THE STANDING SENATE COMMITTEE ON NATIONAL FINANCE
EVIDENCE
OTTAWA, Tuesday, May 26, 2026
The Standing Senate Committee on National Finance met this day at 9 a.m. [ET] to study the subject matter of Bill C-30, An Act to implement certain provisions of the spring economic update tabled in Parliament on April 28, 2026.
Senator Claude Carignan (Chair) in the chair.
[Translation]
The Chair: I wish to welcome all senators, as well as the viewers across the country who are watching us on sencanada.ca. My name is Claude Carignan, senator from Quebec and chair of the Standing Senate Committee on National Finance.
Now, I would like to ask my colleagues to introduce themselves.
Senator Forest: Good morning and welcome. Éric Forest, independent senator from the Gulf division in Quebec.
[English]
Senator Pupatello: Good morning. Sandra Pupatello, Ontario.
[Translation]
Senator Gignac: Good morning. Clément Gignac from Quebec.
Senator Oudar: Welcome. Manuelle Oudar from Quebec.
Senator Galvez: Good morning. Rosa Galvez from Quebec.
Senator Cardozo: Good morning. Andrew Cardozo from Ontario.
[English]
Senator Robinson: Hello and good morning. Mary Robinson, representing Prince Edward Island.
Senator Ross: Good morning. Krista Ross, New Brunswick.
Senator MacAdam: Jane MacAdam, Prince Edward Island.
[Translation]
Senator Hébert: Martine Hébert from Quebec.
[English]
The Chair: Welcome to Senator Robinson, a new member of this committee. She will be a very positive addition.
[Translation]
Today we begin our study on the subject matter of Bill C-30, An Act to implement certain provisions of the spring economic update tabled in Parliament on April 28, 2026.
For our first panel today, we are pleased to welcome our friends from the Department of Finance: Mark Maxson, Senior Director, Employment and Education Taxation; Gervais Coulombe, Director General (Legislation), Sales Tax Division; and Galen Countryman, Director General, Federal-Provincial Relations Division, Economic, Fiscal and Intergovernmental Policy Branch.
Welcome and thank you very much for accepting our invitation to appear today. I understand that Mr. Coulombe has a short introduction to make, and then we will proceed with the question period until 10 a.m.
Gervais Coulombe, Director General (Legislation), Sales Tax Division, Department of Finance Canada: Thank you.
I will provide an overview of the measures for which the Department of Finance officials are here this morning.
As you said, an economic update was tabled on April 28, 2026.
[English]
Part 1 of the bill implements a number of income tax measures, including changes to the Labour Mobility Deduction, measures to support employee ownership, adjustments to the Home Buyers’ Plan and targeted investment incentives.
[Translation]
Part 2 implements excise measures, including the temporary suspension of excise taxes on certain fuels, as well as extensions to existing relief for the alcohol sector.
[English]
We are also joined by Finance colleagues who can support the committee’s review of Divisions 1, 2, 3 and 5 of Part 3, which include amendments to statutes such as the Bank Act, the Bank of Canada Act, the Canadian Payments Act and the Canada Pension Plan.
[Translation]
We would be pleased to answer any questions you may have.
Thank you for having us.
The Chair: Thank you very much.
Senator Forest: Welcome.
My first question is about the support measures for microbreweries. We had long wondered about the two-year extension of the 2% cap on the annual inflation adjustment of alcohol excise duty and the 50% reduction in excise duty rates on the first 15,000 hectolitres.
What is the rationale for renewing this temporary measure rather than establishing a predictable and reasonable one? This could provide greater certainty to investors in this industry, who have been vulnerable in recent years, not only due to the dynamics of supply and demand, but also because of the intense competition in this sector. It’s an important sector in Canada’s tourism profile, and particularly for Quebec.
Mr. Coulombe: Thank you for the question.
I’ll start with the 2% cap on inflation adjustments. We must remember that in a normal environment, the Bank of Canada’s inflation range is 2% to 3%. There have been years of very high inflation in the past. The government is trying to maintain a certain degree of stability. However, should the measure become permanent or not? These are matters of government policy.
The two-year extension of the inflation adjustment was announced on April 1. For example, next year, if inflation were higher than 2%, it would still be 2%. The reduced rates for microbreweries are part of a measure introduced in 2024 for a two-year period. Again, it’s a government policy decision to extend it again for another two years.
That said, there are permanent reduced rates that apply to the first 75,000 hectolitres brewed in Canada by a Canadian brewer. Those rates have been in place since 2006, I believe. They remain permanent. It is only for the first three tiers, between zero and 2,000 hectolitres, between 2,000 and 5,000 hectolitres, and between 5,000 and 15,000 hectolitres, that an additional 50% reduction is granted for another two years.
Senator Forest: In this context, if the measure were to become permanent, could that help with predictability and the development of this sector?
Mr. Coulombe: Once again, these are political issues. I can’t comment on hypotheticals. What we have here is a temporary extension measure.
Senator Forest: I was referring to your extensive experience to educate politicians.
My second question is about the provisions to support greenhouse production. Are we targeting only greenhouses for growing fruits and vegetables? Are flower or cannabis producers affected by these measures?
Mr. Coulombe: My colleague Shane Baddeley will come to the table for that question.
Shane Baddeley, Director, Economic Development, Business Income Tax Division, Department of Finance Canada: Thank you for the question. I will answer in English so that I can give a precise answer.
[English]
The immediate expensing measure for greenhouses applies to all greenhouses, regardless of what is grown inside, whether it be food, flowers or any greenhouse it applies to.
[Translation]
Senator Forest: So any greenhouse production is eligible for these measures?
Mr. Baddeley: Yes.
Senator Forest: Okay.
[English]
Senator Cardozo: I have two questions; I will pose both of them at the same time. The first question is on the Labour Mobility Deduction, and the second is on extending the Home Buyers’ Plan.
On the Labour Mobility Deduction, it is an interesting issue that has had a long history. It started with the NDP putting forward private members’ bills that the other two parties rejected. Then the Liberals picked it up, but the Conservatives were still against it. Then the Conservatives were for it, so now everybody is for it, which is great.
There was a private member’s bill in the last Parliament that extended the amount from $4,000 to an unspecified amount, which I think didn’t pass in the end; you can correct me if that’s the case. But now you’re limiting it to $10,000, which is up from $4,000. But you’re reducing the distance threshold from 150 kilometres to 120 kilometres. My question is: Could you just explain those two figures?
The other question is on the Home Buyers’ Plan. The idea was to make it easier for people to buy a home. In extending this further, did you look at the success of what you have done so far? This might sound a bit wrong, but are you sure you didn’t make it too easy in the sense that you encouraged people to buy a home who could not afford it long term?
Mark Maxson, Senior Director, Employment and Education Taxation, Department of Finance Canada: Thank you for the question. I can speak to the Labour Mobility Deduction, and one of my colleagues will join us for the second question.
You have the history correct. There was a private member’s bill in the prior Parliament. It was not passed before the election. It would have, actually, introduced a second, parallel deduction with no limit and a 120-kilometre threshold for relocations.
As you said, this proposal would increase the maximum expenditure from $4,000 to $10,000, so that’s the amount that an individual can spend and deduct in a particular year in respect of all their relocations. The distance threshold effectively says that you need to be taking up temporary lodging somewhere that is at least 120 kilometres closer to the work site than your current dwelling.
Senator Cardozo: It is more generous?
Mr. Maxson: It is more generous; that’s right.
Senator Cardozo: But why the $10,000 limit as opposed to unlimited?
Mr. Maxson: That is, ultimately, a policy question, but it is not unusual to have some kind of limit on expenditures, just from a compliance perspective. This is a relatively new deduction.
What we saw with the $4,000 limit was that about 40% of claimants were hitting that cap. We think that at the $10,000 cap, it should be considerably lower, but for now, that is where the government has set that limit.
Senator Cardozo: And what about the Home Buyers’ Plan?
Mark Walsh, Senior Director, Savings and Investment, Department of Finance Canada: Thank you very much for your question.
The purpose of the Home Buyers’ Plan extension of the grace period to repay is that the government recognizes that many Canadians who have recently purchased their first home or who wish to purchase their first home continue to face affordability challenges and could benefit from cash flow support.
The proposed measure will provide cash flow relief of up to $4,000 per individual per year for the three years over which they are not required to repay the amount into their Registered Retirement Savings Plan, or RRSP.
Senator Cardozo: Do you know that it is a reasonable level or a safe level so that people are not buying homes who cannot afford them long term?
Mr. Walsh: Again, the idea is to ensure that Canadians who want to purchase their first home have cash flow support to be able to do so, and that is the objective.
Senator Cardozo: Thank you.
Senator Ross: I’m interested in hearing a bit about the capital gains tax exemption for the sale of a business to employee ownership trusts, or EOTs, or worker co-ops.
First of all, I’m wondering: When revenue is received over several years, if there is a vendor take-back, how does that work? They can be 10 years for the claim but 15 years for the vendor take-back.
I’m also wondering if there are any issues with this change for intergenerational family transfers that would be different than an EOT.
And for my last question, are you hearing anything from tech companies that rely on equity shares or stock compensation about if there are issues with the tie-up of funds with the vendor take-back?
Mr. Walsh: Thank you for the question.
With respect to the exemption for employee ownership trusts and making the exemption permanent, as announced in the statement, the objective there is to ensure that employee owners can become owners in their business. The Department of Finance Canada has undertaken an analysis to look at those issues.
I can get back to you with respect to your question about the tech companies, but we have not heard anything. I would have to take that back for consideration.
Senator Ross: I wonder if you have heard anything from smaller companies that might be interested in this type of transfer, especially those where there are no family members who are interested but rather a small company. Are they finding it is too complex to participate, or are there ways in which they can participate easily and take advantage of this opportunity?
Mr. Walsh: The intention, certainly, is to ensure that small businesses and families have the opportunity to avail themselves of the exemption. Yes, I would have to take the rest back.
Senator Ross: What size of company would it be mostly targeted toward in terms of the number of employees or volume?
Mr. Walsh: The exemption is $10 million, so you are talking about a business sale that would yield a capital gain of $10 million. Regarding the exact size of the businesses that we are targeting, I would have to take that back and get further information on that for you.
Senator Ross: Thank you.
[Translation]
Senator Oudar: Welcome to all of you.
I’m specifically interested in the Canadian Payments Act. I see that there’s a provision in the act regarding the civil liability of directors, which is somewhat unusual in our body of legislation. Directors, other individuals, and so on, are exempt from any civil liability. Why is it necessary to include this immunity clause in the act?
Nicolas Marion, Senior Director, Payments Policy, Financial Services Division, Department of Finance Canada: Thank you for the question, senator.
I’m Nicolas Marion, Senior Director, Payments Policy.
Payments Canada is a unique entity. There are no other entities that carry out the activities it does in Canada. It oversees national payment systems. It is established under the Canadian Payments Act, it is a non-profit organization, and it is a public policy entity. All of its expenses must be covered by its members.
The government’s goal of increasing competition and innovation in the payments sector could result in potential members of Payments Canada deciding not to become members if they are concerned about their civil liability. Therefore, this provision provides a certain degree of civil immunity to the association, its employees and its administration. That said, Payments Canada members remain liable, and the immunity measure does not cover its members as such.
Senator Oudar: This civil immunity would mean that these individuals could not be sued by someone who has suffered harm as a result of a wrongful act. What are the consequences for the other parties to a contract of no longer having any recourse? This is, after all, significant. It prevents people from being sued, and it prevents people who allegedly suffered harm from being compensated. Could you explain to us why this provision exists? Could you also tell me if there are currently any legal actions pending in court?
Mr. Marion: Thank you again for your follow-up.
If it acts in good faith, Payments Canada would indeed have civil immunity. That said, this immunity would not apply to contracts. There is therefore an exclusion within the provision regarding contracts.
Specific issues may arise. In any case, users’ use of Payments Canada payment services is facilitated through its members. We would therefore observe that an entity or an individual could sue a Payments Canada member if there was an issue with a payment or other matter. That would still remain in place. The immunity would not be extended to members as such, but would actually apply to Payments Canada.
Senator Oudar: Since this clause is quite clear, the court should rule that individuals cannot be compensated. In addition to the contractual liability included in the act for all other sectors, this would create immunity and prevent individuals from obtaining compensation in court.
Mr. Marion: To clarify, immunity does not extend to contractual arrangements.
Senator Oudar: Yes, that is indeed provided for in the act.
Senator Hébert: My question is about the labour mobility amendments.
Were these amendments determined following consultations with the industry? This is intended to meet the needs that will arise in the construction sector. Could you tell us how these measures were determined?
[English]
Mr. Maxson: Thank you for the question. The parameters of the enhancement to the deduction are consistent with recommendations made by Canada’s Building Trades Unions in a pre-budget submission prior to Budget 2025, and there has been quite a lot of discussion in the public sphere around it over the past number of years, so it’s based primarily on that.
[Translation]
Senator Hébert: Is there an estimate of how many positions this will help fill in relation to the shortages identified so far and those expected in the construction sector?
[English]
Mr. Maxson: In 2023, which is the last full year of data that we have for the deduction, there were around 2,500 workers who claimed the deduction. Our expectation is that the increase to the limit should not likely change the number of claimants. It will allow claimants to claim more. The change to the distance threshold could increase the opportunities to claim the deduction, but we don’t expect a large increase in the number of claimants overall.
[Translation]
Senator Hébert: I understand, then, that this will help, but that it’s not a miracle cure for meeting future needs in the construction sector. Thank you.
[English]
Senator Robinson: I’m looking at the eligible greenhouse component of this. The definition of “eligible greenhouse” in amended subsection 1104(2) is based on the capital cost allowance, or CCA, class and acquisition date. My question is specific to Atlantic Canadian producers expanding existing operations. Can you confirm that each addition or alteration to an existing greenhouse is treated as a separate eligible property under proposed subsection 1102(27) and that a producer whose structure was under construction on November 4, 2025, can elect to bring pre-November costs into the eligible pool under proposed subsection 1102(28)?
Mr. Baddeley: Yes, that’s correct.
Senator Robinson: Thank you. The 100% deduction rate applies to greenhouses that become available for use before 2030, stepping down to 75% in 2030-31, then to 55% for 2032-33, then to 0%. In agriculture, construction timelines are vulnerable to supply chain delays and permitting backlogs. Is “available for use” administered strictly to the calendar date, or does the Department of Finance Canada have a relief mechanism for producers who proceed in good faith but face circumstances beyond their control?
Mr. Baddeley: Ultimately, that’s a question for the CRA on administration, but “available for use” is defined in legislation. There is not necessarily a recourse if construction times lag. The timeline and the temporary treatment of this align with other immediate expensing measures and capital cost allowances elsewhere in the act, including the productivity super-deduction. So it is just aligning with that.
Senator Robinson: I’m new to this committee.
I want to talk a little about the fuel excise tax suspension. The suspension covers diesel fuel set to zero cents from April 20 to September 7. For agricultural producers in Atlantic Canada, diesel is a primary input for tractors, irrigation and grain drying. Does the zero rate apply equally to dyed diesel purchased for on-farm use or only to diesel sold at retail motor vehicle pumps?
Nina Gormanns, Director, Excise Policy, Department of Finance Canada: Thank you for the question. From a federal perspective, there is no such concept as dyed fuel, so it would apply equally to all diesel fuel.
Senator Robinson: In P.E.I. and in Atlantic Canada, peak agricultural diesel consumption falls during the potato harvest in late September through October. The suspension expires on September 7. Was Agriculture and Agri-Food Canada consulted on whether the window captures the full production calendar for Atlantic Canada, or was it calibrated to a national or central Canadian model?
Ms. Gormanns: Ultimately, the date chosen for the end of the suspension was a political decision. Since tax policy is under the purview of the Minister of Finance and the Prime Minister, the policy was developed by the Department of Finance.
Senator Robinson: Thank you.
[Translation]
Senator Galvez: Thank you very much for being here today.
My questions will focus on exemption taxes.
[English]
It’s the federal fuel excise tax that is eliminated on gasoline and diesel. In the Spring Economic Update, you expanded the tax incentive for carbon capture, utilization and storage, or CCUS.
To me, it looks a little like it is one against the other. For the first one, the federal fuel excise tax on gasoline and diesel would for sure have an impact on increasing emissions. I would like to have the numbers saying how this is going to affect the increase in emissions due to this excise tax. But on the other hand, we have the expansion of the tax incentive for CCUS. In the news, we read that one of the companies that has been retained to develop this is Bison Low Carbon Ventures.
[Translation]
They believe that, for now, CCUS is just a concept. It’s not really an industry or even a sector.
[English]
What are the reporting requirements that justify that this is going to attain whatever goal has been set?
Ms. Gormanns: I can speak to the first question about the greenhouse gas emissions impact of the fuel excise tax suspension. Generally, the consumption of fuel is fairly inelastic in the short term, meaning people do not usually change their behaviour very much, so we would not expect any significant impact on emissions. There is also the consideration whether due to higher prices, people possibly reduce their consumption, but again, ultimately I think the impact on emissions is negligible.
Senator Galvez: Do you have the numbers for that? Can you send it to the committee?
Ms. Gormanns: We didn’t do any greenhouse gas emissions modelling. But this is generally what we do see with fuel consumption.
Senator Galvez: What about CCUS?
Mr. Coulombe: I don’t see any colleagues coming to the table, so that kind of makes me think this is not a measure that is part of Bill C-30. We can take it back and see if it is possible, but at first blush, this is not part of the bill we are studying today.
[Translation]
Senator Gignac: I will continue with a question for Ms. Gormanns.
You’re probably right: Consumption doesn’t fluctuate much and is independent of price changes. However, the profit margins of refiners and oil companies can fluctuate. Do you have any studies showing how effective the measure is? With price volatility, people realized fairly quickly that, despite the drop, prices at the pump went back up.
In the past, when governments have used this type of temporary discount, have you observed changes in oil companies’ profit margins? Were any studies done beforehand? Have you made any recommendations to the minister regarding the appropriateness of using such a measure?
Ms. Gormanns: Thank you for the question.
We’ve seen that excise tax relief has lowered prices. However, prices depend on several factors, including margins, as you mentioned. This is something our department is studying and monitoring. However, we would need to consult colleagues from another department.
Senator Gignac: In the weeks following the end of the period, namely September 7, I’d like the Department of Finance to tell us whether it observed an increase in oil companies’ profit margins during the period when this discount was in effect. In the past, we have seen increases in profit margins when governments temporarily reduced gasoline taxes.
The Chair: That’s what we’re also hearing from analysts right now.
Senator Gignac: That’s what we’re seeing.
I would like to go back to a topic discussed earlier, namely the Canadian Payments Act.
Could you go back to that, Mr. Marion?
The Canadian Payments Association has been around since 1980. In 2025, it expanded its membership. Was this a request from the association? Without this expansion, do you believe this request would have been made to you?
Mr. Marion: Thank you for the question, senator.
Indeed, this is a request from Payments Canada, some of its members and its stakeholder committee, which includes payment service providers, consumer groups and other non-member stakeholder groups involved in payments.
We reviewed the request. Indeed, following the expansion of membership rights to Payments Canada, the government determined that, for public policy purposes, this provision would be well aligned with its goal of increasing competition and innovation. Above all, this encourages payment service providers to join Payments Canada and, eventually, to allow access to their payment system.
Senator Gignac: Was it mainly payment service providers who made this request to you? Financial institutions have been around since 1980, so they didn’t see any issues?
Mr. Marion: There have been requests from several stakeholders, including Payments Canada, some of its members, and various stakeholders.
Senator Gignac: Thank you, Mr. Marion.
[English]
Senator MacAdam: Most of my questions have already been asked. I do have one with regard to improving the interaction of the Electric Vehicle Affordability Program with existing tax rules. I understand this is consistent with the tax treatment under the former Incentives for Zero-Emission Vehicles Program. I am just wondering if you could elaborate on the tax treatment first and also whether you could explain if there are any differences between the eligibility rules under these two programs.
Lauchlin MacEachern, Acting Director General, Legislation, Department of Finance Canada: The old Incentives for Zero-Emission Vehicles, or iZEV, Program expired at the end of 2025, and the way that the Income Tax Act rules interacted with the iZEV Program is that the act provides immediate expensing — a full writeoff — for zero-emission vehicles. However, that immediate expensing does not apply if a taxpayer — and this would be a business that is using the vehicle in a business — has already claimed a rebate under the old iZEV Program. The same principle would continue to apply under the new Electric Vehicle Affordability Program, or EVAP. Taxpayers and businesses could decide whether to claim immediate expensing on their zero-emission vehicles, or they could decide whether to claim the rebate under the EVAP.
My understanding is that the EVAP is a more targeted program than the old iZEV Program, but ultimately, it’s up to the taxpayer to decide which is more advantageous for them. Smaller taxpayers or those who don’t have taxable income may prefer the rebate over the immediate expensing claim, even though, generally, the immediate expensing claim would tend to provide a greater benefit if the taxpayer has sufficient taxable income.
Senator MacAdam: With regard to eligibility for both of those programs, are the rules similar?
Mr. MacEachern: I’m only responsible for the income tax rules. I wouldn’t be the best person to answer the question on the EVAP and the former iZEV Program.
[Translation]
The Chair: I have a question about the labour mobility deduction. I understood that there won’t necessarily be more people applying for it, and that it won’t lead to an increase in the number of workers. So why are we doing this? Isn’t the objective to change people’s behaviour and then encourage it?
[English]
Mr. Maxson: There are two changes in question. One is to increase the maximum amount that can be claimed, so people who are already claiming $4,000 but had higher expenses can claim more. The other change is to reduce the distance threshold from 150 kilometres to 120 kilometres, but the deduction is designed for relocations rather than ordinary commuting, so it already requires a job that is at least 36 hours and requires temporary lodging. So we don’t believe that the change from 150 kilometres to 120 kilometres will have a large impact on the number of people taking up the deduction, but that’s something that we’ll see. It will make things a little bit easier for some people.
[Translation]
The Chair: What’s the status of discussions on interprovincial barriers, particularly regarding labour mobility and the recognition of credentials? We can increase the deduction, but it’s pointless if people can’t go to work because there’s a barrier related to certification. I understand that this mainly affects construction workers. We can keep increasing the deduction indefinitely, but we won’t improve the system if people can’t go work elsewhere because their credentials won’t be recognized.
[English]
Mr. Maxson: Certainly, the government is doing a lot of work on interprovincial mobility of workers, including recognition of credentials. My expertise is in the tax policy space. I can’t really speak in detail to that subject.
[Translation]
The Chair: Aren’t you in discussions with the regulatory body to ensure coordination between fiscal and legislative measures to bring about positive change?
[English]
Mr. Maxson: There is mutual awareness, and to the extent that interprovincial mobility becomes easier in the regulatory space, then we’re able to facilitate that on the tax side. But I don’t know that it’s necessarily a coordinated process.
Senator Pupatello: I have a question. This is on the Home Buyers’ Plan and the ability to use an RRSP for a down payment and then the repayment of that. Can you give me the rationale for the use of the RRSP pot, if you will, for individuals versus some kind of expansion or extension of a tax-free savings account, or TFSA, since that is specifically for retirement purposes? You’re giving them more time to pay it back, but for people who are investing those funds or whatever, they’re also losing in that retirement fund for the time being as well.
I’m wondering about the rationale for using that vehicle to allow people to find the down payment amount, and then clarify that anyone who owns a home today is not eligible for this. You would have to have been out of a home for four years before you are then eligible. You could have owned a home but now you’re a renter, for example. Then you can access this benefit?
Mr. Walsh: Thank you very much for the question. In response to the second question, that is correct, yes.
In terms of the question about the use of an RRSP and the ability to withdraw from an RRSP to put toward the purchase of a new home, the objective is to ensure there is an ability of the prospective homebuyer to draw from funds to be able to put toward their down payment on their home in order to facilitate the purchase.
There are other vehicles as well that a prospective homebuyer can draw from for the purchase of a new home. For example, the First Home Savings Account is a relatively new product that is also available to prospective homebuyers to use for the purchase of their new home.
Senator Pupatello: I just wonder: Was it advanced to you from some group that the RRSP fund is the best vehicle for this purpose? Is there a consumer group that proposed that? Was that something we thought of internally?
Mr. Walsh: I’m not aware of a specific proposal in regard to that.
Senator Pupatello: Thank you.
The Chair: Thank you.
[Translation]
Senator Forest: Regarding the tax exemption for employee ownership trusts, I understand that this extends the temporary measure that’s been in place since 2023. Do you have data indicating how many business transfers have benefited from this measure in the past?
Mr. Walsh: Thank you very much for the question.
I can look into it and get back to you. We know there have been three or four transactions over the past two years. In terms of transactions that will be facilitated by the deduction, we’ll need to verify that information. I will send you all that.
Senator Forest: If we want to extend the measure, I believe it would be a good idea to assess what impact it’s had on business transfers. So there was no assessment before extending the measure? If you can send us the information, that would give us an indication of the relevance and impact of the exemptions.
Mr. Walsh: Certainly.
[English]
Senator Robinson: Looking at the temporary immediate expensing for eligible greenhouse buildings — I’ll pause for a second so that the right people can be here.
Given that the Spring Economic Update 2026 stated that the objective of immediate expensing for greenhouses is to supercharge food production, has the government conducted an analysis of the food production gap? If so, what are its projections regarding the impact of this measure on that gap?
Mr. Baddeley: Thank you for the question. I’m really only here today to be able to speak to the tax measure specifically. The government has announced multiple measures to promote food security and food affordability, which are all meant to address that gap, but I don’t have any further information to share in terms of what that gap specifically is or how this measure specifically — given all the other measures in play and the multiple factors that contribute to closing that gap — may be attributed to the specific measure.
Senator Robinson: Thank you.
Senator Galvez: The government has announced the creation of the Canada Strong Fund, which is set out in the Spring Economic Update as a new sovereign wealth fund to mobilize capital for strategic investment.
My first question is: From where will the funds come in order to do this sovereign wealth fund? And how will the fund incorporate climate-related financial risk, biodiversity considerations and taxonomy-aligned sustainable finance criteria into the investment decision making?
Galen Countryman, Director General, Federal-Provincial Relations Division, Economic, Fiscal and Intergovernmental Policy Branch, Department of Finance Canada: Thank you for the question, senator. There is nothing in Bill C-30 regarding the Canada Strong Fund, so there are no officials here who can respond to that question today.
Senator Galvez: You don’t have people here, but can you send the information later to the —
Mr. Countryman: We can take the question back and see if we can have a response.
Senator Galvez: Please do. Thank you.
The Chair: Any other questions? No? It’s easy today.
[Translation]
Thank you.
Welcome to our second panel this morning.
From Employment and Social Development Canada, we welcome Mona Nandy, Director General, Employment Insurance Policy Directorate; and Francis Nolan-Poupart, Director, Employment Insurance Policy Directorate.
From Transport Canada, we welcome Jennifer Little, Director General, Air Policy. From Health Canada, we have Matt Jones, Assistant Deputy Minister, Healthy Environments and Consumer Safety Branch; and Shannon Laforce, Director General, Pesticides Regulatory Directorate, Health Environments and Consumer Safety Branch.
Lastly, from the Canadian Food Inspection Agency, we have Debbie Beresford-Green, Vice President, Food Safety and Science.
Welcome to all of you.
The floor is yours, Ms. Nandy.
[English]
Mona Nandy, Director General, Employment Insurance Policy Directorate, Employment and Social Development Canada: Good morning, senators. It’s a pleasure to be here today. I’m joined by my colleague Francis Nolan-Poupart who is the Director of Regular and Fishing Benefits on my team. We are both pleased to be here today to speak to you about the proposed amendments to the Employment Insurance Act in Division 4 of Part 3 of Bill C-30 and to answer any questions you may have on the proposed amendments.
Division 4 of Part 3 of the bill would amend the Employment Insurance Act by extending until October 2028 the current temporary legislated measure that provides up to five additional weeks of Employment Insurance, or EI, regular benefits to workers in seasonal industries in 13 targeted regions in Atlantic Canada, Quebec and the Yukon.
The current seasonal measure is set to end on October 24, 2026, so the two-year extension would help seasonal workers avoid income gaps between work seasons. The proposed amendments would additionally maintain an exception clause in the Employment Insurance Act that ensures that seasonal workers with claiming patterns that may have been disrupted by the COVID-19 pandemic can continue to benefit from additional weeks of EI income support.
This exception would remain in effect until November 7, 2027, after which COVID-19 EI temporary measures would no longer have an impact on claiming patterns for seasonal claimants.
Finally, Division 4 amendments would also support the list of 13 targeted regions for this seasonal measure to remain in the Employment Insurance Act until the Governor-in-Council makes an order providing the regions be prescribed by regulation instead of by statute, preserving the coherence of the Employment Insurance Act.
This concludes my overview of the bill for Division 4 of Part 3. We are available for questions.
The Chair: Thank you.
Jennifer Little, Director General, Air Policy, Transport Canada: Good morning, senators.
[Translation]
My name is Jennifer Little, and I am the Director General of Air Policy at Transport Canada.
[English]
Thank you for inviting me here this morning to provide an overview of the airport information provision, which is set out in Division 6 of Part 3 of Bill C-30.
[Translation]
Airports play a key role in ensuring that people, businesses and communities across Canada stay connected.
[English]
Canadians rely on air travel to access critical services and business opportunities, visit loved ones and support supply chains, trade and tourism.
Canada’s airports are operated through several different models. Most of the large airports in Canada are National Airports System, or NAS, airports. These are operated on federal land through long-term ground leases by private, not-for-profit, non-share capital corporations called airport authorities. Most of the other airports are owned and operated by other levels of government.
As announced in the Spring Economic Update, the government is examining how to unlock the full value of Canada’s airports in support of investments in Canada’s long-term growth. In order to understand the potential value, detailed data-based analysis is required. At present, airport authorities are not required to provide detailed financial information to the federal government.
While we work very closely with airports, of course, to obtain relevant information, there are gaps and limitations with respect to what information we can collect. Bill C-30 proposes a measure that will close this gap.
Under the new rule, the Minister of Transport would be able to require people and businesses whose activities could affect airport value — such as airport owners, operators and others, including airport subtenants — to provide any information necessary to support transportation policy development.
The department will continue to work very closely, of course, with airport authorities and other air sector stakeholders to gather information voluntarily, with this new authority intended as a backstop. This will ensure that the government will have the data it needs to develop evidence-based transportation policy, assess airport value and evaluate system capacity.
It will provide the government with the means to identify new opportunities for economic development on airport lands and to properly assess different airport ownership models.
[Translation]
More broadly, this measure will also position the Government of Canada to advance policy development in other areas, such as improving air travel affordability and service quality, expanding regional connectivity and responding effectively to operational challenges.
[English]
This measure reflects the government’s commitment to supporting Canada’s airports as key economic enablers, and this provision will help to ensure that decision makers can access and consider all relevant data and information when making policy decisions.
Thank you. I am happy to take your questions.
[Translation]
Matt Jones, Assistant Deputy Minister, Healthy Environments and Consumer Safety Branch, Health Canada: Thank you, Mr. Chair. I am pleased to be here with you this morning.
[English]
I am here to speak to the amendments to the Pest Control Products Act. The amendments contained in this bill are intended to help protect Canada’s economy and food security, including by enhancing flexibility in the face of emerging pressures on Canada’s agriculture sector, while continuing to uphold the government’s primary objective of protecting human health and the environment.
The proposed amendments would do two main things: First, they would expand the current mandate of the act to incorporate consideration of national or regional economic security and food security.
I want to be clear that this proposed amendment does not affect the minister’s primary objective of protecting human health and the environment.
Second, the bill introduces two new Governor-in-Council powers intended for use in exceptional circumstances. These powers could allow the temporary use of certain pesticides under specific conditions, where necessary, to protect the Canadian economy and food security, such as in the case of a major crop failure or a significant supply disruption.
Specifically, the Governor-in-Council would be able to temporarily register a pest control product to control a seriously detrimental infestation or allow a registered product to remain on the market to avoid significant disruption.
The amendments would not change the fundamental requirement that human health risks must always remain acceptable.
Further, orders would be time-limited and must be issued within one year of a relevant ministerial decision where the minister did not consider the environmental risks to be acceptable and could set out any conditions considered necessary.
Overall, the proposed amendments are expected to create a more responsive framework that better supports economic growth and better protects Canadian economic security and food security.
[Translation]
Thank you, Mr. Chair.
The Chair: Thank you.
Debbie Beresford-Green, Vice-President, Food Safety and Science, Canadian Food Inspection Agency: Good morning. Thank you, Mr. Chair.
[English]
Thank you for the opportunity to appear before you today to discuss the proposed amendments to the Canadian Food Inspection Agency Act in Bill C-30.
The Canadian Food Inspection Agency, or CFIA, is Canada’s largest science-based regulator with a dual mandate to protect health and safety and enable trade. Protecting health and safety remains the CFIA’s core priority.
The proposed amendments would not change existing health and safety requirements or lower Canada’s science-based standards. Setting clear rules and using our policy and enforcement tool kit allows the CFIA to take timely and risk-based approaches to protect Canada from the highest risks.
While trade and commerce were already in the preamble of the Canadian Food Inspection Agency Act, what these amendments would do is clarify that alongside its core responsibility to protect health and safety, the CFIA should also consider broader economic and food security impacts in carrying out its mandate.
The amendments would also introduce a limited, time-bound authority that could be used in exceptional circumstances involving serious risks to domestic economic or food security, such as significant supply disruptions or shortages.
An exemption would be issued by the Governor-in-Council, on the minister’s recommendation, only if it does not pose unreasonable risks to health, safety or the environment and is necessary to address serious risks to economic or food security.
This authority is intended for exceptional situations involving broad systemic disruptions. It is not intended to weaken Canada’s regulatory system or reduce oversight.
These amendments would help ensure that the CFIA can continue protecting health and safety while responding effectively to the economic and food security challenges affecting Canadians, producers, processors and supply chains.
Thank you. I would be pleased to take any questions.
[Translation]
The Chair: Thank you.
Senator Forest: Thank you for being here. These are very important issues for all regions of Canada.
My first question is about employment insurance. I note that the flexibilities for seasonal workers, initially framed as temporary, are being extended. It is clear that this temporary measure is moving toward becoming permanent.
I’ve lost count of how many times these measures have been extended on a so-called temporary basis.
One day, we will have to admit that the regular program is not adapted to the reality of workers and seasonal industries. It is time to stop governing by pilot projects and finally tackle genuine reform.
In fact, we’ve been undertaking a major review of our employment insurance program for a long time. Is the project moving forward? Will we eventually realize that the reality of seasonal workers is not a temporary reality, but a permanent one?
Ms. Nandy: Thank you for the question.
[English]
We acknowledge that this is a two-year extension of the current temporary seasonal measure that is in the act. The government recognizes that seasonal workers are an important and integral part of Canada’s economy, and many of them rely on EI benefits for the support that they need in between work seasons.
This current measure is reflective of a pilot project that was first introduced in 2018. Subsequently, that project ended in 2021. Budget 2021 made, effectively, the same rules a temporary measure. It implemented it in the Employment Insurance Act, recognizing that these continued supports for seasonal workers are very important for them to maintain financial stability and remain in their rural and remote communities. Hence, that is the reason why the government has announced that it is proposing a further extension of the current measure for an additional two years.
[Translation]
Senator Forest: In 2018, we instituted these temporary measures while knowing that we were in the process of overhauling the program. Has the review been abandoned? Eight years have passed since 2018. Is it still ongoing? Do we need help to introduce an employment insurance program that is adapted to today’s reality? What is the status of the review of the EI program?
[English]
Ms. Nandy: Again, thank you for the excellent question, senator. On the review, as you mentioned, there were extensive consultations done by the government in 2021 and 2022. There was significant outreach done at the national and regional levels, including with seasonal workers and seasonal employers. That continues to inform the government’s work on modernizing the EI program. That work is continuing. It has been reflected not only by the fact that this measure is being continued and is proposed to be extended, but also by the other measures that have been taken and announced by the government in recent years, including the extension of EI sickness benefits and, more recently, the introduction of the EI adoption benefit and the legislative changes, as well as the EI tariff measures more recently.
The modernization work of the program continues, and it is the government’s view that it is important to continue to simplify and improve the program to reflect current labour market realities at such time as we are living in the current labour market context.
The current policy direction is to extend this measure while that work on modernization continues.
[Translation]
Senator Forest: I see that there is a slow rush to review the program.
[English]
Senator Ross: My question is for Ms. Little.
I’m reading here that the government is committed to reforming Canada’s airports system to lower air passenger costs. I’m wondering how potential privatization would lower costs, given that the experiences in Australia, the United Kingdom and Brazil have all been that it has exponentially increased passenger costs.
I’m also concerned about the comments on modernizing the governance of airport authorities, given that, I believe, airport authorities are run under very modern governance situations with federal appointees, provincial appointees and non-governmental organizations, or NGOs. There is a really strong cross-section of individuals on those boards. They have 30 years of experience running under the National Airports System and the experience of having invested more than $25 billion into capital improvements.
I’m concerned that the lack of clarity on these comments about privatization could lead to increased costs for passengers, loss of public control and prioritizing profit over our public transportation. Can you give me some comments on this?
Ms. Little: Yes, thank you very much for the excellent question.
With respect to the objective of the initiative, the government has announced a suite of initiatives designed to really maximize the potential for Canada’s airports to support economic growth. In addition to studying airport privatization, the government is also examining possible amendments to the rent formula, for example, which could have, potentially, a positive impact on affordability, and it is also looking at opportunities as well to extend leases, which provide greater certainty for investors in airports. That continued economic growth at airports is really intended to support the overall economic growth and health of the Canadian sector because airports are key economic drivers in this country.
With respect to the governance model, yes, we are studying the potential for other alternatives that may have public policy benefits, but we are still in the early stages, and it is too soon to commit what direction that will take.
Senator Ross: Could you give me a sense of how the government plans to engage with airport authorities in consultation and in working with them to determine what these community organizations feel is the best path forward?
Ms. Little: Yes. The government has signalled in announcing that it is undertaking this work that it will be engaging with airport authorities and local communities and other levels of government in this work so that the options and the policy development will be informed by consultation.
Senator Ross: Are you finding that airport authorities are receptive to this? I’m hearing they are not.
Ms. Little: It is really very early days. We are having conversations with airports fairly regularly, and we are hearing a range of views, but there will be formal engagement that will inform the policy direction.
Senator Ross: Thank you.
Senator Robinson: I wanted to talk a little bit about provisions of certain sections of the Food and Drugs Act and the entire Plant Breeders’ Rights Act in that the entire Plant Breeders’ Rights Act is excluded from the exemption orders. I wonder if you could explain the rationale. Why is there the distinction?
Ms. Beresford-Green: Thank you very much for the question. We have explicitly excluded the Plant Breeders’ Rights Act because that actually deals with intellectual property not related to food safety. We would not want to interrupt, obviously, the obligations and rights that people have with respect to intellectual property.
Thank you.
Senator Robinson: I want to spend a bit of time looking at this. I don’t see a definition for “economic and food security.” For the lens on it, I wonder what the timeline is on defining these.
We are being asked to support legislation that talks about these things, but it does not specify what they are.
Will industry be consulted? What is the timeline on coming up with the definitions for terms that we see mentioned but they are not outlined regarding what they actually mean? Can you tell us what the process of that will be?
Ms. Beresford-Green: Yes. Thank you for the question.
With respect to definitions for “food security” and “economic security,” I think work continues to make sure that there is clarity.
We have, however, already had significant feedback from industry associations and regulated parties, both through parliamentary committee testimony and, in fact, in our own discussions with industry sectors on the interrelationship and the importance of reducing red tape burden and how that can help create a level playing field but also ensure that the platform for that regulatory burden is not increasing pricing for consumers.
Through a number of other activities and by using the lens of trade and commerce, we have been looking at how we simplify rules for our regulated parties and how we make sure that our regulatory framework supports both economic security and the food security perspective, both in terms of price and availability.
Senator Robinson: Thank you. For the “seriously detrimental infestation,” will this be defined later through regs? From our Health Canada Pesticides Regulatory Directorate guys, I am wondering if we could get a response on that.
Mr. Jones: Certainly. There are a number of concepts introduced in the amendments that would be defined either through changes to our regulations or through our internal policies, which would be made public. There will be, no doubt, lots of interest from stakeholders on that. The department’s position is because these are exceptional powers to be used in exceptional circumstances, we would want to lay out some guidance that makes it clear that these powers are not to be used frivolously but in exceptional circumstances. We are doing some policy work internally on what that guidance would look like.
Senator Robinson: Generally, I’m hearing a lot of optimism and appreciation from industry for this economic lens that we are talking about being applied to these decisions. I did hear specifically from meat processors that there is a specified risk material that costs their processors $25 million a year versus the regulations in the U.S. that are modern and costing their sector zero. We can certainly see the impact of something like that on competitiveness and on food affordability. It is kind of like the broken window economic theory and the benefit to not spending money on that.
I wanted to talk a little about this one-year timeline. As I understand it, if it has been turned down — remind me of how that goes. I’m concerned about the regional nuances. Economic impacts are different within different areas of the country. My concern is if something has declined in one area, will that apply across the national jurisdiction, or will the regional nuances be considered?
Mr. Jones: We have the opportunity in the Governor-in-Council decision to impose various conditions or limitations, including regionally. So if there were a specific rationale for allowing the emergency use of a product or the continued use of a product for a specific problem that was specific to, say, the Prairies, it would probably be limited to the Prairies for that period of time to address that specific problem.
Senator Robinson: The wording doesn’t give me faith that’s how it is, so I’m happy to hear you clarify that because that regional nuance is so incredibly significant. Thank you.
Senator Galvez: My question goes to Mr. Jones and to Ms. Beresford-Green. I’m worried about this issue with the Canadian Food Inspection Agency Act amendments and the amendments to the Pest Control Products Act. It is well known and well documented that Canada has higher thresholds compared to Europe. I read last year that France doesn’t take any more of our lentils because we have too many glyphosate residues in the lentils and in some oats and in some cereals like soybeans.
We already use an approach that is risk-based instead of precautionary. Now we are saying for broader economic security challenges, we will allow some exceptions. The devil is in the details, so this is an unreasonable risk that will be defined at a later time.
How will it be unreasonable? It reminds me of regulations in a developing country where you do things like this, but then you allow the importation of rice that has higher concentrations of pesticides. Then it is sold or bought at a much lower price. How do you balance the health and the economics? What are the logic and the argument for this? What could constitute an unreasonable risk?
Ms. Beresford-Green: Thank you for the question. Perhaps I can start. My colleagues at Health Canada may wish to add, specifically on your questions regarding pesticide levels.
It is critically important here that Canada is known for having a world-class food safety system. Nothing we are proposing in the amendments to the Canadian Food Inspection Agency Act would undermine that. That is critical for a number of reasons: First, of course, it’s to protect the health and safety of Canadians who are consuming that food, but that also enables trade. Having that reputation gives Canadian businesses access to worldwide markets. By explicitly putting that trade and economic lens into our act and into the mandate, we want to make sure we are always balancing those two aspects but never putting the safety and security of Canadians at risk.
In terms of the exception process, again, it would be in very exceptional circumstances. It is not intended to increase risk to Canadians for a product that’s being consumed. It would be to ensure that they have access to food and, in fact, that food is also at a price that can be affordable.
The other piece that is important in terms of the question that you asked is balancing our domestic and export work with our import standards. We work very closely with any trading partner to make sure that any imports have to meet Canadian standards. If there were to be an exception process, we would have to analyze the level of risk and make recommendations to the Governor-in-Council before any such decision was made if that were related to the importation of a food product.
Senator Galvez: What led to these amendments? What happened?
Ms. Beresford-Green: That is an excellent question. The primary driver for the proposed amendments is twofold. One is to recognize the feedback that has been received not only at parliamentary committees but also, as I say, the feedback that we have received directly as an agency about ensuring that we understand the impact of all of our regulatory regimes on business. Is there an unnecessary burden on that, or are we truly looking at what is essential for food safety? That was a key part of what drove this.
The second piece, from an exception perspective, is to recognize that there could be situations where, in fact, we would need to be able to use that flexibility. I’m thinking of things like floods and wildfires in British Columbia that have previously impacted specific parts of the food sector where we did not have such a nimble mechanism to allow us to respond and help business but also to help Canadians while maintaining that health and safety lens.
Senator Galvez: I agree with the fact that extreme weather events are causing floods that are impacting the production of vast agricultural lands. Why don’t we work on that instead of going into all that you are saying about allowing exceptions for food? I already said that our standards and our thresholds are much higher than, for example, Japan. We cannot export any cereals to Japan because the standards are so high. What happened with the lentils in France? The lentils were returned because they had too many pesticides.
I understand what you are saying, but it seems contradictory to the objective. I don’t know how we are going to address it. Sorry.
Ms. Beresford-Green: We work very hard with industry and with our colleagues in other government departments to make sure that markets are open for trade where they can be. Over the last number of months and the last couple of years, we have both maintained markets around the world for export as well as opened new markets. Regarding your question around why not focus on floods and wildfires, that’s outside the purview of the Canadian Food Inspection Agency. We have a small piece to play in making sure there is a mechanism to ensure food security in such instances. Thank you.
[Translation]
The Chair: Mr. Jones, very quickly add to that.
Mr. Jones: Quickly, okay.
[English]
Thank you, senator. I agree that climate change is a key issue that is affecting food prices, but certainly these things are not mutually exclusive. These are additional actions. Certainly, action on climate change is important.
Quickly, on your point about pesticide limits and export markets, there are what is known as maximum residue limits. Significant international cooperation and collaboration exist on these limits that are health-based. The example you are using from France was a one-off. It’s not a standard thing that we are not able to export to France or Japan.
There have been rare occurrences in which there was more than the expected level, but these trade implications would certainly influence any decisions associated with the use of these Governor-in-Council powers.
[Translation]
The Chair: Thank you.
Senator Gignac: My question is for Employment and Social Development Canada.
I’ll continue along the same lines as my colleague Senator Forest’s question. In 2018, you identified 13 economic regions. Am I mistaken? Is it currently the same 13 economic regions as in 2018?
[English]
Ms. Nandy: Thank you for the question. Yes, the proposed extension of two years for the current measure would apply to the same 13 regions in Atlantic Canada, Quebec and the Yukon.
[Translation]
Senator Gignac: The labour market has changed quite a bit since 2018. In British Columbia, the unemployment rate was 4.4% back then. It is currently 6.5%. It is even higher than in Quebec. What do you say to the seasonal workers in British Columbia? Are they treated according to a double standard? What is being done? Will there be a review of how economic regions are identified?
[English]
Ms. Nandy: Thank you again for the excellent question. As I mentioned, the work on modernizing the EI program continues. At the same time, those 13 targeted regions were first targeted — you’re right — through the 2018 pilot project and subsequently through the legislative changes that were implemented in 2021 and have continued to be extended. The reason those 13 regions were first identified was based on high seasonal concentrations, which is the share of seasonal claims in those regions relative to total labour force participation, and the share in those regions was higher than 4% relative to all others.
That continues to be consistently the case. Those 13 regions, by and large, still have the highest seasonal concentrations of workers relative to the rest of the EI economic regions in the country. That is not to say, senator, that there are not seasonal workers or seasonal claimants in other parts of the country. That is absolutely true.
There are existing EI supports, including through EI regular benefits and the EI tariff measures that I mentioned before, which can continue to support those workers. But the direction is as the work on EI modernization continues, these seasonal claimants and these 13 targeted regions continue to receive these additional EI supports for an additional five weeks.
[Translation]
Senator Gignac: I will no doubt have an observation to make. Those 13 regions certainly need it. However, I see no regions like Nunavut or the Northwest Territories. Given that the labour market has changed a lot since 2018, we should ask, as Senator Forest did, that we get moving and review the definitions.
Thank you for that.
[English]
Senator MacAdam: My question is for Ms. Little. You mentioned in your opening remarks that there were various ownership models of airports in Canada. I’m just wondering if you can provide some general statistical information on the number of airports we have in Canada broken down by the various models.
Ms. Little: I’m happy to follow up with something in writing to provide a bit more granularity. We have many hundreds of airports in Canada. In the 1990s, the policy was to transfer them from government ownership — because a large majority of them were owned by the government — to other hands. So Canada fully divested a number of airports to regional and local authorities in many cases. Some examples of those would be Hamilton, Ontario, for example, and Waterloo, Ontario, which were divested into the regional centres.
We have other examples, such as 26 National Airports System, or NAS, airports. They tend to be the largest airports in Canada. It’s most provincial and territorial capitals, for example. There are airport authorities. Their governance is undertaken by their boards of governors. They are run by airport authorities, which are private, not-for-profit, non-share capital corporations. They rent the land from Canada, and as your colleague mentioned, they remit rent to Canada annually for operating the airports.
There are many airports in the country as well that are in aerodromes that are very small and that are in private hands. There are airports that are run by local municipalities. Another example of a more private type of airport is the Montreal Metropolitan Airport.
Another example that is a unique governance model in Canada is Billy Bishop Toronto City Airport, which is actually governed under a tripartite committee formed of Canada, the City of Toronto and the Toronto Port Authority. So there are a variety of airports across the country, all told serving 150 million passengers, but many of these airports also play an important role in our trade relationships, particularly the larger ones in terms of cargo. I would be very happy to provide a fact sheet — if that would be helpful — of some of the characteristics of our airports.
Senator MacAdam: As far as information being provided, this measure that’s being introduced would apply to all these different models.
Ms. Little: Yes.
Senator MacAdam: I’m wondering if there are any other jurisdictions that you’re looking toward in terms of best practices as the government approaches airport reforms.
Ms. Little: Yes. Certainly, our analysis will take into account the experience in other countries, and we’ll be talking to stakeholders in other parts of the world, studying and reviewing the different airport models. Different countries have had different experiences with privatization. Canada’s situation with the NAS airports is quite unique. We will be taking a look at what other countries’ experiences have been.
Senator MacAdam: Can you identify any specific countries up to this point where the work that they have done is particularly successful?
Ms. Little: As I mentioned, there are a range of models. Countries have had varying experiences with different types of transformations of their airports. In Canada’s case, we would not be moving directly from a public entity to a private entity. The NAS airports were essentially privatized in the 1990s when the airport authorities were created.
The question is looking at the optimal way to attract investment into airports to support economic growth overall. We’ll be looking at a range of models that could vary on the spectrum, from additional private ownership in an airport shifting potentially from a not-for-profit to a for-profit model, and what the implications of these different approaches might be.
The idea is really for the analysis to look at potential new models to determine whether there is merit to transitioning to a new model in Canada.
Senator MacAdam: Looking at all that information, what is your timeline? It sounds like there is a lot of work to be done. Do you have any timelines or schedules? When is all this supposed to happen?
Ms. Little: The work is under way right now. Part of it is really ensuring that the government has access to data and financial information from the airports themselves, which is why this amendment has been proposed. Once the government has data and can perform its analysis, yes, you’re correct: It is a sophisticated analysis that needs to be undertaken. It is complex, and consultations will be required. I am hesitant to put a timeline on it. But we understand that this is a government priority, and we are advancing work on all of the parallel paths that the government announced in Budget 2025 and restated in the Spring Economic Update 2026. In addition to the airport privatization study and lease extensions, we are examining the rent formula and looking at other opportunities to support economic growth in our airports.
[Translation]
The Chair: I want to address that. I still don’t understand. Despite everything you say, I don’t understand why the government needs to ask an airport operator or owner for that. As you said, a few of them do not belong to the federal government, but most belong to Transport Canada or the federal government.
What is the objective of getting the airport value from the Saint-Hubert airport and the Billy Bishop airport? The legislation goes much further than that. Paragraph 50.2(2)(b) reads as follows:
individuals or entities whose activities, in the Minister’s opinion, may affect the value of an airport . . . .
However, there is the capacity to expand runways, the value of the land adjacent to the airport, the train that transports passengers to the airport, and the public transit system that brings passengers to the airport. It’s very broad.
What determines the value of an airport? It comes down to the overall activity, the potential for expansion, and the ability to attract traffic — whether cargo or passenger — to that airport. It’s a very significant responsibility to ask someone to assign a value to land adjacent to the airport. Owners who believe their land may be expropriated will set the highest possible value. There is this whole aspect of objectivity or subjectivity in the figures you will be given. Adjacent land may have a certain value, but with a potential zoning change, will that value increase tenfold? What is the point of having all that?
Ms. Little: Thank you for the question.
[English]
It’s a very interesting and complicated question. The idea here really is that the government would be able to access information it can’t access to inform its deliberations with respect to airport privatization and understanding the value of an airport.
At present, most airports in Canada actually do publish their annual reports and financial statements online, and the NAS airports — the airports that pay rent largely to Canada — are also required under the terms of their leases to provide additional information such as land use plans, environmental plans and master plans. Transport Canada does have access to a certain amount of detail.
However, in order to actually understand in greater clarity and more precision the valuation of an airport and the potential implications of a change of the governance model, the government would need to access more detailed information from the airports themselves. Again, this would only be used as a backstop. In many cases, airports and those that are operating on airport land may provide the information voluntarily, and that is our expectation.
But to fully undertake a study that is data-based, additional information may be required. That could include information about future capital investments, for example, passenger growth projections and information that airports themselves and those operating on the lands would have.
[Translation]
The Chair: It does not affect safety. It’s purely forward-looking. We’re accessing the private and personal information of operators and property owners adjacent to an airport, and requiring them to provide confidential and financial information so that we can, in turn, decide or plan for the future.
I have never seen such a power in any other field. If expropriation is required, we will conduct our own appraisal. After that, we’ll either go to court or withdraw the claim, as was done with Exo. That’s how it works.
Here, it looks like a fishing expedition seeking a vast amount of private, personal and economic information is being sought from an incredible number of companies. How will that information be protected?
[English]
Ms. Little: Thank you again for the follow-up question. All personal information, of course, would be subject to privacy legislation. The intention here is really very specific. The Canada Transportation Act currently allows for the Minister of Transport to request information. And this amendment is specific to airports to allow the minister to access information, not only in the context of the current exercise, as announced in the Spring Economic Update, to study airport privatization, but also in the context of future policy-making. It’s really to ensure that the government has data and can make decisions based on facts and supported analysis.
[Translation]
The Chair: But it does say:
individuals or entities whose activities are likely, in the Minister’s opinion, may affect the value of an airport . . . .
We’re talking here about private properties adjacent to the airport that have nothing to do with the Department of Transport. We’re referring to neighbouring property owners who may exert an influence. I find that to be very broad. That’s my opinion.
[English]
Ms. Little: I am happy to address that. The idea here really is to focus on the airport itself, the airport authorities and the airport lands and understanding what the value of all the commercial and other activities on those lands might be, so it’s not to extend into the community, for example. Examples of activities on lands could be an airport could have a subsidiary that runs a cargo enterprise on the airport grounds or it runs, for example, an airline maintenance and overhaul operation. It’s about understanding what the activities are on the airport campus and how those contribute to the value of the airport and also how one might be able to support additional activities and investment in Canada’s airports.
[Translation]
The Chair: Senator Oudar, I’m sorry, I was following up on Senator MacAdam’s point.
Senator Oudar: In any event, your questions are always very thoughtful. Thank you for this exchange.
I also have a question regarding a major exception in the act. It concerns all issues of economic security and food security.
Just to wrap up the previous exchange with Senator Gignac, Ms. Nandy, can we count on the commitment to consult the provinces before redrawing the map and determining the 13 regions? I have a concern about the obligation to consult the provinces before making this type of decision.
[English]
Ms. Nandy: Thank you very much for the question. It’s an excellent one. The EI economic regions that will be affected by the proposed extension will be the same 13 regions as has previously existed. Currently, there are 13 regions in Atlantic Canada, Quebec and the Yukon where seasonal claimants can benefit from an additional five weeks of EI regular benefits under the proposed extension in Bill C-30 —
[Translation]
Senator Oudar: I apologize for interrupting, Ms. Nandy.
I was talking more about the changes that will be made in 2027. I just wanted to make sure that the committee is told publicly that the provinces will be consulted before finalizing the changes that will be made in 2027.
[English]
Ms. Nandy: Thank you for the question. Perhaps I should clarify. In addition, in terms of the proposed amendments related to the Employment Insurance Act, they do three things. One, it extends the existing additional five weeks to October 2028. Two, there is a current grandfathering section, a legislative fix, that is in the Employment Insurance Act that says if you are a seasonal claimant and you were a claimant that benefited from the additional five weeks from 2018 to 2021 and if COVID-19 measures affected your seasonal claiming patterns — because seasonal claiming patterns are one of the factors that determine eligibility for these additional five weeks — then that can be continued under these proposed amendments all the way until November 7, 2027.
The reason why that date is in place is because it’s five years out from the end of the 2021 COVID-19 measures. As of November 7, 2027, COVID-19 temporary measures will not have any more effect on seasonal claiming patterns. There is no need for that exception.
No, it’s not a question of additional consultation. That fix was put in to make sure that seasonal workers who had previously benefited from the measure — because of the government’s introduction of temporary measures during COVID, which disrupted their claiming patterns through no fault of their own — could continue to benefit.
Just to close off, the third thing that this EI amendment does is it ensures that should the government decide to make changes to the EI economic regions that are targeted by that measure at some future point, that list could move from what is currently in the legislation to the regulations, but there is no change proposed again to those 13 regions in this measure that will change. It just adds some coherence in the act at some future date.
[Translation]
Senator Oudar: I understand, then, that there’s no obligation to consult. I’m not a member of the committee; I’m merely filling in for Senator Kingston. However, I would venture to suggest that there will be something in the report’s observations regarding the need to consult the provinces.
As I mentioned in my introduction, I wanted to allow the discussion with Senator Gignac to continue, but my question focuses more on the concepts of economic security and food security.
More specifically, there is a rather significant exception, I would say, at the heart of Division 7 of the bill. Perhaps to address and reassure the citizens listening to us, what criteria will the Governor-in-Council use to determine that it isn’t a danger? In fact, there must be a concept of unacceptable danger. What are the criteria? I listened carefully to the previous discussions, and I didn’t hear any specific criteria or examples that would guide the Governor-in-Council.
Next, I’ll have questions about the powers, because, of course, you mentioned a temporary period for the application of the order. However, I would point out that the bill refers to a three-year period, renewable once, for a total period not exceeding six years. I no longer consider that particularly temporary, which is why I have these concerns.
I understand that there would be a review of what is considered an unacceptable danger. However, so far, I haven’t seen any criteria set out in the bill. As a citizen, I find it concerning that all matters relating to human health could be excluded from this chapter of the bill for six years. This situation is all the more concerning given that the exception provided in the bill stipulates that the Statutory Instruments Act doesn’t apply. Under clause 50 of the bill, that means that the order would be published only after it comes into force. I’ve never seen that in legislation. There would be no prepublication or enforcement of the Statutory Instruments Act, and the order would be made public only after it comes into force.
In law, as a lawyer, we often say that ignorance of the law is no excuse, so how are people supposed to comply when the legislation or the order isn’t even published?
My first question is about the criteria for determining unacceptable danger. Could you give us some examples?
My second question has to do with this mechanism, which seems to me as not only temporary, but also not very transparent, due to a lack of publication and consultation. The purpose of prepublication under the Statutory Instruments Act is also to solicit comments from individuals and groups, and then making and adopting an order. This process is entirely bypassing all of that through a significant exception regime.
Thank you.
Mr. Jones: Thank you for those questions.
In terms of defining a significant economic problem, I would say that, as I mentioned, there is some work to be done to develop those concepts in regulations or perhaps even in policies as well.
Perhaps an example would be helpful. Currently, the act requires that all products be reevaluated every 15 years. As a result, a product could be restricted, or the use of a chemical could even be discontinued. The use of a pesticide could be discontinued if there is another useful, effective and available option. That could create another vulnerability in agriculture. It is important that we take some time to identify and document other options to avoid this problem.
[English]
In terms of health, I would emphasize that the way the amendments are structured, the current requirement that health risks be acceptable is maintained. So the new powers can only be used if the health risks are deemed acceptable.
[Translation]
Only the environmental risks are potentially taken into account.
As far as I know, the six-year period is three years, but it could be extended for up to three years. I understand that this could be an extended period and that the intention is to limit it as much as possible.
Senator Forest: My next question is for Ms. Little.
In another life, I was the manager of the regional airport and a member of the board of directors of the Mont-Joli airport, an airport governed by an inter-regional body, where responsibility is shared among municipalities that lack the necessary financial system. Throughout this process, beyond the very valid legal concerns, maintaining the operations of these regional airports is quite a challenge.
In your opening remarks, you mentioned that one of the objectives is to ensure coverage across all regions of Canada and to provide airport service. For example, I am looking at the Mont-Joli airport, which served the entire Lower St. Lawrence and Gaspé region. It took considerable efforts to ensure NAV Canada maintained its service. Air Canada decided to pull out. In fact, that’s what prompted my move from Rimouski to Quebec City, because Air Canada no longer serves that city.
With this goal in mind, how do you plan to help the sector take on this major responsibility when it likely lacks the financial resources and tools to do so? Because things look good at the outset. When the transfer is carried out, there are memoranda of understanding, and upgrades to runways and infrastructure. However, in terms of operations, how do you see this collaboration? Will you carry out assessments of the transfer method and how it works? Returning to the example of the Mont-Joli airport, these are immense challenges for communities.
I’m thinking about Natashquan. If the airport were ever to cease operations, the entire supply of perishable goods and delivery of mail would also come to a halt. It is an essential link for that community. If, tomorrow morning, they become responsible for operating the airport and don’t have the resources, a community like Natashquan will be limited. That concerns me greatly. How do you plan to ensure the sustainability of these services?
Ms. Little: Thank you for that excellent question.
[English]
It’s very pertinent. Absolutely, regional connectivity is critical, as I mentioned at the outset. One of the perspectives that we take when we look at the air sector overall is an ecosystem perspective, precisely to factor in the various considerations that you raise, senator. There’s the complexity of the relationship of the airports with other service providers — NAV CANADA, for example, which is also not-for-profit — and federal entities on site, such as the Canadian Air Transport Security Authority and the Canada Border Services Agency. Every airport has its own unique considerations. Their regional presence can be very different. We do take a look at the entirety of the ecosystem.
Part of what we’re doing in the context of this particular initiative, as we examine the potential for greater investment in our airports, is we’re looking at particularly the larger airports, should there be a change in governance, for example, and understanding what the impact of that might be on the ecosystem and on connectivity in Canada. This is an important policy question, along with affordability and competition, that we will be examining in the context of looking at the government’s objectives in this space.
Senator Ross: NAS airports already enter joint ventures with commercial leases, such as things like hangars, flight schools and all kinds of things, as well as defence companies and companies that want proximity to the airport. They do this to support infrastructure, to pay ground rent and to keep passenger fees low.
When you speak of updating the framework for airport rents, what does this mean if the stated intent is to increase capacity for economic development? Given that the airports are already doing this work through their subsidiaries, how would reforming or raising rent accomplish this?
Ms. Little: It’s an excellent question, and you’re absolutely right; the National Airports System can already attract and does attract significant private investment through the form of subleases, subsidiaries and subcontracts. A variety of activities take place on our NAS airport campuses, including, in some cases, commercial activity beyond the aeronautical side of things.
In looking at the rent formula, really the objective is to understand if adjustments to the rent formula could actually support the airports, particularly some of our small- and medium-sized airports. Would adjusting the formula have a benefit in terms of helping them attract additional capital investment, for example? That’s part of the package of initiatives that we’re looking at with our colleagues at Finance Canada.
Senator Ross: You’re looking at lowering rents?
Ms. Little: Potentially. Adjustments to the formula is the brief.
Senator Ross: Thank you.
Senator Robinson: Perhaps if there is no time to respond verbally to my questions, we could have a written response from the officials.
I first want to thank Ms. Beresford-Green for your comments. I heard about the stellar brand that the Canadian Food Inspection Agency has with our regulations and how we are kind of the envy of the world as far as our food quality goes. I am certainly a believer in science. We want to make sure that our decisions are informed by science and not, with all due respect, by politicians. So I really appreciated that.
I wanted to build off what Senator Oudar started. The Statutory Instruments Act does not apply to the exemption orders in the Canadian Food Inspection Agency Act, but the definitions of “economic security,” “food security” and “seriously detrimental infestation” will go through the normal process. When regulations are posted in the Canada Gazette, it’s very helpful to understand where the decisions came from. Usually, we have a backgrounder that, at times, goes into the science, and it is this piece that I don’t want to lose: the science behind the policy. If you have any comments on how we ensure the science behind the policy does not get lost with these provisions in Bill C-30, that would be great to have in writing.
For my second question, I want to go back again to the definitions. I keep bringing up the definitions of “food security,” “economic security” and — for our folks at the Pesticides Regulatory Directorate — “detrimental infestation” because I do not see that operationalizing these additional mandates for the Pesticides Regulatory Directorate and the Canadian Food Inspection Agency can occur without these definitions.
I want to stress how quickly we need to move on these definitions. I ask again if we have a timeline in mind for these definitions to be posted. Please, we have run out of time, so those responses in writing would be great. Thank you.
[Translation]
The Chair: Thank you very much to the witnesses.
We are awaiting this information as soon as possible, given that this is a bill we have to pass before the summer recess.
Thank you very much.
(The committee adjourned.)