can rent hotel rooms or apartments and give these women a safe place to live?
Mr. Morneau: That’s a very good question. We know that the current situation is creating problems because people are confined together, particularly vulnerable people. That is why we have been looking at the need to provide funding for women’s shelters from the beginning. We started with $50 million, I believe. I don’t have the exact details on how we are going to proceed, but I know that we have allocated funding for that.
We will be watching out for any problems in the coming days and weeks to see if we need to do more.
Senator Dalphond: But do I understand from your answer that the money is not yet running to these shelters?
Mr. Morneau: What you need to understand is I don’t know exactly the mechanism, but we’ve already allocated the funds. I’m just not sure — not because it isn’t important, but there have been many things I’ve been working on. I’m not sure exactly how those funds have been allocated.
Senator Dalphond: The next question is about this wage subsidy program. How is it adjusted to take into consideration the particularities of the charities as suggested by my colleague Senator Omidvar from Toronto? I think she wrote to you about that.
Mr. Morneau: We found that for the charitable sector, first and foremost, in many cases they were going to be facing the same issues as other organizations — significant decline in revenues. However, it would be particular in the charitable sector in the sense that some charities would not be losing money if they had government sources of revenue because that government source of revenue might not go away, but they would be losing all their donations. For other charities, they might have government sources of revenue because governments might actually be paying their daily stipend, for example, if you’re in a shelter or something. For those charitable organizations, we decided to choose whether or not to include government revenues in their test for whether their revenue went down.
For example, if you were in a situation where you had government revenue, you just had your donations go down and that government revenue was stable, you could not use the government revenue and just demonstrate donations went down. If you’re in a situation where you had government revenue that went down because of your source, you could use it and show that it went down significantly.
We’ve given a double test for charities that we think puts them in a position to demonstrate their challenge. And then, of course, we have specific supports for certain kinds of organizations — food banks, shelters, as you just mentioned — that are particularly challenged during this time. We’re going to continue to think about organizations that are effectively support mechanisms for people during this time. We need to find a way that they have the resources that they need.
Senator Dalphond: Thank you, and may I beg you to make sure the shelters get the money as soon as tomorrow or the day after because they require it now? Thank you, minister.
Senator Plett: Minister, this question comes from one of our colleagues, Senator Patterson from Nunavut. The NWT & Nunavut and Yukon Chambers of Mines released a joint letter stating:
Employee continuity is critical to the success of Northern exploration and development companies. Not only do their employees have the technical memory and knowledge of the projects they are advancing, they hold important, established relationships with local Indigenous and community leadership, with hunters and trappers organizations, regulators, and local Indigenous employees and service providers. There is tremendous value in these relationships, a value higher than would be recognized in the proposed emergency wage subsidy.
Minister, how does the bill capture companies whose work is non-revenue generating, such as junior mining companies and mineral exploration companies?
Mr. Morneau: I imagine there are many companies in the North that are finding themselves particularly challenged during this time period, just as there are across the country.
I think we have extremely valued employees in those sectors, as was identified in the letter you’re quoting from, just as we have extremely valuable people in other sectors of the economy. Our goal is to support as many people as we possibly can through this crisis, and that means what we’re trying to do is to deal with those companies, first of all, that are able to keep their people on; in some cases perhaps the mining companies would be good examples where they want to keep these people on, and that’s important. That’s why we hope that the wage subsidy will be something they will use and perhaps if they have the capacity, they will top up the employees’ wages fully. If they find themselves not able to do that for whatever their reason is, because they think their long-term prospects are such that it’s not plausible, then presumably those employees would go on the Canada Emergency Response Benefit to protect them during that time.
If there are specific sectoral issues that we need to consider, we will be looking at those, but broadly speaking, our hope is that for very valued employees like the ones you are talking about, employers would keep them on and they will be able to use the wage subsidy to do that.
Senator Plett: You suggested earlier that we might have some recommendations for you, and I suspect that the senators from the North might take you up on your offer.
My next question, minister — and we’re trying to get in as many of our senators’ questions as we can — is from Senator Percy Mockler from New Brunswick, and it concerns our students.
It is vital in this time of the COVID-19 that Canada enables its students to continue their education without distraction of financial impediments. How are you going to ensure that all Canadian students, especially those without independent financial means, have the confidence and ability to continue to pursue their education with a minimal amount of disruption?
Mr. Morneau: I think you heard me say earlier today that we do see this as a critical issue. We’re working on it now. We are recognizing that the time period is short. Two of my four children are in university; one is finishing in two weeks and one is finishing in about four or five weeks, so I know the timelines. We’re certainly working against those timelines.
For those students that are on grants and loans, they can continue those grants and loans during the course of the summer for the low- and middle-income students. They can continue to do studies during the summer if they choose. We recognize that won’t be something all students will want to do and many will want to work, so we are looking at various ways we can be supportive on that. When I have more to announce, I will, which I hope will be in the not-too-distant future.
Senator Plett: Have you decided whether students will qualify for the CERB, and are you looking to do more under the Canada Student Loans or Canada Apprentice Loan program?
Mr. Morneau: By definition, some students will qualify. The criteria for qualifying are that you’ve earned $5,000 or more in the last year, that you’re a Canadian resident and that you have lost your income as a result of COVID-19. So in many cases, students who were working part time during the student year, and that’s approaching 50% of them, will have actually lost that revenue and passed the $5,000 threshold. Many will be eligible for it, but we will be looking at other measures to support those who aren’t.
Senator M. Deacon: I have two questions at this time. My first is on behalf of Senator Bovey from Manitoba and Senator Cormier from New Brunswick. It involves our arts organizations and the wage subsidies. Given that the arts organizations are not-for-profits, the sector has very real concerns about their ability to pay that 25% of staff salary. Their cash flow is nil, and they’re having to refund monies to ticket purchasers, in some cases, private and significant sector donors.
Some organizations have endowment funds , which is good, and surpluses can be added, but federal regulations limit the use of capital in those endowment funds in determining the percentage of annual earnings from such funds. Might these federal rules be waived during this crisis so that organizations can use the monies in their unrestricted endowment funds to assist in paying the 25% of the staff salaries?
Mr. Morneau: First of all, just for clarification, those organizations are not required to pay the 25%, so there may be just an understanding issue that if they don’t have the capacity to pay that, they are not required to. We’re encouraging people to do it if they can. That might make your question less urgent for those organizations.
Second, another senator asked a question about long-term systemic changes, and whether we would change our approach to taxing things or to endowment funds. We are not seeking to make systemic changes that would be long term in terms of their impacts and implications for what we hope is a shorter-term issue.
The idea of fundamentally changing our approach to endowment funds to solve a problem would not be our first, best approach. Happily, it is probably not a problem anyway, the way you have identified it.
Senator M. Deacon: Let us hope so. Thank you for the answer.
The second question deals with wage subsidy, but now going on to larger, publicly traded companies. It is a different focus.
Given the number of people publicly traded companies employ, I support that they should be able to access this service. However, I worry about potential bankruptcies and acquisitions after this crisis is over. Not too long ago we had the case of the Sears Canada bankruptcy. We saw the company strip itself of assets to pay shareholders, despite being unable to fulfill its pension obligations to its employees.
Would the government consider measures being put in place for a temporary moratorium on dividend payments and stock buy-backs or executive pay raises for the companies that receive this money during the COVID-19 crisis, and perhaps for a short time afterwards, even if these companies quickly become profitable again?
Mr. Morneau: I think the premise of your question is on the idea that the companies receive the money. That is not what we’re doing. The company is applying for these funds. They have to demonstrate that they have paid the money out to their employees. The money is actually going to their employees. It can’t be used for executive compensation or share buy-backs or those sorts of things because it has already gone to their employees.
I don’t think that premise is one that we’re concerned with. It will be important for us, as we think about the approach we take to providing credit to organizations, and our approach to dealing with eventual challenges, if they happen, of companies going into CCAA. There will need to be some consideration of conditionality in those situations, potentially. We are not considering that quite yet. We hope to avoid those situations by providing appropriate credit so that organizations can get through this time.
Senator Carignan: I just want to be sure that you have committed to giving me a written response to the technical question I asked earlier. Will I get a written answer?
Mr. Morneau: Or Mr. Marsland can answer that right now if you want.
Senator Carignan: I have other questions, but go ahead and answer.
Mr. Marsland: The question you asked is an excellent one because it was exactly the question I had when I read the draft. What is the difference between those two components?
I will step back and explain the provision. The provision is intended to deal with circumstances where a corporation, for example, has a subsidiary in another jurisdiction and all its product goes to that subsidiary and it is marketed in the other jurisdiction. This is essentially intended to look through — because the loss in revenue is borne by a subsidiary outside of Canada — and allowed to recognize that in reality the revenues of the Canadian corporation have dropped, that are reflected in the sales made by the subsidiary; the selling corporation.
The reason those two provisions are similar is they are intended to deal with circumstances where a corporation in Canada is selling its output through two or more subsidiary corporations in different jurisdictions. The formula is intended to get the right result when you look at those complex organizational structures, corporate structures that exist in, for example, the resource and the mining sector and so on.
Senator Carignan: The next question is from Senator Batters.
Mr. Minister, the government’s first COVID-19 bill gave you the power to create a Crown corporation wholly owned by the government to promote stability and maintain efficiency. Bill C-14 includes a sunset clause stating that the Crown corporation cannot be created after September 30, 2020. However, the clause does not prevent the government from creating the Crown corporation before September 30, 2020, and spending the money after that date.
Senator Batters’ question is as follows: Mr. Minister, do you intend to nationalize entire sectors of the Canadian system using that loophole?
Mr. Morneau: The important thing here is that we want to have the necessary powers to handle a situation where companies are under the CCAA.
We don’t know what the future holds, but we want to have the appropriate powers should that situation arise, as we saw in 2008-09 when GM and Chrysler were dealing with some difficulties, for example.
I hope we won’t be in that situation, but we do have to consider that possibility.
Senator Carignan: My second question is about the Canada Emergency Business Account. At RBC and CIBC, the application forms for the $40,000 include a section detailing the Government of Canada’s eligibility criteria for the loan. The criteria include:
The entity is not owned by individuals that hold political office.
The entity cannot be owned by an individual who holds political office. This excludes municipal officials, provincial members and band chiefs. It excludes a whole bunch of people.
Did your government ask that the hundreds of businesses owned by people who hold political office, at any level, be excluded?
Mr. Morneau: That’s a good question. I know that is something we need to keep in mind at all times.
I have nothing to add.
Senator Carignan: So, you did not request this.
Mr. Morneau: No. I cannot say, but if it’s important, we can look into your question and get back to you.
Senator Carignan: Please do.
Senator Coyle: Thank you, Minister Morneau and Mr. Marsland, for being with us today. Thanks to you and your hard-working team, including Sean Fraser, Member of Parliament for Central Nova — my member of Parliament — for all the efforts you are making. Canadians appreciate this Canada Emergency Wage Subsidy program as well as your willingness to make adjustments as you go along. I think that’s really important to acknowledge.
I have three questions. My first question is, could you tell us what the response has been to that initial 10% wage subsidy? What is the status?
My second question is, can you speak to any additional measures you are considering now to complement Bill C-14, in terms of the tech start-up sector that has had issues with the various programs? Is there anything further that you are considering for the charitable sector?
My third question is — recognizing that you are extremely preoccupied with the immediate crisis in front of us — what planning might be under way for the post-peak pandemic period to power up our economy and further take care of Canadians impacted by this crisis?
Mr. Morneau: Thank you.
To the first question around the number of companies that have made use of the 10% wage subsidy program; I don’t have those numbers. It is likely too early to know those numbers. I would expect it will be broadly used because basically every business with 18 or fewer employees can get $1,375; a 10% wage subsidy. If you know someone who is not using it, you might want to suggest they should consider that. I expect that will be very broadly used and we expect it to be a support for everyone.
In terms of the tech start-ups, the wage subsidy changes we have put in place have included some things that were important for that sector. A big concern around that sector was either for businesses that were brand new or for businesses that were in a very high-growth phase. In our original approach to the wage subsidy, we were thinking about revenue this April against last April, for example, and if you were a tech start-up and last April you had $100,000 worth of revenue and now you are at a $500,000 annualized pace of revenue, then you will not be able to show the reduction in revenue. That’s why we chose a secondary test, which is their revenue in March versus what happened in January or February, for example.
That was really important for that sector. I’m not saying there will not be other challenges, but that was an important issue. Similarly, as referenced behind me, we have done some things around the charitable sector that allow them to consider their revenue in different ways to improve their situation.
Finally, around next steps, we are in a phase that is very difficult. We are going to continue to see challenges, and we are triaging those challenges on a daily basis. I do have an internal team working on next steps as we move out considering how we can do that, and they are using some external resources as well. I imagine we will be turning our attention to that as we get through this particularly intense phase.
Senator Coyle: Just to probe a little deeper on the tech start-ups, some of them are so new and fast paced they don’t have revenues yet, so these organizations are starving. Is there anything to help them through this other than what we have seen here?
My second question is: Is there anything else in the works besides this and CERB for the charitable sector?
Mr. Morneau: To be clear, we are trying to focus on organizations impacted by COVID-19. For those pre-revenue businesses, they are largely funded by venture capital and other sources of funding. If they have already sourced funding, it’s not necessarily the case that those have gone away, so there needs to be a demonstration of that sort of reality. Everybody has a problem and the job is to figure out which problems are most urgent and important. We will have continuing things to say on the next steps in many areas.
The Chair: Thank you, minister.
Senator Ngo: I have two questions. The first question is from Senator Wells in Newfoundland and Labrador. The second question will be from Senator Yonah Martin from British Columbia.
Minister, our seniors are being affected the most by the COVID-19 pandemic. My concern is regarding the financial burden COVID-19 is causing seniors in my province of Newfoundland and Labrador and in this country. Our seniors are isolated. They rely more on other people for essential errands, and this requires supplementary financial assistance throughout the duration of the pandemic.
Seniors rely on medications more than any other demographic. Drugstores are only allowing limited supplies to be dispensed at any given time. This results in increasing dispensing fees and extra costs that many seniors cannot afford.
The question is: How will the government address this important issue when many seniors live on the edge of poverty and extra expenses for one item will mean less money for other essentials?
Mr. Morneau: First, we recognize that seniors in many ways are the most impacted by this crisis because they are most anxious about their health, so supporting the health system is critically important to give confidence to seniors.
Obviously we don’t want seniors to have to pull money out of their RSP at the same pace, and that’s why we lowered the amount they need to pull out of RRIFs by 25%. That won’t impact many of the seniors that you’re talking about, the most impoverished.
The good news is that for the seniors in the most impoverished part of the senior population, they are continuing to get their sources of income, their sources being the Old Age Security system and the Guaranteed Income Supplement, so unlike other Canadians, their sources of income are not diminished. One of the measures we put in place, the GST low income tax credit, actually has an implication for more than 80% of single seniors and more than 40% of seniors in couples. They have all received a significant boost in income even though their sources of income have not gone down. We will need to continue to look at this, but we think we have made some decisions that will impact the senior population positively.
Senator Ngo: Thank you. The second question is from Senator Yonah Martin in B.C. It’s related to the question of Senator Coyle regarding the new start-ups that got their business licences to operate this year and have no record of income in 2019-20. To build their business, they have to use their own personal savings to get started in anticipation that they will generate revenue this year. The government forced the nonessential businesses to shut down, and yet they don’t meet the requirements for the new program that you have announced.
When will you introduce relief measures specific to start-ups or revise existing programs to include these businesses and families that are barely hanging on through no fault of their own?
Mr. Morneau: First of all, it’s important to recognize that these businesses do have access to a number of things. So the thing that you’re referencing is the Canada emergency wage subsidy, but employees in those businesses do have access to the Canada Emergency Response Benefit, like anybody else. Second, if the businesses actually have a payroll, they also have access to the Canada Emergency Business Account, a $40,000 no-interest loan. There are other things available to them, they are just not the specific wage subsidy because of that revenue test.
We will, of course, continue to look at various subsets. We’ve tried to find measures that can hit a large cross-section of Canadian enterprises. We do know there are some organizations that will be in a particular category of challenge that we’ll consider. We’ll consider that in considering as well the things that are available to them and whether it’s appropriate to make sure decisions.
Senator Ngo: When do you think you will introduce the relief measures for those start-up people?
Mr. Morneau: I didn’t say I was introducing anything. There are certainly many people across the country who have concerns. I appreciate those concerns, and we’re trying to look at how we can support people appropriately. That includes considerations of equity and fairness as well as the appropriate measures of support.
Senator Saint-Germain: Before I ask my question, minister, I want to acknowledge the complexity of managing such a crisis, in terms of both health and the economy. I would like to commend the efforts being made by the government, businesses, and, of course, workers.
I would like to begin by quoting Quebec economist Pierre Fortin who said, “There is no conflict between saving lives and saving the economy.” The government is making a necessary and temporary choice in this initial phase, which, as the title of the bill states, is in response to COVID-19. The measures include investments in health and, at the same time, compensation to address the economic impact of the fact that our economy has truly ground to a halt.
My question has more to do with the next phase, which will take place once the temporary measures are lifted, when the economy and jobs gradually return, and once recovery is possible without causing a second wave of the pandemic. Again, we are talking about a recovery strategy that combines both health measures and support for the economy.
In this gradual return phase, I would like to know what scenario you are considering and what are your main criteria for deciding what action the government will take in support of this economic recovery. Also, in these scenarios, what do you believe will be the impact of the gradual return of exporting to the U.S.? As we know, the United States is facing a huge crisis right now. The pace of their recovery will be different than ours. In this scenario, with our economies so intertwined, how do you plan to adopt progressive measures related to the difficulties or impacts on our exports to the United States?
Mr. Morneau: That’s a good question, but I don’t know what the future holds. At this point, it’s hard to predict what we will do.
As I said, there is now a team in my department that is working on the next steps. These people are working with experts. Obviously, we don’t have enough information yet to know what will happen in the next phase. That is clear.
It is important for me to be here with you today. Of course, I will probably have other opportunities in the coming weeks to appear before you again, and I’ll be able to give you more information at that time. I know some things today, but I will have more information on the next steps when we have moved on to another phase and we can make predictions.
Other countries around the world are in the same situation as we are right now. I am in contact with my G7 and G20 counterparts, and we are all in the same situation, which is constantly changing. We need to make investments to protect our economy, our workforce and, of course, our businesses. We can expect a second phase where we will be in a better situation. That’s how we have to proceed. We will make decisions when we have enough information. If we can get more information from other countries that are in a better position than us, we will be able to examine their way of doing things when planning our next steps.
Senator Saint-Germain: I have a supplementary question.
The Chair: I’m sorry, senator, but your time has expired.
Senator Woo: Good afternoon, minister. My question follows on Senator Plett’s question. It is also on behalf of colleagues from the North, particularly our senators from Yukon, Northwest Territories and Nunavut.
The specific question is in the same category as so many others. What exceptions are you willing to make to the existing programs? There are so many special cases out there. In this situation, the special case is exploration companies, mining companies in the North. You know they are quite important to the economies of the North because they generate income and activity, particularly for Indigenous people.
The specific request that has been put by our colleagues in the North, on behalf of the exploration sector, is whether you would consider a change in the eligibility period. I think they have specifically asked to use a full-year eligibility for 2019, rather than three months or year over year, and maybe to use a different comparator period, such as protected revenues for 2020. This is a generic question on willingness to look at a reference period for the calculation of the 30% loss.
Mr. Morneau: Over the course of the last month during this crisis, I think you have seen us recognize that we’re not going to get everything right at every step along the way. Before Andrew and I came in here, we were talking about the fact that we have basically done five years of policy in five weeks. The perfect is going to be the enemy of the good in this situation.
We have moved forward on measures that we know will have the broadest potential positive impact, and we’ve accepted that there will be things that we need to reconsider, potentially fix or amend.
I don’t know whether what you’ve just identified from the mining sector is a good idea. There are many things we would need to think about. I don’t know if the mining sector’s revenues were impacted in a way where someone is trying to present something that is particularly positive for their industry. We’d need to evaluate it, but nothing is out of the question. We will evaluate it with the appropriate due diligence as we would for any other request to consider whether it makes sense or not. Then we would recognize that we cannot make an exception for every single industry and situation in our country, however big or small. We need to think about the ones that have the biggest and most important impact, otherwise we will not get anything done that will have the impact we are trying to achieve.
Senator Woo: Thank you, minister. I commend to you the letter they have written to your officials so that you can look at it in the context of the special circumstances they seem to have.
My second question is on the loan backstop that the government is offering to small businesses administered by banks, interest free, with 25% waived at the end of the period if companies cannot meet the loan repayments. It’s a terrifically generous offer, but I wonder if you worry a bit that these loans might be taken by small businesses to service their loans to the commercial banks at the high interest rates they have borrowed from and, in effect, that these government backstop loans to small businesses are a subsidy to the big banks. Is this not a reason for us to maybe push the banks a bit harder to do their part for Canadian small businesses?
Mr. Morneau: It’s important to know that we have been in pretty intense negotiations with the big banks for a number of weeks now. I think the premise underlying your question and other questions I have heard here today is that we haven’t been in the process of pushing the banks. That’s a false premise. We have been working hard to push the banks to get to the right conclusion.
The biggest and most important thing we have done with the banks is that we have pushed a huge amount of liquidity out into the system — $500 billion plus — and now we need the banks to use that liquidity to actually get credit out into the market. It has been about that negotiation around what sort of guarantee would be big enough that we would encourage them to get the lending but not so big that we don’t still have the banks with skin in the game. That was an important and consequential negotiation that will have important impacts on the overall business sector. That $500 billion plus is really the biggest single thing that can impact our economy, but we have been pushing them in other ways as well.
I’m not in any way suggesting that we don’t have more work to do. Your premise is correct; the $40,000 business loan for those small businesses is helpful for the banks, but it’s also helpful for those small businesses, which is really what we are trying to do. We know that it provides the banks with more ability to have capacity in other parts of their books, which we want. Now we need to ensure they use that capacity to get lending out, which we are working on, and they are as well.
We’re not finished. We will continue to work with the banks to ensure they are stepping forward and taking the responsibility they should.
Senator Dagenais: Minister, because Canadians and the businesses that hire them so urgently need financial assistance, I don’t plan on opposing Bill C-14. However, this is the second time you’ve appeared before us to talk about economic measures that, although necessary, are also meant to fix some of the previous bill’s shortcomings. Which brings me to my question, which follows up on Senator Carignan’s question about the cultural sector.
Are you sure that your many advisors and public officials have a good political and economic picture of the situation? Some of the government’s changes seem to be steps backwards or seem to be changes to glaring oversights that were raised in the media by analysts and observers.
Mr. Morneau: In politics, it’s important to ensure that the necessary analyses are done in order for the proper steps to be taken. That takes time. That’s the way it is.
We tried to put our policies together as quickly as possible. Obviously that’s difficult. We looked to examples from other countries and other crises. This situation is different; it’s dynamic. That’s why we have to look at our approach and improve it. That will be our approach going forward. We know we can’t come up with something perfect. We know our approach will have to keep changing to reflect a situation that is most certainly going to evolve over the coming weeks. I think we’ve found the right approach.
Senator Dagenais: I’m not sure you’re going to like my second question, minister. Your government has posted several deficits since taking office. In spite of all the money your government had, I don’t think you consistently set aside enough funding to purchase the essential equipment needed for a pandemic. According to multiple sources, this government, and perhaps previous governments, has known for 14 years that funding for new equipment needed to be allocated. In light of this pandemic, don’t you think Canadians deserve an apology today?
Mr. Morneau: We believe that today, it’s crucial that we make major investments in our economy to keep it going in future. In these difficult circumstances, we’re being forced to make unprecedented decisions. There are sure to be more challenges ahead, but with a working economy, and with our workforce, we’ll be in a better position moving forward because of the actions we’re taking.
Senator Dagenais: Thank you, minister.
The Chair: Honourable senators, the committee has been sitting for 125 minutes. In conformity with the order of the Senate of earlier this day, I am obliged to interrupt proceedings so that the committee can report to the Senate.
Minister, on behalf of all senators, thank you for joining us today to assist us with our work on the bill. I would also like to thank your official.
Hon. Senators: Hear, hear!
The Chair: Honourable senators, is it agreed that the Committee rise and that I report to the Senate that the witnesses have been heard?
Hon. Senators: Agreed.
The Hon. the Speaker: Honourable senators, the sitting of the Senate is resumed.
Report of the Committee of the Whole
Hon. Pierrette Ringuette (The Hon. the Acting Speaker pro tempore): Honourable senators, the Committee of the Whole, authorized by the Senate to examine the subject matter of Bill C-14, A second Act respecting certain measures in response to COVID-19, reports that it has heard from the said witnesses.
The Hon. the Speaker informed the Senate that a message had been received from the House of Commons with Bill C-14, A second Act respecting certain measures in response to COVID-19.
(Bill read first time.)
The Hon. the Speaker: Honourable senators, when shall this bill be read the second time?
Hon. Marc Gold (Government Representative in the Senate): Honourable senators, with leave of the Senate and notwithstanding rule 5-6(1)(f), I move that the bill be read the second time now.
The Hon. the Speaker: Is leave granted, honourable senators?
Hon. Senators: Agreed.
The Hon. the Speaker: Is it your pleasure, honourable senators, to adopt the motion?
Some Hon. Senators: Agreed.
An Hon. Senator: On division.
(Motion agreed to and bill read second time, on division.)
The Hon. the Speaker: Honourable senators, when shall this bill be read the third time?
Hon. Marc Gold (Government Representative in the Senate): Honourable senators, with leave of the Senate and notwithstanding rule 5-5(b), I move that the bill be read the third time now.
The Hon. the Speaker: Is leave granted, honourable senators?
Hon. Senators: Agreed.
Senator Gold: Honourable senators, I rise today to move third reading of Bill C-14, A second Act respecting certain measures in response to COVID-19. I want to thank all of you for being here today, and thanks as well to our dedicated staff who always make sure that we can get our jobs done and done well.
I would also take a minute to recognize the departmental officials who have worked tirelessly to finalize Bill C-14 and, previously, Bill C-13: Andrew Marsland, Miodrag Jovanovic, Maude Lavoie, Brian Ernewein, Ted Cook and Trevor McGowan. They deserve our gratitude for their Herculean efforts.
We are facing an unprecedented crisis, and Canadians are counting on us, their legislators, to work on their behalf. Colleagues, our quick and decisive passage of Bill C-14 will help businesses and workers weather the storm that so many people are facing. In addition, it will send a positive and reassuring signal to the millions of Canadians forced to struggle with the crisis. Canada’s COVID-19 economic response plan consists of a comprehensive package of measures to support Canadians: $107 billion in direct support, $85 billion in liquidity support through the deferral of taxes and GST/HST and customs duties payments, and more than $570 billion in additional credit and liquidity supports.
Bill C-14 brings in key measures to support Canadian workers and businesses. The Canadian Emergency Wage Subsidy measure will assist businesses that are hardest hit by the COVID-19 pandemic and will help protect jobs on which Canadians depend. This subsidy aims to prevent further job losses and encourage employers to re-hire those workers previously laid off as a result of COVID-19. It is designed to position employers to more easily resume normal operations following the crisis.
As the situation evolved and with the input and cooperation of all legislators, the government decided that an enhanced subsidy was needed for those hardest hit by the crisis. Bill C-14 would apply at a rate of 75% of the first $58,700 normally earned by employees. This represents a benefit of up to $847 per week, per employee. The program would be in place beginning March 15 to June 6, 2020. Colleagues, that would provide payroll support estimated at $73 billion.
This wage subsidy would be available to employers of all sizes and across all sectors of the economy, with the exception of public sector entities. Bakeries, movie theatres, hardware stores — you name it — if you’ve been significantly impacted by COVID-19, you could be eligible.
Eligibility would require an employer to attest to a drop in gross revenues of at least 15% in March of this year and 30% in April or May. To determine the revenue drop, businesses may choose to compare revenues to the same month in 2019 or take the average of January and February 2020 revenues.
The revenue drop test of 15% for March recognizes that a significant number of businesses were required to shut down operations by provincial governments by mid to late March.
For added flexibility, once an employer is found eligible for a specific period, the employer would automatically qualify for the next period of the program. For example, an employer with a revenue drop of more than 15% in March would qualify for the first and second periods of program covering remuneration paid between March 15 and May 9. Similarly, an employer with a revenue drop of 30% in April would qualify for the second and third periods of the program covering remuneration paid between May 10 and June 6.
Non-profit organizations and registered charities also enjoy the same flexibility with respect to the revenue drop. This sector, which is very important during this crisis, is under all kinds of financial pressure. As a result, non-profit organizations and charities will be able to choose whether to include or exclude government revenue when calculating their revenue drop.
The Canada Emergency Wage Subsidy is key to protecting jobs during this period of uncertainty and to ensuring that workers have steady income to meet their families’ needs. This will enable employers to rehire the workers they had to lay off and keep those who are still working.
To make sure the subsidy is used properly, the government is putting in place strict anti-fraud measures. Businesses will designate an officer to attest to the accuracy of the firm’s claims. If it is found that an employer has artificially reduced its revenue in order to qualify for a subsidy, a 25% penalty of the subsidy received will be imposed. Furthermore, employers who make a false or deceptive statement may face up to five years in prison.
This program is there to benefit employers who have been hardest hit. It’s for businesses big and small, non-profits and registered charities to make sure they can keep employees, re-hire them, and be positioned to quickly restore operations when this crisis passes. As an example, if a small family-owned business employing 25 people was ordered to shut down in mid-March, it would qualify for this subsidy. If the average salary per employee was $4,250 monthly, the company would qualify for a wage subsidy of $79,688 per month for the total benefit of $239,063 over the next three months. This amounts to 75% of the total monthly payroll. It would allow the company to keep its 25 employees throughout this crisis. As well, the company can defer payment of income tax amounts owing until after August 31, 2020, allowing financial flexibility to address immediate needs. Payments of GST/HST as well as customs duty payments on imports can also be deferred until June 30.
The government is constantly collecting comments and views from stakeholders, elected officials, senators, as well as provinces and territories relating to all the measures being implemented. This includes identifying gaps, which there certainly will be when a program of this magnitude is developed so quickly. For example, the North and rural and remote parts of the country have unique circumstances that will be supported. The government is also committed to pre-commercial companies as well as those whose revenue drop is anticipated months from now. These may require different tools if the accrual alternative currently offered is not sufficient. But, senators, it is too early to propose alternatives at this time. The design of the revenue model in Bill C-14 deals with drops in cash flow today. However, the government will continue to listen to input and is committed to providing support for different sectors and different businesses as needed.
Honourable senators, the assistance that was put in place through Bill C-13, COVID-19 Emergency Response Act, are considered emergency measures. Accordingly, with the passage of Bill C-14, these measures will be sunsetted on September 30.
Colleagues, all levels of government — municipal, provincial and federal — have been clear that they will do whatever it takes to protect the health and safety of Canadians, stabilize the economy and mitigate the economic impact of this pandemic. All legislators need to address the impact of the pandemic with the right tools in the right sequence and at the right time.
I am asking all honourable senators to support Bill C-14 so that we can help Canadians at this critical time and set the country up for success in the recovery that will come. Thank you for your very kind attention.
Hon. Donald Neil Plett (Leader of the Opposition): Honourable senators, I want to begin once again by saying that our thoughts and prayers are with every Canadian affected by COVID-19, and especially those who have lost family or friends due to this virus. The passing of a loved one is difficult at any time, but right now, the loss is even more acute because of quarantine requirements which can steal precious time from families wanting to be with their loved ones during their final days.
I also want to express my heartfelt thanks to all of those who are on the frontlines of this pandemic. From our health care workers to our truck drivers, to our grocery store clerks, we thank you for your service.
On a personal note, colleagues, I would like to wish all of you and all those watching a very happy Easter.
Today we commemorate the pause day between the death and resurrection of Jesus Christ. It was a day of uncertainty, anxiety and fear for Jesus’s disciples, because they did not realize that tomorrow would bring the resurrection which would change everything.
I know that Easter will be very different for all of us this year, but I pray that in the midst of it we will all find joy and fresh hope for tomorrow.
Colleagues, the legislation before us today is Bill C-14, A second Act respecting certain measures in response to COVID-19. This bill implements the Canada emergency wage subsidy, and it’s the second act because the first one was simply inadequate.
You will recall that the last time we were in this chamber — just two weeks ago — I asked the Minister of Finance why he chose to go with a wage subsidy of only 10%. The U.K. was using 80% and Denmark 75%.
The minister’s response was bewildering. He said that he needed to correct me and that the government’s program was, in fact, similar to the U.K.’s and better than Denmark’s. I am still trying to understand how a 10% wage subsidy can be better than a 75% wage subsidy, but the questioning moved on.
Only two days later the government made a sudden U-turn and announced that they were now going to provide a 75% wage subsidy after all. Less than 48 hours earlier, the finance minister had been indignant that I would question whether their plan was sufficient and acted like it was the best in the world. Now they were hastily throwing another $71 billion into the pot to address the specific shortcomings that we had pointed out and they had denied needing.
Colleagues, there is something wrong with this picture, and I take no satisfaction in pointing it out. It was like arriving at a house fire only to realize that the firefighters do not have enough water in their tanks.
The fact that we needed to point this out alarmed me, and it continues to alarm me today, because bad judgment, poor planning, wrong turns and slow responses have become the pattern for this government, not the exception.
We are repeatedly assured by the Prime Minister that his government has everything in hand, is monitoring things very closely and is adhering to the best medical and scientific advice, only to find out later that they have done too little and have done it too late.
Consider the government’s response when China finally confirmed they had a coronavirus outbreak in Wuhan. While other countries moved quickly to start screening airline passengers and prohibiting travel from China, the Prime Minister insisted that we should carry on as usual and just wash our hands.
Two days later, while Taiwan had already begun quarantining travellers from China, our government’s top health official tweeted out that if Canadians were travelling to Wuhan, they should just contact their health care provider if they began to feel ill after returning. There was no mention of screening, testing or quarantine, but just a recommendation that if returning travellers had symptoms, they should consider going into isolation for 14 days.
Only three days later, on January 25, Canada announced its first COVID-19 case. It was from none other than a person who had recently travelled to Wuhan, China.
Liberal Minister of Health, Patricia Hajdu, assured Canadians that the government was taking measures. They had to — wait for this — put messages on arrival screens in the airports and placed additional health screening questions on electronic kiosks used by international travellers.
We were supposed to believe that these efforts reflected the best medical and scientific advice available to protect Canadians.
Needless to say, colleagues, not everyone was convinced. Only two days later a second case of COVID-19 was reported in Canada.
Conservative MP Matt Jeneroux rose to his feet in the house and asked:
. . . how can Canadians be assured that this spread is being properly contained?
Minister Hajdu said:
. . . the risk to Canadians remains low. Our systems continue to work extremely closely together . . .
It was hardly a reassuring reply.
So Conservative MP Todd Doherty took a shot at it when he asked:
When will the government institute a real plan that includes an enhanced screening process?
Minister Hajdu gave a typical non-answer:
We have multiple measures to alert travellers from the affected regions about what to do if they suspect that they have the illness. We have trained our CBSA officers to ensure that they have the tools that they need to support people who may be ill. . . .
It was like the government was oblivious to the fact that this virus posed a real danger to Canadians, even though other countries were already in advanced stages of infection, lockdown and quarantine.
For the next month and a half, the Liberal government would continue to insist there was no reason to screen passengers, test arrivals, restrict travel or close borders. Voluntary isolation was sufficient, we were told. And even then, it was only necessary for those who were showing symptoms.
While the virus walked, flew and drove across our borders, this government was asleep at the wheel.
As late as March 13, the Prime Minister was still defending his inaction when he said:
We will recall that a number of weeks ago in the beginnings there was discussion of whether or not we should entirely close our borders to China the way the United States did. We did not. We were able to manage it in a way that allowed for control and a non-spread of the virus that gives us confidence that our public health officials are giving us the right recommendations for Canada.
It’s like he was giving us a virtual pat on the head while giving himself a pat on the back.
Then, only three days later, he abruptly changed direction, announcing that Canada was now closing its borders by restricting international flights. It’s like he woke up. Well, sort of, because there would still be no effective screening, testing or mandatory quarantine for arrivals.
Colleagues, I could go on and on. This government has repeatedly and tragically mishandled this crisis by doing too little, too late: too little because they didn’t want to offend anyone by closing the borders, and too late, because by the time they did take action, we had already imported the pandemic and were experiencing community transmission; too little because they sent our surplus protective equipment over to China, only to realize — too late — that we would need the equipment ourselves; too little because they insisted that testing was not necessary for international travellers coming to Canada. Too late, because although passengers with symptoms are no longer allowed to board a plane to Canada, they are still not being tested when they arrive.
Colleagues, let me suggest that by consistently fumbling its management of the health crisis, this government has led us straight into an economic crisis. Imagine if, instead of patting us all on the head for two months and telling us to run along, the Prime Minister had taken definitive action. Imagine if even one month ago we had been called here to pass a bill to put $71 billion into our health care system in order to protect our front-line health care workers; expand intensive care units; properly equip seniors’ homes; ramp up extensive testing across the country; erect temporary hospitals; and ensure an ample supply of face masks, ventilators and other critical supplies.
Imagine the difference this would have made, but it never happened. So instead, we find ourselves scrambling to help Canadians keep their jobs, pay their rent and buy their groceries while being asked to accept the fact that between 11,000 and 22,000 Canadians might die.
I realize that even if the government had acted quickly, pre-emptively and courageously, there still would have been an economic impact. But by consistently doing too little, too late to protect the health of Canadians, by downplaying the risk and wasting valuable time, they have dramatically escalated the economic fallout.
And now they are repeating this pattern by doing too little, too late to protect the financial well-being of Canadians. Consider that it took until March 18 for the government to announce its COVID-19 Economic Response Plan. It planned for $27 billion in direct support for Canadians and another $55 billion to meet liquidity needs. It was like bringing a squirt gun to a dumpster fire, and everyone except the government seemed to know this. Even after the government backtracked on their 10% wage subsidy and announced they were increasing it to 75%, a survey of 651 CEOs by the Council of Canadian Innovators revealed that 94% of their companies would be ineligible for the program because of its restrictive criteria.
The Canadian Federation of Independent Business surveyed their members and found that the wage subsidy would only help one third of them.
It makes you wonder who the government was actually consulting before drafting this legislation. We know that they huddled with their cabinet committee and deputy ministers, but what about the businesses it was supposed to help?
Senators Anderson, Duncan and Patterson noted in a joint letter to the Minister of Finance that this bill excludes major industries and sectors in the territories and throughout rural and Northern Canada. Apparently the government didn’t even bother to talk to them. But these senators did. They quickly found out that non-revenue-generating businesses such as mineral exploration companies, junior mining companies, construction companies and tech start-ups don’t qualify. This will cause a domino effect with negative implications for the seasonal hospitality industry, and the Indigenous businesses involved with the active resource sectors are all going to be left out in the cold. This is alarming.
Essential workers get up every day and leave the safety of their homes to serve their country. Perhaps the Prime Minister should have done the same and gone in to the office to pick up the phone and properly consult with Canadians instead of choosing to stay at his cottage long after his 14-day isolation had ended.
Colleagues, the legislation before us implements the Canada emergency wage subsidy. This program is appropriately named because households and businesses across the nation are facing emergency financial needs. But I can assure you, colleagues, that when you are responding to an emergency, one of the worst things that can happen is to arrive on the scene with too little of what you need. But the very worst thing that can happen is to show up too late.
In the middle of the worst crisis of the last 100 years, this government is consistently doing both: too little, too late. They are reactionary, not visionary, and they are taking a piecemeal approach, which is leaving thousands upon thousands of Canadians to fall through the cracks, which are now bigger than the floorboards.
Our Conservative caucus will allow speedy passage of this legislation today, colleagues, because Canadians need it badly. But what Canadians need even more is better leadership from this government. And for the sake of the nation, I hope they get it. Thank you.
Some Hon. Senators: Hear, hear.
Hon. Yuen Pau Woo: Honourable senators, when I spoke to the first COVID economic response bill, Bill C-13, less than two weeks ago, I lamented the fact that 25 Canadians had died from the novel coronavirus. That number has risen to nearly 700 and it continues to rise.
In the meantime, the number of businesses which have suspended operations or closed down altogether has risen many fold, with over 1 million Canadians thrown out of work. A staggering 5.6 million claims have already been received under the COVID-19 economic relief benefit, which was part of the bill we approved on March 25.
If anyone was in any doubt about the need for a deeper and broader economic response package to the current health crisis, the events of the last two weeks alone should put those doubts to rest.
That is why we are here today — to consider a set of expanded COVID-19 responses by way of Bill C-14.
I want to start by acknowledging our colleagues in the other place who have worked very hard to come to an agreement on this bill in a relatively short period of time. I support this bill and look forward to voting it into law later today.
I also look forward to the establishment of a COVID-19 oversight mechanism whereby two Senate standing committees will be able to monitor the progress of Team Canada’s response to the current crisis and to offer constructive feedback on the actions taken. Likewise, I welcome the creation of a COVID-19 special committee at a later date that will be able to consider, with the benefit of hindsight, lessons learned from this crisis and how Canada can be better prepared for future pandemics and other health system emergencies.
The other place has established its own oversight mechanism, so it is important that our committees not duplicate the efforts of the House of Commons. The last thing we should be inflicting now on our public officials who are on the front lines of the crisis is armchair criticism or duplication of other oversight efforts. That is why the Senate, as a less partisan institution than the House of Commons, must rise to the role that it is especially well suited for.
I am not referring so much to the cliché of “sober second thought,” since we surely will not be dealing with much legislation during this crisis period, but to the inherent qualities of an upper chamber that allow it to be more detached from politics, less tied to the here and now and, therefore, more forward-looking. Even though it is hard for anyone to see a horizon beyond the health and economic turmoil that we are currently living through, it is precisely the Senate that should be looking for that horizon and thinking beyond the horizon of COVID-19.
Colleagues, there are so many dimensions as to what “looking over the horizon” might mean, and this is not the time to go into all of those issues, but I will flag just a few for us to think about:
First, we should reflect on the distributional effects of the COVID-19 health crisis as well as the distributional effects of the economic response measures that have been put in place to counter the health crisis. It is a sad truth that when economies face major financial crises, the measures that are put in place to solve those crises — however laudable — often end up benefiting those who were better off before the crisis than those who were less well off.
To the extent that income and wealth inequality was already creating stress in Canadian society, we must make sure that it does not create even more stress because of the choices made in our response to the crisis.
Second, we should be thinking about what the COVID-19 crisis is telling us about the Canadian social compact and Canadians’ understanding of what constitutes a national social safety net. There has been an extraordinary discussion in this country over the past few weeks in the public domain — and today during Committee of the Whole — about making sure that no one falls through the cracks. That is an extraordinary discussion that this country is having, and it surely reflects a thinking among the Canadian public of how the Canadian social compact has evolved and what we conceive to be an appropriate Canadian social safety net.
There are many questions raised by this evolving — I don’t want to say consensus, but this evolving mood about the determination to not let Canadians be left behind. There are questions around the role of government and its importance for society. There are questions around the tolerance of debt and deficits. There are questions around the expectations of citizens, and there are many important questions and important new ideas about notions of welfare and notions of income support.
Third, there is the vital question already raised by some colleagues in this chamber around when to restart the economy and how to do so. Prime Minister Trudeau has been quoted saying that our economy will come back roaring:
. . . I know that if we pull together, our economy will come roaring back after this crisis.
I certainly hope that is true, but colleagues, we cannot assume that it will be the case.
As I said in my previous speech on Bill C-13, the best way to ensure that the economy is protected is to make sure that the health crisis is dealt with as fully as possible so that rates of infection fall to manageable levels and/or there are therapeutics in place to deal with the disease.
It is too early for the government and the opposition to talk about restarting the economy, and we heard that again from Minister Morneau. But it is not too early for an independent Senate, drawing on the best minds in the country, to think about that question. The key to answering that question is having good data and applying it to a variety of models that can help us come to a proper understanding of the costs and the risks associated with any relaxation of restrictions on economic activity.
Much of this data already exists, but there should be a centralized repository that can make this data available to researchers across the country and around the world so that they can do their modelling work. It is not too early for government to put resources to this kind of effort and to make it a high priority.
Fourth, even if the economy does come roaring back, it will be a different economy from what we know today. Sectors of the economy and, certainly, a number of individual businesses will be permanently damaged because of new business models, because of the acceleration of secular trends in the economy, because of political reflex due to social pressures and, very importantly, because of behavioural changes. It would not be appropriate to withhold support to industries in the current crisis that are affected by longer-term structural challenges that have been exacerbated by the COVID-19 crisis. The human cost of economic dislocation is real, and it must be addressed in any relief package, even if the ultimate source of the dislocation came from sources beyond the current health crisis.
But it would be irresponsible for any government to not be mindful of what the proximate causes as opposed to fundamental or structural changes are that are driving certain industries and causing difficulties for industries that extend well beyond this health crisis. It is more important than ever, therefore, colleagues, that we think about the new economy and that we think about how Canada cannot just get through this crisis but must get through it in a way that positions the country for the future.
Fifth, we need to think about the international economic context, which is changing as fast as the domestic economic context that I just described. There are many in this country and in other countries who are voicing the call for parochialism, for insular economics, for isolationism and for protectionism. We need to reject those calls and continue to focus on how Canada can only thrive if it is part of a global economy.
Of course, things will not be the same as they were before. All businesses will have to look at concepts such as second sourcing or business redundancy and maybe even some degree of self-sufficiency when it comes to a number of strategic sectors. But this is not the time to be talking about putting up tariff barriers or other protectionist measures simply because of a political reflex to the health and economic challenges of the day.
Colleagues, there are many other issues that are just over the horizon and which the Senate should be thinking about. I don’t have time to go into all of them, but they include, for example, how a post-COVID-19 world will affect international relations, particularly great power relations, multilateral cooperation, refugee movements and techno-nationalism. These are all topics for another day.
But how will we do any of this work if we are not meeting? How will it be possible for the Senate to play a role during a time of social distancing and in a context where we meet so infrequently?
Let me, first of all, recognize and thank His Honour for his leadership in initiating some activity around the investigation of technical, logistical and administrative solutions for the Senate and its committees to meet remotely. I also want to thank the Senate administration for the work they have already done in exploring these options. I know CIBA has also done some work in this area.
We heard earlier notice of a motion requesting that the Senate administration continue to put energy into efforts to explore technical and logistical solutions to meeting remotely. This motion reflects a deep desire, or more likely a frustration on the part of many senators at their current inability to discharge fully their duties as parliamentarians.
I would say that it also reflects a desire on the part of many senators, if I may say so, to bring our beloved institution into the 21st century in terms of having the ability to meet remotely. Other parliaments are looking at this issue with great seriousness and great intensity. Other well-functioning organizations much larger than ours are already taking on these challenges and solving them. I recognize we have special needs in this Parliament because of our unique bilingual character and the Rules of the Senate — all of these have to be observed — but it is time for us to address these issues, and there is no better time than now, when we are forced into a situation where we do not have the ability to meet in person.
The House of Commons, as you all know, colleagues, is moving ahead on some of these questions. Only today we learned from the government house leader that, in addition to the two oversight committees that have been established, Health and Finance, the House is going to find a way for at least four other committees to meet remotely: Industry, Human Resources, Government Operations and Procedure.
Colleagues, we don’t know when we will back to our normal sitting pattern. It may well be a long time. That is why we should not squander the opportunity to work on solutions for remote meetings, so that when we do return, it will be to a Senate that has not only proved itself to be responsible and relevant during the current crisis, but also newly equipped to function more effectively, using the many connectivity tools that are already available to Canadians.
Some Hon. Senators: Hear, hear.
Hon. Jean-Guy Dagenais: Honourable senators, allow me to add my take on Bill C-14 before us. Try not to be surprised, you will probably never have heard me say such things about the current Government of Canada. The situation demands that we all stand united behind those who govern us so they can bring in, as quickly as possible, measures to help our businesses and our workers. Employment is a factor in economic health. There is an urgent need for action, period. Canadians are currently going through a life-changing tragedy. We never imagined what an impact this virus would have. It has already killed far too many people here and around the world.
Despite the best efforts of our health care workers, the list of deaths gets longer every day and it is not over yet. However, like many others, I dare not believe the projections any more. Beyond the deaths, the global economy is in turmoil. Without sometimes staggering, not to say improvised, political interventions, several sectors of the Canadian economy will never recover from the impact of this pandemic. Many businesses, large and small, will face bankruptcy and layoffs will be financially catastrophic for workers and their families. The government must be able to act.
We passed Bill C-13 on March 25, and now along comes Bill C-14. I wouldn’t be surprised to see a Bill C-15 before long. It would be irresponsible to delay matters, and the people anxiously waiting for financial assistance would never forgive us if we did. Let’s agree on one thing: In order to save the economy, we are temporarily abstaining from our duty to ask questions, but we will eventually examine the actions taken by political decision makers. The Senate’s political role is to be a chamber of scrutiny, and I have full confidence that our existing committees, and perhaps other committees that will be formed later on, will ensure that we are able to ask all the necessary questions in the coming weeks and months about what is going on.
In my opinion, now is not the time to object on political grounds to emergency decisions being made to save our citizens, our economy and our country. That being said, I don’t want anyone to think that the stance I’m taking today means I’m being willfully blind. At my age, I still have excellent vision, and I’m perfectly lucid. In exchange for fast-tracking the passage of Bill C-14, I expect unprecedented transparency from Prime Minister Justin Trudeau’s government. Democracy demands it.
Prime Minister Trudeau’s government must not spend money recklessly, even during this period. It never found the money needed to buy the medical equipment recommended by various auditing agencies to ensure that Canada would be able to deal with a pandemic. We’re seeing the result of that carelessness today. Canada had money for everything, except what was needed most.
Everything I just said is extremely serious. Audit reports, including one dating back to 2006, have shown that Canada did not have the medical equipment needed to deal with a pandemic. A more recent report showed a lack of ventilators in this country in 2018, and now we are willing to pay a lot more for those ventilators. I was surprised to learn that one of the authors of the 2006 report was Dr. Theresa Tam, the current Chief Public Health Officer of Canada. She could not have been oblivious to the medical equipment shortages in Canada repeatedly exposed over the past decade by experts here and around the world.
If, one day, she agrees to testify before the Senate, it would be interesting to ask her how, on January 29, she concluded that the risk of coronavirus in Canada was very low, especially now that we have learned that the Canadian Armed Forces intelligence unit, which includes scientists like her, had warned the Trudeau government a month earlier about the risk of a coronavirus outbreak in Canada.
I want to be accommodating for the sake of saving our economy, but I will never be accommodating to cover the incompetence that put Canadians in danger.
In addition to reviewing the government’s proposed legislation to provide financial assistance to businesses and corporations, the Senate should definitely look into what information the Prime Minister and some of his ministers had in early January 2020. We may be surprised to learn that the current government did not take our allies’ warnings seriously, which explains why the Prime Minister and his entourage were reckless, negligent and incompetent with respect to the emergence of the virus. We will pay the price, we will get back on our feet, but we will also need to demand accountability from those who failed in their duties.
When one adds to what I just said the fact that Prime Minister Trudeau was very, and I would say almost shamefully, slow to close our borders to foreign nationals, despite the information that he had, there’s reason to be angry. He has demonstrated a total lack of leadership from the beginning of this crisis and in other crises that Canada has experienced since he was re-elected, and I’m not the only one who’s noticed.
To be frank, Prime Minister Trudeau’s lack of leadership in times of crisis is distressing and even worrisome. What’s more, the government’s improvisation has resulted in assistance programs that are unfair and even discriminatory to some Canadians.
I’d like to remind senators that millions of Canadians still don’t have internet access, despite the billions of dollars in investments promised by the Liberals in the 2015 and 2019 election campaigns. Did you know that, in the midst of the crisis, this government was able to immediately process online claims for the monthly $2,000 benefit? How can the government then turn around and tell those who aren’t connected to the internet that it will take 10 more days for their claims to be processed because they’re unable to communicate with the government in that way? That is shameful in 2020.
I will vote in favour of Bill C-14 today anyway. I’m doing it for the good of the economy. I can’t help but condemn the lack of political and economic vision on the part of those currently in government. What happens when we reopen our borders to foreign nationals at some point? We’ll have to do that eventually, but I haven’t seen or heard anything about setting up a health screening system to protect our citizens from travellers who could infect them or set off a second wave of COVID-19.
In the future, the government will have to spend a lot of money on screening immigrants and tourists who come here. We’ll need new regulations and additional investment in border control. Prime Minister Trudeau hasn’t said a thing about that yet despite being so reluctant to close our borders.
If the past few weeks are any indication, we’ll be seeing more costly ad hoc policies when the time comes to open our borders. Will we be lagging behind the United States once again?
Let’s come back to Bill C-14 and the moral obligation I am under to approve it to save our businesses and the jobs that go with them. This bill will allow the Liberals to distribute millions of dollars because the country is in a state of economic emergency. Honestly, I hope that they aren’t doing this in the hope that we will forget their highly questionable decisions since the beginning of this pandemic.
I would remind all senators, as our colleague Senator Dalphond said in an opinion letter published yesterday, that the Senate must perform its duty to provide oversight of political decisions, even during a crisis. We must do so without denying the current government the power to act quickly.
Our committees have shown that they’re good at research and listening, and their reports have always conveyed the fact that senators take major issues facing our society very seriously. We will most certainly have to undertake a thorough analysis of this sad time in the history of our country as soon as we can get back to work.
Off the top, I want to acknowledge that some mistakes can be forgiven, as long as they’re fixed. However, I’d be gravely disappointed if we were to undertake studies and reviews that merely cover up political incompetence and mistakes. Transparency will be a crucial part of what we expect from those making decisions during this pandemic.
When the time comes to do that work, I’ll be vigilant on behalf of the Canadians I represent, and I hope other senators will as well.
In closing, I ‘d like to offer my sympathies to all Canadians who have lost loved ones during this pandemic and encourage everyone to stay strong. Thank you.
Hon. Jim Munson: Honourable senators, I rise to speak briefly about Bill C-14, A second Act respecting certain provisions in response to COVID-19.
My words will be the voice of our leader Senator Cordy. Out of courtesy to the former Government Representative and now a non-affiliated senator, Senator Harder, I plan to cede the rest of my allotted time to him.
Before I echo the words of my leader, I would like to say that we in the progressive senators group are a small but feisty group of senators. We are strong believers in the Charter of Rights and Freedoms and of building a new relationship with Canada’s Indigenous peoples. Our motto comes from the Algonquin language Mamidosewin which can mean a meeting place or walking together towards a common goal. In this case, we can use Mamidosewin to work collaboratively during this pandemic for the good of all Canadians.
I will now share the words of Senator Cordy:
Honourable senators, the bill before us today is a much-needed lifeline to employers during an unprecedented time of economic turmoil in this country.
As government COVID-19 response measures remain in place to help contain the virus, Canadian businesses are really feeling the pinch. We have heard that today. Revenues are greatly reduced and in many cases there is little or no revenue. As a result, we are seeing a staggering number of Canadians who are now unemployed. Canada’s jobless rate has soared. In March, it was 7.8% and growing.
The federal government’s Canada Emergency Response Benefit went online this week for Canadians who lost their jobs as a direct result of COVID-19. They are reporting that 3.8 million applications for the CERB program have been made since it launched on Monday, and that Service Canada has processed just over 5.6 million EI claims retroactive to March 15.
Canadian workers and Canadian businesses urgently need their government’s help to get them through this time. I applaud the government’s response efforts, particularly the CERB and the application process that was launched this week. By all accounts, it has been a success. The ease of accessibility to the benefit and the speed at which applicants received the payment in their bank account must be praised.
Now we all have to deal with businesses and give them the tools to stem the tide of job losses and retain staff. I am hopeful that the wage subsidy provided through this legislation will help achieve this.
Unfortunately there will be businesses and organizations that may fall through the cracks of the wage subsidy program. Questions remain how organizations such as charities, not-for-profit and religious organizations or newer businesses will be eligible for this benefit.
The bill before us will help a vast number of Canadian businesses now, but the government must continue to find ways to reach all those organizations that are not served by this legislation.
Honourable senators, as we continue to navigate these difficult and unprecedented times, I want to acknowledge all our health care workers and health care leaders across the country who face new challenges each and every day. I thank them for their dedication and adaptability as new information is regularly presented to them. I also want to thank them for helping to keep us safe and for stepping in to be with our loved ones when they’re most frightened and we’re unable to hold them close.
I want to commend those on the front lines in our grocery stores and pharmacies, at our ports and on our roads keeping supply chains going and those delivering services to our homes such as heating oil and propane. We appreciate the long hours and energy you have put forth while potentially placing yourselves in harm’s way.
Thank you to all our artists and creatives who have come up with initiatives to keep us engaged and entertained to help make endless hours at home bearable.
A big thank you to educators who are finding new ways to reach their students and ensuring they’re continuing to learn at home in virtual classrooms and online activities.
Finally to all Canadians who are staying home and social distancing in order to minimize the spread, your efforts cannot be overstated. To all those who have shown incredible kindness in reaching out and checking in on neighbours, family and friends, I encourage you to continue to do so. While we call it social distancing, perhaps the more appropriate term would be physical distancing. We are by nature social creatures. It is crucial in times like this that we keep mental well-being a top priority, which includes regular contact with cherished loved ones and extending a kind word to those who find themselves alone and vulnerable.
Honourable senators, in conclusion, I again want to say that I fully support the legislation before us today. Canadian businesses and employees are in dire need of the assistance provided through this bill. The sooner the financial support is in the hands of Canadian businesses the better.
To all Canadians watching or listening today and to my colleagues in the Senate, stay safe, stay healthy and please, as Premier McNeil of Nova Scotia says, “. . . stay the blazes home.”
The words of Senator Cordy. Thank you.
Hon. Peter Harder: Thank you, Senator Munson, for giving me the time to fill the few minutes left.
Honourable senators, we are living through a great disruption. It’s changing how we work, play and live. It affects each farm, village, town and city across Canada and around the world. When and how it ends is still dimly understood.
These extraordinary times require extraordinary efforts by individuals, communities, provinces, the Government of Canada and increasingly international organizations. Today we will be approving one such extraordinary measure to, in effect, significantly subsidize the wages of a large number of Canadians working in business, the not-for-profit and charitable sectors.
This has never been done before in Canada and reflects the unique nature of the challenge before us. The public policy behind this initiative is clear. It is desirable to keep liquidity in our economy, to ensure households can be sustained and to ensure the workforce remains attached to their employment so that we are better able to preserve in the short term the rebound as circumstances allow.
When this initiative was first announced some 10 days ago, I received phone calls from a number of business people who expressed total support and saying they no longer needed to lay off their workforce. They would get by and get ready for the future.
I have heard from not-for-profits and charitable organizations that with this support can begin to plan for the short-term and the longer-term reinvention of their mission.
With this measure alone, we are adding significantly to our collective deficit in the short term to mitigate the costs of the economic downturn and better equip us collectively for a return to more normal economic times. The Government of Canada cannot be the paymaster forever, but it can and must for now. This bill deserves our support.
The great disruption of the past month or so has revealed much about ourselves. I would like to highlight briefly some of what I have observed.
First, Canadian federalism is working. Provincial governments have stepped up and in some cases surprised their citizens by the way in which they have engaged either with the cities in their jurisdictions or with the Government of Canada. A Senate dedicated to the interests of regionalism should take a pause and say collectively: that’s really good. And you only have to look perhaps a few miles south and see that federalism can be under stress in times like this.
While all governments matter, I am increasingly worried personally about the mechanisms of international coordination — G7, G20, the UNHCR, the UN organizations — because it is not their deficiency that I lament, it’s their member states not giving them the tools with which to do the job that needs to be done. I worry, colleagues, about Africa, but that’s another subject.
Second, science and expertise matters: front-line emergency officers, first responders, researchers. The private sector management in this period of crisis is amazing to behold. If you get inside some of the organizations that are retooling and reorganizing themselves for the short term, they have benefited, if you can call it that, from the experience of 2008-09. For example, Ontario lost 50,000 manufacturing businesses in those years. It means that those who have continued to have a certain resilience that is being tested in this period for sure, but they have some experience of getting through it.
Institutions matter, and institutions matter because trust matters. We will not be able to sustain social distancing and the various requirements of behaviour if we didn’t believe that institutions and their advice are coherent, meaningful and well-motivated. That means we probably need to reflect on the fact that our institutions need a greater redundancy in capacity for dealing with situations like now, and that simple efficiency in our institutions isn’t in the long-term interest.
Agility in responding to changing circumstances by changing course ought to be respected and not ridiculed, even in the Senate. When new gaps emerge, we must be able to respond quickly and be encouraged to do that. Parliamentary oversight is absolutely important, but second-guessing from the sidelines isn’t really helpful.
Lastly, we need to begin to think our way back to normal, or the new normal, and I would argue in this time of transition, we need to have a higher tolerance for risk in the public sector.
I’ve been somewhat critical of the so-called accountability reforms of 10 years ago. I made the allusion once that if the public service was a hockey team, it would be a team of goalies because it was better not to be scored on than to score. We won’t get through this if we don’t have a full-fledged hockey team, with forwards and risk takers, people who are prepared to see a goal being scored because the game needs to be won. And that requires public institutions like the Senate, the House of Commons, the Auditor General, and others who are charged with ensuring proper oversight, are also aware that we need a culture of risk taking and innovation in the public service. I applaud the public servants who have taken us thus far in developing the advice and starting to implement it, but the implementation of what we are passing today will, colleagues, mean mistakes will be made. People will game the system and we’ll have, I’m sure, sober advice to tell us how this and thus should not have taken place.
Risk taking is an essential component of getting through this period.
So what we are doing is absolutely necessary but not sustainable. It requires patience, understanding and the courage of all of us to see Canada through.
Hon. Larry W. Smith: Goodness gracious, it’s tough to be at the end of the pack, but I’ll try to make a few comments on Bill C-14.
The measures announced by the government are comprehensive and targeted actions which aim to provide financial assistance to the most vulnerable Canadians, as well as induce economic activity and maintain liquidity in the Canadian economy. Now more than ever, Canadians are looking to their government to make challenging decisions that protect the health and well-being of its citizens but also safeguard their livelihoods.
Now, more than ever, it is imperative to prevent the erosion of trust in our institutions with transparent and accountable policy, similar to what Senator Harder just talked about.
The government’s cumulative fiscal response to COVID-19 has surpassed hundreds of billions of dollars, including direct spending measures totalling $107 billion. According to projections from the Parliamentary Budget Officer, the federal deficit is now expected to reach $184 billion, which could push Canada’s debt-to-GDP ratio up to its highest level in 20 years, at 40%. While these are daunting figures to digest, we understand it is the government’s duty to do whatever it takes to ensure that we as a country get through these difficult times.
As they stand currently, these spending programs come with no costing notes from the government. There is uncertainty around the length and scope of these programs. There is uncertainty around how these programs will be financed, and there is uncertainty around how the crisis will impact federal tax revenues moving forward.
Currently, there is no way for us to know of the future implications of this spending on Canadians. In short, I’m concerned about the government in its duty to be transparent and accountable in this regard.
However, Parliament, especially in a minority government, can play an important accountability role. The Prime Minister has made mention of Team Canada in his remarks since the start of the COVID-19 pandemic in Canada. He has said that addressing this virus must be a Team Canada effort, meaning his government will have to work collaboratively, not only across governments, but also across party lines. So when the opposition in the House of Commons rejects the idea of granting the Minister of Finance unfettered spending and taxation powers for two years, it was not a partisan tactic; it was simply Parliament as an institution exercising its constitutional duty to hold the government of the day to account.
Let’s not forget one thing. Truth always builds trust and leads to transparency. And as Senator Harder spoke about it, the idea of tone and attitude becomes tremendously important for all of us as we move forward.
For these reasons I believe that the Senate is well equipped and in a good position to act as an oversight body, a role our institution already has in our system of democracy. The Senate has a duty to thoroughly review these fiscal programs by questioning experts and providing recommendations where appropriate. We can act quickly, and we can adapt to the new work environment as much as possible, but we must never give up our constitutional duty to hold the government accountable for its decisions.
For example, while the government has worked to provide relief to Canadians and Canadian businesses impacted by this pandemic, the oil and gas industry in Western Canada has yet to hear the government’s plan for their sector. I’m not going to go any further into this, other than to say we have to be able to address this issue. Western Canada is tremendously important, and contributes up to 10% of Canada’s GDP in terms of the energy sector. We have to find ways of moving forward that protect not only this industry but protect the environment movement we have to deal with. Two realities: how do we balance them and make them work?
I don’t have a final answer — and this was Minister Morneau — about dealing with this crisis, but let’s hope that positive leadership comes forward shortly on the energy issue.
Continuing the theme of transparency and accountability, we have learned that during the course of this pandemic, processing access-to-information requests has slowed across the country and even stopped at the federal level. Canadians wishing to hold their government to account through freedom of information are being met with roadblocks. In an email to a request, Public Services and Procurement Canada responded by saying:
The Access to Information and Privacy Office has decided to put all access and privacy requests on hold until the situation returns to normal.
Toby Mendel, executive director of the Centre for Law and Democracy raised concerns saying:
We’ve got, on the one hand, this incredible need for accountability and, on the other hand, the institutions of accountability are operating well below their normal levels.
Again, we need to reinforce a behavioural pattern that will be able to help us move forward as opposed to putting up roadblocks.
This is yet another example of the government failing in its duty to be accountable to the public. COVID-19 has certainly exploited many weaknesses in our public health system as well as in our economy. It is no secret that policy errors on the part of the federal government have amplified the magnitude of the virus’s impact.
Sandy Buchman, President of the Canadian Medical Association said:
I am trying to understand the government’s response today because I think everyone was caught flat-footed. The front line is telling us over and over that they are not prepared and they are scared. We are hearing it from everywhere.
The 2006 report from Dr. Theresa Tam was mentioned earlier where she warned about a pandemic similar to COVID-19 and provided guidance on maintaining adequate domestic stockpiles of medical equipment as well as hospital capacity to deal with surges.
With time, as this virus wanes, people will slowly return to their normal lives again — whatever that new normal may be — and it will be important for us to ask tough questions on behalf of Canadians. Canadians will want to know where their government’s policies failed, where there were gaps in accountability and what lessons were learned to better prepare for future tragedies.
Without accountability and transparency, you cannot expect trust. Trust in our institutions and in our government is paramount today. Now we need more accountability, not less. We need more transparency, not less. The federal government must provide a detailed costing of the fiscal measures it has announced. It must provide full and comprehensive explanations in its policy decisions regarding COVID-19.
Finally, what we need moving forward is a long-term strategic plan with the appropriate financial resources, equipment and leadership so that we will be proactive and ready as a country in overcoming the next health epidemic that we will face and our fellow Canadians will face. Thank you.
Hon. Julie Miville-Dechêne: Honourable senators, in the last few days, the federal government has demonstrated that it’s willing to listen by relaxing the criteria for the 75% wage subsidies meant to help businesses get through the worst of the crisis. No single program can meet all the needs. It will be much more difficult for small businesses that have already laid off their employees and have limited liquidity to use those subsidies. If they have a payroll over $50,000, they still have the option of applying for a $40,000 loan that is interest free for two and a half years, 25% of which is non-repayable. Still, those small business need to have the means to pay back these loans. Who knows how the economy will look after all this?
Hundreds of thousands of workers laid off because of COVID-19 are already receiving their EI payments or the Canada Emergency Response Benefit. I was relieved to hear that CRA’s computer systems held up. There were a few glitches, but overall, fewer administrative delays than we might have feared. I therefore want to thank the public service employees who contributed to this massive effort.
But some people are being left behind, like those who lost their jobs before the coronavirus outbreak and who don’t qualify for emergency benefits or employment insurance. How many of them are there? Minister Morneau didn’t want to give us an estimate earlier. Maybe he doesn’t know. No one can tell us when or how these people are going to be helped, either. Nonetheless, we have a duty to help them.
This unprecedented health crisis has forced us to do some serious soul-searching. I live in Quebec, where the number of deaths due to the pandemic in long-term care homes, intermediate resources and private nursing homes has become a burning issue. These institutions account for half of all deaths caused by COVID-19. We know that people over 70 are at the highest risk of dying from the novel virus, but that’s only part of the explanation. Quebec society, meaning all of us, made a choice to institutionalize vulnerable seniors in large establishments that are chronically and cruelly understaffed, with appalling turnover. Three times more seniors live in institutions in Quebec than in the rest of Canada. Because of the choice society made, a lot of these establishments are now practising something akin to wartime medicine. The people who live there are dying off behind closed doors. Human beings are suffering in agony, often dying without medical care and without anyone at their side.
The federal government and the Government of Quebec misjudged the enormous need for masks. There wasn’t enough protective equipment for nursing and medical staff and for care attendants outside hospitals. Care attendants, who are paid $13 an hour, were therefore sent to the front, without masks and without training, to care for 10 to 25 functionally dependent seniors, often by themselves. They are caring for fragile human beings in facilities where hundreds of seniors with dementia or Alzheimer’s are in close contact and contaminating each other because of a lack of oversight.
In one of these residences, which was described as a concentration camp, patients were found starving, soiled and even dead. The employees had fled and abandoned the institution. This sort of thing is happening right here at home.
For the past few days, the government has been redirecting personnel to help these people who have been overlooked in this time of crisis. It’s clear that, once the worst of this health crisis has passed, we need to take time to reflect on how to prepare and on the authorities’ response to the most vulnerable members of our society, who currently aren’t entitled to a dignified death. We also need to think about how little value we place on the essential and difficult jobs of orderlies and care attendants for functionally dependent seniors, jobs that are predominantly held by women, underpaid and devalued. Since the pandemic began, these workers have been called guardian angels in Quebec. However, the admiration being shown for their courage and hard work should be reflected in their working conditions.
Hon. Senators: Hear, hear!
Hon. Pierre-Hugues Boisvenu: Honourable senators, as I rise today my thoughts go out to our fellow citizens in Canada and Quebec who are undoubtedly going through the most difficult crisis of their lives. That is why I’d like to begin by offering my sincere condolences and all my support to families who have unfortunately lost a loved one to the coronavirus.
I would also like to commend the courage and will of all those who are working, near or far, in service of Canadians during this crisis. These people who risk their lives in the national interest deserve our recognition and I’d like you to join me in thanking them for their dedication and their sense of duty.
I also want to acknowledge the exceptional work of our premier, Mr. Legault, and his team. Since the beginning of the crisis, Quebec has found reassurance in Mr. Legault’s incredible leadership. We thank him for that.
Colleagues, I’m worried about this government’s management. I have no doubt that it wants to help and protect Canadians. However, I’m troubled by the quality of communications throughout this crisis. The government committed to working with the opposition parties and to being transparent with Canadians. On a number of very important issues, such as the economy and public safety, however, we haven’t gotten clear answers to our legitimate questions.
The government’s attempts to stop this crisis will have serious long-term consequences on the economy and on Canadians. I understand the need to support the economy with massive amounts of spending. I’m not opposing that choice. However, I have to wonder about the government’s long-term plan for this massive deficit that will have accumulated and that will have an effect over a long period. I realize that the economy is a major issue that we need to consider in this crisis, but, above all else, I’m concerned about the public safety of Canadians.
The evasive answers given by the Minister of Public Safety, Mr. Blair, during our previous exchange failed to convince me, and certainly failed to reassure.
Canada has nearly 70,000 police officers, including 20,000 members of the RCMP. The Canada Border Services Agency has some 7,000 uniformed officers. More than 6,000 correctional officers work at Correctional Service Canada, along with 1,000 parole officers and support staff. All of those officers protect Canadians, but we also have a duty to protect them.
I asked Minister Blair what he planned to do to protect Correctional Service officers from COVID-19. This is what he said, and I quote:
We’ve also been providing training to our officers. We are ensuring that the inventories of Personal Protection Equipment are adequate for the challenges we may face.
This shows the lack of substance in the government’s response regarding the protection of prison staff. We were not given a real plan or any details. It seems the situation is becoming increasingly worrisome in many federal prisons in Quebec and no doubt elsewhere in Canada as well. What are the specific requirements for personal protective equipment for all of these officers? Do we have enough protective equipment supplies to keep them safe? What is the government’s plan if there is an outbreak of COVID-19 in a prison, as is currently happening in Quebec?
What I find even more worrisome is the solution of releasing inmates back into the community. That illogical response is a threat to Canada’s public safety, and most Quebecers and Canadians are opposed to it. It would be like deciding to free up beds in a seniors’ home for fear of a pandemic. It does not make any sense.
I understand why COVID-19 getting into penitentiaries would be a problem. However, we have to acknowledge that we have no way to monitor offenders if they reoffend post-release. The Auditor General himself confirmed that.
Are our halfway houses and community correctional facilities ready for an influx of offenders? Are municipalities and local health services informed ahead of time about decisions made by Correctional Service Canada?
In his response to a question posed in the Senate, Minister Blair said that he asked the commissioner of Correctional Service Canada and the chair of the Parole Board of Canada to look at the possibility of taking measures to facilitate the early release of non-dangerous offenders. I would like to know what “non-dangerous offenders” means. Does that include individuals convicted of firearms offences or offences related to organized crime? What about individuals with multiple convictions for breaking and entering or robbery? What about drug traffickers?
I would also like to remind my colleagues that Canada’s current situation does not in any way justify the early release of inmates. Indeed, in the other place, the House of Commons Standing Committee on Public Safety and National Security is already reviewing the circumstances surrounding the release of Eustachio Gallese. That individual, who tragically murdered Marylène Levesque, was a repeat offender; a few years earlier, he killed his own spouse, Chantal Deschênes.
I would also point out that on March 30, the union representing correctional officers stated, and I quote:
The release of a few inmates would not solve the potential spread of COVID-19 in our facilities; it would only increase the risk for Canadians.
Even inmates on conditional release can pose a threat to society. Canada is in crisis, and its citizens are already facing a potential deadly threat. It would be irresponsible to add to that threat.
Honourable colleagues, we cannot take Canada’s public safety lightly. The government is leaving unanswered questions on this, so we need to react. The early release of inmates is already a risky proposition, but early release without planning would constitute a reckless disregard for community safety.
It seems to me like we’re trying to fix a problem by creating an even bigger one. We should be thinking about how to equip Correctional Service Canada with the right resources and measures to protect prison staff and to ensure normal operations of our Canadian penitentiaries, as most of the provinces have done. They’ve equipped the hospitals with extra staff and extra resources to provide services to those infected with this virus.
I’d also like to draw your attention to another problem that might arise from the early release of inmates. The fundamental priority of the Parole Board of Canada is to protect the Canadian public. However, how could it do that if we don’t test offenders who might be released or if we’re unable to monitor their housing conditions in such a way as to ensure the necessary social distancing? How many of these criminals might simply join the ranks of the homeless and put their health and that of others even further at risk? We know that COVID-19 is extremely contagious. Why is the government not providing more clarity on this issue? Releasing contagious inmates will only worsen the health situation.
I believe that with the right means — in other words, increased resources for correctional services — they would be able to prevent outbreaks in penitentiaries.
According to a TVA article I read this morning, inmates freed from the Port-Cartier institution are now 50 kilometres away, confined to a hotel in Sept-Îles for two weeks. The MLA for Duplessis and Parti Québécois public safety critic expressed grave concerns about safety in the region. What authority did the minister have to legally order the Parole Board to release certain categories of offenders before they were eligible?
According to the Corrections and Conditional Release Act, the Parole Board is an independent administrative tribunal that must retain that authority.
Over the past few days, I have been informed that a number of victims were not invited to the parole hearings, which is a violation of their rights. These victims feel wronged and ignored by our justice system, once again.
Why is the government in such a rush to free inmates to protect their rights, when it is willingly trampling the rights of victims and their families? It’s important to keep in mind that, in 2015, Canada instituted the Victims Bill of Rights, which is supra-constitutional, meaning that it is above departmental laws. How, then, does the government explain this situation? It is sad to see that this government neglected its duty and was more concerned about criminals’ rights than victims’ rights.
Honourable senators, the government’s first duty is to keep Canadians safe. We have a responsibility to ask the government questions and demand clear answers.
The safety of Canadians is one of the government’s most important responsibilities, and it is one that we cannot shirk. We need to stand together in the face of this crisis, which affects every one of us directly.
I have no doubt that we will find the right compromises to help Canadians get through this epidemic.
I’d like to take a moment to wish all Canadians and all Quebecers a happy Easter.
Honourable senators, may you and your loved ones stay healthy and safe. Thank you.
Hon. Senators: Hear, hear!
Hon. Kim Pate: Is it possible to pose a question?
The Hon. the Speaker: Senator Boisvenu, would you take a question?
Senator Boisvenu: Absolutely.
Senator Pate: Thank you for your comments. I was going to stand to raise a point of order about the appropriateness of these comments in light of what we are discussing, but I’m not doing that.
The Hon. the Speaker: Is there trouble with the translation?
Senator Pate: Thank you very much. I was interested to hear your comments that have come from the guards’ unions.
I’m not certain, senator, if you are aware that, in fact, many medical professionals, including some leading epidemiologists in this country, have written to correctional authorities in all jurisdictions recommending that the numbers of people in prisons be reduced and that prisoners be released so that prisons don’t become vectors for the virus and contribute to increased strain on the public health system, particularly in communities where prisons are located, so that they can actually engage in physical distancing in prisons for staff, as well as prisoners, so we end up not prolonging or repeating, and have more cyclical reintroduction of the virus and preventable continuation of the pandemic we are currently facing. I’m not certain if you’re aware of that. If you aren’t, I would be happy to share that information with you.
Senator Boisvenu: Thank you for your question. I’ve visited all the penitentiaries in Quebec, and I can assure you that very, very few of them are overpopulated. Federal penitentiaries in Quebec are very well equipped, in terms of both gear and personnel, to practise social distancing as required. It’s just a matter of management and common sense.
Hon. Mary Coyle: Honourable and cherished colleagues, I am deeply honoured to stand with you today in this chamber to speak in support of this critical wage subsidy bill, Bill C-14. This is a bill to support workers and families, a bill to support businesses and the future health of our economy. I would like to acknowledge contributions to my remarks from Senators Ratna Omidvar and Colin Deacon.
In his April 8 news conference, Minister Morneau said:
In the face of an historic public health crisis, we are providing historic support. These are the largest economic measures of our lifetime.
These measures include this bill.
Before speaking to this bill and other government measures, I would like to join my colleagues in telling you and all Canadians how grateful I am for the superhuman efforts of so many who are working relentlessly, with great intelligence, creativity and dedication, to get us through this enormous and unprecedented crisis in Canada and around the world.
I am grateful to our political and public health leaders, at all levels, whose competence inspires confidence.
I am grateful for the civil service; a shout-out to Rhonda Kropp of the Public Health Agency of Canada, and all the vitally important civil servants we interact with on the daily technical briefings for parliamentarians.
I’m grateful to our skilled and brave health care workers, including those in mental health care, and other front-line workers in the grocery stores, food banks, women’s shelters, prisoner advocacy and support organizations, and especially those who care for our most precious and vulnerable fellow citizens, like my mother-in-law, Eileen Coyle, who is a resident at a care home in Almonte, Ontario, which is currently experiencing a terrifying COVID-19 outbreak.
I’m grateful for educators, many of whom are caring for their own children while trying to keep their students happy and engaged in learning.
I am grateful to artists, who show us beauty, entertain us and challenge us to reflect at this time when we need them most. As a rabbi whom I recently listened to said, “This is a time to focus on comforting the disturbed and disturbing the comfortable.”
I’m grateful for journalists, who are working around the clock to keep our communities informed on public health matters and emergency response measures.
I’m grateful to innovators, scientists and entrepreneurs like my fellow Antigonishers Kulbir Singh and Mike McAlduff of Sona Nanotech, who are working without rest to develop and commercialize their COVID-19 rapid-response antigen test.
I’m also grateful for all of your global counterparts. You and many others are important members of Team Canada and Team Earth.
I support this bill and the other unprecedented and extensive measures our government has rapidly put into place to help Canadians get through to the other side of this crisis. I was very pleased to see that this bill recognizes the importance of both the business sector as well as the charitable and non-profit sectors. Providing job security and support for operational continuation is key for both sectors. It’s key for all Canadians.
Honourable senators, our Special Senate Committee on the Charitable Sector highlighted the critical role that this sector plays in Canada and around the world. At a time when the sector is needed more than ever, Imagine Canada has estimated that charities will see financial losses this year of $9.5 billion to $15.7 billion, as well as layoffs of 118,000 to 194,000 people. That’s the charitable sector.
With this potentially dire and urgent situation, charities need to be supported by the right policy tools so they can continue their vital work responding to the impacts of this crisis. The 75% wage subsidy provided through this bill, and described in detail by Senator Gold in his speech, will definitely help many charities to keep their doors open. For this we are thankful. There are, however, a number of other measures the sector is asking the government to consider, given the distinct characteristics of this sector.
The charitable sector is asking for a whole-of-government approach and asking the Treasury Board to issue a directive to that effect. The measures they are asking for also include adjustments to the way declines in revenue are calculated. Charities with funding agreements with the federal government and Crown agencies would have those automatically renewed. Unspent funds from previous years would be carried over. Flexibility on how funds are spent would need to be there, as well as simplified reporting requirements — yes, more offence and less defence from the government, please — and a temporary moratorium on the restrictions that limit charities and foundations to only provide funds to qualified donees, in order that they may form the critical partnerships required to reach vulnerable populations at this time, including Indigenous peoples. And, just as government is looking at developing specialized relief for industries, such as our airlines, the charitable sector is calling on the government to create a significant stabilization fund tailored to its urgent needs.
Honourable senators, these are not frivolous asks. These are essential supports for a sector working hard every day to help fellow Canadians get through this crisis.
In addition to the charitable sector, it is important that we give special consideration to our start-up and growth companies. These are vital to the successful recovery and future strength of our economy.
Over the decades, Canadians have dramatically increased investment in businesses like Shopify here in Ottawa, Verafin in Newfoundland, and SkipTheDishes out West. To achieve this, the federal government will need to put in place programs to unlock investment from private individuals and entities that have been shaken, like all of us have been.
Colleagues, I support Bill C-14 and I, like you, look forward to hearing more and being involved in further measures to address other pressing needs resulting from the COVID-19 crisis.
Honourable senators, as I conclude my remarks today and we all plan our socially distanced Easter, Passover, Vaisakhi, Ramadan and other celebrations, I remind us that our Chief Public Health Officer, Dr. Theresa Tam, has called for a “staycation for the nation.” I quote, as did Senator Jane Cordy, my fellow Nova Scotian, Premier Stephen McNeil, who has told he everyone to “stay the blazes home.”
Fellow senators, I will leave you this evening with lyrics — I’m not going to sing; don’t worry — from a famous Rankin Family song:
. . . as sure as the sunrise
As sure as the sea
As sure as the wind in the trees
We rise again . . .
Rise again, yes, we shall; of that I am confident.
Welalioq. Thank you.
Hon. Leo Housakos: Honourable senators, today I’m going to talk about the unprecedented economic challenges that Canada is facing due to the global pandemic. In this chamber, we often — perhaps too often — use the word “crisis” to describe events and challenges that we have had to overcome as a country. However, I think that word perfectly sums up the situation the world is facing right now. Indeed, I think it would be impossible to overstate the economic disruption and upheaval that Canadians are going through right now.
The Conference Board of Canada has indicated that it expects Canada to lose 2.8 million jobs in March and April alone. Prior to this crisis, Canada had a national unemployment rate of 5%. That rate is now 20% and expected to rise significantly.
My province, Quebec, lost 264,000 jobs in March alone. Quebec’s unemployment rate rose from 4.5% to 8.1%. In the rest of Canada, only Ontario has lost more jobs than Quebec.
We’ve been told to expect that in some regions of the country the unemployment rate could reach a staggering level of 85%. This level of unemployment and slowdown in economic activity is unprecedented, even in comparison to other crises, notably the great market crash of 1929. We are engaging in radical surgery in order to make social distancing effective and smother the virus. Even if we are successful in maintaining effective social distancing, the virus will still kill between 11,000 and 22,000 Canadians. We have all seen projections that are even more worrisome. However, we cannot be blinded to the longer-term impacts for our economy and for the livelihood of Canadians. It is on some of these impacts that I want to focus my remarks this evening.
In the face of this global pandemic, every country is facing similar economic challenges, but I believe we need to be frank and acknowledge that some countries will be better prepared than others. Some are also responding to the economic challenges we face better than others.
At a foundational level there is the matter of how well we have positioned ourselves as a country to weather unexpected economic challenges that will inevitably arise from time to time. If one looks at the first half of the previous decade, the government of the day undertook considerable efforts to return the country to a balanced budget situation after the economic shocks of 2008 to 2009. As a result of these efforts, by 2015 the federal budget had been returned to balance. The country was well positioned to prosper and prepare for an economic downturn when and if ever it occurred. Prime Minister Stephen Harper understood that politicians do what is popular, but leaders do what is right.
However, in the second half the decade the current government embarked on a different approach. Instead of making good stewardship of the economy a priority, the government engaged in deliberate deficit spending and acted as though there could never be any bad times again. The result is in the last half decade more than $100 billion has been added to federal debt. In the face of the current crisis, the Parliamentary Budget Officer has calculated that the federal deficit will now reach $184 billion in just the coming year. That level of spending will be three times what was required in the 2009 budget, which responded to a deep recession of 2008 and 2009. However, at that time the federal government was coming off nearly a decade of budget surpluses and proper fiscal management. A decade ago it was much easier to weather the storm, though it was still a significant struggle to return to a balanced budget in the years that followed. Unfortunately, the advantage we had then has been flippantly tossed aside over the past four years.
According to projections, Canada’s federal GDP-to-debt ratio is set to rise to 40% from 30% in just one year. That’s just the federal debt-to-GDP ratio, colleagues. Provinces carry additional debt, which, as noted in recent articles in the Financial Post, is the highest collective debt-to-GDP ratio in the whole world. The subnational governments in this country have unparalleled debt-to-GDP ratios.
Colleagues, I fear that we have simply been too optimistic and too fiscally irresponsible over the past four years. Now the only option we have is to hope for a relatively fast global recovery to pull us out of the current crisis.
Regardless of how the global economic situation plays out, this country is going to face very difficult economic and financial choices in the few years ahead. Much of that will be due to cavalier economic choices. There is nothing that could be done about past bad decisions at this point, colleagues. Unfortunately, however, I’m equally concerned about the aspects of government’s current approach.
To begin with, it’s clear that the government did not react to the crisis quickly enough. On March 18, barely three weeks ago, the government announced a 10% wage subsidy for businesses demonstrating a 30% drop in revenue compared to the same period in the previous year. Most businesses criticized the measure as inadequate given the magnitude of the crisis.
We’ve since learned that the wage subsidy will be quintupled to 75% and that businesses will only have to show a 15% drop in revenue. Such a significant change suggests that the government’s approach to consulting Canadian businesses was sorely inadequate.
There are further problems, colleagues. The program is highly complex. When he testified before the House of Commons Finance Committee just this week, Dan Kelly of the Canadian Federation of Independent Business reported his group is getting 800 calls a day from Canadian businesses seeking to understand the complexities of eligibility requirements for the emergency wage subsidy. Kim Moody of the Canadian Tax Advisory told the committee it will take three to six weeks for Canadian businesses to access funds under the envisioned application process. He said:
Three to six weeks is simply too long — way too long.
And it is, colleagues. Those of us who have been in business know that six weeks is the point at which you go bankrupt or you keep your nose above water.
Similar concerns have been expressed by the Canadian Chamber of Commerce. This suggests completely inadequate consultations with Canadian business groups, colleagues. I’m sorry, but this is something we cannot afford during this crisis. The government cannot do business as they usually have because these are not normal times. It should be working hand in glove with businesses and with a sense of urgency.
There are also increasing indications that the program may have significant gaps. The Canadian Federation of Independent Business has reported that up to 80% of Canada’s small businesses are currently shuttered. That involves a staggering total of 110,000 companies across the country. Some small- and medium-sized enterprises are reportedly struggling to access needed loans. This has given rise to significant concerns that the Business Development Bank of Canada’s lending criteria are just too stringent and that they are favouring medium- to large-sized businesses with already-established positive cash flow. So we are certainly not responding to those most in need. This could risk leaving many small businesses out in the cold, and small businesses are the foundation upon which our Canadian economy functions.
All of this is very concerning and it should be for all of us. The government has claimed that a collaborative approach is a core principle of how it plans to tackle this crisis. However, what we are seeing is not indicative of a collaborative approach.
Some people have suggested that in the middle of this crisis, the government should have additional unfettered powers to act without parliamentarians exercising oversight or questioning its actions.
However, given this government’s tendency to treat our national finances rather cavalierly for years now, given how slow it has been to take action to help Canadian businesses, and given that it appears to be developing policies without worrying too much about transparency or the need for effective consultation, parliamentary oversight is of the utmost importance, honourable colleagues.
Colleagues, there is no question we need to act and pass this legislation urgently. We simply have no choice, but I have some serious concerns. I can only implore the government to recommit to effective engagement and consultation with businesses and other partners in this crisis. What we are facing is not unlike the crisis we’ve experienced during World War II. This time the enemy is different, but the requirement for a truly national and collaborative approach between government and Canadian industry is no less the case now than it was then. Indeed, this time the survival of Canadian businesses and of our national economy depends on the strength of that collaborative approach. I urge the government to recommit itself in this objective in no uncertain terms. I urge Parliament and the Senate to also insist on that in no uncertain terms.
With all of that said, while I credit the government for trying to do its very best — and I do want to make it clear that I don’t believe anyone is not doing likewise and working in good faith — the bottom line is that Canada was not prepared for this pandemic. We weren’t prepared on the financial front and we weren’t prepared on the health front. We allowed our stockpiles of medical equipment to be depleted and we allowed our financial stockpiles to be depleted. This government was warned that all of their spending over the last four years was going to leave us in dire straits when the time came. Here we are, colleagues. Let this be a lesson, a lesson once and for all. We must never ever find ourselves in this position again. Thank you.
Hon. Rosa Galvez: Honourable senators, the passage of Bill C-14, which I support, will likely conclude the immediate rescue phase for the control of the COVID-19 crisis. I commend the government, Parliament and everyone involved for the tremendous work that went into providing critical protection and an emergency safety net for Canadians whose livelihoods have been upended by this pandemic.
As the situation stabilizes over the coming months and we move from rescue to recovery planning, we will need to analyze the underlying causes and pathways that allowed the crisis to reach cataclysmic proportions. Researchers in the public health field are warning us about secondary waves to come and the urgent need to remain alert. We must learn quickly and ensure we develop the right tools to better prepare contingency plans covering health, democracy, education and economy.
It is becoming obvious that we were poorly prepared for this pandemic and the economic fallout that came with addressing it. This crisis exposes our absolute interdependence and the extreme fragility of the globalized hyper-capitalist system. Not only do we depend on overseas production to cover essential health products, but the structural unsustainability of the modern industrial economy has created a domino effect, resulting in a series of crises that we now are facing. For example, greater human encroachment on natural habitats increases contact between wild animals and humans, resulting in increased pandemics but also contributing to climate change. These issues are interconnected, and therefore, solutions must be integrated.
I implore our government and all political parties to work together and design plans based on scientific evidence, long-term vision, inclusivity, economic efficiency and environmental sustainability.
As we look to the future, there will be calls for things to return to normal, and for some that will mean making even more cuts to the minimal environmental protection measures in place in order to make short-term gains.
It would mean ignoring the fact that pollution is an aggravating factor for viruses like COVID-19, that it already kills more people than this virus and that it also contributes to climate change. Pollution is a fundamental cause of many problems, and it is an issue that we cannot continue to ignore. The poor sanitary conditions of workers overseas in the manufacturing production chain are also to blame for this pandemic.
We must recognize that returning to pre-COVID-19 conditions is no longer acceptable. The ground has just shifted under our feet. We stand at a historic moment where we are called to implement dramatic changes. We cannot downplay the immensity of the challenges and tasks ahead. This period will be filled with mourning of loved ones and the pain of having our preconceived ideas shattered and replaced.
But it is also a tremendous opportunity to prepare, to start integrated planning and to embark on a process of adaptation that will leave us more resilient, happier and more connected.
We share a blue dot in space with finite resources. The vulnerable yet invaluable global ecosystems that keep us alive are on the verge of a breakdown. Luckily, there is no end to human creativity, and now it is time to unleash it.
Over the coming weeks and months, we will be able to see if the effort was commensurate to the challenge. We already have worries that some groups, particularly vulnerable people, will fall between the cracks, which over time may need a universal approach to be solved. As earlier today we reached an agreement to enable minimal oversight functions over the emergency measures of our house of sober second thought, I hope we will be able to contribute to ensuring that no Canadian is left behind.
Finally, I hope that regenerative, resilient, circular economies that centre on human and ecosystem well-being will become the new normal. Economy serves humanity and not the other way around. It is time that our macro-indicators reflect well-being and not just a dollar sign.
Safety is not a place we revert to. Safety is a place that we build together. Thank you.
Hon. Marty Deacon: Honourable senators, one month ago, we completed our Senate sitting unsure of what to expect next. In the weeks that have followed, we have witnessed and continue to experience extraordinary and unprecedented times. Canadians have been open, honest, vulnerable and weary in crisis. Almost all of us have seen our lives upended. We have been told to keep our distance from our friends and loved ones. Some have fallen ill with this disease. Some have lost their lives.
Today, while we’re here to support Bill C-14 in this chamber, we are reminded of our work as it relates to the response to COVID-19. As I stand here with a smaller group of senators, I am reminded that we must represent our colleagues who are not present in the chamber with us. We also continue to be supported virtually by an incredible and adaptive staff, to whom I offer a great deal of thanks.
While we are in the midst of a global crisis not experienced in a lifetime, we are also in a role where we are able to provide support during significant disruption. We are accountable to our communities, to supporting our most vulnerable, to directing them to government updates and to finding solutions. I am most thankful for the daily parliamentarian updates and the network of my Senate colleagues of all stripes who have helped us help others.
Losing my first friend to COVID-19 was devastating and a shock. She was healthy, vibrant and larger than life. It is something we will, no doubt, all experience. From that devastation, we also all observe incredible decisions and actions from everyday Canadians who have stepped up to help others. We, of course, show our appreciation to the medical professionals who are dealing with conditions very few of us can begin to empathize with.
But it doesn’t stop there. Our workers at essential businesses deserve our thanks as well. Many of these individuals are young Canadians working part time, making barely more than the minimum wage. They did not sign up for this, but they are showing up nonetheless. They deserve our thanks and our attention to make sure they can cope and deal with what is being asked of them.
As a senator, I am also grateful in this time of crisis for the leadership I see and for the opportunity to listen deeper to the needs in my community and our communities. I thought I understood my community; I did not. From meeting with the local women’s prison officials, to the homeless, to those suffering with mental health, to the food bank, every one of those encounters informs and will inform my thinking and is the lens through which I will view this legislation before us.
Like each of you, I have listened to many Canadians: those most vulnerable; those trying to keep the lights on; those who went from a healthy income and identity to total isolation and no paycheque; those who work in the arts that have completely dried up; those just trying to navigate government websites, links and trying to figure out where they fit; and those who feel they do not fit anywhere. I have a deeper understanding of those falling through the cracks and the opportunity that Parliament has to influence getting things right.
We are all observing significant innovation through rapid change. Virtually, I have seen some great retrofitting and re-visioning locally of new equipment. I am especially proud that the term “innovation” is being respected as something much bigger than technology. It is a way to adapt and help, to keep close to those we love and to help those who need it.
Canadians, young and old, are contributing in their own way. I’d like to read to you two examples of individuals who wrote to me to demonstrate how Canadians of all ages are contributing in any way they can. From Dawn in Ottawa:
Our 7-year-old son, Ollie, has lymphoma and needs a stem cell transplant. Because of COVID-19, we had to use a family half-match donor instead of an anonymous one, so our 11-year-old daughter, Abby, stepped up to do it in the middle of a pandemic. She’s incredibly brave.
From Carol in Hammond, Ontario:
My father fought in World War II. I am 73 years old, and I am fighting in World War III against an enemy called COVID-19. I am doing my part, staying home and physically distancing. Fighting for my country, it’s my turn now.
Senators, our COVID-19 response, support and leadership are here for the long haul. We will get to the other side. We don’t know what that looks like, but we can help shape it. We have time to think about this now and commit to action as we emerge and learn lessons from this crisis, like considering the merits of a guaranteed basic income. Today, as we move Bill C-14 forward to support Canadians in urgent need, we must continue to think and ask ourselves: What will the impact of this global crisis be on the other side, in the chamber, across our country, around the world?
As senators, what are we willing to do differently? How will our priorities shift? In the future, how do we individually and collectively support our front-line workers and those we may have missed in all of this?
I have heard it said that what the government is undertaking is akin to building an airplane in mid-flight. This is new territory for all of us, and trust in government at all levels is crucial if we’re to achieve a best case scenario. That being said, Parliament has a critical role to play.
Both here and in the other place we are asked to bring our knowledge to bear on what is before us. We are here as representatives of all Canadians. It is not our job to step aside, but do our best to find the right solutions in these trying times. Patience is key, mistakes will be made, but working in a collaborative and collegial fashion is our best way out of this. Regardless of what group or caucus you sit in, we are now, more than ever, united at being Canadian, and I know every one of us just wants to help.
Honourable senators, look after yourselves, your families and your communities. I hope each one of us can collectively use this time to make Canadians our number one priority, while improving the agility and adaptability of the Red Chamber in the current crisis. Thank you.
Hon. Pierre J. Dalphond: Honourable senators, before I speak to the important purpose of the bill, I want to commend the efforts of the government, the Minister of Finance and the thousands of public servants who support them in creating and operating the various government programs designed to help Canadians get through a very difficult period, including those who even have to mourn the loss of loved ones.
I also commend the work of the opposition parties in the House of Commons who, on March 25, while supporting the government’s efforts and in a “Team Canada” spirit, put in place checks and balances to allow elected members from all parties to continue exercising their duties in the new technological environment required by the pandemic.
Finally, I want to express my appreciation for the various groups represented here in this chamber who have worked hard over the past few weeks to ensure that the Senate was also able to fulfill its constitutional duty of oversight on behalf of Canadians through two committees that adequately reflect the composition of the Senate.
When a person is appointed to this place, a new senator is born. I must add that all senators are born equal in rights, privileges and duties, wherever they come from, whatever their gender or orientation, irrespective of their political preferences, affiliation with a group or no group.
As I said at the last meeting of CIBA, I believe in equality among all senators. During this period where the House won’t be sitting regularly for a while, it is critical that the composition of our two committees be a good reflection of the composition of this house, because these two committees are going to be the mini-parliament, the mini-house, as we are suspending our work as a full house.
Since these are important measures that are being developed quickly, these two committees will be able to detect any shortcomings in the measures proposed so the government can fix them.
I strongly believe, honourable colleagues, that it would be a dereliction of our duties not to play our complementary role in scrutinizing the federal government’s COVID-19 response, considering the extent of the extraordinary powers that were conferred upon the government to respond to the pandemic. Experience has shown that Senate committees, such as the National Finance and Social Affairs Committees, often question the government on important issues different from those raised by MPs, such as policy details, minority rights, including for those who have no voice, like the black community, those in remote communities, those who are in prison, and regional and territorial concerns.
Of course these committees and their very helpful staff will have to adjust to remote hearings and the new technology, but I am convinced that the Senate is up to the challenge, as is the case in the other place and in so many other parliaments around the world.
I now move to the content of the bill before us today. I have some very technical comments about certain aspects of the bill, which I shared with the Department of Finance earlier this week, and which I will spare you from. They are here if you want to read them.
I would like instead to focus on the policy objective of the bill: to reduce the number of employees being laid off as a consequence of the severe economic consequences of the pandemic. It is not to help companies, it is to look after employees.
Honourable senators, as we all know — it was said by my colleague Senator Housakos before — millions of Canadians are now unemployed and many others are at risk of becoming unemployed. Hopefully this bill will serve to maintain or resume the employment of hundreds of thousands or more Canadians who would find themselves without a paycheque or a job.
When looking at the aim of this bill, I cannot forget what a famous judge from Manitoba, the late Chief Justice Brian Dickson, wrote in a Supreme Court decision rendered in 1987 — I was already a lawyer:
Work is one of the most fundamental aspects in a person’s life, providing the individual with a means of financial support and, as importantly, a contributory role in society. A person’s employment is an essential component of his or her sense of identity, self-worth and emotional well-being. . .
In this difficult period, where employees, like other Canadians, have to endure so much stress at home and in their family, this bill will provide an important relief to many who were recently laid off or on the edge of being laid off. Thus I am proud today to vote in favour of this bill, which not only supports part of our economy, but will also contribute to maintaining the dignity of hundreds of thousands of Canadian workers.
In conclusion, work is a fundamental aspect of a person’s life. It provides a livelihood and contributes to self-esteem and human dignity. This is a difficult period for millions of workers, and this bill will help many of them preserve their dignity, ease their families’ worries and believe that things will get better. Thank you. Meegwetch.
Senator Pate: Honourable senators, I want to rise as well to indicate my support for this bill, and I want to thank all of our colleagues here and at home for their thoughtful and valuable contributions to our discussion.
During this pandemic, COVID-19 has been described as a great equalizer. In fact, it has exposed the results of decades of evisceration of health care and social services systems throughout this country. It has also revealed the historic devaluing of the work of those on the front lines, the low wages, the lack of benefits and the lack of protections for those workers on whom we are now relying, from store clerks, delivery workers, cleaners, garbage collectors, seasonal and gig employees and those — as Senator Miville-Dechêne pointed out — working in long-term care homes as personal support workers, not to mention artists and so many more.
With every passing day it becomes ever more clear that, far from being experienced equally, COVID-19 is exposing and exacerbating inequalities, and taking a disproportionate toll on low-income people, women trying to escape violence, homeless people, those who are racialized — especially Indigenous, Asian, and African-Canadians. The patchwork of measures that we have today still leaves behind far too many.
Honourable senators, we have been invited by the minister to provide advice on how to address the needs of those still not eligible or able to access the resources we are now making available. As senators, we have a particular responsibility to represent the most vulnerable. I look forward to our collective efforts to work to address the gaps that remain.
We must remedy and redress the inequality of access to economic and health measures, and address discrimination based on class, race, ability, geography, and sex exposed by both who is most impacted and vulnerable to COVID-19, as well as who is left out of our response to COVID-19 so far. We know that our responses to COVID-19 could exacerbate the enormous inequalities that this pandemic is exposing, however unintentionally.
Those of us working on these issues invite all of you, here and at home, to join our efforts and work to end the discrimination that is currently experienced by far too many in this country.
I want to end with a special thanks to all of our front-line workers, our colleagues here and at home, the Senate teams that have made this possible today and to everyone everywhere who is working to get through this pandemic.
Meegwetch. Thank you.
The Hon. the Speaker: Are honourable senators ready for the question?
Hon. Senators: Question.
The Hon. the Speaker: Is it your pleasure, honourable senators, to adopt the motion?
Some Hon. Senators: Agreed.
An Hon. Senator: On division.
(Motion agreed to and bill read third time and passed, on division.)
Business of the Senate
Hon. Marc Gold (Government Representative in the Senate): Honourable senators, with leave of the Senate and notwithstanding rule 5-5(j), I move:
That the sitting be suspended to the call of the chair, with the bells to ring for five minutes before the sitting resumes.
The Hon. the Speaker: Is leave granted, honourable senators?
Hon. Senators: Agreed.
The Hon. the Speaker: Accordingly, it is moved by the Honourable Senator Gold, that the sitting — shall I dispense?
Hon. Senators: Dispense.
The Hon. the Speaker: Is it your pleasure, honourable senators, to adopt the motion?
Hon. Senators: Agreed.
(Motion agreed to.)
The Hon. the Speaker: Accordingly the sitting is suspended for the bells for five minutes.
(The sitting of the Senate was suspended.)
(The sitting of the Senate was resumed.)
The Hon. the Speaker informed the Senate that the following communication had been received:
April 11, 2020
I have the honour to inform you that the Right Honourable Julie Payette, Governor General of Canada, signified royal assent by written declaration to the bill listed in the Schedule to this letter on the 11th day of April, 2020, at 9:09 p.m.
Assunta Di Lorenzo
Secretary to the Governor General and Herald Chancellor
The Speaker of the Senate
Bill Assented to Saturday, April 11, 2020:
A second Act respecting certain measures in response to COVID-19 (Bill C-14, Chapter 6, 2020)
Hon. Marc Gold (Government Representative in the Senate): Honourable senators, with leave of the Senate and notwithstanding rule 5-5(g), I move:
That, when the Senate next adjourns after the adoption of this motion, it do stand adjourned until Tuesday, April 21, 2020, at 2 p.m.
The Hon. the Speaker: Is leave granted, honourable senators?
Hon. Senators: Agreed.
The Hon. the Speaker: Is it your pleasure, honourable senators, to adopt the motion?
Hon. Senators: Agreed.
(Motion agreed to.)
Business of the Senate
The Hon. the Speaker: Honourable senators, before calling upon Senator Gold to move the adjournment, honourable senators, I wish to offer my sincere thanks to all those who made it possible for the work of the Senate to continue in spite of these extraordinary circumstances.
I know I speak on behalf of all senators in expressing my profound gratitude for their dedication to our institution and their commitment to the health and safety of all members of the Senate family.
By the same token, we must not overlook the tireless efforts of all front-line health care workers, first responders, public health experts and all those who help keep our supply chain open and safe across Canada, to whom we owe an immense debt of gratitude.
Finally, I would like to thank all honourable senators for their patience and understanding in recent weeks.
This has been a difficult period for all Canadians, and I commend each of you for working in a collaborative, positive and supportive manner. To you and your families, stay safe, keep in good spirits and we will get through this together. Thank you.
(At 9:35 p.m., the Senate was continued until Tuesday, April 21, 2020, at 2 p.m.)